Developer understood payment to Love's son to be 'introduction fee', court hears

The family of Ngatata Love had attempted to get even bigger payments from developers anxious to get access to Maori land for a Wellington development, including a $2 million "opportunity" fee for son Matene to introduce property developer Equinox Group to the Wellington Tenths Trust, the High Court in Wellington heard today.

Equinox development manager Travis Coffey understood a payment to Matene Love would be an introduction or "opportunity" fee to pursue the development, and while it would have been more than the combined fees for Redwood, Equinox, and an external project management company, there was no problem in paying an introduction fee if the development was profitable enough, he said. In the event, that payment wasn't made, although Ngatata Love and his partner Lorraine Skiffington obtained $1.5 million, the court heard.

Ngatata Love is charged with obtaining a secret commission and obtaining significant sums by deception. The Crown says he signed an agreement in late 2006 with Auckland property developers Redwood Group and Equinox Group to ensure they could lease land owned by the Wellington Tenths Trust, which Love then chaired, and he received service fees through Pipitea Street Development Limited (PSDL), a company owned by his partner Lorraine Skiffington, without the trust's knowledge.

Skiffington was also charged but has been granted a permanent stay due to her ill health, while Matene Love had already pleaded guilty to accepting a smaller secret commission of $168,750.

The proposed payment to Matene Love was scrutinised under cross-examination by Ngatata Love's counsel, Colin Carruthers QC, who said Equinox director Kerry Knight had written to the Serious Fraud Office in June this year saying the payment was in exchange for work Matene Love had agreed to do and Equinox hadn't agreed to pay him for an "opportunity".

Coffey said Knight would be in a better position to explain what had been intended with the $2 million fee for Matene Love. Under re-examination from crown prosecutor Grant Burston, Coffey said he got the impression it was an introduction fee from Equinox principals Knight and Chong du Cheng.

Burston presented a letter from Kerry Knight to Equinox sent on March 2, 2006. In it, Knight said Matene Love wanted $200,000 to give them an "informal opportunity," but it was proving impossible to get him to commit to anything in writing. Knight said Matene Love didn't have any mandate for the Tenths Trust but would work on a project then "he puts it in front of the trust and the trust votes on it."

When asked what he understood from the reference in the letter to a payment to Matene Love, Coffey said it was "part of securing the opportunity, the introduction fee."

Bruce Drysdale, the operations manager for document destruction at Online Security Services, appeared as the Crown's final witness of the day. Drysdale said that the document destruction service had been called to pick up documents from Love and Skiffington's Plimmerton address on the morning of Aug. 14, 2012, and was given the Port Nicholson Block Management Group's account for the service.

The SFO contacted OSS the next day and asked them to secure the bins. They did so, and the bins were made available to the SFO on Aug. 21, Drysdale said.

The court earlier heard that Equinox had been told the $1.5 million fee paid to Ngatata Love was to cover Treaty of Waitangi claim costs. In an email from Equinox's Kerry Knight to Lorraine Skiffington, Knight queried the payments required to be made to the services company. Knight said Ngatata Love had told him the funds would cover Treaty of Waitangi claim costs.

Crown witness Clive Hudson, a forensic accountant and electronic investigator, said the money had not been used for that purpose, but to pay off a loan on a house in Plimmerton owned by Love and Skiffington.

In September that year, Knight wrote again to Skiffington, requesting the $1.5 million services payment be unwound and a refund given to Equinox, the developers.

The court heard about communications between Lorraine Skiffington and the developers between February 2008 and April 2008, including an email Skiffington sent on Feb. 17 when she reassured Knight about projects going ahead: "We all have good links in Wellington. The mayor knows and likes you. They bend over themselves to help Ngatata."

The Crown presented a document found on Love's laptop, named the joint venture partnership document. It discussed the relationship between PSDL and Pipitea St Limited, and showed PSDL loaned $1 million of the developer's payment for the purchase of the Plimmerton property on Moana Rd. Hudson said metadata showed Love was the author and last modifying user of the document.

Carruthers said Love had no involvement with PSDL, which Hudson agreed with. Love's counsel went on to say the Plimmerton house had been bought in November 2006, before there was any agreement between Skiffington and the developers, although Hudson said there were "negotiations and drafts" which provided a basis for the view that they were related transactions.

The trial, being heard by judge alone, will continue on Monday.

(BusinessDesk)

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