Tag Archives: Stormwater discharge

Delta #EpicFail —EpicFraud #12 : The Buyer Confirmed

Received from Christchurch Driver [CD]
Fri, 26 Aug 2016 at 9:47 p.m.

Readers, you must allow your correspondent some iced cupcakes with his Choysa tonight, go on then, the ones with the cherry on top….your correspondent, with a modicum of luck was in fact 100% successful in the dire prediction that Infinity, of Wanaka, are indeed the purchasers of the Noble Subdivision. Our friends at Delta have issued a breathless press release explaining they are or have received $0.9m – yes $0.9M, from their friends at Infinity. The sky is blue, houses will be built, Delta’s financial fruit will follow. Fancy that !! Let us allow reality to intrude : This is the first, and only guaranteed payment that Delta will receive for the outstanding $25M+ debt they have incurred there. That’s not low hanging fruit, it’s been trampled underfoot and is not even worth stewing (over). Trampled underfoot also is the small matter of the outstanding interest. Would it be churlish to remind readers that Delta, of course, has written off about $12M in interest because it wanted to protect certain reputations more than it wanted to protect ratepayers ? Would it spoil Delta’s collective fist pump to remind them that $0.9M is no more than (and likely less than) 4% of the outstanding debt ? Yes I thought so. Delta as debt collectors ? = EpicFail.

Missing in Delta’s gushing remarks from Grady Cameron was any mention of the Constructive Fraud action. It seems that the hapless Mr Smillie has taken Delta down a dark cul-de-sac yet again this week. Mr Smillie has opposed Delta being joined to the constructive fraud action, with a mistaken understanding of High Court rule 4.56. However, that rule is not relevant and it is trumped by High Court Rules 4.1 and 4.3 which allow parties to be joined. Basically, the rules allow that a plaintiff can joinder anyone at any time, and the plaintiff caveator in this action is 100% unlikely to allow the central party to the constructive fraud action (yes, that is you Grady as CEO of Delta) to smile bashfully and say “can I go now?” after having undermined the interests of the neighbours on occasions too numerous to count at this point. Oh well Mr Smillie, another unpaid legal bill….

This is an important point because our Delta friends seem oblivious to the impending legal actions they are facing. Delta think that because the caveats were lifted, all is well, but that is still subject to a court of appeal hearing, and the way is open now for Delta to have another action brought against them by the neighbours. Delta and the DCC’s pockets are deeper than Gold Band’s, and they can’t go broke, so from the neighbours’ view, what’s not to like ?

Delta’s utter stupidity is revealed when the press release acknowledges that they have allowed a bank lender to take the first mortgage over the property, and have put themselves, yet again in the same weak position. As noted in the Delta —EpicFraud #10 post, Dunedin City Council just needed to show a scrap of acumen and take control of the subdivision. Now their fortunes are tied to an even weaker developer than Noble (how is that possible ?), who has managed to lose, much, much more money than Noble (truth stranger than fiction), and to cap it off, are in the same second mortgage position. This is not logical. But it is a windfall – for Infinity. Could there be a quid pro quo somewhere ?

Turnips all round. Readers, consider when voting, that Cr Lee Vandervis is the only surviving councillor (there were only ever two, Hilary RIP from Council) who grasps this major issue and has fought for the ratepayers. Cr Vandervis has never been one to accept Mr Crombie’s vague platitudes and was always wary of Mr McKenzie. Vandervis for Mayor.

[ends]

From: Gary Johnson [Gary.Johnson @thinkdelta.co.nz]
Sent: Fri, 26 Aug 2016 at 4:21 p.m.

Message: Please find media release attached regarding a breakthrough on recovery of outstanding debt owed to Delta in relation to the Yaldhurst Village subdivision.

160826 Media Statement_Breakthrough on Yaldhurst subdivision debt recovery

160826 Media Statement_Breakthrough on Yaldhurst subdivision debt recovery

“With a new developer, new financing and removal of the caveats, the way is now clear for the Yaldhurst Village subdivision to restart….” Mr Grady (sic) said. –emphasis by whatifdunedin

### ODT Online Fri, 26 Aug 2016
Delta sells Christchurch subdivision
By Vaughan Elder
Delta has hailed the sale of a controversial Christchurch subdivision as a breakthrough in its efforts to recover $13.4 million in bad debt. The Dunedin City Council owned infrastructure company yesterday announced Wanaka-based developers Infinity Group purchased the Yaldhurst Village subdivision. […] The purchase means Delta has entered a new loan agreement with Infinity Yaldhurst Limited, to replace the existing $13.4 million debt owed to Delta by the original developer.
Read more [See tomorrow’s ODT]

● INFINITY YALDHURST LIMITED (5886102)
Incorporation Date: 09 Feb 2016
Address for service:
Jackson Valentine Limited, Level 3, 258 Stuart Street, Dunedin 9016
http://www.companies.govt.nz/co/5886102

Ultimate holding company :
● INFINITY INVESTMENT GROUP HOLDINGS LIMITED (1004601)
Incorporation Date: 06 Dec 1999
Address for service:
Jackson Valentine Limited, Level 3, 258 Stuart Street, Dunedin 9016
http://www.companies.govt.nz/co/1004601

Related Posts and Comments:
8.8.16 Delta #EpicFail —Epic Fraud #11 : The Buyer
1.8.16 Delta #EpicFail —The End Game according to CD
31.7.16 Delta #EpicFail —Epic Fraud #10 : The Beginning of the End : Grady Cameron and his Steam Shovel

█ For more, enter the terms *delta*, *noble* or *epic fraud* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

13 Comments

Filed under Business, Construction, DCC, DCHL, DCTL, Delta, Democracy, Design, District Plan, Economics, Finance, Geography, Housing, Infrastructure, Name, New Zealand, OAG, Ombudsman, People, Perversion, Politics, Project management, Property, Public interest, Resource management, Site, Town planning, Transportation, Travesty, Urban design

Delta peripheral #EpicFail : Stonewood Homes —Boult under investigation

Stonewood Homes New Zealand Ltd was placed in receivership on February 22, 2016, owing unsecured creditors $15M.

Jim Boult [Stacy Squires - stuff.co.nz] bw### ODT Online Tue, 23 Aug 2016
Investigation of mayoral candidate
By Mark Price
Queenstown mayoral candidate Jim Boult is to be investigated in relation to the collapse of Stonewood Homes New Zealand Ltd, something Mr Boult says he welcomes. Ernst and Young liquidator Rhys Cain said yesterday an investigation into the failed company would begin “in the next few days”. It would examine the workings of the company during the two years before its collapse, with a “specific focus” on its final six months. […] Mr Boult was a member of the board of the Christchurch building company for about a year and acted as executive chairman for a period. He stood down from the board on February 1, 2016, telling Mountain Scene later he had done so because he had been part of an attempt to buy Stonewood before receivers were called in and he considered he had a conflict of interest. […] Asked if he could rule out action against Mr Boult, Mr Cain said: “No”.
Read more

Related Post and Comments:
11.3.16 Delta peripheral #EpicFail : Stonewood Homes and ancient Delta history

█ For more, enter the terms *delta*, *noble* or *epic fraud* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

*Image: stuff.co.nz – Jim Boult by Stacy Squires

1 Comment

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Delta #EpicFail —Epic Fraud #11 : The Buyer

Received from Christchurch Driver [CD]
Sun, 7 Aug 2016 at 11:08 p.m.

Your correspondent was heartened to read Saturday’s ODT editorial. It was mostly on the money, apart from the fabrication that Delta pays a dividend most years, when it is well known that for many years it borrowed to provide dividends, and it will not pay a dividend for the next three years.

[screenshot]ODT Online 6.8.16 Editorial [odt.co.nz_time-transparency]

In its diplomatic way, the editorial conveyed the (accurate) impression that

A)
Mayor Cull is a either a devious and unfaithful turnip or he is a blundering nincompoop. Given his disgusting complicity with DCHL Chair Crombie, last week, making simply absurd and risible statements as to why Delta CEO Cameron did not need to appear at the Council meeting and explain to Council how Delta, for the third time, had created a stinking financial mess, and done so under his approval to proceed at Noble in 2009, to build an illegal and unconsented subdivision. All Mayor Cull had to do to show some integrity and leadership was to insist to Delta and DCHL that Mr Cameron appear as per Councillors Vandervis and Calvert’s request. Ratepayers now know that he is unfit to be Mayor and has not a shred of any concern for the interests of Ratepayers but is simply part of the Dunedin establishment who protect each other. It is clear a great many Ratepayers have already come to this conclusion : As part of his mayoral campaign, Mayor Cull’s Facebook page invited feedback in recent weeks and it was so overwhelmed by negative and derisive comments – that he could not refute – that he simply stopped attempting to respond after two attempts. Readers should find the site – it may well have been taken down after the avalanche of negative feedback – and make THEIR views of Mr Cull known.

B)
Named and shamed the four Delta Directors, Frow, McLauchlan, Kempton and Parton, and that they contributed to the history of “secrecy and limited transparency” of Delta, a culture that “continues to envelope a company which is effectively owned by ratepayers”. ODT readers did not have to join too many dots to see that the ODT is saying that these directors are not fit to be directors of a Ratepayer owned company and need to be sacked. This is very strong (and welcomed) from the ODT.
We should consider the curious case of Mr McLauchlan, who has had his nose in the Delta trough since 2007 : It was around that time that Mr McLauchlan gave accounting evidence to the High Court for Scenic Circle in a dispute, reported in the ODT, with the co-owner over the then –new Scenic Circle Dunedin City Hotel. Mr McLauchlan, as seems to be the pattern with Delta, tried to tell the Court that black was white, that effectively, debits were credits and vice versa. Unfortunately for Mr McLauchlan, the opposing side had a much more credible accounting witness, whose evidence was the complete opposite of Mr McLauchlan’s. Needless to say the Court much preferred the evidence of the opposing side, so it is a statement of fact that the Courts have found Mr McLauchlan to be an unreliable witness. One wonders if Delta knew this when they appointed him, or if it was part of the job description….

And then there was the other curious case of Mr McLauchlan’s short tenure as the “Crown Monitor” for the SDHB, where an outgoing board member publicly questioned if he had any utility at all, and what did he actually do for the approximate $30,000 a year he received for acting as the Crown Monitor. Mr McLauchlan then confirmed to the ODT he hadn’t actually done anything as Crown Monitor except attend the board meetings and make some phone calls to Wellington. He had not written any reports – at all.

C)
The ODT did not dwell on CEO Grady Cameron. Your correspondent was wrong in his last post – Mr Cameron was not left to sweat it out in front of Council, but probably had so much dirt on the Directors and DCHL that they could not risk him appearing, and they conspired to put Mr Crombie in front of Council.

However, the true dirt tonight is the identity of ‘The Buyer'(?) of the Noble Subdivision : (ODT – feel free to pick this up and make any inquiry you want). It is of course truly unbelievable that Council would approve a loan of $13.4M to a buyer that they do not know, which shows that a wholesale cleanout of Councillors is necessary. More on that later. However, Councillors are not going to want to know the identity of the Buyer because they make the dismal NIL (Noble Investments Ltd), Tom Kain, Gordon Stewart, et al look like paragons of commercial acumen.

Your correspondent’s information is that the Buyer may be or very well includes Infinity (of Wanaka). A caveat, readers : We seek through the glass, darkly, and are not privy to the full machinations of Mr Crombie and his cronies. It will not be certain until this is confirmed publicly, but we do know that Delta, via Mr Murray Frost, have been working on this “arrangement” for months. Perhaps the ODT might like to make inquiries of Mr Paul Croft, General Manager and CFO of Infinity Investment Group Holdings….
Now at one level Infinity and Delta are birds of a very, very similar feather, and it is clear why they would seek to stick together : Like Delta, this will be Infinity’s third attempt at a Canterbury subdivision. Like Delta, the other two have been failures. Readers, hold those cups of Tiger Tea tight…. Infinity’s abysmal financial performance on those projects makes Delta look like seasoned and competent professionals !!!

The amazing truth that is stranger than fiction : Infinity have lost MUCH MUCH MORE than Delta on their two failed Canterbury projects…… IN EXCESS OF $100M. I can hear the teacups rattling now, readers, “Prove it CD, prove it !!” Elementary, my dear readers : Here is the link to the Stuff.co.nz story that appeared last year. It takes a special effort to lose $100M on one deal, but Infinity pulled it off. Perhaps Delta’s Mr Cameron and CFO Dixon, having had their subdivision trainer wheels on since 2009, are ready to move up to the big leagues at Infinity and lose serious amounts of someone else’s money.

It beggars belief that Mr Frost, who has been acting for Delta (but mostly Noble, it appears), would actively court Infinity as the Buyer, and place at risk $13.4M of Dunedin Ratepayers’ money with a company with this recent history; when there was a far safer option of Dunedin City Council taking control of the project, perhaps in concert with a developer that HAD NOT lost $100M on the same sort of project. Let us not forget either, the other $12M that Mr Crombie has “given up on” reported by the ODT last week, as though it were a trifle as light as air. If it were your money, Mr Crombie, I don’t think you would be quite so cavalier.
Readers should remember that essentially the deal is that the Buyer (Infinity ?) will pay around $2.7M to Gold Band Finance, and $1M to Delta (probably for consultant and court costs !) and NO OTHER MONEY CHANGES HANDS. If that is the best that Delta / Gold Band could do I will eat my tea cosy.
Bottom line : This deal smacks of cronyism.

And here is the interesting part : Murray Frost, Graham Crombie and Stuart McLauchlan are all well known to each other. We hope that there will be assurances that there will be NO INVOLVEMENT or REMUNERATION either directly or indirectly to these three, or any other Delta or DCHL personnel, on the Noble Subdivision.

Mr Crombie – as someone allegedly with an IQ greater than room temperature – how could you think this deal passes the smell test for a Ratepayer owned company ? What if? understands you conspired to conceal key information about this deal from Councillors. As the ODT infers, you are a pathetic guardian for the Ratepayers’ interests and you need to conduct that cost/benefit analysis we advised you to do months ago, and prepare the resignation letter – before a new mayor orders a “review” of the DCHL structure, which as we all know is code for : “Get rid of those incompetents, ASAP”.

█ For more, enter the terms *delta*, *noble* or *epic fraud* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

*Image: Screenshot of ODT Online (detail) tweaked by whatifdunedin

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LGOIMA requests to DCC from Colin Stokes #Delta #Noble #Yaldhurst

Received from Colin Stokes
Wed, 3 Aug 2016 at 12:30 p.m.

These emails are being circulated to national broadcast and print media today.

Colin Stokes, caveator and plaintiff, is one of the original landowners of the Noble Subdivision application (Yaldhurst, Christchurch).

In short, Delta, with its controlling interest at Noble, has joined with other parties, in the ongoing repeated attempt to defeat the known prior interests of Mr Stokes, Greg Smith, and others.

Those parties with Delta appear to have connived to form a new consortium to purchase and control the development, with ongoing cheap money from Dunedin Ratepayers to prop up their own private fortunes.

Life has never been so good for Mr Crombie, does he work for the likes of Justin Prain, Gordon Stewart, Murray Valentine, Murray Frost, Paul Croft
—Or us, poor little us who bleed.
Rhetorical.

Noble is like Sticky Pudding for fatsos.

Here are some straight shooting questions in public domain —for Transparency, that old so OLD concept not known to DCHL / Delta and the Noble / Gold Band bandits.

[Updated LGOIMA request]

From: Colin Stokes
Sent: Wednesday, 3 August 2016 12:27 p.m.
To: Sue Bidrose [DCC]
Subject: RE: LGOIMA: Noble Yaldhurst Subdivision Christchurch Delta DCC

Dear Dr Bidrose

Could I please amend my LGOIMA question number 4 below?

It was both Noble and Gold Band that enticed Delta to provide infrastructure and services at Delta’s cost on the promises of “agreements to have first-ranking first mortgages registered over the land.

Noble owned the land (it having been transferred to Noble by the neighbours for promises alone), and Gold Band held the thinly spread first mortgage over all 9 titles.
The enticement (recorded in their security sharing agreements):-
a. Noble agreed to give Delta “first-ranking first mortgages over the land” if Delta did the works at Dunedin ratepayers expense;
b. Gold Band agreed to swap priority of its first mortgage in favour of Delta over certain Lots if Delta did the works at Dunedin ratepayers expense;

c. Noble then reneged on providing the interests protected by the caveats that prevent Delta’s agreements to mortgage from being registered.
d. Gold Band (and Noble) (and with Deltas insistence apparently) then, under the guise of Gold Bands power of first mortgagee (despite its only 32.5% ownership of it), ran a mortgagee sale tender that lapsed Delta’s caveats protecting their agreements to mortgage used to entice the works.
Subordinate caveats, behind Deltas caveats, that protect the interests of [parties] associated with Nobles did not lapse in the tender documents; such as Southpac which is controlled by Nobles sole director Gordon Ralph Stewart.

So question 4 should correctly read:-

4 updated.
the total sum of “agreements to mortgage” given by Noble Investments Ltd (NIL) and Gold Band Finance Ltd to Delta to entice Delta to do work for them at Dunedin ratepayers costs?

Thanks and regards
Colin

[original LGOIMA request]

From: Colin Stokes [mailto:stokesy@xtra.co.nz]
Sent: Tuesday, 2 August 2016 11:07 p.m.
To: ‘Sue Bidrose’
Subject: LGOIMA: Noble Yaldhurst Subdivision Christchurch Delta DCC

Chief Executive Officer
Dr Sue Bidrose
Dunedin City Council (DCC)

LGOIMA: Noble Yaldhurst Subdivision Christchurch Delta DCC

I am one of dozens of resident owners in the above subdivision. We have prior interests from 2002 in the land that Delta has mortgages and shared mortgages and agreements to mortgages on.

I am also one of the residents that lodged caveats to protect these interests. I gave my caveators’ consent required of Delta to register its mortgage on the land. The consent was given on the clear condition and acceptance that the work Delta was securing with the mortgage included for the interests that the mortgagor/developer Noble owed us. Noble and Delta both agreed.

However we later discovered Noble and Delta had already designed a plan before they approached us whereby Delta was given the power (illegally under the Property Law Act) to instruct the first mortgagee Gold Band to do as Delta instructed in relation to defeating our caveats.

Noble and Delta then jointly constructed the works not including our provisions as agreed and making them impossible.

Delta later bought a 67.5% share of Gold Bands first mortgage (this too is illegal under the Property Law Act s84 – partial assignments are not permitted)

Delta then used Gold Band as planned to use their first mortgage position in Court to defeat our caveats to recover Delta’s subordinate debts.

We tried to redeem Gold Band and Delta’s shared first mortgage in 2014 but they refused us (we later found out that this was illegal under the Property Law Act as well – s102). We tried again recently but they illegally demanded double what it is worth and wouldn’t answer our request for information that we require to legitimately redeem it.

I understand they now propose to sell the land by way of mortgagee sale to defeat our caveat protection, despite that it’s illegal to do so given our prior interests and two refused requests to redeem the first mortgage.

I also understand from media statements and statements made in public Council meeting, that Delta are seeking to write off millions of dollars of debt in the subdivision ($25m debt due in Feb 2016) and are now only “chasing $13.3m”.

I have information that Noble gave Delta a mortgage (with our caveators’ consent), and agreements to mortgage subject only upon our caveats being defeated or removed, to a total of at least $22.7m. This seems peculiar that if Delta can have $22.7m in security that it would write off above $13.3m of what the law would require MUST go to ratepayers.

I am aware that DCC 100% own Dunedin City Holdings Ltd (DCHL) and that DCHL 100% own Delta Utility Services Ltd; so under the Local Government Official Information and Meetings Act (LGOIMA), in relation to the Noble Yaldhurst Subdivision Christchurch, please provide:-

1. the valuation’s for the mortgaged property that DCC is relying on in its proposal that Delta must lose multiple millions of dollars in debt due to Dunedin ratepayers (despite having “securities in the land that covers the debt” according to Delta media releases)?

2. the total debt due to Delta from the subdivision (actual debt including what Delta consider to be doubtful it can recover)?

3. the total debt secured on the land in mortgage? a/ share of first mortgage? and b/ second mortgage amount including interest?

4. the total sum of “agreements to mortgage” given by Noble Investments Ltd (NIL) to Delta to entice Delta to do work for them?
{See email above for new wording to 4. -Eds}

5. the tender documents and agreements that are, or have been, before DCC for their consideration including how those amounts are proposed to be distributed?

6. DCC’s responses to the people with caveated prior interests in the land who have presented and sought to present and discuss alternative proposals with the Council, including that of redemption and transfer?

7. correspondence and/or actions taken to contact and liaise with existing resident stakeholders with known prior interests in the land and in the development?

Kind regards
Colin Stokes
021 2200622

█ For more, enter the terms *delta*, *noble* or *epic fraud* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

8 Comments

Filed under Business, Construction, DCC, DCHL, Delta, Democracy, Design, District Plan, Economics, Finance, Geography, Housing, Infrastructure, Name, New Zealand, OAG, Ombudsman, People, Perversion, Politics, Project management, Property, Public interest, Resource management, SFO, Site, Town planning, Transportation, Travesty, Urban design

Lee Vandervis on Delta + DCHL media release

What if? Dunedin notes:
Dunedin City Councillors have now lost control of DCHL, Delta, and all the other subsidiary companies. Now, your Dunedin City Council is manipulated and run to ground by DCHL chairman Graham Crombie.

Cr Richard Thomson and DCHL’s Graham Crombie should Resign immediately.

Read on.

Received from Cr Lee Vandervis
Tue, 2 Aug 2016 at 6:48 p.m.

From: Lee Vandervis
Date: Tue, 02 Aug 2016 18:01:53 +1200
To: Chris Morris [ODT]
Conversation: Yaldhurst
Subject: Re: Yaldhurst

The Mayor and DCHL have stood by and done nothing as DELTA did massive Noble subdivision work costing over $13 million through 2010 to 2013 without getting so much as a progress payment.
DELTA have already written off more than $11 million owed in interest payments and invested a further $3+ million in buying mortgage shares in the ill-fated subdivision in 2013, but this was disguised and Councillors [word deleted] by Chair Crombie and by Mayor Cull despite my specific questioning about the supposed ‘just a bad debt’.
The now $24+ million loss for which DELTA has only a 67% first mortgage as a lever, to get some millions owed paid, has resulted in a 6-years-too-late knee-jerk from DCHL and Mayor Cull to rid itself of the whole mess, the disgusting details of which I am not permitted to divulge because the deed was done in a public-excluded meeting, without being allowed to question the responsible DELTA CEO Cameron or to see the requested valuations and contracts.
Like the Jacks Point/Luggate DELTA subdivision $7-$9 million losses, the same DELTA, some of the same directors, same Project Management company and same DCHL ‘oversight’ have done over Dunedin ratepayers again, this time for even more millions than what resulted when they failed at Jacks Point/Luggate.

[ends]

****

[What if? Dunedin : We said DCC could make Real money – now What if? hears that Mr Crombie told reporter Chris Morris that ‘no money is changing hands’. Very few people including most Councillors have any idea of what is truly happening, except that three accountants are writing or was that ‘deciding'(?) the deal, and then this rubbish release from Mr Crombie. OMG]

Dunedin City Council – Media Release
Update on Yaldhurst subdivision debt recovery

This item was published on 02 Aug 2016

Dunedin City Holdings Limited (DCHL) and its company Delta Utility Services Limited (Delta) can now start to make progress towards recovering money associated with a Canterbury development.

The Dunedin City Council yesterday supported a recommendation from DCHL relating to the Yaldhurst Village subdivision. Delta has an outstanding debt of more than $13 million for infrastructure work it carried out for the development over four years.

Graham Crombie, DCHLDCHL Chairman Graham Crombie says the decision means Delta is authorised to enter a new loan agreement with a potential purchaser of the Yaldhurst subdivision, to replace the existing $13.4 million debt owed to Delta by Noble Investments Limited. Mr Crombie says, “We can now start to make some progress towards recovering this outstanding debt.”

The decision authorises Delta to refinance its outstanding debt with the potential new purchaser, on settlement of the purchaser’s offer to Gold Band Finance Ltd, the first mortgagee.

Gold Band Finance put the Yaldhurst subdivision to tender late last year in a mortgagee sale process. The mortgagee sale is still subject to conditions. When the mortgagee sale process is concluded, Delta will provide a further update on the outcome.

During 2009-2013, Delta provided infrastructure services for the Yaldhurst subdivision through its now closed civil construction business in Christchurch. Delta’s role was as a contractor providing infrastructure services to the developer, Noble Investments Limited. Recovery of the outstanding debt has been held up by a longstanding dispute between the developer and neighbouring properties that has delayed titles being issued for the subdivision.

Mr Crombie says Delta remains fully focused on recovering the outstanding debt owed by the original developer and has mortgage securities in place for the amount owing.

Note: The Dunedin City Council owns Dunedin City Holdings Ltd, which in turn owns seven subsidiary companies being:
● Aurora Energy Ltd
● Delta Utility Services Ltd
● City Forests Ltd
● Dunedin City Treasury Ltd
● Taieri Gorge Railway Ltd
● Dunedin Venues Limited
● Dunedin Venues Management Limited

and a 50% share in Dunedin International Airport Ltd.

Contact Chairman , Dunedin City Holdings Ltd on 03 477 4000.

DCC Link

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

62 Comments

Filed under Business, Construction, DCC, DCHL, Delta, Democracy, Dunedin, Economics, Finance, Geography, Housing, Infrastructure, Media, Name, New Zealand, OAG, Ombudsman

Delta #EpicFail —The End Game according to CD

Updated post
Mon, 1 Aug 2016 at 9:54 a.m.

Received from Christchurch Driver [CD]
Sun, 31 Jul 2016 at 9:50 p.m.

Readers and Councillors, there is a way out of the Noble Quagmire— but first, not before there is a wholesale clean out of the Delta senior management and directors, or those that have either created this toxic mess or allowed it to continue, which is all of them.

As time is tight, we will not dwell yet again on this topic…. but we will return.

After spending many months considering this toxic mess and the abysmal management and governance that is evident, your Correspondent has come to a conclusion that shocks even him, but desperate times call for if not desperate, then extreme lateral thinking :

After a clean out at Delta, we must hold our collective noses and Council must do the unthinkable and spend MORE ratepayer funds and BUY OUT GOLDBAND’S 32.50% SHARE OF THE FIRST MORTGAGE and take control of the ENTIRE SUBDIVISION.

Council need only to buy the $2.7M Gold Band First Mortgage to have complete control of the project. There of course remains the issue of the Neighbours and the ongoing court actions, but the Neighbours are very willing to work with Council (not Delta) and they have estimated that a solution to provide for their interests could cost around $2M.

The Neighbours have offered to meet with Councillors immediately, at any time to discuss and resolve the issue. The alternative is ongoing legal action with the Council in a very weak positon. Certainly, Crs Calvert and Vandervis, and other Councillors also share this position.

Here is the Outline Plan

1. DCC – (Preferably NOT Delta or DCHL) spends $2.7M to buy the remaining first mortgage. To be free of the toxic taint of the DCHL, ideally a separate Council Owned Company may need to be created. Tax issues may mean it has to stay within Delta but every effort should be made to avoid this. Once the $2.7M mortgage is bought there are no external interest costs, just some rates and insurances, which are minimal in the overall scale of things. Council then has time to make informed decisions. THE IMPORTANT THING IS TO AGREE TO BUY THE MORTGAGE AND STOP THE CURRENT MORTGAGEE SALE (which is possible with the agreement of the Neighbours under s102 of the Property Law Act).

2. BEFORE the remaining mortgage is bought, do a deal with the Neighbours to satisfy their interests which will cost around $2M, plus some amount for Neighbours’ costs – this might be around $500-600,000. The legal costs might grate but that is the cost of acting like a corporate criminal. This step provides certainty to Council there will be no more legal delays that have added years to the project.

3. The DCC appoint a directly employed project manager that is answerable directly to the DCC CEO, and set in place very clear KPIs and make a very large proportion of his/her remuneration subject to those KPIs. NOT a “Consultant” and DEFINITELY NOT Mr Mike Coburn or any other person associated with past or present Directors.

4. That project manager will have full visibility of absolutely all costs relating to the subdivision past and present, and will present full and detailed monthly reporting to Councillors and DCC Management and appear at all Council meetings. The project manager will have complete control over the Delta CEO on this matter.

5. Resolve with Christchurch City Council and Yaldhurst Community what is required to make a workable and safe subdivision.

6. Complete the work required to sell the first stages of the residential subdivisions – there are around 80 sections ready to go and if a deal was offered to a housing company like Mike Greer Homes that had demonstrated expertise and capacity to build cost effective homes, the deal would be done in a week. The remaining work would NOT be done by Delta but by a small efficient company. Above all, it is important that the work awarded by the DCC project manager is an open and transparent process and there are no links to Delta or DCHL Directors, past or present.

7. Councillors must understand the land will never be worth less than it is now – they must avoid Denham Shale-like stupidity that occurred at Luggate where land was sold for a fraction of the cost, only for the sections to be marketed several years later at prices that would have yielded Delta all of its funds spent there, interest and a profit besides. Council must learn from the mistakes past, not repeat them, otherwise there will be more Auditor-general and Ombudsman reports, and it won’t be good for Council.

8. Councillors must resist temptation to bow to the Delta / DCHL Directors recommendations to sell now – the overriding concern of these incompetents is to sweep this toxic mess under the carpet and hope that Ratepayers will buy the TINA line – there is no alternative, we just had to move on with another $10-20M loss….

9. The directors will be pushing hard for a quick sale and say in effect : “If you don’t accept this mortgagee offer there won’t be another as good” which is utter rubbish. There were several mortgagee offers, despite the property being marketed over the holiday break and with a lot of complexity in the sale document that wrote off large chunks of value. But the essential point is that the first sections that are almost ready and all or part of the commercial land is sold off separately, then Delta plus get MORE than what is currently available :

10. What is the ultimate value of the land ? Very quickly, there is over 35,000 m2 of commercial land, for a major commercial centre including retail anchors and specialty shopping that is already master planned with the main entrance road virtually complete. This excludes the main entrance road and shared parking circulation roads. Even in a fire sale this land is worth around $90-100 /m2. This alone is a value of $31M minimum, Councillors. Admittedly it will take time to sell down, but the upside is huge again – even industrial land in Christchurch is $250-300 /m2, and commercial zoning is worth more again. Completed, in an orderly sell down over time, 35,000 m2 at $300 /m2 is …. too big to contemplate !! The 80 completed sections would be worth around $9M nett after selling costs, and then there are 190 consented but undeveloped sections that your Correspondent says are worth around $9M also. These end value figures are why Noble are fighting so hard to regain control of the asset. Yes, there is some re-work and further costs, but they are small in relation to the total asset. The key is not to pass that value to some bottom feeding vulture at mortgagee sale that is likely to be NIL in disguise. NOTE : Your Correspondent has not calculated in detail the area of the commercial land.

11. The Delta Directors and Mr Crombie, Mr Dixon and Mr Cameron cannot be trusted. They have not ever given Councillors the full facts about a range of matters, have at best misled Mr McKenzie. Their willingness to simply close the door and accept a huge loss on this deal is plainly evident by the fact they wrote off in excess of $10M in their 2015 accounts. They just want to forget this mess ever existed, because it is Other People’s Money.

12. Councillors should consider 2 final facts : The only way that the $24M investment that ratepayers have made in this project to be protected and repaid is if Council finishes the project, even if just in part. With what has gone on, there must be full accountability and transparency which can only be achieved by full Council control. The other thing to remember is that Council has already set a precedent to bail out loss making Council enterprises : It’s called the stadium. Council agreed to reduce the rent by $1.85M per year. If Council takes an amount equal to around 18 months of Stadium rent subsidy to DVML, it can have control over the subdivision and very likely make back at least the $10-15M in interest costs that would pay for the Luggate and Jacks Point debacles !! Result !!

Go on Councillors, make a sensible and decision tomorrow and make us proud.

█ For more, enter the terms *delta*, *noble* or *epic fraud* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

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Filed under Business, Construction, DCC, DCHL, Delta, Democracy, Design, District Plan, Economics, Finance, Geography, Housing, Infrastructure, Media, Name, New Zealand, OAG, Ombudsman, People, Politics, Project management, Property, Public interest, Resource management, Site, Town planning, Travesty, Urban design

Delta #EpicFail —Epic Fraud #10 : The Beginning of the End : Grady Cameron and his Steam Shovel

Received from Christchurch Driver [CD]
Sun, 31 Jul 2016 at 1:18 a.m.

Dear Readers

We must give plaudits to Vaughan Elder of the ODT for Saturday’s front page article on Delta’s court action over the Noble Subdivision. Readers should remember that the new CEO of the ODT Grant McKenzie, Mr Elder’s employer, stated in a Council Meeting in February that there was “no relationship” between Gold Band Finance and Delta, and continued to perpetrate that myth in Saturday’s newspaper : Mr McKenzie “stood by comments he made at the council meeting at February”. That is a classic piece of misdirection, in that most people will read it and construe that Mr McKenzie is saying his comments in February were true and accurate, but of course it does not say that —Mr McKenzie has thrown a lifeline to himself so that when the good ship Delta sinks, he can say that he “stood by” his comments in so far as what he knew or had been definitively confirmed to him at the time —or some other carefully concocted excuse that may or may not be true.

But readers, tonight we are not concerned with Mr McKenzie (you can go now Mr McKenzie, we know you read this site….), but the dismal and desperate Mr Grady Cameron. Saturday’s article was very telling in many respects :

Firstly, when Delta thought it had a chance of controlling the issue back in February, it issued a general press release via Gary Dixon and made contact with What if? to deal with alleged “misinformation” that was being perpetrated (mostly by your correspondent). Back then, Mr Graham Crombie, the DCHL chair, was also wheeled out to add gravitas and to try to stabilise the situation, which failed miserably, as your correspondent was happy to predict. See the earlier post Tea & Taxing Questions (6 Mar 2016). It was suggested in that post that Mr Crombie conduct a personal risk register cost/benefit analysis, for any Noble involvement. Mr Crombie has read the tea leaves, and neither him nor any other director are anywhere to be seen. Mr Cameron (Grady) is all on his own.

KMBT_C554e-20140321160947

Let us examine the hole that Grady has dug for himself. Grady is quite clearly not really an earthmoving guy, and has obviously never read the early childhood earthmover’s bible written in 1939 by Virginia Lee Burton, Mike Mulligan and His Steam Shovel : Four corners…neat and square…four walls straight down…We’ve dug so fast and we’ve dug so well that we’ve quite forgotten to leave a way out! —Yes readers, there is no way out, for Grady.

Over a Choysa (No sugar please, it’s late), let us examine some of his statements in Saturday’s ODT.

In a response emailed to the ODT, Mr Cameron disagreed

Well Grady, how about sending out a general press release or an email, as you did in February so that others like What if? who have been on your trail for months, can verify what you are saying is factual, and you are not merely trying to sidestep Mr Elder who is new to the issue.

“We remain fully focused on recovering the outstanding debt owed to Delta from the developer and have securities in place for the amount owing.”

That is a disgraceful misrepresentation of the truth, Grady Cameron, and you know it is. Your DCHL chair Mr Crombie confirmed that the amount owed in March including interest, was over $24M, and you have security for $13.3M. This is beyond doubt because the recent court documents show you were willing to allow Gold Band to sell the mortgage for $16M, which included your second mortgage interest of $5M. This meant after Gold Band was paid its –current– share of the 32.5% of the First Mortgage, Delta would receive $13M. Mr Crombie also confirms you are not telling the truth because he said in the ODT (23 Feb 2016) that Delta would have to write off millions, but not to worry, it was only interest and it was “horrendous”.

The mortgagee sale was being conducted by Gold Band Finance, not Delta, he said.

Grady, with this statement you are not fit to remain as CEO any longer. Your disdain for the collective intelligence of Ratepayers is clearly in the gutter. You –Delta!, dictate what Gold Band can and cannot do. See the earlier post #EpicFail —Noble Subdivision: Cameron, Crombie and McKenzie (24 Feb 2016). Grady, you spent $3.39M on a very likely illegal 67.50% share of the Gold Band first mortgage so you could dictate to Gold Band what they can and can’t do, and you have promised to pay all their costs, “legal or otherwise”. You have already dictated to Gold Band that they cannot sell the first mortgage to the other landowners, who offered to buy it. This is confirmed in Gold Band emails in court documents.

How about answering these questions Grady :

When purchasing the partial first mortgage amounts, what interest rate did Delta have to pay for the first mortgage amounts ?

Was it 22.50% compounding, or a figure close to that? If Delta has to pay 22.50% interest, why do you think it is appropriate for Ratepayers to receive no interest on the $13M approx. of core debt that has been outstanding for six years ?

It (Delta) had not been involved in any unethical behaviour

We could have hours of entertainment with this one, but gravitas and the impending council meeting this Monday mean we must play it straight.

Grady, that is another disgusting fabrication.

mike-mulligan-and-his-steam-shovel-illustrations [childrensbooksguide.com] 1

Did you allow the ENTIRE SUBDIVISION WORK COMPLETED BY DELTA AT THE NOBLE SUBDIVISION to be completed NOT to the CCC CONSENT DRAWINGS AND SPECS, but to radically different specifications, with roadways that were 8 METRES NARROWER than the CCC Consent Requirements ?

Did this continue for AT LEAST 18 MONTHS from late 2009 to mid 2011 ?

Is it normal for Delta to ignore the local authority consent conditions for projects and simply suit themselves and their clients ?

If not, how on earth could you consider it “ethical” on this project ?

Did Delta install stormwater systems at the subdivision that were undersized to cater for the neighbours’ land, but continue to assure them that their interests were being catered for ?

Do you consider that actively trying to defeat “known prior interests in the land”, that were specified very clearly in the sale and purchase agreements for the land that the subdivision was being built upon, ethical behaviour ?

Do you think that attempting to have your $5M second mortgage, that was registered after various caveats were registered, paid ahead of the caveated interests is ethical ?

Do you say the following -extracted from the post Epic Fraud #5 – Delta and the ghostly hand of Tom Kain (12 Jul 2016)- shows ethical behaviour ?

Mr Smillie (Delta’s lawyer) in an email of 11 February 2011 sets out step by step how the deception will work :

1. NIL granting a registered mortgage to Delta.
2. Philpott etc consenting to registration of the mortgage but the caveat remains in place ahead of Delta’s mortgage.
3. Gold Band agrees to Delta having 1st priority
4. Gold Band agrees to hold its 1st registered mortgage on lot 19 on trust for Delta (To allow sale / enforcement by Delta if necessary so as to avoid caveat issues

Mr Smillie concludes by stating “while not ideal that seems to be as close as we can get to a 1st registered mortgage position for Delta given the caveat issue”.

If you consider it ethical, what would it take for you to find there was unethical behaviour —murder ?

Are you willing to state categorically that you will resign if any of these allegations are true ?

tried several times to find a solution […] on the neighbouring land.

Grady, did any of these solutions involve actually working with the neighbours, or merely trying to deceive and cheat them of their prior known interests.

Provide email evidence of any assertion that you sought to satisfy their interests.

If you allegedly ‘tried to find a solution’ why was it necessary to go about a constructive fraud, designed by Mr Smillie, as noted above to defeat their caveats.

He denied Delta’s actions over Yaldhurst had been reckless.

Grady, if Delta has not been “reckless” then by your lights, Delta has acted with some degree of prudence.
Let us back the truck up here.
You, personally, approved Delta’s involvement in this subdivision, in 2009, with full knowledge of the following :

a) The land was in fact not even owned by the Developer NIL, but in a complicated buy-back scenario with a lot of obligations to the landowners.
b) Has a third (or fourth) tier finance company, Gold Band Finance, as first mortgagee (because the banks would not lend on it).
c) The first mortgage loan amount was only $1.75M, it was fully drawn down, and the finance company Gold Band had NO ABILITY to advance any further funds to pay for Delta’s work.
d) No other second mortgage funding was in place to allow Delta to be paid.
e) The Developer NIL had no capacity at all to make payments to Delta from its own resources.
f) The Developer and Owners, Apple Fields and NIL, were well known commercial hazards and aggressive litigants.
g) The subdivision has 33KV overhead powerlines running through it, and has limited market appeal.
h) Delta would not be paid until the most or all of the sections were sold and paid for, and the industry at the time would have forecast around a two-year sell down period.

In other words, you approved $11M of work, in a dodgy subdivision project, that had no chance of ANY meaningful repayment, for at least three to four years, on the absolute best case scenario, until the sections were sold.

Grady, if you consider this NOT to be reckless commercial behaviour for a Ratepayer owned company, you need to be sacked, now.

KMBT_C554e-20140321160658

Readers, in conclusion, even in our children’s story, ‘Mike Mulligan’, there were consequences for non–performance. Grady, it looks as if the Delta Directors and DCHL have left you, and you are, indeed…. the weakest link, and expendable. Just like Mary-Anne, the steam shovel, along will come new management, just like the new diesel shovels, and electric shovels that made Mary-Anne redundant. There will be NO MORE WORK for you, and just like Mary-Anne, you will be GONE. “They left the canals, and the railroads, and the highways, and the airports, and the big cities, where no one wanted them any more….. and went away.”

Readers, if you have the patience, the best primer for the sorry saga is found in the first post Delta #EpicFail —Epic Fraud (5 Mar 2016).

█ For more, enter the terms *delta*, *noble* or *epic fraud* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

*Images: [lessons in creative destruction, a shocked Mary-Anne] Illustrations from Mike Mulligan and His Steam Shovel (1939), a book by Virginia Lee Burton – blog.acton.org | childrensbooksguide.com | blog.acton.org

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