Blue Chip investors lose in Supreme Court

"Whilst the Bartles are deserving of much sympathy, it was they who chose to put their faith in Blue Chip and their chosen lawyer. They expressly disavowed reliance on GE. It would make bad law if they could now hold GE responsible for what has occurred.'' Costs of $25,000 were awarded against the Bartles.

http://www.stuff.co.nz
December 3, 2010

Blue Chip investors lose in Supreme Court
Tim Hunter

Bruce_Bartle_Blue_Chip.jpg

COURT BATTLE: Blue Chip investors Bruce and Dorothy Bartle. JON SELKIRK

In a landmark decision that could affect hundreds of former Blue Chip investors, the Supreme Court has ruled against Whangarei pensioners Bruce and Dorothy Bartle in their battle to avoid huge debts incurred to buy an apartment from Blue Chip.

After winning in the Appeal Court last year, the Bartles said they were shocked at the ruling.

"It's very cruel," said Dorothy Bartle. "Why should we lose our house when they told us lies? Where are we going to live?"

"You have to ask the question, where is justice and what is fraud?'' said Bruce Bartle.

In its judgment delivered this morning the Supreme Court said loans of more than $600,000 provided by GE to the Bartles were not oppressive, overturning the Appeal Court decision.

Justices Elias, Blanchard, Tipping, McGrath and Anderson said the result was hard for the Bartles, "whose rights against those responsible for their predicament, Blue Chip and [lawyer Jonathan] Mathias [now bankrupt], may be of limited value. But it would be quite wrong to hold GE culpable for what has occurred.

"Whilst the Bartles are deserving of much sympathy, it was they who chose to put their faith in Blue Chip and their chosen lawyer. They expressly disavowed reliance on GE. It would make bad law if they could now hold GE responsible for what has occurred.''

Costs of $25,000 were awarded against the Bartles.

The decision marks the end of the couple's legal fight after signing up with Blue Chip in 2006.

The deal involved using their home in Whangarei as security for loans to buy an apartment in Symonds St, Auckland. Although the purchase price of the apartment was $552,000, they were required to borrow a total of $629,566 - money supplied by GE through a mortgage broker called Tasman Mortgages, which had close links with Blue Chip.

After Blue Chip failed to deliver on its promises and collapsed altogether in early 2008, the Bartles, who had a combined income of $21,736, were faced with responsibility for the loan.

When they sold the apartment to repay the debt the Bartles found it was worth just $225,000, and GE is now chasing them for the rest of the debt, which is secured on their home.

- BusinessDay.co.nz

http://www.stuff.co.nz/business/money/4419738/Blue-Chip-investors-lose-in-Supreme-Court


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