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General Finance chases Serepisos's mum

NZ Newswire logoNZ Newswire 16/03/2017 Jonathan Underhill

General Finance has sought summary judgement against the mother of discharged bankrupt Terry Serepisos over some $275,000 owed on a defaulted mortgage.

But her lawyer argued the mortgage lender 'sabotaged' the sale of the apartment and is to blame for the outstanding money.

Alliki Serepisos was the owner of a Wellington apartment financed via a mortgage with General Finance but soon defaulted on the payments and the property was put up for sale.

It sold in early May 2016 for $580,000, well below the valuation on which the mortgage had been provided.

Before real estate firm Harcourts won the listing, it had appraised the value at $995,000 and evidence was given of a 2014 valuation by Telfer Young for about $715,000.

While there is no argument from the Serepisos family that the mortgage was in default, lawyer Kevin Smith argued that the mortgagee was the architect of its own misfortune by taking 18 months to sell the apartment and then failing to respond to a potential higher offer - before it had signed the sale and purchase agreement - that would have left Alliki owing very little.

Mr Smith said Alliki was too elderly and frail to attend the hearing.

He argued that General Finance hadn't carried out its obligations as mortgagee in exercising the power of sale because it had failed to pursue a potentially higher offer.

He said a Mr Chin had indicated in early May that he was interested in buying the apartment and was prepared to offer about $800,000 but had been unable to get access for a viewing.

Mr Smith said the real estate agent had told Mr Chin she didn't have the key, an assertion later shown to be false. Associate Judge Warwick Smith repeatedly asked General Finance's lawyer, Sean McAnally, why it hadn't followed up on the potential higher offer before signing for the lower price.

Mr McAnally said there was an offer on the table that might have been lost and that Mr Chin hadn't yet done due diligence on an apartment that was in a block which faced a range of issues including a low earthquake rating, leaky building concerns and high body corporate fees.

The judge reserved his decision.

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