It is a dispute that has left at least 215 parties with forward bookings without accommodation and collectively out of pocket for almost $100,000.
Arrowtowners Mark Samways and Ken Wimsett, who settled on Dana Hemingway’s boutique hotel on September 13 — after which it stopped trading — have begun legal proceedings against the latter, alleging "multiple breaches of the sale and purchase agreement".
They also promised any remaining funds considered on settlement to be guest deposits will be returned to the vendor on settlement of the action.
Mr Samways and Mr Wimsett had planned to subdivide the hotel land and buildings and sell off individual titles. In an email to stranded guests, their Queenstown accountant, Kenny Frisby, said his clients originally intended to settle the hotel in March and run it until the end of the ski season.
However, just weeks out, they learned Mr Hemingway’s company, Hipzone, could not provide clear title to the property due to a family dispute.
By September, when settlement was achieved, Mr Frisby says his clients had suffered "crippling legal costs", so they decided to on-sell the property.
He alleged this delay was "a serious breach of vendor warranties and undertakings in a sale and purchase agreement".
On settlement, Mr Hemingway claimed he passed on to Mr Samways and Mr Wimsett’s company $40,156 in deposits for 63 forward bookings.
Mr Samways and Mr Wimsett, who originally helped out some stranded guests, stopped doing this when they were not given a full schedule of forward bookings, they said.
They claimed, however, that Mr Hemingway continued to take bookings after the hotel shut, and they have now found records of 215 forward bookings from September 13, totalling $95,872.59.
In his email, Mr Frisby urged guests to go back to the entity they paid, Hipzone, to recover funds.
Mr Hemingway has been sought for comment.
