In the decision, Justice Neil Campbell ordered a caveat be removed from the 23ha site overlooking Lake Wakatipu south of Jacks Point.
It lifts the lid on two years of High Court proceedings involving Chinese investors Brian Chen and Cassie Xiao and property entrepreneur Andrew Guest, best known as co-founder of Auckland-based commercial property services company Viranda Holdings.
In 2014, the trio were directors of Murphy’s Development Ltd (MDL) when they decided to buy a 45ha chunk of Remarkables Station.
They incorporated Homestead Bay Trustees Ltd (HBT) as the development company, and after the purchase was settled in 2016 for a reported $18m, touted a $100m development with a marina, hospitality premises, hundreds of apartments and a 130-section residential subdivision.
A focus of the caveat decision was two agreements between HBT and Fiordland Experience Group Ltd (FEG), which it engaged to manage the sale and marketing, or underwriting — the point remains in dispute — of the development’s first stage, 12 large residential sections.
Mr Chen and Ms Xiao alleged that from 2014 until 2021, Mr Guest earned "secret commissions from apparently arm’s-length transactions" between HBT and FEG as a result of an allegedly undisclosed interest in FEG through his friendship with its former shareholder and director, Roy Toms.
The transactions were HBT’s payments to FEG, totalling over $1.5m, for its services relating to the sections.
In 2021, when Mr Chen and Ms Xiao learned Mr Guest’s company Viranda Holdings had been invoicing FEG for half of the payments, they declared the agreement "null and void and unenforceable" and launched legal proceedings.
At June’s High Court hearing in Auckland, FEG argued HBT’s sole shareholder at the time of the 2016 agreement was Viranda Nominees Ltd — of which Mr Guest was one of two directors — and therefore his interests in FEG were known to HBT.
Last September, FEG lodged the caveat on the 23ha site to protect its option rights after hearing HBT had put it on the market.
HBT responded by applying to the High Court to have it removed.
In a complex decision, Justice Campbell noted the process for determining caveat applications was not suited to resolving disputed facts or "very difficult questions of law", but ruled the 2016 agreement had ended and ordered the caveat be removed.
Of HBT’s grand vision for the Homestead Bay land, only the 12 sections have been completed to date, selling in 2018 and 2019 for about $2m each, although it has retained the 23ha site.
In April, Australian-based RCL Group, developer of the nearby Hanley’s Farm residential subdivision, bought an adjoining 163ha block from Remarkables Station, stretching to the Kingston Highway, for $70m.
It has plans to develop between 1700 and 2300 residential sections on the land over the next decade.
