Bettaway home still far away

When a young family man and his wife decided to build a new home through Bettaway Homes, they never dreamed it would turn into a nightmare.
The homes are prefab put together by a team of local builders under the banner of Bettaway Homes with a ‘show home’ in Muri, near the football club.
Thinking that prefab homes would be an affordable option, Nooroa Samuel visited the company in Henderson, Auckland, and dealt with company director, Clive Doyle. He also secured a bank loan with one of the local banks and said he recalled Doyle had even pointed to one of the containers in the yard and claimed it belonged to him (Nooroa).
When he returned to Rarotonga, he waited and rang many times over several months and each time was assured the container was on its way but it did not arrive. When asked why he had paid for the kitset house in full instead of by progress payments, he said he did not pay them. It was all done by the bank without reference to him and taken directly out of his account and placed into that of Bettaway Homes and there was nothing to nothing to show for it.
How was that possible? Nooroa did not know but he did have the documents that on the face of it, back up his claim. The bank sent an initial letter of offer dated 20 June 2008 (for $119,374) which inter alia detailed the requirement to have a builder’s all risks insurance policy which the bank can arrange.
On page 3 of the offer, there are ‘conditions precedent’ where funds ‘will be released progressively as per schedule of works and upon satisfactory inspection done by the bank’. A second letter of offer dated 8 September 2008 (for the slightly amended amount of $123,004) was later sent to him.
Three days later on 11 September 2008, the first payment of $47,955 was sent to Bettaway Homes by the bank and his account was charged $42 commission for the transaction. Presumably this was for the materials but he waited and nothing came. Then by chance, Nooroa found out through a friend that Bettaway Homes had gone into liquidation and in due course he received a letter from RES Corporate Services Ltd that the company had been placed in liquidation on 21 May 2009. After checking online, there is also the concern that there is no indication that the company is in liquidation at all.
Not knowing where to turn, Nooroa contacted the Herald who forwarded his concerns to TVNZ’s Pacific Reporter Barbara Dreaver to ask if she would be interested in doing a review on TV One News or if not, perhaps on the Close Up show.
The Herald contacted Secretary of Internal Affairs Bredina Drollet to ask what assistance, if any, there is under the Fair Trading Act or the Consumer Guarantees Act for Cook Islands based clients who are affected by the liquidation of NZ companies with which they are dealing.
After perusing the documents, she advised she had only briefly reviewed the Fair Trading Act and the Consumer Guarantees Act, however, the issue discussed earlier did not seem to be covered directly under the two Acts. She preferred to seek a legal opinion to confirm this view. She said that on the face of it, it appeared it was a contractual issue and therefore all the relevant contracts needed to be reviewed.
Drollet said that after having had a further look at the information at hand, it appeared there was not enough information to be able to make an informed view on the case e.g. is there a contract between the identified persons and the third party constructor and what are the contents of that contract? She said she would be surprised if a contract did not exist between the parties and perhaps the contract provided authorisation to the third party to drawdown funds from the loan based on progressive reports provided by that third party. Drollet added she could not see how the bank could release funds against the loan without such an agreement otherwise it would be a serious breach of contract. She agreed that the bank needed to be contacted to produce the evidence on which funds were released to the third party. The affected couple should be able to acquire these documents from the bank.
The Herald also contacted a former head of the Law Society for comment and after being told the circumstances, his advice was not to pay the loan. However, he has asked to take a look at the documents as well. Incidentally, similar advice not to pay until the matter is sorted out has been offered by a qualified accountant.
In fairness, the Herald has also visited the bank and given the managers an opportunity to comment on the case. They have promised to investigate the case as they were not aware of it and we shall advise their response in due course.
Meanwhile the young family is in debt to the tune of close to $120,000 and in good faith has been making loan repayments of $300 per week .
However they have nothing to show for it but bare earth.

Herald Issue 463 10 June
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