KEY POINTS:
Blue Chip investors are being encouraged to apply for legal aid.
Commerce Minister Lianne Dalziel says the Legal Services Agency is co-ordinating a centralised response to applications from Blue Chip victims from its Rotorua branch.
In a letter to property consultant Olly Newland, who is acting for numerous former Blue Chip clients, Dalziel says she is "interested in helping Blue Chip investors find ways and means to access legal advice, particularly in this case where lack of funding is a barrier to legal recourse".
Around 2000 investors have lost at least $84 million in the collapse of the structured property investment scheme. The ongoing effects have been severe, with many facing losing their homes.
Qualification for legal aid depends on an individual's circumstances, but as many Blue Chip investors were pensioners who mortgaged their only asset, the family home, to invest it is likely a number will qualify.
Law firm Ellis Law, together with barristers Paul Dale and Daniel Grove, are acting on behalf of several hundred of them. Activity includes taking legal action against solicitors over allegedly negligent advice they gave on the investments.
Valuers who provided allegedly inflated valuations on properties sold through the Blue Chip scheme are also in the lawyers' sights.
Principal Brian Ellis said his firm was already processing legal aid applications for around half a dozen investors, and it expected a lot more.
He welcomed the encouraging words from the Government. "It gives some of those people who have no hope the possibility of getting on the bandwagon to do something."
He said affected investors could contact his firm.
Dale and Grove, who have spearheaded court action over Blue Chip, don't generally do legal aid work because it comes nowhere near to covering their costs. They have spent the past four months getting to the bottom of the complex Blue Chip scheme. It was doubtful that other barristers would take up the cudgels at this stage.
