Oslo Municipality lost controversial Boligbygg case: must pay millions in legal costs – E24

– I’m glad you listened to us, says Geir-Åge Normannseth in Mano Eiendom.

This is the case:

• In August, E24 wrote that the Oslo municipality has sued four real estate companies in connection with the Boligbygg scandal. Boligbygg owns, manages and rents Oslo’s municipal housing.
• The municipality requires companies to return public support. They believe they have paid well above the market price for various apartment buildings.
• In total, the municipality demands the reimbursement of NOK 94 million.
• On Friday afternoon the verdict came in the first case, against Mano Eiendom.
• The claim was unsuccessful. The municipality is now ordered to pay NOK 5 million in legal costs.

Mano Eiendom is owned by Per Ø vivos Martinsen and Geir-Åge Normannseth.

The claim against them was for NOK 26.7 million.

Not decided whether to appeal

Christian Stang Våland and Robert Lund at Kvale Advokatfirma have represented the company.

– The verdict is as expected. The exchange took place at fair values ​​and in market terms, Våland tells Aftenposten / E24.

The Oslo municipality does not agree with the court’s decision.

– We must have time to familiarize ourselves with the verdict before deciding whether to appeal, says Victoria Marie Evensen to Aftenposten / E24.

She is a councilor for industry and property of the municipality of Oslo.

Boligbygg caps had to go

A Deloitte investigation in 2017 found 110 purchases in which they believed the Oslo municipality had paid a total of NOK 100 million in markups.

The background to the investigation was a series of revelations at Dagens Næringsliv.

DN revealed that investors made millions from reselling properties to the municipality of Oslo.

Both the director and the chairman of the Boligbygg board resigned. In addition, Økokrim has accused several people of corruption.

It was last spring that the Oslo City Council ruled on a claim in six cases.

– Strange use of money

So far, a lawsuit has been filed against four companies. In all four cases, the total claim is NOK 94 million.

The case against Mano Eiendom concerned Neuberggata 24C in Majorstuen, for which the municipality paid NOK 128 million.

– We think it is strange that Oslo municipalities spend many millions trying to get a price cut due to what they themselves believe to be their own mistakes, says Våland.

The case reached the Oslo District Court from August 31 to September 11.

Våland and Lund also represent the other three companies that are being sued.

– What will this mean for the other three cases?

– All cases are different. But there are certain guidelines in this case that will be of interest to the other cases, says Våland.

Disagreement over value

The basis of the requirement is an EEA ban on state aid that distorts competition by favoring certain players.

Following the Deloitte investigation, the municipality obtained new assessments, from Veridan and Newsec. They both thought the apartment buildings were worth less than they paid for.

Mano Eiendom believes that the apartment building was sold at market price.

Mano Eiendom also got new evaluations, from Malling & Co. On the other hand, they believed that the apartment building was sold at market price.

This is supported by the Oslo District Court.

Both buyer and seller collected their own evaluations before the deal was made. Assessments confirm that the price did not deviate from market value, the court believes.

The court has placed limited emphasis on evaluation that has been obtained in retrospect.