Labour leader Andrew Little will go to court after his offer of an apology and redress over allegedly defamatory statements made against the management of a Niuean resort was rejected.
It was revealed in April 2016 that Earl Hagaman, chairman of Scenic Hotels, made a $100,000 donation to the National Party in 2014, a month before his company was awarded a contract to run Niue's Matavai luxury resort.
The resort is heavily funded by the New Zealand Government and is owned by a trust on behalf of Niue's government.
At the time, Mr Little questioned the timing of the donation and the awarding of the contract, and called on the Auditor-General to investigate.
"As Leader of the Opposition, I considered I had an obligation to respond to media questions on the issues which related to government actions. I referred the matter to the Auditor-General because I believed the public was entitled to be reassured. My focus was, and has always been, on holding the Government to account," Mr Little says.
"Throughout, the Hagamans have vigorously maintained there was no connection between the award of the contract to Scenic and Mr Hagaman's donation. The Auditor-General did not establish any connection."
Earl and Lani Hagaman asked for an apology and gave him a deadline - or he would face defamation proceedings.
"We are asking for a full retraction and apology because no one should be verbally attacked and denigrated because they believe in democracy and the right to make their own unsolicited political choice on who they want to give a donation to," Ms Hagaman said at the time.
"The decision to make the donation was completely unsolicited and was Earl's personal decision and nothing to do with the Scenic Hotel business."
Mr Little didn't apologise by the deadline, saying he had told them he had a constitutional duty to challenge the actions of the Government over the expenditure of public funds.
On Friday Mr Little apologised for his statements.
"Today I want to publicly apologise unreservedly to Mr Hagaman for any hurt, embarrassment or adverse reflection on his reputation which may have resulted from my various media statements," Mr Little says.
"My offers of an apology and redress have been rejected and the matter will now have to be resolved in court. That is unfortunate. I strongly believe everybody's time, not least the Court's, could be better used.
"I want to make it clear that the object of the criticism was the actions of the National government and that I intended to reflect no impropriety on the part of Mr Hagaman.
"I accept that no connection has been established between the donation and the award of the management contract and the hotel upgrade."
The Hagamans say his apology comes as a "surprise".
"It's difficult for us to accept this as a genuine apology if Earl is receiving the details after it was released to the national media," Ms Hagaman says.
"Mr Little has had 12 months to apologise, and in the interim we've spent more than $200,000 in legal fees preparing for this case, which is now only one week away."
Ms Hagaman said they would consider their position over the weekend and they would seek legal advice but, at first glance, believe they will continue with defamation proceedings that commence in Wellington's High Court on 3 April.