DOMINION FINANCE GROUP LIMITED (IN RECEIVERSHIP AND IN LIQUIDATION) V SHANE ALLEN LE PROU HC ROT CIV 2011-463-000169

DOMINION FINANCE GROUP LIMITED (IN RECEIVERSHIP AND IN LIQUIDATION) V SHANE ALLEN LE PROU HC ROT CIV 2011-463-000169

The adjudication orders were granted because the Le Prous' complaints derive from rights belonging to Sade (the company) which has abandoned claims; the Le Prous were not parties to the priority deed and therefore cannot rely on it; the guarantees preclude set off or subrogation to Sade's rights; no contractual duty arose to the guarantors under clause 7; and in the exercise of s37 discretion the large outstanding debt and public interest favoured making the adjudication orders.

Citation
openlaw-eec3efb7_6bd4_4297_894f_1b9617dec5bd.pdf
Parties
Judgment Creditor: Dominion Finance Group Limited (in receivership and in liquidation); Judgment Debtor: Shane Allen Le Prou; Judgment Debtor: Denise Ellen Le Prou
Court
High Court
Jurisdiction
New Zealand
Judgment Date
30 August 2011
Procedural Posture
Bankruptcy Adjudication Under Insolvency Act 2006 / Hearing and Oral Judgment
Outcome
Adjudication orders made against Shane Allen Le Prou and Denise Ellen Le Prou
Legal Topics
Adjudication Order, Guarantees and Guarantor Liability, Set Off and Subrogation, Deed of Priority, Receivers' Duties, Consent Judgment
Insolvency Bankruptcy Contract Property Receivership Adjudication Order Guarantees and Guarantor Liability Set Off and Subrogation +3 more

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Parties

Dominion Finance Group Limited (in receivership and in liquidation)

Judgment Creditor

Shane Allen Le Prou

Judgment Debtor

Denise Ellen Le Prou

Judgment Debtor

Procedural Posture

Bankruptcy Adjudication Under Insolvency Act 2006 / Hearing and Oral Judgment

Legal Issues

  1. 1 Whether adjudication orders under the Insolvency Act 2006 should be issued against the guarantors
  2. 2 Whether guarantors can assert set off or counterclaims derived from the company (Sade Developments Ltd)
  3. 3 Whether clause 7 of the deed of priority created enforceable duties to Sade or to the guarantors

Ratio Decidendi

The adjudication orders were granted because the Le Prous' complaints derive from rights belonging to Sade (the company) which has abandoned claims; the Le Prous were not parties to the priority deed and therefore cannot rely on it; the guarantees preclude set off or subrogation to Sade's rights; no contractual duty arose to the guarantors under clause 7; and in the exercise of s37 discretion the large outstanding debt and public interest favoured making the adjudication orders.

Court Disposition

Adjudication orders made against Shane Allen Le Prou and Denise Ellen Le Prou

Orders

  • Adjudication orders made and timed at 3:14pm on 30 August 2011
  • Costs awarded to Dominion Finance Group on a 2B basis together with disbursements approved by the Registrar