BODY CORPORATE 81340 v YEE GOOD FORTUNE INVESTMENTS LIMITED [2018] NZHC 1472_x000b_

BODY CORPORATE 81340 v YEE GOOD FORTUNE INVESTMENTS LIMITED [2018] NZHC 1472[19 June 2018]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYI TE KŌTI MATUA O AOTEAROATE WHANGANUI-Ā-TARA ROHECIV-2018-485-314[2018] NZHC 1472UNDER the Companies Act 1993 andHigh Court Rules 2016IN THE MATTER of an application for putting a company intoliquidationBETWEEN BODY CORPORATE 81340PlaintiffAND YEE GOOD FORTUNE INVESTMENTSLIMITEDDefendantHearing: 19 June 2018Appearances: Mr D W Hunt for plaintiffMr N B Dunning for defendantJudgment: 19 June 2018JUDGMENT OF ASSOCIATE JUDGE JOHNSTON[1] This proceeding was called in the Commercial List earlier today. It is aliquidation proceeding commenced by Body Corporate 81340 against one of theowners of a unit in the building in Lower Hutt in which Body Corporate 81340 is thecorporate entity under the Unit Titles Act.[2] For Body Corporate 81340 Mr Hunt indicated that his instructions were toproceed. Mr Dunning for Yee Good Fortune sought a stay of the proceeding.[3] Having heard from both Mr Dunning and Mr Hunt, I declined Yee GoodFortune's application. I made an order putting Yee Good Fortune into liquidation. Iapproved John Howard Ross Fisk and Marcus James McMillan as the liquidators onthe terms set out in their consent to act as such dated 14 June 2018 and I awarded costsin favour of Body Corporate 81340 against Yee Good Fortune on a 2B basis togetherwith disbursements as fixed by the Registrar to be paid out of the assets of Yee GoodFortune. My order was timed at 11.39 am on 19 June 2018.[4] I informed counsel that I would let the parties have a short judgment settingout my reasons for declining Yee Good Fortune's application for a stay. I now do so.[5] The basis upon which Mr Dunning advanced Yee Good Fortune's applicationwas expressed in more than one way during the course of the hearing. Indeed,Mr Dunning used strong language to describe it. He said that the original underlyingjudgment of the Tenancy Tribunal in favour of Body Corporate 81340 against YeeGood Fortune was obtained fraudulently. A slightly less inflammatory way of puttingthe same point might be to say that the Tenancy Tribunal's judgment was wrong inlaw.[6] Mr Dunning went on to submit that, if the underlying judgment was open toquestion, then this Court should exercise its discretion and refuse to make an orderputting Yee Good Fortune into liquidation on the strength of it. He mentioned also thefact that in the past Body Corporate 81340 had commenced other types of enforcementproceedings in an attempt to enforce the same judgment but had abandoned these. Thecontention was that this illustrated that Body Corporate 81340's motivation in thisproceeding was simply the enforcement of the debt and that that was an abuse ofprocess.[7] The Tenancy Tribunal's decision has now been the subject of a substantiveappeal to the District Court and an application to this Court for an order setting it aside.The appeal to the District Court was unsuccessful. So too was the application to setaside the judgment in this Court.[8] In her Honour Justice Mallon's decision in this Court dated 30 March 2017,she said:11 Yee Good Fortune Investments Ltd v Body Corporate 81340 [2017] NZHC 611.[29] The applicant has not persuaded me that it would be a miscarriage ofjustice to allow the Body Corporate to enforce the judgment againstit. To the extent the applicant contends the work was not needed orwas carried out to a poor standard, the applicant had its opportunity toadvance this in the District Court. Even now its claims are more inthe nature of assertions than based on any admissible, substantial andreliable evidence before this Court. To the extent the applicantcontends the later District Court decision has vindicated its positionabout the unlawful nature of the levies, I am not convinced. The laterDistrict Court decision turns on the validity of levies for long-termmaintenance funds, which are not how the levies were described inthe documents, the Tribunal decisions or the District Court judgmentin the applicant's case. To the extent the applicant relies on the BodyCorporate making a s 74 application as vindicating its position, I amnot convinced. The applicant has not provided me with a copy of thatapplication and explained why, if it pays the levies which are thesubject of the District Court judgment against it, the applicant will beprejudiced if approval is given to this scheme. Presumably any fairscheme will take into account payments already made by unit holdersand potentially allow for re-allocation of respective shares of the totalcosts if appropriate.[30] The applicant is one of a small number of unit holders who have notpaid their share of the costs. Repairs have been completed to its unitbut repairs to other units have not been completed because more fundsare needed. The applicant did not bring this application for someyears after the District Court judgment against it, some years after thatjudgment was entered in the High Court, some months after the laterDistrict Court judgment, and some months after the s 74 applicationwas made.[31] In these circumstances I see no substantial miscarriage of justice towarrant the exercise of the Court's powers in the manner sought.[9] Thus, Yee Good Fortune has now had two opportunities to raise the very issueswhich Mr Dunning submits should prevent Body Corporate 81340 proceeding. Boththe District Court and the High Court have considered the argument and rejected it.[10] I cannot see that the fact that Body Corporate 81340 has in the past sought toenforce the Tenancy Tribunal's decision by other means available to it should detractfrom its right to pursue bankruptcy proceedings. Certainly, I do not acceptMr Dunning's submission that that illustrates that this proceeding is an abuse ofprocess.[11] There is no evidence before the Court suggesting that Yee Good Fortune is ableto pay its debts as they fall due. The only evidence is the inferential evidence that itis unable to do so because it has not complied with Body Corporate 81340's statutorydemand.[12] It was on those bases that I declined to stay this proceeding and made the orderI did winding Yee Good Fortune up.Associate Judge JohnstonSolicitors:Rainey Collins, Wellington for plaintiffNat Dunning Law, Wellington for defendant