NEW ZEALAND BLOODSTOCK FINANCE & LEASING LTD v JONES [2023] NZHC 2111

NEW ZEALAND BLOODSTOCK FINANCE & LEASING LTD v JONES [2023] NZHC 2111

Under s31(3) Insolvency Act the Court granted permission for the creditor to continue execution; tribunal found on admissible evidence the 333 shares are held by the MOF2 Trust, not the judgment debtor personally; there was insufficient evidence that the trust is a sham or alter ego; r17.53(e) permits charging the...

Source-derived case information.

Citation
[2023] NZHC 2111
Parties
Judgment Creditor: New Zealand Bloodstock Finance & Leasing Limited; Judgment Debtor: Gregory John Jones
Court
High Court
Jurisdiction
New Zealand
Judgment Date
10 August 2023
Procedural Posture
Application for Final Charging Order and Sale Order / Hearing and Judgment (application Heard 31 July 2023; Judgment 10 August 2023)
Outcome
Application partly granted and partly dismissed
Legal Topics
Charging Order, Sale Order, Bankruptcy, Sham Trust, Alter Ego Trust, High Court Rules R17.53, Insolvency Act S31(3), Good Faith, Trustees' Duties
Insolvency Trusts Company Law Civil Procedure Property Law Charging Order Sale Order Bankruptcy +6 more

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Parties

New Zealand Bloodstock Finance & Leasing Limited

Judgment Creditor

Gregory John Jones

Judgment Debtor

Procedural Posture

Application for Final Charging Order and Sale Order / Hearing and Judgment (application Heard 31 July 2023; Judgment 10 August 2023)

Legal Issues

  1. 1 Whether creditor may continue execution process while bankruptcy application pending under s 31(3) Insolvency Act 2006
  2. 2 Whether 333 shares in Harlow Holdings Ltd are property of judgment debtor or of MOF2 Trust
  3. 3 Whether MOF2 Trust is a sham trust or an alter ego of the judgment debtor

Ratio Decidendi

Under s31(3) Insolvency Act the Court granted permission for the creditor to continue execution; tribunal found on admissible evidence the 333 shares are held by the MOF2 Trust, not the judgment debtor personally; there was insufficient evidence that the trust is a sham or alter ego; r17.53(e) permits charging the judgment debtor's estate/right/interest as a beneficiary, therefore a final charging order was appropriate over Jones' contingent interest in the shares; a sale order was declined; execution was not set aside for lack of good faith.

Court Disposition

Application partly granted and partly dismissed

Orders

  • Permission granted under s31(3) Insolvency Act 2006 to continue the execution process
  • Final charging order granted over Gregory John Jones' "estate, right, or interest" in the 333 shares in Harlow Holdings Ltd held by the MOF2 Trust