THE COMMISSIONER OF INLAND REVENUE v CHESTERFIELDS PRESCHOOLS LIMITED [2015] NZHC 2440

THE COMMISSIONER OF INLAND REVENUE v CHESTERFIELDS PRESCHOOLS LIMITED [2015] NZHC 2440 [6 October 2015]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYCIV-2015-409-000043[2015] NZHC 2440BETWEEN THE COMMISSIONER OF INLANDREVENUEPlaintiffAND CHESTERFIELDS PRESCHOOLSLIMITEDDefendantHearing: 18 June 2015Additional written submissions filed 2 July 2015 (Plaintiff)and 21 July 2015 (Defendant)Appearances: P J Shamy & S M Kinsler for PlaintiffD P Weaver for DefendantJudgment: 6 October 2015JUDGMENT OF ASSOCIATE JUDGE OSBORNEon application for stay of liquidation application and on liquidation[1] Litigation of the kind which has occurred between Chesterfields Preschools Limited (Chesterfields) and the Commissioner of Inland Revenue (the Commissioner) is the stuff of law reports.1[2] This tranche of the ongoing litigation saga entails the Commissioner applyingfor an order putting Chesterfields into liquidation for Chesterfields' failure to complywith a statutory demand.1 A search on Westlaw NZ identifies 33 judgments involving Chesterfields and the Commissioner between June 2005 and March 2015, many of which are reported.BackgroundAntecedent proceedings[3] Chesterfields is one of a number of entities associated with David Hampton and his former wife, Therese Sisson (the taxpayers). Another of the entities was Anolbe Enterprises Limited (now in liquidation) (Anolbe). The energetic life of disputes concerning the taxation liabilities of the taxpayers is captured in the lengthy judgment of the Court of Appeal in Commissioner of Inland Revenue v Chesterfields Preschools Limited.2 By that judgment, appeals against a High Court judgment in a second judicial review proceeding brought by the taxpayers were largely unsuccessful. The Court of Appeal traced tax assessments relating back to 1990. After initial assessments of core tax, the taxpayers' liabilities had ballooned out as penalties and interest accrued. Mr Hampton had represented the taxpayers in discussions and negotiations with the Inland Revenue Department (the Department). The taxpayers argued that the Commissioner had a responsibility for the state of thetaxpayers' accounts, particularly the accrual of penalties, and for not processing GST inputs claimed.[4] In 2006, the taxpayers' first judicial review proceedings were largely successful. The Commissioner was ordered by Fogarty J to reconsider a number of matters, including remissions of penalties.3 Debt collection proceedings by the Commissioner were "adjourned" pending the outcome of the Court's directions.[5] There then followed a reconsideration by the Department culminating in a new decision as to sums owing. The taxpayers issued their second judicial review application, determined by Fogarty J in his second judicial review judgment.4 The second application was also successful. The Departmental determination was set aside. The Commissioner was directed to act upon the first judicial review judgment and to reconsider matters in accordance with those directions. The "adjournment" of2 Commissioner of Inland Revenue v Chesterfields Preschools Ltd [2010] NZCA 400, (2010) 24 NZTC 24,500 [Court of Appeal Decision].3 Chesterfields Preschools Ltd v Commissioner of Inland Revenue (2007) 23 NZTC 21,125 (HC), at [159].4 Chesterfields Preschools Ltd v Commissioner of Inland Revenue (2009) 24 NZTC 23,148 (HC).debt collection proceedings from the first judicial review proceeding remained in place.5[6] The Commissioner appealed against the second judicial review judgment. At the same time the Commissioner appealed against other High Court judgments dealing with costs and security over frozen assets. The Court of Appeal heard these four outstanding appeals in 2010.[7] The Commissioner was largely unsuccessful on the judicial review appeal. There was to be a re-consideration by the Commissioner of penalties according to an approach outlined by Glazebrook and Chambers JJ in their judgment.6[8] Glazebrook and Chambers JJ devoted a short, distinct passage in their judgment to the stay which had been ordered in the High Court. Their Honours stated:Stay[146] Fogarty J has restrained the Commissioner from collecting any of the taxation owed by the taxpayers until the first judicial review judgment has been complied with. In our view, this is unreasonable. The Commissioner should be able to collect immediately (at the least) the core tax owing which is not in dispute (and some portion of the associated penalties).[147] We had hoped to have the Commissioner provide calculations in this regard (on the most favourable assumptions for the taxpayers) but it did not prove possible in the timeframe.7 If these calculations can be provided to the High Court, however, we would expect the order would be varied to allow immediate collection of the undisputed core tax and some associated penalties.[9] Subsequently, the Commissioner applied to this Court for the stay of debt collection to be lifted. The stay was lifted on 23 September 2014.5 At [18].6 Court of Appeal Decision, above n 2, at [143]-[145], [211].7 The Judges footnoted their judgment at this point as follows:Given that these penalties relate to core tax which is not under dispute we would have thought that the percentage of any write off penalties for inordinate delay of the Commissioner would be very small, even taking into account that the Commissioner is bound by the first judicial review judgment. We also see no reason why the normal rules as to collection should not apply to tax (and penalties) in dispute.Chesterfields' debt to the Commissioner[10] Adrian Brighty, a technical advisor in the Legal and Technical Services Unit of the Department, assisted in calculating a reduction in the penalties and interest which had been added to the Chesterfields debt, and which required reconsideration in terms of the Court of Appeal judgment.[11] In approaching the reduction of penalties, Mr Brighty noted the following guidance provided by Glazebrook and Chambers JJ in relation to the required reduction:8[93] Given the long history of this matter, rather than undertaking the laborious process of consideration set out above, a pragmatic course may be merely to reduce penalties by a certain percentage across the board. In this regard, a reduction of 15% would, in our view, more than fulfil the requirements of the first judicial review judgment. In saying this, we are not to be taken as mandating this pragmatic approach. Rather we raise it as an alternative solution. It is for the Commissioner to choose whether or not he wishes to adopt this pragmatic approach.[12] Mr Brighty deposes the Commissioner elected to adopt the Court of Appeal'ssuggestion of a 15 percent reduction in overall penalties and interest as reasonable with some additional measures in favour of the taxpayers. He used the debt figures which had been before the Court of Appeal as the basis for making adjustments.[13] The Department on 27 July 2012 notified Chesterfields of its calculations. The letter explained the 15 percent reduction applied to penalties and interest (other than shortfall penalties). Additionally, no further penalty or interest was accumulated after July 2008. The Commissioner arrived at a debt figure for collection of $1,199.835.11. The calculation was:Debt owing as per the schedules of July 2008 1,467,585.23Less a 15% reduction 197,472.03 197,472.03 ____________Subtotal still due 1,270,113.20Less default assessments 70,278.09 ____________Amount for recovery action 1,199,835.118 Citations omitted.[14] Mr Hampton was asked to provide any comments on the Commissioner'sapproach by 17 August 2012.9[15] Mr Hampton promptly replied to the Department on behalf of Chesterfieldsand Anolbe. He declined what he described as the Commissioner's "settlement offer". He traversed issues relating to the Commissioner's and the Department's conduct, indicating that his entities were "conscientiously pursuing the mal-administration proceedings". He stated that the taxpayers' focus for their limitedresources was on the costs of achieving legal redress and resolution of those complaints. He sought a discussion to settle the taxpayers' complaints.[16] The Department promptly responded by letter stating:(a) Rather than making a "settlement offer", the Commissioner had setout the way she proposed to comply with the Court of Appealjudgment, with Mr Hampton's comments invited on that proposedapproach.(b) The Commissioner's focus was on the tax assessment and particularlythe remission of penalties.(c) If Mr Hampton did not respond specifically to the proposed approach to remission of penalties, the Commissioner would implement her earlier proposal and would recommence debt recovery proceedings against Chesterfield.[17] Mr Hampton did not respond to that letter.[18] The Commissioner, upon the lifting of the stay of enforcement intended to rely upon her original (2004) statutory demand against Chesterfields and Anolbe which those companies had at the time applied to have set aside. On reflection the9 A parallel letter was sent on the same day to Mr Hampton regarding Anolbe in relation to a smaller sum ($46,754.21). The Commissioner subsequently has successfully pursued liquidation proceedings against Anolbe.Commissioner preferred to recommence with "clean" statutory demands. The 2004 demands were withdrawn and the 2004 setting aside applications dismissed accordingly. New demands were issued.The present proceedingThe steps taken[19] The Commissioner's present application for an order putting Chesterfieldsinto liquidation rests on the presumption of insolvency created when Chesterfields failed to comply with a statutory demand for $1,231,940.11 issued by the Commissioner on 5 December 2014.[20] The statutory demand was for two sets of sums. First, it demanded payment of the $1,199,835.11 as calculated and explained in the Department's 27 July 2012letter. Secondly, it demanded costs of $32,105.00 owing on three Court judgments.[21] After the Commissioner commenced this proceeding, Mr Hampton, on behalf of Chesterfields, obtained adjournment of the proceeding while he sought legal representation for the defendants and a release of frozen funds for that purpose.[22] Mr Hampton then purported to file an application for an order to restrain advertising and to stay further proceedings in relation to the liquidation. The Court did not accept that application as Mr Hampton did not have leave to represent the company. The liquidation application was allocated a hearing on Mr Hampton'sindication that Chesterfields intended to file a Defence. He also intended to pursue an application for a stay of the proceeding.[23] The Commissioner, in accordance with the Court's direction, advertised theproceeding in April 2015. Apparently unaware that part of the advertising had already taken place and the remainder was in train, Mr Hampton filed a synopsis of submissions in support of the (invalid) application for orders restraining advertising and staying the liquidation proceeding. The synopsis in itself contained a further application by Mr Hampton to appear on behalf of Chesterfields. Although I had directed that any application to represent Chesterfields would have to be filed andaccompanied by a draft statement of defence by 20 April 2015, Mr Hampton did not then file a draft defence.[24] Mr Kinsler, counsel for the Commissioner, in accordance with the timetable, filed a synopsis of his submissions in late April 2015 in the absence of any defence.[25] Chesterfields then filed an application for leave to file a statement of defence out of time. The application is dated 15 June 2015 but was in fact filed on 17 June 2015, the day before the liquidation hearing. The application was filed by solicitors now acting for Chesterfields, who were in turn instructing Mr Weaver, counsel for Chesterfields. The application was supported by an affidavit of Mr Hampton sworn 15 June 2015. At the same time Mr Weaver provided a synopsis of submissions.The application for leave to file defence out of time[26] At the hearing, I reserved my decision on Chesterfields' application to file a defence out of time.[27] The defence was grossly out of time in that it was filed on the eve of the substantive hearing (although, I understand, served two days earlier). The failure was the worse because submissions in support of the defence (and application for leave) were also not filed until that time.[28] As against those considerations, the Court takes into account that, through the freezing of its funds and subsequent need to free up funds, Chesterfields struggled to find representation.The liquidation application[29] Chesterfields asserted four grounds of defence:(a) it is solvent;(b) the amount the Commissioner claims is not an assessment of tax and is not payable by Chesterfields;(c) the amount the Commissioner claims is disputed; and(d) there remain outstanding issues between the Commissioner and Chesterfields as to liability which require the intervention of the Court.The issuesIssue 1: Insolvency[30] I do not find there to be a serious issue as to Chesterfields' insolvency. Thecompany is presumed to be unable to pay its debts because it failed to meet (orrespond at all) to the Commissioner's statutory demand.10[31] By his affidavit Mr Hampton referred to financial details under a heading"Solvency of CPL". The details do not establish that Chesterfields, taking into account the debt to the Commissioner, is solvent, either in a balance sheet or a cashflow sense.[32] While Mr Weaver for Chesterfields submitted that the company is "balance sheet solvent", that conclusion appears to have been reached by ignoring the core debt to the Commissioner. The submission also fails to address the fact that Chesterfields is plainly insolvent on a cashflow basis, in that it is unable to meet such expenses as the interest which will be accruing on the debt to the Commissioner.[33] In any event Chesterfields is presumed to be unable to meet its debts unless the contrary is proved, which it has not been.Issue 2: Assessment[34] Chesterfield's second ground of defence, namely that the amount claimed bythe Commissioner as payable is not an assessment of tax, was further explained by Mr Weaver in his submissions. Mr Weaver submitted that the Commissioner is not10 Companies Act 1993, s 287.entitled to rely on the letter of 27 July 2012 as constituting an assessment of liability for either GST or income tax.[35] Mr Weaver referred to case law dealing with the concept of "assessment".11The short point of Mr Weaver's submission is encapsulated in two sentences from the judgment of Richardson J in Commissioner of Inland Revenue v Canterbury Frozen Meat Co Ltd.12 In discussing how, under the Income Tax Act 1976, an assessment was made which determined the indebtedness of a taxpayer, his Honour stated:13It follows that a decision which is tentative or provisional or subject to adjustment or conditional does not reflect the statutory scheme. In short, to constitute an assessment for income tax purposes the decision of the Commissioner must be definitive as to the liability to taxpayer at the time it is made and final subject only to challenge through the objection process.[36] Mr Weaver submitted that the Department's 27 July 2012 letter contained aproposal which was tentative, provisional and subject to amendment. He submitted, therefore, that the letter could not be treated as an assessment of tax for which the taxpayer is liable.[37] This ground of defence proceeds on a misunderstanding as to the purpose and function of the 27 July 2012 letter and the calculations which are therein summarised. Mr Kinsler for the Commissioner succinctly summarised the point by noting that the 27 July 2012 letter is not an assessment.[38] The unpaid tax debts date back to the period 2000 to 2003 (for GST) and 1997 to 2003 (for income tax). The last GST payment on account was received by the Commissioner in June 2004 and the last income tax payment on account was received in July 2000. The core tax liabilities were a combination of self-assessed debt (by Chesterfields) and reassessed debts (by the Commissioner). The core tax had all been assessed.11 JD and CE Henson Partnership v Commissioner of Inland Revenue [2009] NZCA 423,(2009) 24 NZTC 23, 802 at [19] – [22]; Golden Bay Cement Co Ltd v Commissioner of Inland Revenue [1995] 3 NZLR 475 (HC) at 483; Commissioner of Inland Revenue v Canterbury Frozen Meat Co Ltd [1994] 2 NZLR 681 (CA) at 690.12 Commissioner of Inland Revenue v Canterbury Frozen Meat Co Ltd, above n 11.13 At 690.[39] The position is explained in an affidavit of Mr Lieuwe Doubleday, a Senior Investigator of Large Enterprises within the Department. He explained the function of the 27 July 2012 letter:The Commissioner issued statements of account setting out the core tax assessed and penalties and interest accruing to the tax account of the company. The penalties and interest arise by operation of law calculated by reference to core tax assessments. The assessments in this case pre-date the judicial review proceedings.[40] Mr Doubleday then notes that the judicial review proceedings did not challenge the existing assessments. That Mr Doubleday's evidence correctly reflectsthe position in the light of Court of Appeal judgment can be seen in the observations of the Court which I have quoted concerning the stay that "these penalties relate to core tax which is not under dispute".14[41] Accordingly, there is no validity in the proposition that Chesterfields has a defence by reason of 27 July 2012 letter not being an assessment. It was not intended to be and does not have that function.[42] The Commissioner is entitled to rely on the pre-existing assessments.Issue 3: A dispute as to the amount claimed[43] As a further ground of defence, Chesterfields asserts that the amount claimed by the Commissioner is disputed.[44] I first note that the context of the discussion is not in relation to the settingaside of a statutory demand, but in relation to an application for Chesterfields'liquidation. The central remaining issue in the present context is whether the Commissioner is a creditor for a substantial sum, (such that the defendant is unable to pay by reason of its insolvency).[45] The decision of the Court of Appeal in Bateman Television Ltd v Coleridge Finance Company Ltd binds this Court and continues to be good authority.15 In that14 Court of Appeal Decision, above n 2, at [6] and n 7.15 Bateman Television Ltd v Coleridge Finance Company Ltd [1969] NZLR 794 (CA), affirmed inBateman Television Ltd (in liq) v Coleridge Finance Company Ltd [1971] NZLR 929 (PC).case the Court dismissed appeals in relation to the orders for the winding up of twocompanies. In dealing with submissions of appellants' counsel as to an inaccurateaccounting of payments of dealings as between creditor and debtor, McCarthy J observed:16It is true that, normally speaking, the procedure of petition for a winding-up order is not a satisfactory one to dispose of the question whether a particular debt is or is not owing; but there is authority and not a little of it, to the effect that though there might be a bona fide dispute concerning the precise indebtedness of the debtor, it is patent that there is sufficient owing to found a petition and that the company is insolvent, an order will be made.[46] The Court of Appeal adopted this approach in Anglian Sales Ltd v South Pacific Manufacturing Co Ltd.17 In both cases, the Court of Appeal referred to the judgment of Plowman J in Re Tweeds Garages Ltd.18 His Lordship rejected an argument that there was a valid defence, not only where there was a dispute as to the existence of the debt, but also where there was a dispute as to the amount of the debt. Upon review of authority, his Lordship concluded:19In my judgment, where there is no doubt (and there is none here) that the petitioner is a creditor for a sum which would otherwise entitle him to a winding-up order, a dispute as to the precise sum which is owed to him is not of itself a sufficient answer to his petition.[47] In this case, Mr Hampton, in response to the Commissioner's recalculations and the statutory demand process, has not proposed any arrangement as to payment of what was accepted by Mr Hampton personally in the Court of Appeal as the undisputed core debt. Instead, his responses indicate that he requires some form of settlement of intended cross claims, either before payment of outstanding tax, or to be brought into account as some form of set-off.[48] The way in which Mr Hampton presented the taxpayers' case in the Court of Appeal and the findings of the Court itself, are a complete answer to the present assertion of a dispute by way of defence. There are at least three aspects to this:16 At 819 – 820.17 Anglian Sales Ltd v South Pacific Manufacturing Co Ltd [1984] 2 NZLR 249 (CA) at 251.18 Re Tweeds Garages Ltd [1962] Ch 406 (Ch).19 At 414.(a) The ground of defence raised – that the amount claimed in the statutory demand is disputed – is of itself an insufficient defence in terms of the authorities I have cited.(b) The taxpayers conducted themselves in the judicial review proceedings, including through their appeal, upon the basis that the core tax was not under dispute, and should not be permitted to resile from that position.(c) The judgment of the Court of Appeal expressly recognising that the Commissioner should be able to collect immediately at the least the core tax owing and some portion of the associated penalties, is a binding conclusion, pursuant to which this Court has lifted the stay which previously operated to prevent debt collection.[49] Accordingly, the amount indisputably owed by Chesterfields must, on any approach, be substantial. The expectation of the Court of Appeal was that an appropriate outcome would be that the taxpayers meet core tax together with 85 per cent of accrued penalties. This reflects the 15 per cent reduction of penalties.Issue 4: Outstanding issues between the Commissioner and Chesterfields[50] Chesterfields says that pending the resolution of a taxation review authority proceeding, it ought not to be put into liquidation by reason of the tax liabilities which were the subject of the Court of Appeal hearing.[51] In his synopsis, Mr Weaver identified this submission in a single paragraph:The TRA proceeding was not consolidated with the Judicial Review and was not heard following the first Judicial Review – remains on foot. The legal effect is that ... the tax liability of CPL is deferred pursuant to s 138I of the Tax Administration Act [1994].[52] A brief history of what Chesterfields says is the outstanding TRA proceeding is identified in an affidavit provided by Mr Hampton, who refers to a claim filed in the TRA in January 2005. In the claim Chesterfields sought to challenge assessments (outside the relevant response period) on the grounds that the Department had misconducted itself over a period of 10 years by failing to make fulland frank disclosure to Chesterfields and others concerning matters of their tax administration. In September 2005, in timetabling matters for the first judicial review hearing, Fogarty J directed that the judicial review application would be heard first followed by the TRA claim.20[53] There then followed not only the first judicial review proceeding but thesecond judicial review proceeding and appeals. Chesterfields' case is that with the current judicial review process having come to an end, its TRA claim now needs to be resuscitated and determined. Chesterfields invokes s 138I of the Tax Administration Act 1994.[54] For the Commissioner, Mr Shamy submits that, regardless of the way inwhich the TRA proceeding may have been "parked", the decisive answer to thisground of defence lies in the law of res judicata.[55] The authors of Spencer Bower and Handley: Res Judicata, identify the elements of what they refer to as "res judicata estoppel", a term which covers bothcause of action estoppel and issue estoppel.21 The elements, as accepted by the Court of Appeal, are:22(a) the decision was judicial in the relevant sense;(b) it was in fact pronounced;(c) the Tribunal had jurisdiction over the parties in the subject-matter;(d) the decision was –(i) final, and(ii) on the merits;(e) it determined the same question as that raised in the later litigation; and20 Chesterfields Preschools Ltd v Commissioner of Inland Revenue (2005) 22 NZTC 19,500 (HC).21 KR Handley (ed) Spencer Bower and Handley: Res Judicata (4th ed, LexisNexis, London, 2009).22 Adopted by the Court of Appeal in Chean v De Alwis [2010] NZCA 30 at [21].(f) the parties to the later litigation were either parties to the earlier litigation or their privies, or the earlier decision was in rem.23[56] I accept Mr Shamy's submission that the doctrine of res judicata precludes Chesterfields (and the other taxpayers) from resuscitating the "parked" TRA claim.The Court of Appeal extensively reviewed the events which led to both the first and second judicial review judgments. Given the issue of res judicata which now arises, it is a notable feature of the judgment of Glazebrook and Chambers JJ in the Court of Appeal that their Honours applied the doctrine of res judicata to the first judicial review judgment.24 As well as citing Spencer Bower and Handley: Res Judicata, their Honours adopted classic statements of the House of Lords in Lockyer v Ferryman:25... it is in the interests of the State that there should be an end to litigation and [that] hardship [would be caused] an individual should he be vexed twice for the same cause; [57] And Millett J in Crown Estate Commissioners v Dorset County Council, who observed the doctrine:26... [the doctrine] gives effect to the policy of the law that the parties to a judicial decision should not afterwards be allowed to re-litigate the same question even though the decision may be wrong.[58] By the first judicial review judgment the Commissioner was required toreconsider the taxpayers' affairs having regard to the in-substance arrangementswhich Fogarty J found to have existed. The taxpayers' complaints of delay andmaladministration to that date were to be addressed. The Court of Appeal found that the doctrine of res judicata applied, thereby binding both the Commissioner and the taxpayers to that outcome.[59] By the second judicial review judgment, Fogarty J found two main errors in the Departmental response to the first judicial review judgment, being the failure to recognise the in-substance continuation of an earlier arrangement (called the23 KR Handley Spencer Bower and Handley: Res Judicata (4th ed, LexisNexis, London, 2009) at [1.02].24 Court of Appeal Decision, above n 2, at [4].25 At [4], citing Lockyer v Ferryman (1877) 2 App Cas 519 (HC) at 530.26 At [4], citing Crown Estate Commissioners v Dorset County Council [1990] Ch 297 (Ch) at 305."Thornley arrangement") and a failure to remit further penalties in light of theconduct of the Departmental officers. The Court of Appeal summarised this aspect of the judgment:27The Commissioner was redirected to act upon the first judicial reviewjudgment and to reconsider the matters in accordance with the High Court'sdirections in that judgment, being bound to the reasons of both the first and second judicial review judgments.[60] The Court of Appeal dismissed the Commissioner's appeal from these aspectsof the second judicial review judgment. Thereby the Commissioner was required to reconsider the write-off of penalties.[61] The Court of Appeal recognised that an intricate assessment of the historical points of delay and responsibility would involve a "laborious process of consideration".28 The Court, while not requiring the Commissioner to undertake a"pragmatic approach" implicitly approved such a pragmatic approach as an alternative solution, holding:29It is for the Commissioner to choose whether or not he wishes to adopt this pragmatic approach.[62] It was in that context that Glazebrook and Chambers JJ observed that in their view, a reduction of 15 per cent in penalties would more than fulfil the requirements of the first judicial review judgment.[63] The background lay in the two judicial review judgments and of the three day Court of Appeal hearing. It is inescapable that the range of taxpayers' grievances which the Court required the Commissioner to take into account in reconsidering penalties had been finally identified. Otherwise Glazebrook and Chambers JJ would not have expressed a view as to what level of remission would adequately reflect theimpact of the Commissioner's and Departmental conduct. The Commissioner was to exercise his statutory responsibility to consider remission taking those matters into account.27 At [109](d).28 At [99].29 At [93].[64] Upon the basis of that process, the Court of Appeal went so far as to recognise the finality which would now attach to the core tax liability and some portion of the associated penalties by observing that the Commissioner should now be able to collect those immediately.30 While the Court of Appeal necessarily left the process of lifting the stay to the High Court, Glazebrook and Chambers JJ again noted their expectation that, upon the calculations being provided to the High Court, the stay would be lifted so as to allow the Commissioner to effect immediate collection of the undisputed core tax and some associated penalties.31[65] All this indicates an expectation of finality. The elements required for anissue estoppel are met. There is no merit in Mr Hampton's implicit suggestion thatthere remained room for the expectation on the part of any party that a remedy forsome aspect of the Commissioner's or Departmental earlier conduct should now, through TRA processes be addressed and somehow taken into account.Conclusion[66] By reason of the conclusions I have reached, it is unnecessary that the Court embark upon an investigation into the precise level of Chesterfields' liability. In the circumstances, the existence of a substantial, indisputable debt entitles the Commissioner to the order of liquidation which she seeks.[67] The just course is that Chesterfields be put into liquidation. This gives effect to the expectation of the Court of Appeal that the Commissioner would be able to proceed to exercise her rights in relation to the indisputable portion. Upon liquidation, if it is in the company's interests that further analysis be undertaken or discussion had with the Department, that decision appropriately will be made by the liquidators.30 At [146].31 At [147].Application for stay and to the defence out of time[68] In light of the above conclusions, Chesterfields' applications for a stay ofproceedings and for leave to file a defence out of time fall away. Neither a stay nor leave would be appropriate.Orders[69] I order:(a) The defendant's application for a stay of proceedings is dismissed.(b) The defendant's application for leave to file a statement of defence outof time is dismissed.(c) Chesterfields Preschools Limited is put into liquidation.(d) The liquidators shall be Malcolm Grant Hollis and Jeremy Michael Morley.(e) The liquidators' remuneration is approved in accordance with theircertificates dated 14 and 15 May 2015, subject to s 284 of the Companies Act 1993.(f) The liquidators are allowed to exercise their powers individually pursuant to s 242 of the Companies Act 1993.(g) The plaintiff shall have costs on a 2B basis to be approved by the Registrar, including a certificate for second counsel.[70] This Order is timed at 4.00 pm.Associate Judge OsborneSolicitors:Crown Law, Wellington (S Kinsler)P J Shamy, ChristchurchThe Insolvency and Trustee Service, Christchurch (G Slevin)D P Weaver, Barrister, Tauranga