CPG NEW ZEALAND LIMITED V WHARIKI LIMITED HC WN CIV 2009-485-1040

CPG NEW ZEALAND LIMITED V WHARIKI LIMITED HC WN CIV 2009-485-1040 20 July 2009IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY CIV 2009-485-1040UNDER The Companies Act 1993 IN THE MATTER OF an application for liquidation of Whariki Limited BETWEEN CPG NEW ZEALAND LIMITED Plaintiff AND WHARIKI LIMITED Defendant Hearing: 20 July 2009 Appearances: C. Potter - Counsel for Plaintiff No Appearance - Defendant Judgment: 20 July 2009ORAL JUDGMENT OF ASSOCIATE JUDGE D.I. GENDALLSolicitors: Webb Farry, Solicitors, PO Box 5541, Dunedin[1] Before the Court is an application by the plaintiff seeking an order to place the defendant company into liquidation. [2] A statutory demand from the plaintiff was served upon the defendant on 31 March 2009 seeking payment of the sum of $16,059.88. The defendant did not respond to the statutory demand. [3] On 4 June 2009 the plaintiff filed its statement of claim seeking an order to place the defendant company into liquidation. [4] Those proceedings were advertised in the Dominion Post on 2 July 2009 and in the New Zealand Gazette on 2 July 2009. In addition the statement of claim and supporting documentation were served upon the defendant company on 16 June 2009. [5] This matter was called before me on 13 July 2009. No opposition to the application or statement of defence had been filed for the defendant company. Instead, Mr. Walbran, a director of the defendant company, appeared and sought an adjournment of this matter for 1 month. He informed the Court that the defendant company was intending to refinance debts which it had of some $2.5 million dollars by a $2 million dollar finance package and this would take approximately 1 month to put in place. He advised the Court that the assets of the company in his words were $1.79 million dollars. [6] The present debt in question owing to the plaintiff is $16,059.88. In view of the major amounts which Mr. Walbran indicated the defendant company was endeavouring to refinance and the substantial level of assets he contended the company had, on 13 July 2009, I adjourned this matter for only 1 week. I rejected his request for an adjournment for 1 month. In a Minute I issued on 13 July 2009 I set out the reasons for this, indicating that in light of the amount of the debt at issue here, it seemed clear that if the company was unable to satisfy this debt from some source or with some outside assistance then the large refinancing which Mr. Walbran indicated was underway must be in some doubt.[7] This matter was then called therefore before me today, 20 July 2009. [8] Ms. Potter for the plaintiff indicated that the debt of $16,059.88 was still outstanding. [9] Although there was no appearance for the defendant company the Court was handed photocopies of two documents from a third party which appeared to show that on 16 July 2009 the defendant company passed a special resolution of shareholders pursuant to s. 241(2)(a) Companies Act 1993 purporting to place itself into liquidation and appointing Bruce Frederick McCullough, a Business Consultant of Lower Hutt as liquidator. [10] Ms. Potter for the plaintiff was unaware that this shareholder's voluntary liquidation resolution had been passed on Thursday last, 16 July 2009. [11] She submitted to the Court that this purported appointment of Mr. McCullough as liquidator was invalid and should be set aside. [12] On this aspect, it is clear from s. 241AA Companies Act 1993 that once an application has been filed in this Court to appoint a liquidator of a company, a liquidator may only be appointed by Shareholders Resolution under s. 241(2)(a) of the Act if that liquidator is appointed within 10 working days after service on the company of that Court application by a creditor to place the company into liquidation. [13] In this case as I have noted, the present application to liquidate the defendant company was served on Tuesday, 16 June 2009. An affidavit of service of David John Clark confirming this was filed on 10 July 2009. This affidavit of service indeed states in para. 2: "2. I served the documents on the defendant company at 33 Regent Drive, Paraparaumu Beach, Paraparaumu by handing the documents to Warwick Walbran director of the defendant company at the registered address for service."[14] 10 working days after this date of service of 16 June 2009 is 30 June 2009. The Shareholders' Resolution and purporting to place the defendant company into liquidation was passed on 16 July 2009 which is outside this 10 working day period. [15] That said, the purported appointment of Mr. Bruce Frederick McCullough by special resolution of the shareholders of the company pursuant to s. 241(2)(a) Companies Act 1993 is invalid. An order is now made setting aside that appointment. [16] In its place Ms. Potter for the plaintiff seeks an order on the plaintiff's present application appointing the Official Assignee as liquidator. [17] That is appropriate. The application is effectively unopposed by the defendant company. [18] In addition there is no appearance before me today on behalf of the defendant company. [19] That said, the following orders are now made: (a) An order is made placing the defendant company Whariki Limited into liquidation. (b) The Official Assignee is appointed liquidator. (c) Costs are awarded to the plaintiff on a Category 2B basis together with disbursements as approved by the Registrar. (d) This order is timed today, 20 July 2009 at 10.39 am.'Associate Judge D.I. Gendall'