VICTORIA STREET APARTMENTS LTD (IN LIQUIDATION) and ANOR v SHARMA and ORS HC AK CIV-2009-404-008377

VICTORIA STREET APARTMENTS LTD (IN LIQUIDATION) and ANOR v SHARMA and ORS HC AK CIV-2009-404-008377

The third party claim was dismissed because the pleaded and proved facts did not establish a common liability or common demand between the third party claimants and Mr Watt, the pleading was deficient as it did not put Mr Watt on notice of accessory or restitutionary liability, prior factual findings attributed knowing breaches to Mr Sharma (precluding reliance on mistake or direction by Mr Watt), the amounts actually traceable to Mr Watt were minimal, and equitable principles and public policy (unclean hands, attempts to evade bankruptcy constraints) disentitled the claimants to contribution.

Citation
openlaw-479f2c14_3977_4eb4_b1c0_fa7b6cf645aa.pdf
Parties
First Plaintiff: Victoria Street Apartments Limited (in liquidation); Second Plaintiff: Treasury Technology Distribution Limited; First Defendant: Suren Sharma; Second Defendant: Suren Sharma as trustee of the Sharma Family Trust No. 2; Third Defendant: Suren Sharma as trustee of the Sharma Family Trust; Fourth Defendant: Quay Street Apartments Limited; Fifth Defendant: Mutual Trust Properties Limited; Sixth Defendant: Mission Trustee One Limited; Sixth Defendant: Mission Trustee Two Limited; Third Party: Reginald James Watt
Court
High Court
Jurisdiction
New Zealand
Judgment Date
10 January 2012
Procedural Posture
Civil Third Party Claim for Equitable Contribution Arising From Fiduciary Breaches and Restitution / Judgment on Third Party Claim (final Judgment)
Outcome
Third party claims by Mr Sharma and the Sharma trusts against Reginald James Watt dismissed
Legal Topics
Equitable Contribution, Fiduciary Duty, Knowing Receipt, Dishonest Assistance, Tracing, Breach of Trust, Bankruptcy, Public Policy, Pleading Sufficiency
Equity Trusts Insolvency Restitution Civil Procedure Equitable Contribution Fiduciary Duty Knowing Receipt +6 more

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Parties

Victoria Street Apartments Limited (in liquidation)

First Plaintiff

Treasury Technology Distribution Limited

Second Plaintiff

Suren Sharma

First Defendant

Suren Sharma as trustee of the Sharma Family Trust No. 2

Second Defendant

Suren Sharma as trustee of the Sharma Family Trust

Third Defendant

Quay Street Apartments Limited

Fourth Defendant

Mutual Trust Properties Limited

Fifth Defendant

Mission Trustee One Limited

Sixth Defendant

Mission Trustee Two Limited

Sixth Defendant

Reginald James Watt

Third Party

Procedural Posture

Civil Third Party Claim for Equitable Contribution Arising From Fiduciary Breaches and Restitution / Judgment on Third Party Claim (final Judgment)

Legal Issues

  1. 1 Whether the third party claimants have an equitable right to contribution from Reginald Watt
  2. 2 Whether there is a common liability or common demand between the third party claimants and Mr Watt
  3. 3 Whether Mr Watt owed fiduciary or accessory liability to VSAL (dishonest assistance/knowing receipt) or held the funds so as to be subject to restitutionary claims

Ratio Decidendi

The third party claim was dismissed because the pleaded and proved facts did not establish a common liability or common demand between the third party claimants and Mr Watt, the pleading was deficient as it did not put Mr Watt on notice of accessory or restitutionary liability, prior factual findings attributed knowing breaches to Mr Sharma (precluding reliance on mistake or direction by Mr Watt), the amounts actually traceable to Mr Watt were minimal, and equitable principles and public policy (unclean hands, attempts to evade bankruptcy constraints) disentitled the claimants to contribution.

Court Disposition

Third party claims by Mr Sharma and the Sharma trusts against Reginald James Watt dismissed

Orders

  • The third party claims against Reginald James Watt are dismissed.