SERVCORP LTD v PILLAY [2018] NZHC 3208
Where an applicant proves a good arguable case, identifiable assets in jurisdiction and a real risk of dissipation, the Court may grant without‑notice freezing and ancillary disclosure orders; those conditions were satisfied on the evidence of alleged fraudulent transfers by the respondent and orders were justified...
Source-derived case information.
- Citation
- [2018] NZHC 3208
- Parties
- First Applicant: Servcorp Limited; Second Applicant: Servcorp New Zealand Limited; First Respondent: Vinesh Pillay; Second Respondent: Holder of bank account with Westpac Banking Corporation bearing number 0254163 or 2541630, BSB 031 322
- Court
- High Court
- Jurisdiction
- New Zealand
- Judgment Date
- 6 December 2018
- Procedural Posture
- Freezing Order Application Under Part 32 High Court Rules / Interim Without‑notice Orders Granted
- Outcome
- Freezing and ancillary orders granted without notice under Part 32 of the High Court Rules
- Legal Topics
- Freezing Order, Ancillary Disclosure Orders, Without‑notice Relief, Asset Preservation, Fraudulent Transfer
Source-derived case record
Summary, issues, holding and outcome
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Parties
Servcorp Limited
First Applicant
Servcorp New Zealand Limited
Second Applicant
Vinesh Pillay
First Respondent
Holder of bank account with Westpac Banking Corporation bearing number 0254163 or 2541630, BSB 031 322
Second Respondent
Procedural Posture
Freezing Order Application Under Part 32 High Court Rules / Interim Without‑notice Orders Granted
Legal Issues
- 1 Whether applicants have a good arguable case for substantive relief
- 2 Whether there are assets in New Zealand to which a freezing order can apply
- 3 Whether there is a real risk of dissipation if orders are not granted without notice
Ratio Decidendi
Where an applicant proves a good arguable case, identifiable assets in jurisdiction and a real risk of dissipation, the Court may grant without‑notice freezing and ancillary disclosure orders; those conditions were satisfied on the evidence of alleged fraudulent transfers by the respondent and orders were justified to preserve assets and obtain information.
Court Disposition
Freezing and ancillary orders granted without notice under Part 32 of the High Court Rules
Orders
- Freezing and ancillary orders granted as sought
- Prohibition on respondents dealing with their assets in New Zealand
Full Case Text
Judgment text and source record
1 paragraphs
SERVCORP LTD v PILLAY [2018] NZHC 3208 [6 December 2018]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2018-404-2679[2018] NZHC 3208UNDER Part 32 of the High Court RulesBETWEEN SERVCORP LIMITEDFirst ApplicantSERVCORP NEW ZEALAND LIMITEDSecond ApplicantAND VINESH PILLAYFirst RespondentHOLDER OF BANK ACCOUNT WITHWESTPAC BANKING CORPORATION INNEW ZEALAND BEARING NUMBER0254163 or 2541630, BSB 031 322Second RespondentHearing: On the papersCounsel: M D Arthur and J Marcetic for ApplicantsJudgment: 6 December 2018JUDGMENT OF PALMER JThis judgment is delivered by me on 6 December 2018 at 4.30pmpursuant to r 11.5 of the High Court Rules......................................................Registrar / Deputy RegistrarSolicitors:Chapman Tripp, Auckland[1] Servcorp Ltd and Servcorp New Zealand Ltd apply, without notice, forfreezing and ancillary orders against Mr Vinesh Pillay and the unidentified holder ofa Westpac bank account.[2] Evidence of the grounds for the application is contained in affidavits of MrAnton Clowes, the Chief Financial Officer of the applicants, and Mr Johnathon de laHodye, a solicitor acting for the applicants in proceedings against Mr Pillay in theSupreme Court of New South Wales.[3] In summary, Mr Pillay has been employed as an accountant by Servcorp Ltdsince January 2018. He is responsible for making payments from an ANZ NewZealand bank account to third parties in New Zealand. On 29 November 2018,representatives of the applicants were informed by ANZ of a number of suspiciouspayments made over an eight-month period to the identified bank account. Internalinvestigations suggested Mr Pillay fraudulently caused $808,454.17 to be transferredfrom the applicants to the bank account. This involved him: re-presenting for approvalinvoices issued by third parties that had already been paid; modifying invoices andcorrespondence so payment could be approved to the bank account; and manipulatingthe general ledger to cover up the double payments.[4] The orders sought would: prohibit the respondents from dealing with theirassets in New Zealand; require Mr Pillay to confirm within 15 days whether he is theholder of the bank account and, if not, identify who is; and require him to set out thenature, extent and value of his assets in New Zealand.[5] To obtain freezing orders, an applicant must satisfy the Court he or she has agood arguable case for substantive relief, there are assets to which the order can applyand there is a real risk of their dissipation.1 The Court must weigh the overall interestsof justice. A good arguable case requires "the allegations in the proposed claim arecapable of tenable argument and are supported by sufficient evidence, bearing in mindthe early stage at which the application is likely to be brought".2 Ancillary orders,1 Shaw v Narain [1992] 2 NZLR 544 (CA) at 548; High Court Rules 2016, r 32.5(4).2 Hannay v Mount [2011] NZCA 530 at [22].including for eliciting information relevant to the freezing order, may be made underr 32.3.[6] I am satisfied it is appropriate for the orders to be made without notice asservice could well trigger rapid dissipation of the assets. I am satisfied the applicantshave a good arguable case for substantive relief, there are assets to which the ordercan apply and there is a real risk of their dissipation. The allegations are capable oftenable argument and are supported by sufficient evidence. I am satisfied the otherrequirements of the High Court Rules 2016 are met.[7] I am satisfied the application for freezing orders and ancillary orders should begranted as sought. I so order, under part 32 of the Rules. I direct:(a) Under r 32.7, the orders expire on 7 February 2019.(b) The applicants may apply, on notice, for renewal of the orders beforethey expire.(c) The orders, and this judgment, must be served on the respondents assoon as practicable.(d) I grant leave for any party affected by the orders to apply to dischargeor vary them on three working days' notice to the other parties.(e) The applicants must file a memorandum updating the Court ondevelopments by 1 February 2019. The proceeding will then be calledin a duty judge list in the week of 4 February 2019.Palmer J