CHERRY AND ORS V HUDSON AND ANOR HC AK CIV 2008-404-002767

CHERRY AND ORS V HUDSON AND ANOR HC AK CIV 2008-404-002767

The court declined to vary the restraint orders because the evidence did not show the Ferrari lease was within Grey Lynn's ordinary course of business, Grey Lynn was in technical default on mortgage and lease obligations, the lease produced no asset for the company and principally benefited a director, and allowing...

Source-derived case information.

Citation
openlaw-89cdb50c_178d_4b3e_afba_84bcba82f2e3.pdf
Parties
First Plaintiff: DARRYN PAUL CHERRY; Second Plaintiff: KEITH SHEFFIELD; Third Plaintiff: RACHAEL JANE MEAKINS; Fourth Plaintiff: WANE GORDON CHERRY; First Defendant: BRIAN LESLIE HUDSON; Second Defendant: CITY RENTALS TRUSTEES LIMITED; Third Defendant: CITY PROPERTY HOLDINGS LIMITED; Fourth Defendant: CITY PROPERTY INVESTMENT GROUP LIMITED; Fifth Defendant: CHERRY INVESTMENTS LIMITED; Sixth Defendant: KB INVESTMENT COMPANY LIMITED; Seventh Defendant: 53 GREENLANE ROAD LIMITED; Eighth Defendant: 42 WESTEND ROAD LIMITED; Ninth Defendant: RONALD GORDON LESLIE HUDSON; Tenth Defendant: STUART FRANCIS CLARKE; Eleventh Defendant: CK ACCOUNTANTS LIMITED
Court
High Court
Jurisdiction
New Zealand
Judgment Date
9 July 2008
Procedural Posture
Companies Act 1993 / Interlocutory
Outcome
Application to vary orders refused; payments under the Ferrari lease are not payments in the ordinary course of business; plaintiffs awarded costs for the 23 June hearing, quantum reserved.
Legal Topics
Interim Injunction, Ordinary Course of Business, Asset Preservation, Repossession, Default Interest
Company Law Contract Injunctions Commercial Law Property/leasing Interim Injunction Ordinary Course of Business Asset Preservation +2 more

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Parties

DARRYN PAUL CHERRY

First Plaintiff

KEITH SHEFFIELD

Second Plaintiff

RACHAEL JANE MEAKINS

Third Plaintiff

WANE GORDON CHERRY

Fourth Plaintiff

BRIAN LESLIE HUDSON

First Defendant

CITY RENTALS TRUSTEES LIMITED

Second Defendant

CITY PROPERTY HOLDINGS LIMITED

Third Defendant

CITY PROPERTY INVESTMENT GROUP LIMITED

Fourth Defendant

CHERRY INVESTMENTS LIMITED

Fifth Defendant

KB INVESTMENT COMPANY LIMITED

Sixth Defendant

53 GREENLANE ROAD LIMITED

Seventh Defendant

42 WESTEND ROAD LIMITED

Eighth Defendant

RONALD GORDON LESLIE HUDSON

Ninth Defendant

STUART FRANCIS CLARKE

Tenth Defendant

CK ACCOUNTANTS LIMITED

Eleventh Defendant

Procedural Posture

Companies Act 1993 / Interlocutory

Legal Issues

  1. 1 Whether payments under the Ferrari lease fall within the ordinary course of business so as to permit variation of restraint orders
  2. 2 Whether permitting payments avoids crystallisation of a larger immediate debt and prejudice to parties
  3. 3 Whether the lease agreement is commercially justified and benefits the company

Ratio Decidendi

The court declined to vary the restraint orders because the evidence did not show the Ferrari lease was within Grey Lynn's ordinary course of business, Grey Lynn was in technical default on mortgage and lease obligations, the lease produced no asset for the company and principally benefited a director, and allowing payments would not be appropriate given those facts.

Court Disposition

Application to vary orders refused; payments under the Ferrari lease are not payments in the ordinary course of business; plaintiffs awarded costs for the 23 June hearing, quantum reserved.

Orders

  • Application to vary interim orders refused
  • Payments relating to the lease by Grey Lynn Lodge Limited of the Ferrari motor vehicle registration no. CZF 999 are not payments in the ordinary course of business of Grey Lynn Lodge Limited or its parent or related companies