MOTORWORLD LTD (IN LIQUIDATION) AND ORS V MCGREGOR AND ORS HC AK CIV-2007-404-6558

MOTORWORLD LTD (IN LIQUIDATION) AND ORS V MCGREGOR AND ORS HC AK CIV-2007-404-6558

The Court dismissed the strike out applications: the pleadings (with existing particulars and further particulars to be supplied) disclose arguable causes of action in equity, under the Companies Act and the Fair Trading Act; fraud pleadings need precision but do not automatically require full prima facie evidence at strike out; affidavits are of limited use at strike out; certain particular discovery orders for personal bank statements were justified (Millar and McGregor subject to protections) while others were refused (Paterson, TAB); liquidators must provide actual transaction calculations for s297 claims though s298 pleadings may proceed on sampling at their risk.

Citation
openlaw-c43b1bcb_1df4_49b8_b8d9_901f52325a4c.pdf
Parties
First Plaintiff: Motorworld Limited (In Liquidation); Second Plaintiffs: Lloyd James Hayward and Karen Betty Mason; Third Plaintiff: Nichibo Japan Trading Company Limited; First Defendant: Alastair Robert Hardy McGregor; Second Defendant: Eric Leslie Kenneth Millar; Third Defendant: Harley John Paterson; Fourth Defendant: Queen City Autos Limited; Fifth Defendant: Freedom Wholesale Vehicles Limited; Sixth Defendant: Turners Auctions Limited
Court
High Court
Jurisdiction
New Zealand
Judgment Date
9 October 2008
Procedural Posture
Civil (commercial/insolvency/equity) / Interlocutory Application for Strike Out and Particular Discovery
Outcome
Strike out applications dismissed; partial orders for particular discovery made and specific amendments/particulars and disclosure directions given; costs reserved
Legal Topics
Knowing Receipt, Dishonest Assistance, Breach of Fiduciary Duty, S297 Companies Act 1993, S298 Companies Act 1993, S9 Fair Trading Act 1986, Conspiracy by Unlawful Means, Strike Out Applications, Particular Discovery
Company Law Insolvency Equity Tort Fair Trading Civil Procedure Knowing Receipt Dishonest Assistance +7 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 9 Party arguments 2
Sign in to unlock

Parties

Motorworld Limited (In Liquidation)

First Plaintiff

Lloyd James Hayward and Karen Betty Mason

Second Plaintiffs

Nichibo Japan Trading Company Limited

Third Plaintiff

Alastair Robert Hardy McGregor

First Defendant

Eric Leslie Kenneth Millar

Second Defendant

Harley John Paterson

Third Defendant

Queen City Autos Limited

Fourth Defendant

Freedom Wholesale Vehicles Limited

Fifth Defendant

Turners Auctions Limited

Sixth Defendant

Procedural Posture

Civil (commercial/insolvency/equity) / Interlocutory Application for Strike Out and Particular Discovery

Legal Issues

  1. 1 Whether the pleadings disclose arguable causes of action for knowing receipt and dishonest assistance
  2. 2 Whether fraud allegations require production of an evidential foundation at strike out stage
  3. 3 Whether sampling/extrapolation can be used to calculate losses under s297 and s298

Ratio Decidendi

The Court dismissed the strike out applications: the pleadings (with existing particulars and further particulars to be supplied) disclose arguable causes of action in equity, under the Companies Act and the Fair Trading Act; fraud pleadings need precision but do not automatically require full prima facie evidence at strike out; affidavits are of limited use at strike out; certain particular discovery orders for personal bank statements were justified (Millar and McGregor subject to protections) while others were refused (Paterson, TAB); liquidators must provide actual transaction calculations for s297 claims though s298 pleadings may proceed on sampling at their risk.

Court Disposition

Strike out applications dismissed; partial orders for particular discovery made and specific amendments/particulars and disclosure directions given; costs reserved

Orders

  • Strike out applications by second to fifth defendants dismissed
  • Motorworld to particularise paragraphs 49a and 50a to specify essential terms of alleged agreements/arrangements