GERALD STANLEY REA AND PAUL GRAHAM SARGISON V NEIL ALBERT WOLFGRAM HC AK CIV 2008-404-005635

GERALD STANLEY REA AND PAUL GRAHAM SARGISON V NEIL ALBERT WOLFGRAM HC AK CIV 2008-404-005635

Court concluded on available evidence that Claybrook was insolvent in August 2007, payments fell within the restricted period and the respondent failed to rebut the statutory presumption or prove the payments were in the ordinary course of business or part of an integral continuing business relationship under s292(4B); therefore the payments were voidable and must be repaid to the liquidators.

Citation
openlaw-db921ec4_d52c_4a58_bea8_998782721edb.pdf
Parties
Applicant (liquidator): Gerald Stanley Rea; Applicant (liquidator): Paul Graham Sargison; Respondent: Neil Albert Wolfgram
Court
High Court
Jurisdiction
New Zealand
Judgment Date
21 August 2009
Procedural Posture
Application Under Companies Act 1993 to Set Aside Payments in Liquidation / Judgment on Application (decision Delivered)
Outcome
Liquidators' application granted; payments set aside and respondent ordered to repay $160,000 and to pay costs
Legal Topics
Voidable Transactions, Preferences, Ordinary Course of Business, Continuing Business Relationship, Set Aside Payments, Liquidator Remedies
Company Law Insolvency Law Voidable Transactions Preferences Ordinary Course of Business Continuing Business Relationship Set Aside Payments Liquidator Remedies

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Parties

Gerald Stanley Rea

Applicant (liquidator)

Paul Graham Sargison

Applicant (liquidator)

Neil Albert Wolfgram

Respondent

Procedural Posture

Application Under Companies Act 1993 to Set Aside Payments in Liquidation / Judgment on Application (decision Delivered)

Legal Issues

  1. 1 Whether Claybrook Enterprises Limited was insolvent when payments were made in August 2007
  2. 2 Whether the payments of $60,000, $80,000 and $20,000 were voidable under s292 Companies Act 1993
  3. 3 Whether the payments were made in the ordinary course of business

Ratio Decidendi

Court concluded on available evidence that Claybrook was insolvent in August 2007, payments fell within the restricted period and the respondent failed to rebut the statutory presumption or prove the payments were in the ordinary course of business or part of an integral continuing business relationship under s292(4B); therefore the payments were voidable and must be repaid to the liquidators.

Court Disposition

Liquidators' application granted; payments set aside and respondent ordered to repay $160,000 and to pay costs

Orders

  • Set aside the payments by Claybrook Enterprises Limited to N A Wolfgram of $60,000 on 8 August 2007, $80,000 on 30 August 2007 and $20,000 on 31 August 2007
  • Pursuant to s295(a) Companies Act 1993 respondent to pay $160,000 to the applicants (liquidators)