SHELL NEW ZEALAND LIMITED V THURSTON GROUP OF COMPANIES LIMITED HC WN CIV-2009-485-1437

SHELL NEW ZEALAND LIMITED V THURSTON GROUP OF COMPANIES LIMITED HC WN CIV-2009- 485-1437 21 September 2009IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY CIV-2009-485-1437BETWEEN SHELL NEW ZEALAND LIMITED Plaintiff AND THURSTON GROUP OF COMPANIES LIMITED (FORMERLY THURLINE GROUP OF COMPANIES LIMITED AND THURSTON'S TOWING & SALVAGE LIMITED AND THURLINE TRANSPORT SERVICES LIMITED) Defendant Hearing: 21 September 2009 Appearances: K. Lakshman - Counsel for Plaintiff J. Tannahill - Counsel for Defendant Judgment: 21 September 2009ORAL JUDGMENT OF ASSOCIATE JUDGE D.I. GENDALLSolicitors: Buchanan Gray, Lawyers, PO Box 24057, Wellington[1] Before the Court is an application by the plaintiff to place the defendant company into liquidation. This is on the basis of an outstanding debt of $20,873.98 which relates to an amount claimed in a statutory demand served upon the defendant company over 3 months ago on 8 June 2009. [2] No formal opposition or defence to the current liquidation application is before the Court. That proceeding including the statement of claim was served upon the defendant company on 12 August 2009. Advertising of the proceeding took place in the Dominion Post on 4 September 2009 and the New Zealand Gazette on 3 September 2009. [3] When the matter was called before this Court on 14 September 2009 I granted a 1 week adjournment to today, 21 September 2009 and noted this was to be a final adjournment. [4] That adjournment for 1 week was over the objection of Mr. Tannahill who appeared then as counsel for the defendant. He sought an adjournment at that point of at least 2 weeks. [5] In a minute I issued at the call on 14 September 2009 I noted that fact and said that if the defendant company was as substantial as had appeared to be indicated to the Court, then the outstanding debt of some $20,000.00 to the plaintiff should be able to be cleared within the period of 1 week. [6] The matter was again called before me today, 21 September 2009. Mr. Tannahill again appeared as counsel for the defendant. Mr. Lakshman appeared as counsel for the plaintiff. Mr. Tannahill requested today that a further adjournment of another one week is sought on the basis that the company is hopeful that within that 1 week period it will be able to arrange the $20,000.00 odd to clear the plaintiff's debt. [7] From the bar, Mr. Tannahill indicated that the defendant company has three sections of land in Gracefield which it is suggested have a value of approximately $900,000.00. As I understand the position from Mr. Tannahill there is outstandingon mortgage over the titles to these properties some $500,000.00. Mr. Tannahill further indicated from the bar that the company owns approximately 40 vehicles all of which are heavily charged to a finance company, I understand, Marac. [8] Mr. Tannahill suggested further that in the past the director of the defendant company has effectively "buried his head in the sand" with respect to this matter in the hope that it might go away. That has proved understandably not to be the case. [9] Nevertheless, Mr. Tannahill before me today sought a further short adjournment of this matter on behalf of the defendant. [10] This was opposed by Mr. Lakshman for the plaintiff. Mr. Lakshman noted quite properly that this matter has been on foot for some time now and the debt outstanding to the plaintiff of $20,873.98 is a debt owing for product supplied on a Shell Card Account held by the defendant during the months of November 2008 and January 2009. This is a long outstanding debt. [11] In addition before me today, Mr. Tannahill, acknowledged that further proceedings seeking an order to place the defendant company into liquidation are scheduled to be before this Court in 1 week's time at the suit of BP Oil for a debt of some $7,000.00. Again Mr. Tannahill indicated that it is hoped that the defendant company will be able to settle that debt within the next 1 week period. [12] All of this presents what I see as a highly unsatisfactory situation. [13] The defendant company has placed no evidence before the Court of any sort as to its financial position. [14] Mr. Tannahill from the bar has helpfully provided information to the Court concerning his instructions as to the position of the defendant company but all of this is unsubstantiated by affidavit on behalf of the defendant. [15] That said, the debt outstanding to the plaintiff here, although significant, as I noted on 14 September 2009 should not have provided too much difficulty for a company of substance to settle. That has not occurred.[16] Under all the circumstances here, I am of the view that further delay in this matter would not assist the defendant company. As Mr. Tannahill indicated, the officers of that company have effectively "buried their heads in the sand" with regard to the company's outstanding debts. They have had ample opportunity to clear the current debt claimed by the plaintiff. That they have been unable to achieve this or to put before the Court any formal opposition to the present application or any verified details of their financial position must lead to the inevitable conclusion that the company is unable to pay its debts and is effectively insolvent. [17] That said an order to place the company into liquidation in my view is inevitable. [18] The following orders are therefore made: (a) An order is made placing the defendant company, Thurston Group of Companies Limited, into liquidation. (b) Christine Margaret Dunphy and Andrew Robert Croad are appointed liquidators. (c) Costs are awarded to the plaintiff on a Category 2B basis together with disbursements as fixed by the Registrar. (d) This order is timed at 10.43 am.'Associate Judge D.I. Gendall'