STEPHEN JOHN EDWARD PACK v ULTRA PROJECTS LIMITED (in liquidation) [2015] NZHC 940

STEPHEN JOHN EDWARD PACK v ULTRA PROJECTS LIMITED (in liquidation) [2015] NZHC 940

The Court refused to approve the proposal because the insolvent materially failed to disclose assets (notably a significant debt owing from the SS Pack Family Trust) making the statement of affairs inaccurate, the proposal was not reasonable nor calculated to benefit the general body of creditors given the...

Source-derived case information.

Citation
[2015] NZHC 940
Parties
Applicant: Stephen John Edward Pack; Objector: Ultra Projects Limited (in liquidation)
Court
High Court
Jurisdiction
New Zealand
Judgment Date
6 May 2015
Procedural Posture
Application for Court Approval of a Proposal Under Part 5 of the Insolvency Act 2006 / Hearing of Application Under S333 Following Creditors' Approval of Proposal
Outcome
Application for approval of the proposal refused
Legal Topics
Proposal Approval, Disclosure of Assets, Director Conduct, Secured Creditor Rights, Trust Assets, Public Interest in Insolvency
Insolvency Company Law Bankruptcy Civil Procedure Proposal Approval Disclosure of Assets Director Conduct Secured Creditor Rights +2 more

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Parties

Stephen John Edward Pack

Applicant

Ultra Projects Limited (in liquidation)

Objector

Procedural Posture

Application for Court Approval of a Proposal Under Part 5 of the Insolvency Act 2006 / Hearing of Application Under S333 Following Creditors' Approval of Proposal

Legal Issues

  1. 1 Whether the proposal provides for trustee's fees and expenses to be paid before other debts
  2. 2 Whether the insolvent's statement of affairs substantially disclosed assets, debts and liabilities
  3. 3 Whether creditor identity and particulars were properly disclosed

Ratio Decidendi

The Court refused to approve the proposal because the insolvent materially failed to disclose assets (notably a significant debt owing from the SS Pack Family Trust) making the statement of affairs inaccurate, the proposal was not reasonable nor calculated to benefit the general body of creditors given the negligible dividend and uncertainties over secured creditors' net positions, and approval was inexpedient in the public interest due to the applicant's pattern of director negligence and probable risk of repeating harmful conduct; the trustee fee defect was correctable but surplus to these decisive grounds.

Court Disposition

Application for approval of the proposal refused

Orders

  • Application for approval of the proposal is refused
  • Objector Ultra Projects Ltd (in liquidation) is awarded costs on a 2B basis with disbursements as fixed by the registrar