THE OFFICIAL ASSIGNEE IN THE BANKRUPTCY OF CLARKSON V STEPHENS HC TAU CIV 2008-470-460
The s206 notice was properly served and no objection was lodged; the respondent failed to prove any of the s208 defences (good faith, reasonable person standard, or having given value/altered position); the gift was an insolvent transfer that prevented payment to creditors; accordingly the Court ordered...
Source-derived case information.
- Citation
- openlaw-11f88512_aba3_4a34_9008_bab5e3190770.pdf
- Parties
- Applicant: The Official Assignee in the Bankruptcy of Robert Clarkson; Respondent: Dorothy Alma Stephens
- Court
- Unknown Court
- Jurisdiction
- New Zealand
- Judgment Date
- 8 September 2008
- Procedural Posture
- Bankruptcy Proceeding Under the Insolvency Act 2006 / Application for Re Transfer Under S208 Following Service of a S206 Notice
- Outcome
- Order that the respondent pay funds to the Official Assignee and pay costs on a 2B basis plus disbursements.
- Legal Topics
- Irregular Transaction, Re Transfer Order, S206 Notice, S208 Defences, Insolvent Gift, Costs
Source-derived case record
Summary, issues, holding and outcome
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Parties
The Official Assignee in the Bankruptcy of Robert Clarkson
Applicant
Dorothy Alma Stephens
Respondent
Procedural Posture
Bankruptcy Proceeding Under the Insolvency Act 2006 / Application for Re Transfer Under S208 Following Service of a S206 Notice
Legal Issues
- 1 Whether the s206 notice cancelled the irregular transaction (gift)
- 2 Whether the respondent proved the s208 defences (good faith; reasonable person standard; value or alteration of position)
- 3 Whether the Court should order re-transfer/payment to the Official Assignee
Ratio Decidendi
The s206 notice was properly served and no objection was lodged; the respondent failed to prove any of the s208 defences (good faith, reasonable person standard, or having given value/altered position); the gift was an insolvent transfer that prevented payment to creditors; accordingly the Court ordered re-transfer/payment of the ordered amount to the Official Assignee and costs.
Court Disposition
Order that the respondent pay funds to the Official Assignee and pay costs on a 2B basis plus disbursements.
Orders
- Dorothy Alma Stephens is ordered to pay $165,500 to the Official Assignee by 5 p.m. on 22 September 2008.
- Respondent is to pay the costs of this application on a 2B basis together with disbursements as fixed by the Registrar.
Full Case Text
Judgment text and source record
1 paragraphs
THE OFFICIAL ASSIGNEE IN THE BANKRUPTCY OF CLARKSON V STEPHENS HC TAU CIV 2008- 470-460 8 September 2008IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY CIV 2008-470-460UNDER of the Insolvency Act 2006 IN THE MATTER OF of the Bankruptcy of ROBERT CLARKSON BETWEEN THE OFFICIAL ASSIGNEE IN THE BANKRUPTCY OF ROBERT CLARKSON Applicant AND DOROTHY ALMA STEPHENS Respondent Hearing: 8 September 2008 (Heard at Rotorua) Appearances: Mr Foote for the Applicant No appearance for Respondent Judgment: 8 September 2008ORAL JUDGMENT OF ASSOCIATE JUDGE DOOGUESolicitors:Anthony Harper Lawyers, 47 Cathedral Square, Christchurch – crispin.vinnell@ah.co.nzCopyO'Sullivan Clemens, Rotorua - law@osc.co.nz[1] I have read the notice of application dated 10 August 2008 and the affidavit of Robert Gordon McDonald sworn 18 August 2008. A notice has been served on Ms Stephens under s 206 and that had the effect that the irregular transaction, namely the gift of $165,000 which the bankrupt made to Ms Stephens in September 2007 was deemed to be cancelled unless the person on whom the Official Assignee served the notice under s 206 within 20 workings days had not submitted an objection. The only communication that has been received by the Official Assignee is the two page letter undated but date stamped as having been received 5 August 2008 by the Official Assignee. That letter does not state an objection. [2] As counsel points out the second step in the procedural sequence is that upon cancellation of an irregular transaction the Court may order the re-transfer to the Official Assignee of the property which is the subject of the insolvent transaction. Under s 208 the Court must not make an order for re-transfer of the property if the person against whom the order is sought proves: a) That they acted in good faith; b) That a reasonable person in their position would not have suspected that the bankrupt was insolvent and; c) The person receiving the property gave value for the property interest or altered their position in the reasonably held belief that the transfer of the property was valid and would not be cancelled. [3] Ms Stephens, the respondent has not proved any of these matters and therefore the way is clear for the Court to make the order sought. I agree with counsel that what occurred here was clearly an insolvent gift. The payment of the funds to Ms Stephens prevented Mr Clarkson from paying his creditors including Ashburton Finance Limited. I therefore order that Dorothy Alma Stephens is to paythe sum of $165,500 to the Official Assignee. The respondent is to comply with this order of the Court no later than 5 p.m. 22 September 2008 which will give her approximately 10 working days within which to arrange for the funds to be transferred. [4] I also direct that the respondent is to pay the costs of this application on a 2B basis together with disbursements as fixed by the Registrar. _____________ J.P. Doogue Associate Judge