TIME3 GLOBAL LTD v NORRIE AS LIQUIDATOR OF PAKIRI INVESTMENTS LTD (IN LIQUIDATION) [2016] NZCA 400

TIME3 GLOBAL LTD v NORRIE AS LIQUIDATOR OF PAKIRI INVESTMENTS LTD (IN LIQUIDATION) [2016] NZCA 400 [17 August 2016]IN THE COURT OF APPEAL OF NEW ZEALANDCA341/2015[2016] NZCA 400BETWEEN TIME3 GLOBAL LIMITEDAppellantAND MARK HECTOR NORRIE ASLIQUIDATOR OF PAKIRIINVESTMENTS LIMITED(IN LIQUIDATION)RespondentHearing: 2 May 2016Court: Winkelmann, Simon France and Woolford JJCounsel: R B Hucker and J E Tomlinson for AppellantD M Hughes and H L Quinlan for RespondentJudgment: 17 August 2016 at 12.30 pmJUDGMENT OF THE COURTA The appeal is allowed.B The order that Time3 Global Ltd transfer back to Pakiri Investments Ltd (in liquidation) all property taken from it is quashed.C The cross-appeal is dismissed.D The respondent must pay the appellant costs for a standard appeal on a band B basis and usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Woolford J)Introduction[1] Time3 Global Ltd (Time3) appeals against a judgment of Associate Judge Christiansen in which an order was made under s 295 of the Companies Act 1993 directing the transfer back of certain intellectual property from Time3 to Pakiri Investments Ltd (in liquidation) (Pakiri).1 Pakiri cross-appeals against part of the judgment, namely, the finding that Time3 was not a creditor ofPakiri as well as the Associate Judge's failure to consider an order under s 298 for compensation for the transfer of the property at an undervalue.2[2] It is our view that the finding of the Associate Judge that Time3 was not a creditor of Pakiri was open to him on the evidence and is definitive on the appeal, inasmuch as an order under s 295 is not available in respect of transfers of property to non-creditors. The appeal must therefore be allowed. The cross-appeal is dismissed as the requirements for an order under s 298 are not met.Factual background[3] Pakiri is a New Zealand limited company which was incorporated on 3 August 2005. Mr Evan Read, a former director of Pakiri (between 1 September 2006 and 22 May 2010), explained the business of Pakiri and his involvement in it in an affidavit sworn on 25 September 2012 as follows:[4] Pakiri is a technology start up company and carries out research and development of a specific computer application software product which is hoped will revolutionise the way in which the Internet is accessed. It will provide an alternative to the World Wide Web. This research has been on-going for the past twelve years, and since 3 August 2005, the date of incorporation of Pakiri, has been carried out by Pakiri.[5] Pakiri does not trade and does not have a revenue stream. Pakiri raises money for its research and other activities, and to pay its debts as they fall due, from cash injections from investors who purchase shares in Pakiri from the Read Family Trust. It is my role to sell those shares and continue to raise capital for Pakiri.[4] In a business investment memorandum produced for the purpose of raising funds from investors, Pakiri confirmed that it had developed and owned the1 Norrie v Time3 Global Ltd [2015] NZHC 1097 at [147].2 At [86].intellectual and property rights in what it described as the Total Information Management Environment (TIME3) suite of software.[5] The appellant company, Time3, was formed pursuant to a joint venture agreement, dated 14 July 2011, between Pakiri and Globalnet Ltd (Globalnet) in terms of which Pakiri and Globalnet would each hold 50 million shares in Time3 with a nominal value of USD 1.00 each. It was acknowledged by both Globalnet and Time3 that Pakiri was the sole owner of all rights (including intellectual property rights) in the TIME3 software products. The agreement also provided that on or before 1 September 2011 Pakiri would execute a global licence for the marketing, operations and management of the TIME3 software products with Time3. Time3 would in turn pay USD 1.1 billion for the licence. This was to be recorded as a loanfrom Pakiri in Time3's accounts.[6] Globalnet was to pay for its 50 million shares of USD 1.00 each by a payment of USD 5 million on 1 August 2011, USD 15 million on 1 September 2011 and USD 10 million on each of 1 October 2011, 1 November 2011 and 1 December 2011. Pakiri was to pay for its 50 million shares by reducing the loan owed by Time3 (USD 1.1 billion) on 1 September 2011 by the amount of USD 50 million.[7] Mr Igor Sutich, a director of Pakiri (from 1 March 2012) and a former director of Time3 (between 1 March 2012 and 5 February 2016) says in an affidavit sworn on 23 December 2014 that Globalnet was ultimately unable to secure and provide the required USD 50 million. The directors of Pakiri terminated the joint venture agreement by letter dated 29 February 2012.[8] Pakiri was itself liquidated by order of the High Court on 15 February 2013 on the application of a creditor company. The liquidator set about to investigate activities of Pakiri with a view to realising its assets for creditors. He formed theview from correspondence and other documentation that Pakiri's ownership of theintellectual property in the TIME3 software products had been transferred to Time3prior to Pakiri's liquidation in a way which may allow its recovery, or an order forthe payment of a sum of money, under the Companies Act.[9] On 28 August 2014, the liquidator filed an amended notice of application for an order under s 295 directing the transfer of the intellectual property back to Pakiri as a voidable transaction or an order under s 298 for the payment of a sum of money that represented the value of the intellectual property.3 Associate Judge Christiansen allowed the application and ordered that the intellectual property be transferred back from Time3 to Pakiri. He did not, however, ascribe a value to the intellectual property nor did he direct, as an alternative, the payment of a sum of money by Time3 to Pakiri.Appeal by Time3Was Time3 a creditor of Pakiri?[10] The appeal can be disposed of relatively quickly in favour of Time3. Counsel for Pakiri concedes that s 292(2)(b) of the Companies Act requires the existence of a creditor/debtor relationship between Time3 and Pakiri. If there is no creditor/debtor relationship then the alleged transfer of the intellectual property cannot be caught as a voidable transaction under s 292 as there is no preference between creditors. We will consider the issue of whether there was sufficient evidence to prove a transfer later when dealing with the cross-appeal.[11] Section 292 provides in part:292 Insolvent transaction voidable(1) A transaction by a company is voidable by the liquidator if it—(a) is an insolvent transaction; and(b) is entered into within the specified period.(2) An insolvent transaction is a transaction by a company that—(a) is entered into at a time when the company is unable to pay its due debts; and(b) enables another person to receive more towards satisfaction of a debt owed by the company than the person wouldreceive, or would be likely to receive, in the company'sliquidation.(3) In this section, transaction means any of the following steps by the company:(a) conveying or transferring the company's property:(b) creating a charge over the company's property:(c) incurring an obligation:(d) undergoing an execution process:3 The original, less comprehensive notice was filed on 27 June 2013.(e) paying money (including paying money in accordance with a judgment or an order of a court):(f) anything done or omitted to be done for the purpose of entering into the transaction or giving effect to it.[12] It has been said that the purpose of the voidable transaction regime is toprevent one creditor "stealing a march" over others, so that (so far as is possible) all creditors can share equally in the assets of a company in liquidation.4[13] The crucial factual issue in this case is the proper characterisation of a depositof $130,500 into Pakiri's bank account from Time3 on 6 October 2011. Time3 says it was a reimbursement of expenses. The liquidator says it is evidence that Time3 is a creditor of Pakiri. The liquidator submits that the payment was an advance by Time3 pursuant to the joint venture agreement between Pakiri and Globalnet dated 14 July 2011 in relation to the formation of Time3. He says that the advance put Time3 in the position of a creditor of Pakiri. The liquidator also contends that the payment was not payment of a trade debt because Pakiri was not trading commercially at the time.[14] In answer to the suggestion that the payment was a reimbursement of expenses, the liquidator submits that there is no evidence to show that Pakiri incurred debt on behalf of Globalnet nor is there any evidence of the actual costs incurred by Pakiri. The liquidator also contends that there is no evidence of anyagreement between Pakiri and Globalnet that Pakiri would incur costs on Globalnet's behalf or that Time3 would reimburse Pakiri for costs incurred on Globalnet's behalf.[15] On the other hand, Mr Sutich says in his affidavit sworn on 23 December 2014 that the payment of $130,500 was indeed a repayment of expenses. He says that because of the delays by Globalnet in securing and providing the USD 50 million required in terms of the joint venture agreement with Pakiri, the directors of Globalnet and Pakiri agreed that Globalnet would pay USD 1 00,000 to Time3 to cover the expenses incurred by Pakiri following the execution of the agreement, including travel and accommodation in Russia and Europe and the engagement of external marketing consultants, all of which was properly payable by4 Billie J Little (ed) Company and Securities Law (looseleaf ed, Brookers) at [CA292.01(2)].Time3 under the global licence from Pakiri. Time3 then converted the sum of USD 100,000 into NZD 130,500 and paid it to Pakiri on 6 October 2011.[16] The liquidator did not issue a notice requiring Mr Sutich to be cross-examined on his evidence. Mr Sutich's evidence is therefore uncontested.Furthermore, in our view, there is nothing inherently improbable on the face of Mr Sutich's sworn evidence which would justify our rejection of it.[17] Mr Sutich's evidence is also corroborated by evidence given by a formerdirector of Pakiri in an examination of directors and former directors before Associate Judge Doogue on the application of the liquidator.5 In evidence before Associate Judge Doogue, Mr Arron Judson, who was a director of Pakiri at the time of the payment, confirmed that the payment was from the company with which Pakiri was looking to create a joint venture. He said Pakiri had incurred some costs in the process of trying to get the deal completed and they (Globalnet) had provided Pakiri with a small amount of funding to cover Pakiri's out of pocket expenses.The liquidator did not adduce any evidence to contradict that of Mr Judson.[18] Time3 also submits that there was never an expectation of repayment of the $130,500. Mr Sutich confirms in his affidavit dated 23 December 2014 that no claim has been or will be made by Time3 as a creditor in the liquidation of Pakiri. No proof of debt has been filed. Furthermore, Time3 submits that the liquidator has not advanced any evidence of any loan agreement or expectation of repayment.[19] Associate Judge Christiansen's essential findings are as follows:[77] There is no evidence that the respondent was a debtor of Pakiri's atthe time. Mr Norrie's [the liquidator's] position is that if it was not a debtorthen it was a creditor. The Court does not agree and it follows that if there was not that form of a relationship between the parties then the payment in question is not subject to the voidable transaction provisions or considerations.5 This evidence was, admittedly, given in the course of a separate proceeding.Did a debtor/creditor relationship exist?[86] The Court accepts there is no sufficient proof that the payment of $130,500 to Pakiri was for any purpose other than as the respondent claims i.e. to reimburse costs Pakiri incurred in its failed marketing project with the Russian interests associated with Globalnet.[20] It is our view that this finding was open to the Associate Judge on the evidence. The liquidator relied on inferences, which he says could be drawn from the very limited documentation available, while Time3 relied on the uncontested sworn evidence of both Mr Sutich and Mr Judson. The Associate Judge referred tothe lack of "sufficient proof" to go behind the sworn evidence. This reasoning is quite orthodox in that it reflects the onus on the liquidator to establish that Time3was a creditor. There is therefore no basis for overturning the Associate Judge'sfactual finding. That being so, there is no basis for making an order under s 295. Time3 was not receiving a preference over other creditors when the liquidator of Pakiri says the intellectual property was transferred from Pakiri to Time3 as Time3 is not a creditor in the liquidation.[21] With respect to the Associate Judge, he seems to have overlooked his finding that Time3 was not a creditor in the liquidation of Pakiri in making the order under s 295. Because of his finding that Time3 was not a creditor, the alleged transfer of intellectual property from Pakiri to Time3 is simply not subject to the voidable transaction regime. The appeal is therefore allowed. It is unnecessary for us to consider the other grounds of appeal raised by Time3.Cross-appeal by liquidator of Pakiri[22] The liquidator of Pakiri cross-appeals on two issues. First, although it was successful before Associate Judge Christiansen, Pakiri cross-appeals against his finding that Time3 was not a creditor of Pakiri in recognition that his order under s 295 directing the transfer back of intellectual property from Time3 to Pakiri was in jeopardy because of that finding. We have determined this issue when consideringTime3's appeal. We have not been persuaded that the Associate Judge was wrong tofind that Time3 was not a creditor of Pakiri. The first ground on the cross-appeal is therefore dismissed.[23] The second issue raised on the cross-appeal is the Associate Judge's failure toconsider an order under s 298 of the Companies Act of compensation for the transfer of property at an undervalue instead of just ordering its transfer back. Unlike an order under s 295, an order under s 298 does not require a creditor/debtor relationship. Section 298(2) provides:298 Transactions for inadequate or excessive consideration with directors and certain other persons(2) Where, within the specified period, a company has disposed of a business or property, or provided services, or issued shares, to—(a) a person who was, at the time of the disposition, provision, or issue, a director of the company, or a nominee or relative of or a trustee for, or a trustee for a relative of, a director of the company; or(b) a person, or a relative of a person, who, at the time of the disposition, provision, or issue, had control of the company; or(c) another company that was, at the time of the disposition, provision, or issue, controlled by a director of the company, or a nominee or relative of or a trustee for, or a trustee for a relative of, a director of the company; or(d) another company that, at the time of the disposition, provision, or issue, was a related company,—the liquidator may recover from the person, relative, company, or related company, as the case may be, any amount by which the value of the business, property, or services, or the value of the shares, at the time of the disposition, provision, or issue exceeded the value of any consideration received by the company.[24] Associate Judge Christiansen did not make an order under s 298, presumably because he had made an order under s 295. Pakiri submits, however, that the Associate Judge made factual findings sufficient to enable an order to be made under s 298 and invites the Court to do so. We are, however, of the view that the requirements for an order under s 298 are not met. In particular, we are of the view that there is insufficient evidence of the transfer of the intellectual property from Pakiri to Time3.Ownership of the intellectual property[25] As to the ownership of the intellectual property, Time3 points to the uncontested evidence of both Mr Sutich and Mr Judson that the TIME3 softwareproducts were created by Mr Read and/or the Read Family Trust and submits that Pakiri never owned any intellectual property, which was always owned by the trustees of the Read Family Trust. The evidence of Mr Sutich was that Pakiri merely marketed the TIME3 software products under an exclusive licence with the financial assistance of the Read Family Trust. Although the liquidator pointed to several documents in which Pakiri asserted sole ownership in the intellectual property in the TIME3 software products, Mr Sutich explains that Pakiri was able to assert ownership of rights under the terms of its exclusive licence. Time3 points to the definition of an exclusive licence under s 2 of the Copyright Act 1994 as meaning alicence which authorises the licensee to "to the exclusion of all other persons(including the copyright owner), to exercise a right that would otherwise beexercisable exclusively by the copyright owner". It is Mr Sutich's position thatPakiri's assertion of ownership to the public at large or to third parties was merely anincident of the possession of an exclusive licence. Mr Sutich also says that Time3 entered into its own separate and independent arrangements with the Read Family Trust, which enables it to be licensed to utilise and market the intellectual property.[26] We do not accept the position as to ownership of the intellectual property asserted by Time3. First, a firm of patent attorneys, Pipers, acted for Pakiri in filing three patent applications on 18 June 2010, 20 June 2011 and 15 June 2012, and subsequently for Mr Read, as trustee for the Read Family Trust, in filing a fourth patent application on 24 July 2013. The first three patent applications were for an internet operating system of which Mr Read claimed to be the inventor. When Mr Read instructed Pipers to lodge the first application in the name of Pakiri, Mr Jim Piper told him it would be necessary to assign the benefit of the invention to Pakiri. Mr Read therefore signed a formal deed of assignment dated 4 June 2010 in which he assigned any and all rights and benefits in the invention together with copyright in any drawings or other works relating to the invention and the right to apply for protection of the invention by way of application for Letters Patent to Pakiri to hold absolutely.[27] The fourth patent application was filed on 24 July 2013, after Pakiri was liquidated. When Mr Read asked Pipers to file the fourth patent application in his name as trustee of the Read Family Trust, Mr Piper explained to Mr Read that sincethe rights to the invention had previously been assigned to Pakiri it would be necessary to obtain an assignment from Pakiri to the Read Family Trust. Mr Piper does not know if such an assignment was ever executed, although Mr Read did tell Mr Piper that ownership of the invention had been transferred to the Read Family Trust. It is, in our view, highly unlikely that there was any assignment from Pakiri to the Read Family Trust at the time, given that the affairs of Pakiri had been in the hands of the liquidator since its liquidation five months earlier. Nonetheless, Mr Read executed a further formal deed of assignment dated 2 July 2013, this time between himself as inventor and himself as trustee of the Read Family Trust, before instructing Pipers to file a fourth patent application on 24 July 2013. In the absence of an assignment from Pakiri to the Read Family Trust, it is highly doubtful whether the assignment of all rights and benefits in the invention to the Read Family Trust is effective.[28] Secondly, it was acknowledged in the joint venture agreement, dated 14 July 2011, between Pakiri and Globalnet that Pakiri was the sole owner of all rights (including intellectual property rights) in the TIME3 software products.[29] Thirdly, a loan agreement was signed on 2 May 2012 between the Read Family Trust and Pakiri, which clearly implies that Pakiri owned the intellectual property. In terms of the loan agreement, the Read Family Trust agreed to lend to Pakiri and Pakiri agreed to borrow from the Read Family Trust an amount of $100 million, "being the agreed amount of the Intellectual Property assigned by RFT to the Company"6 and in addition any further cash disbursements made by the Read Family Trust from the effective date of the loan agreement.[30] The loan agreement further noted that Pakiri would use the loan to fund the operations of the company to complete its business, which was said to be that of a research and development company in which Pakiri was to conceptualise, design and develop unique intellectual property for eventual sale to a single entity. The principal of the loan was to be repaid in annual amounts of a minimum of $4 millionor at least 10 per cent of Pakiri's profits. Security for the loan was to be by way of a6 This most naturally refers to the formal deed of assignment dated 4 June 2010.debenture over all of Pakiri's assets whether tangible or intangible, but not limited toall intellectual property relating to the TIME3 software products.[31] Fourthly, as previously noted, shares in Pakiri were sold to investors on the basis of statements in documents such as business investment memoranda that Pakiri had developed and owned the intellectual property rights in what it described as the TIME3 suite of software.[32] Taken together, but in particular reliance on the formal deed of assignment dated 4 June 2010 in which Mr Read assigned the intellectual property rights in his internet operating system to Pakiri absolutely, we are of the view that the intellectual property at issue was owned by Pakiri.Lack of evidence of transfer[33] Notwithstanding that the liquidator has been able to establish ownership of the intellectual property by Pakiri, Time3 submits that the correspondence relied upon by the liquidator to establish a transaction in the form of a conveyance of the intellectual property from Pakiri to Time3 is insubstantial, at times contradictory and is, therefore, inconclusive. We agree.[34] On 14 December 2012, Mr Read wrote to Pakiri shareholders as follows:Company restructuringDue to the requirements for the Cayman Islands Trust investment and for the benefit of our dealings with the strategic partners, governments, etc. along with suggestions from the organisations performing our branding revamp, we have decided to restructure the companies to better align with the TIME3 products and provide a clean vehicle for the next phase of the project.To this end the Directors will be shortly sending out share transfer forms to transfer your existing shareholding into TIME3 Global Limited (at no cost), which will replace Pakiri Investments Ltd as the Intellectual Property holding company and owner of the ONE Global Limited Group, and subsidiary companies. Effectively there is no change to your shareholding percentages, nor any change in management or structure, but there will be some changes to operational and marketing components.[35] Mr Read confirmed in an email of 15 December 2012:1. Restructuringa. All company's (including ONE Global), IP and other assetsare being transferred to the new entityb. You will receive exactly the same shareholding percentage as you have now in the new entityc. All contracts, rights and other legal documents will transfer to the new companyd. The share forms and a complete explanation of the process will be coming to you shortly[36] In a follow-up letter dated 28 December 2012 addressed to Pakiri shareholders, Mr Sutich wrote:The salient points of the restructure are:(1) Your existing Pakiri Investments Ltd shareholding will be transferred to the Read Family Trust at a face value of NZ$1 per share.(2) You will receive 100 (NZ$0.01 value) shares in TIME3 Global Ltd from the Read Family Trust for every 1 share you currently hold in Pakiri Investments. As the 2 share transfers cancel out the share payments, it makes this a $0 net transaction for you as the shareholder.a. This will ensure that your new shares in TIME3 Global are fully paid up.b. This means you still hold the same percentage in TIME3 Global Ltd as you currently hold in Pakiri Investments Ltd.c. If the Board decides to take the company public at any point this will be a better position for all shareholders.(3) All assets of the Pakiri Group are being transferred to the TIME3 Group.(4) All relevant shareholdings, including ONE Global Limited, will be transferred to the appropriate entity in the TIME3 Group.[37] Then in a letter to Pakiri shareholders dated 6 March 2013, after Pakiri'sliquidation, Mr Sutich advised shareholders:Company restructuringI am pleased to inform you that the restructuring of the TIME3 Group was completed in January and all shareholders, with the exception of 2 whom we cannot contact, due to out of date information, now have the equivalent shareholding in TIME3 Global Ltd.We are currently completing the new agreements with the Read Family Trust for the Intellectual Property transfer; ONE Global Ltd for the new TIME3 Global Licence; and the constitution and other required company documents, and expect these all to be finalised before March 31st.[38] In his correspondence with the shareholders of Pakiri, Mr Read always referred to a transaction or transactions happening in the future. Mr Read initiallyadvised shareholders of Pakiri that Time3 "will replace Pakiri Investments Ltd as the Intellectual Property holding company" (letter dated 14 December 2012), "All company's (including ONE Global), IP and other assets are being transferred to thenew entity" (email dated 15 December 2012), and "All contracts, rights and other legal documents will transfer to the new company" (email dated 15 December 2012).[39] While Mr Sutich also initially advised the shareholders of Pakiri that "All assets of the Pakiri Group are being transferred to the TIME3 Group" (letter dated28 December 2012), he later told them "We are currently completing the newagreements with the Read Family Trust for the Intellectual Property transfer; ONE Global Ltd for the new TIME3 Global Licence; and the constitution and other required company documents, and expect these all to be finalised before March 31st"(letter dated 6 March 2013).[40] The liquidator has adduced no evidence of a transaction in the form of a conveyance other than the correspondence to the shareholders of Pakiri by Mr Read and Mr Sutich. As noted, the last communication to the shareholders of Pakiri relied upon by the liquidator refers not to any transaction in the form of a conveyance with Pakiri, but instead with the Read Family Trust.[41] In his judgment Associate Judge Christiansen referred to the difficulties of proof of a transfer. He said:[72] The liquidator concedes the evidential difficulty of proving there was a transfer.[88] Mr Hucker's submissions regarding a lack of evidence to prove atransfer of property from Pakiri to the respondent are forceful. There is no documentary evidence of a transfer by Pakiri of intellectual property. There is no evidence that the respondent received the intellectual property as atransferee by any document of record.[116] Mr Hucker submits there is an absence of records of a transfer from Pakiri to the respondent. Indeed that appears so but that does not necessarily mean the transfer did not occur. Mr Read and his trust now proclaim theyretrieved Pakiri's intellectual property assignment rights (for there is nodispute but that they existed) and transferred those to a company established for the purpose of receipt of those.[42] The Associate Judge had also earlier said that there was no evidence of theprocess by which Pakiri's intellectual property rights were retrieved by the ReadFamily Trust as asserted by Time3. He stated:[99] No evidence has been produced describing the process by which Mr Read or his family trust retrieved the asset which the evidence discloses was clearly assigned to Pakiri. There was no notice to Pakiri of theinevitability of this action. [43] In the absence of any records or other evidence, the Associate Judge appears to have inferred that a transaction in the form of a conveyance of certain intellectual property rights occurred in some way, whether directly from Pakiri to Time3 or indirectly via the Read Family Trust. No specific finding was, however, made by the Associate Judge about the timing or mechanism of such a transfer.[44] On appeal it is open to this Court to review the evidence and make its own finding on the issue of a transfer. The evidence is undoubtedly vague and tenuous. In circumstances where:(i) Time3 asserts that Pakiri did not actually own the intellectual property at issue, but merely possessed an exclusive licence to utilise it;(ii) Time3 asserts that the Read Family Trust had an enforceable security interest in the intellectual property owned or at least utilised by Pakiri, which it exercised to reclaim the property; the correspondence to Pakiri shareholders is inconsistent and refers to an intent to transfer the intellectual property at some stage in the future or obtain it directly from the Read Family Trust; and(iii) there is no documentation or other evidence about the timing and mechanism of such a transfer;we are of the view that an inference that there was a transfer of intellectual property from Pakiri to Time3 was not available to the Associate Judge. The evidence isinconclusive, in which case the matter is to be determined in accordance with the burden of proof on the liquidator. He has, in our view, failed to prove a transfer.[45] This finding is sufficient to dispose of the second issue on the cross-appeal. It is also dismissed. It is therefore unnecessary for us to consider whether the intellectual property had any value and, if so, whether the value of any disposition of property (which we have found not to be proven) exceeded the value of any consideration received by Pakiri. Nonetheless, we note for the record we are not persuaded that the intellectual property, whatever it is, has any substantial value. In the High Court, the liquidator conceded that it could only be worth a dime.7Result[46] The appeal is allowed. The order that Time3 transfer back to Pakiri all property taken from it is quashed. The cross-appeal is dismissed. The respondent must pay the appellant costs for a standard appeal on a band B basis and usual disbursements.Solicitors:Hucker & Associates, Auckland for AppellantAnthony Harper, Auckland for Respondent7 Norrie v Time3 Global Ltd, above n 1, at [71].