MOTORWORLD LTD (IN LIQUIDATION) AND ORS V TURNERS AUCTIONS LTD HC AK CIV-2007-404-6558

MOTORWORLD LTD (IN LIQUIDATION) AND ORS V TURNERS AUCTIONS LTD HC AK CIV-2007-404-6558

Nichibo had effectively authorised Motorworld to deliver and sell the vehicles through Turners' dealer auctions such that Nichibo's security interest did not survive the authorised dealing under PPSA s45; consequently Nichibo lacked the possessory interest required for conversion and Turners acted with consent....

Source-derived case information.

Citation
openlaw-2d2ac17f_c89c_4c44_8a19_f3e5b76210af.pdf
Parties
First Plaintiff: Motorworld Limited (in liquidation); Second Plaintiffs (liquidators): Lloyd James Hayward and Karen Betty Mason; Third Plaintiff: Nichibo Japan Trading Company Limited; Defendant: Turners Auctions Limited
Court
High Court
Jurisdiction
New Zealand
Judgment Date
17 February 2010
Procedural Posture
Civil Tort and Equity (conversion; Knowing Receipt) / Trial Judgment Delivered
Outcome
Both claims dismissed; judgment for defendant Turners Auctions Limited
Legal Topics
Conversion, Knowing Receipt, Security Interest, PPSA S45 and S109, Fiduciary Duties, Implied Terms, Liquidation
Tort Equity Company Law Property Law Contract Law Personal Property Securities Conversion Knowing Receipt +5 more

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Parties

Motorworld Limited (in liquidation)

First Plaintiff

Lloyd James Hayward and Karen Betty Mason

Second Plaintiffs (liquidators)

Nichibo Japan Trading Company Limited

Third Plaintiff

Turners Auctions Limited

Defendant

Procedural Posture

Civil Tort and Equity (conversion; Knowing Receipt) / Trial Judgment Delivered

Legal Issues

  1. 1 Whether Nichibo retained a possessory interest in vehicles at point of sale
  2. 2 Whether Turners committed conversion by selling those vehicles
  3. 3 Whether Motorworld/liquidators can recover Turners' fees in knowing receipt

Ratio Decidendi

Nichibo had effectively authorised Motorworld to deliver and sell the vehicles through Turners' dealer auctions such that Nichibo's security interest did not survive the authorised dealing under PPSA s45; consequently Nichibo lacked the possessory interest required for conversion and Turners acted with consent. Separately, McGregor's conduct, though incompetent and in breach of statutory/common law duties, did not constitute disloyalty breaching fiduciary duty; Turners lacked knowledge of habitual loss-making and therefore cannot be liable for knowing receipt; both causes of action fail and claims are dismissed.

Court Disposition

Both claims dismissed; judgment for defendant Turners Auctions Limited

Orders

  • Judgment for defendant on both causes of action
  • Costs to follow the event