VISTAITA LTD V COMMISSIONER OF INLAND REVENUE HC AK CIV 2008-404-1959

VISTAITA LTD V COMMISSIONER OF INLAND REVENUE HC AK CIV 2008-404-1959 16 May 2008IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2008-404-1959UNDER the Companies Act 1993 BETWEEN VISTAITA LIMITED AS TRUSTEE IN THE VISTA TRUST Applicant AND THE COMMISSIONER OF INLAND REVENUE Respondent Hearing: 16 May 2008 Appearances: Mr Hucker for Applicant Ms North for Respondent Judgment: 16 May 2008ORAL JUDGMENT OF ASSOCIATE JUDGE DOOGUESolicitors:Hucker & Associates, P O Box 3843, Shortland Street, Auckland Inland Revenue, P O Box 432, Hamilton[1] Mr Hucker seeks an interim stay of advertising and seeks that the proceedings be stayed on an interim basis as well. [2] The approach that I intend to take is that the Court will require proof on an application of this kind that the application to put the company into liquidation cannot succeed or some special circumstances exist which would make prosecution of the application an abuse of process. [3] The applicant says that it is entitled to a stay because of the following factual matters. It says that a director of the company is also a director of another company called Wagener Place Investments Limited. She says that Wagener Place Investments Limited has made a return for GST purposes with the IRD in terms of which it will be entitled to a refund of $1,625,000 approximately. She says:I confirm on behalf of Wagener Place Investments Limited that it has agreed that the GST refund contained in the goods and service tax return can be partially applied to cover the amount claimed in the statement of claim.[4] Therefore it is the applicant's case that there will be sufficient funds available to meet the Commissioner's demand of approximately $569,000. [5] Mr Hucker sought to persuade me that because the Commission of Inland Revenue has control of the timing of the payments in the Wagener Place Investments return therefore he should be restrained in his position as plaintiff in this case from proceeding. [6] In my view the matters disclosed by the applicant in its affidavit's do not give rise to any basis upon which it can say that it is entitled to a stay. There is no obligation on the Commissioner to abate or postpone seeking statutory remedies against the present defendant because of the state of accounts between the Commissioner and a unrelated company. [7] In my view the defendant is in a position where it cannot pay the debt but is saying a source of funds will become payable shortly. As is often the case the Court is prepared to give adjournments to enable those funds to come to hand. I am prepared to grant an adjournment until 11.45 a.m. on 13 June 2008 to give thedefendant an opportunity to pay the debt, whether from the Wagener Place Investments Limited GST refund or some other source. The proceeding will be adjourned to that date. I decline to order to the respondent not to advertise because, as I have said, the applicant simply has not established a right to such an order. I am advised though by Ms North for the Commissioner that it is unlikely that advertising will take place until July which of course post-dates the date when this matter will next be called. _____________ J.P. Doogue Associate Judge