JEFFREY PHILIP MELTZER AND LLOYD JAMES HAYWARD AS LIQUIDATORS OF WINDOW HOLDINGS LIMITED (IN LIQUIDATION) V ALLIED CONCRETE LIMITED HC AK CIV 2012-404-003170

JEFFREY PHILIP MELTZER AND LLOYD JAMES HAYWARD AS LIQUIDATORS OF WINDOW HOLDINGS LIMITED (IN LIQUIDATION) V ALLIED CONCRETE LIMITED HC AK CIV 2012-404-003170

Allied established the first two limbs of the s 296(3) defence (it acted in good faith and had no reasonable grounds to suspect insolvency) but failed the third limb because it did not prove it gave value at the time the payment was received; under s 296(3)(c) value must be given at receipt (subject only to the separate alteration-of-position exception), so $63,649.50 of the payment is a voidable preference and must be repaid to the liquidators with interest and costs.

Citation
openlaw-5a450c15_3cbe_47b3_8b82_e86cc970c62a.pdf
Parties
Applicants (liquidators): Jeffrey Philip Meltzer and Lloyd James Hayward as Liquidators of Window Holdings Limited (In Liquidation); Respondent (creditor): Allied Concrete Limited
Court
High Court
Jurisdiction
New Zealand
Judgment Date
6 May 2013
Procedural Posture
Companies Act Insolvency Proceeding (liquidation) / Judgment on Application for Recovery of Voidable Transaction
Outcome
Liquidators' application successful; payment of $63,649.50 set aside as voidable transaction and ordered repaid by Allied.
Legal Topics
Voidable Transaction, Preference, Defence Under S 296(3), Running Account, Creditor Good Faith, Value Given
Company Law Insolvency Law Commercial Law Voidable Transaction Preference Defence Under S 296(3) Running Account Creditor Good Faith +1 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 4 Authorities cited 10 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

Jeffrey Philip Meltzer and Lloyd James Hayward as Liquidators of Window Holdings Limited (In Liquidation)

Applicants (liquidators)

Allied Concrete Limited

Respondent (creditor)

Procedural Posture

Companies Act Insolvency Proceeding (liquidation) / Judgment on Application for Recovery of Voidable Transaction

Legal Issues

  1. 1 Whether the payment of 21 October 2010 was an insolvent transaction/voidable preference under s 292
  2. 2 Whether Allied proved the defence in s 296(3): good faith, no reasonable grounds to suspect insolvency, and gave value or altered position
  3. 3 Whether 'gave value' includes antecedent consideration, discharge of antecedent debt, or subsequent supplies under a running account

Ratio Decidendi

Allied established the first two limbs of the s 296(3) defence (it acted in good faith and had no reasonable grounds to suspect insolvency) but failed the third limb because it did not prove it gave value at the time the payment was received; under s 296(3)(c) value must be given at receipt (subject only to the separate alteration-of-position exception), so $63,649.50 of the payment is a voidable preference and must be repaid to the liquidators with interest and costs.

Court Disposition

Liquidators' application successful; payment of $63,649.50 set aside as voidable transaction and ordered repaid by Allied.

Orders

  • The transaction is set aside to the extent of $63,649.50.
  • Allied Concrete Limited is to pay the liquidators $63,649.50 together with interest from the date of liquidation at the rate prescribed under the Judicature Act 1908.