New Zealand Case Law: Decisions & Judgments

Topic

Breach of directors' duties

Legal area

Court

31 Aug 2023

KUMAR v SMARTPAY LTD [2023] NZCA 410

Citation

[2023] NZCA 410
Court

Court of Appeal

Appellant breached ss 131, 135 and 136 by causing or allowing OCL (a company with no revenue or meaningful assets) to incur substantial liabilities while prioritising group interests and relying on unenforceable support; objectively trading created substantial risk of serious loss to creditors and appellant could not reasonably have believed OCL could perform its obligations to Smartpay; causation established between breaches and Smartpay's losses and appropriate compensation under s301(1)(b)(ii) is $850,427.43 plus interest as assessed by the High Court, which the Court of Appeal upheld.
23 May 2023

RIVER OAKS MEWS LTD v MEURANT [2023] NZHC 1222

Citation

[2023] NZHC 1222
Court

High Court

The judge found River Oaks had established a good arguable case that Mr Meurant breached his duties and that surrounding facts (large payments to him and associates, auditor concerns, and a hurried discounted property sale) gave rise to a real danger of asset dissipation. The balance of convenience favoured protecting prospective recovery. Accordingly a limited freezing order without notice was justified, subject to conditions and an undertaking as to damages.
8 May 2023

CAYMAN SPECTRUM (NZ) CO v SPARK NEW ZEALAND TRADING LTD [2023] NZHC 1063

Citation

[2023] NZHC 1063
Court

High Court

The challenged paragraphs were struck out because they were irrelevant to the pleaded causes of action and Spark's knowledge at the time of entering the agreements, would require extensive unrelated evidence and cross-examination, and would cause unfair prejudice, delay and complexity; propensity reasoning and post hoc anti-competitive allegations could not properly be used to prove Spark's knowledge for the dishonest assistance claim.
3 May 2023

FIRST NZ PROPERTIES LIMITED v MILLAR [2023] NZHC 1031

Citation

[2023] NZHC 1031
Court

High Court

During an ongoing substantive hearing the media applicant was entitled to access the court index, minutes and, subject to the Rules' balancing considerations, the pleadings (including counterclaim), the parties' opening submissions when delivered, the witnesses' briefs of evidence after delivery (including any amendments made in court), the notes of evidence once complete, and the closing submissions when delivered; the Registry was directed to provide those documents to the applicant.
21 Dec 2022

MINES v LINDSAY [2022] NZHC 3613

Citation

[2022] NZHC 3613
Court

High Court

The plaintiffs established a serious question to be tried that the first and second defendants, as directors, acted in breach of their duties by pursuing self‑interested transactions and dissipating company assets; the balance of convenience favoured preserving company assets and preventing repetition of the conduct pending an on‑notice hearing, so prohibitory interim injunctions were granted on a Pickwick basis with directions for further on‑notice proceedings.
2 Jun 2022

DEBUT HOMES LIMITED (IN LIQUIDATION) v COOPER [2022] NZHC 1302

Citation

[2022] NZHC 1302
Court

High Court

The plaintiffs were substantially successful; the claimed costs and disbursements were reasonable and payable in full against the first defendant, with a 50% share of costs and disbursements to be borne jointly and severally by the first and second defendants and the remaining 50% by the first defendant alone; expert travel costs and second counsel certification were justified; post-hearing attendances on the late s 138 defence were recoverable; interest at 5% per annum from the date of liquidation (7 March 2014) to judgment (15 March 2018) was payable and the substantive judgment was recalle…
22 Oct 2019

GLOBAL COVER INSURANCES LIMITED (IN LIQUIDATION) v JIURIA REIJELI MARIO [2019] NZHC 2680

Citation

[2019] NZHC 2680
Court

High Court

A liquidator's claim under s301 is a proceeding in the liquidation for the purposes of r18.7(1)(d), so r18.7 did not require an application here; r18.4 must be read consistently with r18.7, and therefore an application for directions as to service is not required where r18.7(1) does not apply.
12 Jul 2019

MAINZEAL PROPERTY AND CONSTRUCTION LIMITED (IN LIQ) v YAN AND OTHERS [2019] NZHC 1637

Citation

[2019] NZHC 1637
Court

High Court

Both applications (plaintiffs' claim for interest and defendants' claim for reduction for asset recoveries) raised legitimate points but economically offset one another; starting net deficiency was ~$87m not ~$110m and plaintiffs' failure to seek interest in closing did not preclude court treating time value as a factor within s301 discretion; net result: no alteration to the $36m compensation order. Costs awarded to plaintiffs on scale with specific adjustments and a proportional award to fifth defendant; fixed contribution from Isola ordered.
29 Mar 2018

ALLIGATORS FAST FOOD LIMITED v YEN WEI CHEN [2018] NZHC 587

Citation

[2018] NZHC 587
Court

High Court

Court struck out plaintiffs' personal claims in contract, deceit and contractual misrepresentation as statute-barred (events accrued in 2009–2010) and struck out one cause that disclosed no tenable cause; held claims for misappropriation of company assets and breach of directors' duties are not amenable to strike-out because fiduciary/trust exception, recent events and potential restoration orders could avoid limitation bars; plaintiffs must either obtain s165 leave and pursue a derivative claim in the District Court (with s328(6) application if needed) or amend and pursue a s174 oppressive c…
9 Oct 2015

TORBAY HOLDINGS LIMITED & ANOR v NAPIER & ORS [2015] NZHC 2477

Citation

[2015] NZAR 1839
Court

High Court

On the balance of probabilities the Court found Mr Napier misappropriated company funds and overpaid salaries; he was liable for money had and received and negligent in tax compliance. A proportionate assessment was adopted where records were deficient (only 30% of suspect payments could be justified), resulting in quantified recoverable sums. The Napier Family Trust was liable in knowing receipt by imputation of Mr Napier's knowledge. A constructive trust was declared over the Whangaripo Valley Road property to the extent funds were traceable into its acquisition and improvement.