New Zealand Case Law: Decisions & Judgments

Topic

Preferential payment

Legal area

Court

10 Sept 2018

ROBT. JONES HOLDINGS LIMITED v MCCULLAGH [2018] NZCA 358

Citation

[2002] NZCCLR 6
Court

Court of Appeal

The Court of Appeal dismissed the appeal: the High Court was correct to find the Columbus and MSH No 2 payments were transactions of Northern Crest (either a redirection of licence fees or loans for Northern Crest's benefit), those transactions were insolvent transactions under s 292 because Northern Crest was unable to pay its debts and the creditors received more than they would in liquidation, the November 2009 licence was not a sham on the evidence, the MYOB and contemporaneous records were admissible and probative, the ultimate effect rule (requiring overall diminution of the assets pool…
17 Dec 2015

SANSON AND ANOR v EBERT CONSTRUCTION LIMITED [2015] NZHC 3046

Citation

[2015] NZHC 3046
Court

High Court

The Court exercised its discretion under s 87 Judicature Act 1908 to award interest on sums ordered recovered and held that interest should run from the date of liquidation because the respondent had, through its CEO, sufficient knowledge of the risk and benefited from use of the funds; respondent's delay and asserted prejudice did not justify denying interest.
16 Apr 2014

D GRANT and S KHOV as liquidators of Insulae Building Consultants Limited (In Liquidation) v NAUHRIA PRECAST LIMITED [2014] NZHC 800

Citation

[2014] NZHC 800
Court

High Court

The continuing business relationship began on 7 February 2011 and ran to the final payment, therefore all payments were part of a s292(4B) running account; the liquidators could not validly pick a peak indebtedness date within that two year period to isolate recoverable transactions; NPL's unregistered security was prima facie effective against unsecured creditors under the PPSA and there was no evidence of preferential payments; NPL had an arguable change of position defence; accordingly the liquidators' recovery application must be dismissed.
1 Nov 2012

DAVID STUART VANCE AND VIVIEN JUDITH MADSEN-RIES AS LIQUIDATORS OF MANUKAU ROAD 380 LIMITED (IN LIQUIDATION) V SUMNERS APPLIANCE LIMITED HC AK CIV-2012-488-000385

Citation

openlaw-6fe1e333_2699_46b2_b237_27935db45254.pdf
Court

High Court

The $30,500 payment made within the restricted period was an insolvent transaction under s 292; Sumners Appliance Limited failed to prove the s 296(3) good faith defence because it had actual knowledge of persistent rent arrears and reasonable grounds to suspect insolvency; therefore the court ordered the payment set aside under s 294(5).
19 Jul 2012

GRANT AND KHOV AS LIQUIDATORS OF BLUNDELL COFFEE CLUB LIMITED (IN LIQUIDATION) V SHEARS AND MAC LIMITED HC AK CIV-2011-404-3866

Citation

openlaw-d6de79f3_e1bd_4bdc_8220_ff7c27161e4a.pdf
Court

High Court

The $10,000 payment was not proved to be an insolvent transaction because liquidators could not establish Blundell was unable to pay its due debts on 20 October 2009. The $8,750 payments fell within the restricted period and were therefore presumed insolvent transactions; the presumption was not displaced. Shears and Mac satisfied good faith and lack of reasonable grounds to suspect insolvency but failed s 296(3) because it did not alter its position after receipt of the impugned payments (failure to have perfected security did not constitute a post-payment alteration of position that changed…
5 Aug 2010

DAVID MURRAY BLANCHETT AND MALCOLM GRANT HOLLIS V MCENTEE HIRE HOLDINGS LIMITED HC ROT CIV 2010-463-000270

Citation

openlaw-a3735c7a_d5d3_4b74_8fb9_4228c587181f.pdf
Court

High Court

The Court held the running account between the parties terminated on 9 January 2008 (Stop Credit Notice and referral to debt collectors evidenced a change in commercial relationship), the Company was insolvent before and at that time, McEntee failed to establish the conjunctive s 296(3) defence (a reasonable person would have suspected insolvency), and therefore payments made after that date are voidable; alternatively the liquidators may select 9 January 2008 as the start date for the single-transaction calculation producing a recoverable preference of $18,124.12, and the liquidators' primar…
9 Mar 2010

RICHARDS-MAYNARD AND MAYNARD HC AK CIV 2009-404-008191

Citation

openlaw-7bf83fbe_2134_4048_be2e_ab3d2b321555.pdf
Court

High Court

The Court approved the proposals because the trustee demonstrated compliance with the statutory procedures under the Insolvency Act 2006, the proposals were accepted by the requisite number and value of creditors, the terms are reasonable and beneficial to the general body of creditors (providing a 26 cent in the dollar return versus nil in bankruptcy), proper provision was made for trustee fees and meeting costs, and there were no objections.

New Zealand Case Law

ROBT. JONES HOLDINGS LIMITED v MCCULLAGH [2018] NZCA 358

SANSON AND ANOR v EBERT CONSTRUCTION LIMITED [2015] NZHC 3046

D GRANT and S KHOV as liquidators of Insulae Building Consultants Limited (In Liquidation) v NAUHRIA PRECAST LIMITED [2014] NZHC 800

DAVID STUART VANCE AND VIVIEN JUDITH MADSEN-RIES AS LIQUIDATORS OF MANUKAU ROAD 380 LIMITED (IN LIQUIDATION) V SUMNERS APPLIANCE LIMITED HC AK CIV-2012-488-000385

GRANT AND KHOV AS LIQUIDATORS OF BLUNDELL COFFEE CLUB LIMITED (IN LIQUIDATION) V SHEARS AND MAC LIMITED HC AK CIV-2011-404-3866

DAVID MURRAY BLANCHETT AND MALCOLM GRANT HOLLIS V MCENTEE HIRE HOLDINGS LIMITED HC ROT CIV 2010-463-000270

RICHARDS-MAYNARD AND MAYNARD HC AK CIV 2009-404-008191