New Zealand Case Law: Decisions & Judgments

Topic

Alteration of position

Legal area

Court

7 Dec 2017

SHEPHERD v WOOD NORTHLAND 2011 LTD (IN LIQUIDATION) [2017] NZHC 3023

Citation

[2017] NZHC 3023
Court

High Court

The appeal was dismissed because the proceeds paid to the appellant were held to be proceeds of Bay Lumber collected by Wood Northland 2011 acting as Bay Lumber's agent and therefore not the appellant's; money had and received was established and the appellant failed to satisfy the cumulative s296 defence (she had reasonable grounds to suspect insolvency and could not show a reasonable belief the transfer would not be set aside).
18 Aug 2015

GRANT AND KHOV AS LIQUIDATORS OF SPRAYMAN & AUCKLAND DOOR FINISHERS LTD (IN LIQUIDATION) v MCKENZIE [2015] NZHC 1958

Citation

[2015] NZHC 1958
Court

High Court

Defendant satisfied s 296(3): he acted in subjective good faith, a reasonable person in his position would not have suspected that Sprayman was or would become insolvent given the information he had, and he gave value by virtue of services rendered as an employee (and/or reasonably altered his position); accordingly the liquidators' application to set aside the $36,000 payments failed.
20 Mar 2015

KIWI DEPOSIT BUILDING SOCIETY v SCANPROJECTS ApS [2015] NZHC 533

Citation

[2015] NZHC 533
Court

High Court

Leave to bring an application for summary judgment was declined because the applicant's delay in bringing the interlocutory application was significant, the defendants have arguable and potentially substantial defences (including ambiguity in the deposit letters and defences of estoppel/alteration of position), and in the interests of justice and efficient case management given the imminent substantive hearing it was not appropriate to permit the summary judgment process to proceed.
18 Feb 2015

ALLIED CONCRETE LIMITED v JEFFREY PHILIP MELTZER AND LLOYD JAMES HAYWARD AS LIQUIDATORS OF WINDOW HOLDINGS LIMITED (IN LIQUIDATION) [2015] NZSC 7

Citation

(2015) 13 TCLR 833
Court

Supreme Court

The Supreme Court held that 'gave value' in s 296(3)(c) includes antecedent value (including satisfaction/release of an antecedent debt) provided the creditor proves it acted in good faith and had no reasonable grounds to suspect the company's insolvency; accordingly creditors paid for antecedent debts can invoke the s 296(3) defence and payments in the appeals were not recoverable by the liquidators.
14 Nov 2013

G REYNOLDS as liquidator of EBODE CONSTRUCTION LTD (In Liq) v EUROVISION LTD [2013] NZHC 3015

Citation

[2013] NZHC 3015
Court

High Court

All three payments were insolvent transactions under s 292. Eurovision proved it acted in good faith and that a reasonable person in its position would not have suspected insolvency for all payments. Eurovision proved alteration of position in respect of the first two payments (forgoing repossession, traveling to Auckland and completing assembly/installation) but did not prove contemporaneous alteration of position in respect of the third payment. Therefore recovery was permitted only in respect of the third payment net of agreed credit; net repayment of $26,695.25 ordered plus interest from…
16 Oct 2013

VIVIEN JUDITH MADSEN-RIES V RAPID CONSTRUCTION LIMITED CA76/2013 [2013] NZCA 489

Citation

[2013] NZCA 489
Court

Court of Appeal

On the undisputed evidence the Court accepted Rapid's unchallenged account that the payment was part of a reciprocal cheque‑swap trading arrangement, and found Rapid satisfied all three limbs of s296(3): it acted in good faith, a reasonable person in its position would not have suspected Giant was or would become insolvent, and Rapid altered its position/gave value in the reasonable belief the transfer was valid; accordingly recovery was limited to the net balance and the liquidators' appeal was dismissed.
10 Oct 2013

LEVIN and MADSEN-RIES v TITAN CRANES LIMITED [2013] NZHC 2628

Citation

[2013] NZHC 2628
Court

High Court

The court found G T Rigging Ltd was unable to pay its due debts at the times of payment; the first three payments (16 Feb, 6 Mar, 3 May 2007) were made in the ordinary course and saved by transitional provisions, but the payments of 22 June and 31 July 2007 were made in response to a statutory demand and threats of liquidation, were not in the ordinary course, are voidable under s 292, and Titan failed to establish the defence under s 296(3) because a reasonable person in Titan's position would have suspected insolvency and Titan did not prove a relevant alteration of position; accordingly th…
5 Jun 2013

V J MADSEN-RIES AND H D LEVIN v RAPID CONSTRUCTION LIMITED [2013] NZHC 1319

Citation

[2013] NZHC 1319
Court

High Court

No order as to costs: costs lie where they fall because both parties had partial success, the liquidators obtained a substantive recovery and reasonably litigated given the unsettled scope of s296(3), and the Calderbank offer did not render the liquidators' refusal unjust so as to require an award in Rapid's favour.
21 Nov 2012

GRANT BRUCE REYNOLDS V TOPLINE EXPORT & TRADING LIMITED HC AK CIV 2012-404-003532

Citation

openlaw-fb5d4b69_5aaf_4772_b679_18bc387c9b55.pdf
Court

High Court

The presumption of insolvency arising from the payment within six months was not rebutted; Topline proved good faith and lack of actual (subjective) knowledge of insolvency but failed to establish alteration of position required by s 296(3); accordingly the February 2011 payment of $19,613.24 was an insolvent transaction and must be set aside and repaid with interest; the March 2011 payment was a cash transaction and not pursued by the liquidator.
1 Nov 2012

PETER ESMOND FARRELL AND SIMON PAUL ROGAN AS LIQUIDATORS OF CONTRACT ENGINEERING LIMITED (IN LIQUIDATION) V ACME ENGINEERING LIMITED HC ROT CIV 2012-463-000175

Citation

openlaw-b09c2f5e_9915_4bec_8c2e_b6a1a03343fd.pdf
Court

High Court

Although the liquidators proved the company was insolvent at the relevant time, the respondent satisfied s 296(3) by proving it acted in good faith, had no reasonable grounds to suspect insolvency, and had given value (supplied the contracted flash silencer); accordingly the payments were not recoverable and the application was dismissed.