New Zealand Case Law: Decisions & Judgments

Topic

Liquidator disqualification

Legal area

Court

27 May 2020

HOLLIS & SOMERVILLE v MAUGERS RENTALS (2009) LIMITED [2020] NZHC 1137

Citation

[2020] NZHC 1137
Court

High Court

Because the applicants are experienced professional insolvency practitioners within PwC subject to strict conflict policies, known to the Court, with director/shareholder consent, the Court found no real risk to independence from PwC's business relationship with the secured creditor and therefore they were not disqualified; the Court also concluded procedural relief (use of originating application and dispensing with service) was appropriate provided creditors are notified and given 10 working days to apply to set aside the appointments.
22 Nov 2019

HOLLIS & SOMERVILLE (Applicants) v FISHER PAINTERS (2017) LTD [2019] NZHC 3066

Citation

[2019] NZHC 3066
Court

High Court

Although a prima facie disqualification existed because partners' firm had provided services to secured creditors within two years, the Court found the risk to independence was remote given the services were unrelated to the company, the applicants' experience, the firm's capacity to manage conflicts, and creditor protection measures ordered; accordingly the Court exercised its s280 discretion to permit the applicants to act as liquidators subject to post-appointment notice to creditors and leave to apply to set aside the appointments.
20 Sept 2019

In the matter of the STANLEY TALLWOOD GROUP [2019] NZHC 2395

Citation

[2019] NZHC 2395
Court

High Court

Given the material before the Court—PwC had not acted for the companies or their directors, services to secured creditors were unrelated to the companies, applicants agreed to exclude PwC personnel involved with those creditors, and both applicants had appropriate experience—the Court concluded the existing PwC relationships did not risk compromising the applicants' independence; accordingly the Court exercised its s286(4) discretion to permit their appointment and allowed the without‑notice proceeding due to urgency provided creditors and the current liquidator are notified forthwith.
29 Aug 2018

JUST BEVERAGES LTD v HORTON [2018] NZHC 2135

Citation

[2018] NZHC 2135
Court

High Court

The Court found Horton had a continuing business relationship with former director McKillen within the two years prior to FUB's liquidation by virtue of his role as provisional trustee and involvement in the creditor proposal process, rendering his appointment in breach of s280(1)(cb); the Court exercised its discretion under s286(4) and declined to permit Horton to continue because legitimate concerns and appreciable risk to independence and impartiality remained, and ordered his removal and appointment of the Official Assignee as liquidator.
19 Dec 2015

PATRICK DEAN NORRIS v BRUCE DONALD GEMMELL AND RHYS JAMES CAIN [2014] NZSC 190

Citation

[2014] NZSC 190
Court

Supreme Court

Leave to appeal was dismissed because the proposed appeal raised no matter of public or general importance and the courts correctly applied s283(2) of the Companies Act 1993: the applicant's resignation and appointment were ineffective as notice to the Registrar was not given until 18 October 2012, so a vacancy arose on conviction and the Official Assignee validly appointed the respondents who were entitled to apply for the search order.
11 Apr 2013

TW PATTISON AND JM MORLEY V GARRITY HOLDINGS LIMITED HC WN CIV-2013-485-495

Citation

openlaw-4394fcc2_3d66_4afa_a96f_06d3db82e350.pdf
Court

High Court

The Court found that PwC's general relationship with BNZ did not create a sufficient risk to the applicants' independence because the applicants did not personally provide the services, the services did not relate to the company, and persons involved in those services will not participate in the liquidation; accordingly the statutory disqualification under s280(1)(cb) was displaced and the applicants were permitted to be appointed as liquidators.
3 Oct 2008

DAVID MURRAY BLANCHETT AND VIVIAN JUDITH FATUPAITO HC NWP CIV 2008-443-000485

Citation

openlaw-469af297_9c49_4aff_8804_4dd9dbd3907b.pdf
Court

High Court

Where services to secured creditors are provided by other members of the applicants' firm but the applicants have no direct, continuing relationship and those individuals are excluded from involvement in the liquidation, there is no real risk to independence; accordingly the Court will exercise its discretion under s286 to permit the applicants to be appointed notwithstanding s280(1)(cb), and leave to proceed ex parte under r458D(1)(e) is appropriate given urgency and protections afforded to creditors.
18 Sept 2008

D & F CONTRACTING LIMITED V BLANCHETT AND ANOR HC AK CIV 2008-404-5443

Citation

openlaw-971527ce_cbb3_4bba_b7f5_40e06cd20825.pdf
Court

High Court

The court will not grant an ex parte order absolving the applicants from the requirements of s280 because there is a real potential conflict of interest, particularly in Mr Blanchett's case due to his paid appointment as a receiver for a secured creditor (Bank of New Zealand), and that potential conflict renders an ex parte absolution inappropriate; alternative procedural steps and a further hearing are required.
23 Apr 2008

COLIN THOMAS MCCLOY AND VIVIAN JUDITH FATUPAITO V TITAN FOUNDATION LIMITED HC AK CIV 2008-404-2243

Citation

openlaw-936c8e22_e4e7_48ae_bb1e_a338c8ceae7e.pdf
Court

High Court

The court authorised Colin McCloy and Vivian Fatupaito under s 280(1)(b) Companies Act 1993 as there was no good reason to disqualify them, their appointment offered clear advantages and did not demonstrably compromise independence; the court required specified service to preserve creditors' rights to object within a limited period.