InThe Commissioner of Inland Revenue v Blackmore Trust Ltd, Blackmore tried to stave off liquidation for the sum of $1.4 million owed to the IRD.  After six or seven adjournments, Blackmore finally put evidence before the Court (albeit through its lawyer, rather than by affidavit) claiming that its liabilities totalled $15.6 million, and its sole asset, the James Smith building in the Wellington CBD, was valued at $21.5 million as a going concern, or $11 million - $13 million in a "fire sale".

Managh v Morrison and Ors involved an application by a liquidator to set aside a transaction pursuant to section 292 of the Companies Act 1993.  Approximately one year before liquidation the company assigned causes of action against a firm of solicitors and a real estate agent to a trust associated with the company's director.

Burns & Agnew v Commissioner of the Inland Revenue and Strategic Finance Limited (in rec) concerned a dispute between a secured creditor and the IRD (as a preferential creditor) in respect of certain funds received by the liquidators of Takapuna Procurement Limited (TPL).  The liquidators applied to the High Court for directions as to the application of those funds and this required the Court to undertake an analysis of the concept of an "account receivable" for the purposes of determining whether such funds could be applied to satisfy preferential claims under the Seventh

Resource consents and environmental risks can affect the value of an insolvent company's assets, and can give rise to civil or criminal liability.

This Brief Counsel examines:

• when resource consents require transfer to a new owner, and
• potential liabilities that insolvency practitioners may face.

Types of consents

Five types of consent are available under the Resource Management Act 1991 (RMA):

In Jordan and Vance v First City (in liquidation ) & Gore Street (in liquidation), the liquidators of Gore Street applied for a pooling order that the liquidation of the two defendants, First City and Gore Street, proceed as if they were one company.

The recent case of Re Armitage, ex parte Established Investments Limited (in liquidation) considered an objection by the Official Assignee to Mr Armitage's automatic discharge from bankruptcy. 

The Ministry of Economic Development has released a discussion document (together with a Q & A) which considers a range of potential changes to the fees and levies that fund the institutions that regulate New Zealand's corporate environment and financial markets.

A recent judgment in the Wellington High Court makes receivers, liquidators – and, potentially, the directors of companies in receivership and liquidation – personally liable for GST on the sale of mortgaged properties even where the mortgagee is not GST registered.1

The decision is being appealed and may be overturned as – in our view – it rests upon an unusual interpretation of the law. 

Finnigan v He underlines the obligatory nature of bankruptcy set-off whereby once the statutory requirements that exist in section 310 of the Companies Act 1993 are met (and no exclusion applies), such a set-off is mandatory. It also discusses when a transaction occurs and the operation of the exclusion in section 310(2) that preludes bankruptcy set-off.

Registration will be mandatory under the Insolvency Practitioners Bill as reported back to the House by the Commerce Committee.  This is a radical and far-reaching change from the negative licensing regime initially proposed in the Bill.

This Brief Counsel summarises and comments on the Committee’s report.