In Aditude Advertising Limited (in liq.) v Techday Limited [2012] NZHC 1884, Aditude Advertising Limited (in liquidation) (Aditude) and Techday Limited (Techday), were members of the Bartercard system, a credit trading system. Under this system members could exchange goods and services without exchanging cash or other legal tender. Aditude went into liquidation with a significant credit in its Bartercard account for services rendered to Techday. The liquidators issued a statutory demand against Techday seeking to recover the actual cash value of the invoices issue
The recent decision in The Official Assignee v Grant Thornton (2012) NZHC 2145 addressed the obligation on a company's auditor to produce all relevant documents and information upon request by a liquidator pursuant to section 261 of the Companies Act 1993. Associate Judge Abbott held that the public interest in investigating the circumstances leading to a company's collapse trumped an auditor's claim to privacy and confidentiality.
Under section 241(4) of the Companies Act 1993 the High Court "may" order that a company which is unable to pay its debts be put into liquidation. While the Court retains a discretion not to order the liquidation of an insolvent company, it will not usually exercise that discretion in the absence of good reasons for doing so.
The recent case ofBay Flight 2012 Limited v Flight Care Limited is a reminder that holders of common law liens must take care to ensure that their lien is not extinguished by giving up possession.
In a decision concerning the expiry of a subordination agreement, the High Court has indicated that the priority of competing security interests is to be determined at the time the competing interests come in to conflict.
In Simpson v Commission of Inland Revenue (2012) 25 NZTC 20-119 (CA) the Court of Appeal held that receivers of a mortgagee which is not registered for GST must still account to Inland Revenue for GST on a mortgagee sale. This decision is controversial and pending possible resolution of the matter by an appeal to the Supreme Court, receivers of mortgagees that are not registered for GST should take legal advice as to how they should best proceed.
It’s now official. Priority between competing security interests under the Personal Property Securities Act (PPSA) is assessed at the time those interests come into conflict. This will usually, but not always, be when receivers are appointed.
The PPSA is silent on the issue but the general view, now confirmed by the High Court, has been that the rule established in the Canadian Sperry1 case is the correct approach.
In this case Westpac sought to have joint debtors Thomas and Sheena Fuller adjudicated bankrupt.
In Re Hurlstone Earthmoving Limited (in receivership and liquidation): Petterson v Gothard (No 3) [2012] NZHC 666, the liquidator of Hurlstone Earthmoving Limited sought orders under section 37 of the Receiverships Act 1993 compelling the receivers to provide company documents and information about the company's affairs after they had failed to comply with a notice under section 261 of the Companies Act 1993.
In the case of In Re Silverdale Developments (2007) Ltd (In Liq): Bunting v Buchanan [2012] NZHC 766, the shareholders of Silver Developments (2007) Limited (in liquidation) unsuccessfully applied to the Court to terminate the liquidation under section 250 of the Companies Act 1993.