IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE	
CIV-2020-419-49
[2020] NZHC 1709	

UNDER	the Insolvency Act 2006	
BETWEEN	JEWEL’EE ELIZABETH HENDRY
Insolvent	
AND	ASB BANK LIMITED, CASH CONVERTERS LIMITED and FLEXI
CARDS LIMITED trading as Q CARD, EC CREDIT CONTROL LIMITED, HARMONEY LIMITED, MILTON GRAHAM LIMITED and DAVID SHANNON PINFOLD
Creditors	

Hearing:	13 July 2020	
Appearances:	Ms Parker for Insolvent
No appearance for Creditors	
Judgment:	15 July 2020	

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 15 July 2020 at 4.15pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 15 July 2020

HENDRY v ASB BANK LIMITED [2020] NZHC 1709 [15 July 2020]

[1]	The insolvent, Jewel’ee Elizabeth Hendry, seeks approval of a proposal under Part 5 of the Insolvency Act 2006 (the Act).

[2]	The insolvent lodged her proposal with the Court on 20 November 2019.

[3]	Ms Liggins accepted the role as provisional trustee and took on the task of sending the proposal to creditors. There was some delay in the finalisation of the meeting date, due to the need for a new affidavit and statement of affairs to be filed with the court. That meant the original meeting date of 5 February 2020 was adjourned to 5 March 2020 and I will return to the significance of this when discussing service below.

[4]	When the meeting was convened on 5 March, the proposal was accepted by the required majority of creditors that voted at the meeting, both in number and in value. All votes were by way of postal vote.

Call of creditors meeting

[5]	Section 330(1) of the Act provides:

(1)	The provisional trustee must, as soon as practicable after the proposal is filed, call a meeting of creditors by posting to every known creditor at the creditor’s last known address -

(a)	a notice of the date, time, and place of the meeting:

(b)	a summary of the insolvent’s assets and liabilities:

(c)	a copy of the proposal and particulars of any charge or guarantee:

(d)	a creditor’s claim form:

(e)	a postal vote in the prescribed form.

[6]	In this case, the provisional trustee emailed the notice of meeting to creditors. I have previously commented on the use of email for the giving of such notices.1

1	Henshaw v ANZ National Bank Ltd [2019] NZHC 3330.

[7]	It is possible in this case to determine that notice of the proposal was given.   I say that, as of the six creditors covered by the proposal, four of them did vote by way of postal vote so they must have received not only notice of the original meeting but also of the adjourned meeting date.   One creditor actually attended the meeting on   5 February, having not caught up with the fact the meeting had been adjourned for one month. So, it is safe to conclude that creditor received the original notice of the proposal and Ms Liggins has sworn in  her  affidavit  that  he was  given  notice of the adjourned date.

[8]	That leaves one creditor, Flexi Cards Ltd trading as Q Card. Ms Liggins advised the Court that the creditor referred its debt to a debt collection agency which ultimately did not send in a postal vote as it was awaiting further information from Flexi Cards Ltd. I infer from this that Ms Liggins had been in discussions with the debt collection agency in order to be able to provide this confirmation. If the assumption I have made in this regard is wrong, Ms Liggins is to immediately advise the court. In any event, the debt collection agency confirmed by email, receipt of notice of this application.

[9]	On that topic, there is an affidavit of service confirming the present application was notified by post or email to all creditors. No creditor has taken any step in opposition.

[10]	As to the substance of the application, it appears to me to be an application that should be approved. The proposal is in the prescribed form as required by s 327 of the Act. The trustee’s report confirms the procedure at the meeting of creditors was followed and the report produced complies with the Insolvency (Personal Insolvency) Regulations 2007.

[11]	Nothing about the proposal is unreasonable or calculated not to benefit the general body of creditors, that being the guiding criteria for refusing approval under s 333(3) of the Act.

[12]	The Court should only refuse to give approval if one or more of the trigger paragraphs in s 333(3) of the Act applies. The approach normally taken to proposals

is that set out by Hardie Boys J in Re Bennetts Proposal,2 which was subsequently quoted with approval in Farmer v Rowley:3

I think the Court should accept the view of the creditors, or the majority of them, and grant approval unless it is apparent that one of the grounds for refusing approval exists.

[13]	Commercially experienced creditors have decided to accept the proposal. It is calculated to return approximately 60 per cent of the insolvent’s indebtedness (less costs of administering the proposal).

Order

[14]	I am satisfied it is appropriate there be an order as sought approving the proposal by the insolvent, Jewel’ee Elizabeth Hendry, under pt 5, subpt 2 of the Insolvency Act 2006 made on 17 October 2019 and there is an order accordingly.

Associate Judge Lester

Solicitors:
Webster Malcolm Law, Warkworth Lawlink House, Warkworth

2	Re Bennetts Proposal HC Christchurch B138/81 and M306/81, 1 February 1982 (alternative citation: Re Duncan Holdings Limited (in liquidation).
3	Farmer v Rowley [1992] 2 NZLR 195 (CA) at 195.