IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404822 [2013] NZHC 1793

BETWEEN	TATA (NZ) LIMITED Plaintiff

AND	INSPIRATION HOMES LIMITED Defendant

Hearing:	9 July 2013

Appearances:	Mr Hucker for plaintiff
Mr Hutcheson for defendant

Judgment:	9 July 2013

ORAL JUDGMENT OF ASSOCIATE JUDGE J P DOOGUE

TATA (NZ) LIMITED v INSPIRATION HOMES LIMITED [2013] NZHC 1793 [9 July 2013]

[1]       This  proceeding  does  not  yet  have  a  date  for  hearing  the  substantive application for an order appointing liquidator/s.  The proceeding has been adjourned from time to time while applications variously for orders seeking orders restraining advertising which the defendant filed, an order for appointment of an interim liquidation (which the plaintiff filed) were dealt with.

[2]       The point has now been reached, though, where Mr Hutcheson advises that his client will no longer be opposing an application for appointment of liquidator/s. Mr Hutcheson says that while his client does not accept that it is indebted in the sum of over $1,000,000 which is the figure that the plaintiff asserts, nonetheless it accepts that it is unable to pay a debt which it owes to the plaintiff which is sufficiently large to justify the making of a liquidation order.

[3]       The application to place the company into liquidation was based upon the inability of the company to pay its debts.   Because that proceeding is essentially unopposed at this point, I assume that the allegations which the plaintiff makes about the defendants inability to pay its debts as they fall due is one of substance and can be proved.  In those circumstances, it seems appropriate that an earlier order made to restrain advertising should be discontinued.  The last date upon which such an order was made was 7 June 2013 when Sargisson AJ directed a stay of advertising until further order of the Court.  In my view the order of the Court at this point ought to be that the stay is terminated and I direct accordingly.

[4]       Mr  Hucker  for  the  plaintiff  invited  me  to  make  an  order  today  for appointment of an interim liquidator.   I have heard from counsel concerning the factual matters which the plaintiff alleges support the making of such an order. Those are the matters that were identified in Robert Bryce and Co Ltd v Chicken and Food Distributors Ltd.1   Those issues are:

a)	Whether the company’s assets are in jeopardy;

b)	Whether the status quo should be maintained;

c)	Whether the interests of creditors are safeguarded.

[5]       Judge Bell was earlier asked to make an interim order for appointment of liquidator on an without notice basis.  In his decision2  His Honour expressed doubt that on a without notice basis he ought to make such an order.  The points that he made at paragraph 10 and following of his minute about the alleged risks remain valid.

[6]       I am not satisfied that there has been any change in the circumstances since Judge Bell gave his decision in February which would justify the appointment of an interim liquidator.   I am also influenced by the consideration that the substantive liquidation proceeding will be resolved at an early date now that it is clear that the proceeding is going to be unopposed.   I therefore decline to make an order for appointment of interim liquidator.

[7]       The way is now clear for the plaintiff to advertise the liquidation proceeding. That is going to take a number of days to complete and I consider that the most appropriate date for the matter to be called next is 2 August 2013.  The proceeding is to be placed in the liquidation list at 10.45 a.m. that day.

[8]       Mr Hucker seeks costs on a 2B basis in respect of the two applications that I have mentioned, the application for stay of advertising and on the application for appointment of an interim liquidator.   As to the first, it would be appropriate in accordance with r 14.29(a) of the High Court Rules that the defendant pay the costs of the application to restrain advertising, while interim orders were made on the application as Mr Hucker has pointed out, these were made without argument.  In the end, though, the withdrawal of the opposition to the making of the substantive order means that that application became doomed at that point and therefore is to be regarded as an unsuccessful application.  The plaintiff will have costs on a 2B basis with regard to that application with disbursements to be fixed by the Registrar.

J.P. Doogue
Associate Judge