Reynolds v Ascot Aluminium Ltd [2012] NZHC 1787 (20 July 2012)

Last Updated: 9 September 2012

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2012-404-001337 [2012] NZHC 1787

UNDER The Companies Act 1993

IN THE MATTER OF The Liquidation of NZB Developments Limited (In Liquidation) Formerly NZ Built Ltd

BETWEEN GRANT BRUCE REYNOLDS Applicant Liquidator

AND ASCOT ALUMINIUM LTD Respondent Creditor

Hearing: 20 July 2012 (on the papers) Counsel: S W Greer for applicant

M Keall for respondent

Judgment: 20 July 2012

_{INTERIM JUDGMENT OF ASSOCIATE JUDGE ABBOTT}

This judgment was delivered by me on 20 July 2012 at 4.30pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date...............

Solicitors:

S W Greer, Solv Law Limited, PO Box 12448, Penrose, Auckland 1642

K King, Wadsworth Ray, PO Box 26-301, Epsom

Counsel:

M Keall, PO Box 6905, Auckland

GRANT BRUCE REYNOLDS V ASCOT ALUMINIUM LTD HC AK CIV 2012-404-001337 [20 July 2012]

[1] This application for an order to set aside a payment as a voidable transaction is listed for a defended hearing on 6 August 2012. The matter has been put before me with counsel’s memoranda of 11 July 2012 (the applicant’s memorandum) and 17

July 2012 (the respondent’s memorandum) concerning an issue over service of an

underlying notice.

[2] The substantive application is brought on the ground that the applicant liquidator on 18 January 2012 served on the respondent’s registered office a notice under s 294 of the Companies Act 1993 to set aside a voidable transaction. The respondent did not file a notice of opposition, as a consequence of which the transaction has been set aside by operation of law. The liquidator’s application starts from that premise.

[3] It is apparent from the evidence before the Court that the notice was served on the respondent’s registered office and address for service as at the date of service (as recorded in the Companies Register). Although the liquidator did not appreciate the fact at that time, he now accepts that the premises were vacant. The evidence is that the respondent used the office of its tax agent as its registered office, and the tax agent went into receivership and ceased trading (and vacated the premises) about four months before the notice was served. The respondent did not change its registered office until about a month after the notice was served. The respondent says that the notice was not forwarded by the landlord of the premises.

[4] The parties take a different position over the best manner of addressing this issue. The applicant seeks an opportunity to re-serve the notice, and asks that the application be adjourned to allow time for that, and for filing of any notice of objection, followed by an amended application and opposition. The respondent considers that the application is a nullity, and should be discontinued.

[5] The notice is a step in a legal proceeding, and must be served in accordance with s 387 of the Companies Act 1993.1 There are two aspects to the test for service

_{under s 387:}

1 Re WSA (NZ) Ltd (in rec and liq) (1999) 13 PRNZ 629 (HC) at 634; Pauanui Properties Ltd v

(a) Service must be effected validly (i.e. in accordance with one of those methods); and

(b) Service must be effective, in that the party being served must be aware of the matter being served.2

[6] In the present case service clearly was valid (it was at the registered office/address for service of the respondent at the time of service),3 but equally clearly it was ineffective, in which case the Court has a discretion as to the relief to be granted so as to prevent any miscarriage of justice.4

[7] The above analysis answers the point raised by the respondent. The application is not a nullity. However, the parties need to consider how the issue over service should be addressed in terms of presenting the substantive arguments. Counsel for the applicant appears to concede that the respondent ought to be given the opportunity to raise opposition to the notice, as well as to the application. If that is the case, the course proposed by counsel (re-serve the notice, serve any opposition to it, and file an amended application) appears to be the practical course.

[8] Counsel are to confer in light of this decision, and advise the Court by memorandum to be filed by 4pm on 25 July 2012 whether they have been able to reach agreement on the procedure to follow.

[9] The Registrar is to allocate a telephone conference at 9am on 26 July 2012 for the purpose of giving further directions.

[10] The hearing scheduled for 6 August 2012 is to remain in place for the time being, although it appears unlikely that the parties will be in a position to proceed

_{that day.}

_{Walker HC Auckland CIV-2006-404-7589, 25 January 2007 at [8].}

2 Refer Argyle Estates Ltd v Bowen Group Ltd (2003) 17 PRNZ 57 (HC) per Laurenson J; Goh v

_{Ridgeview Properties Ltd (in liq) (2009) 24 NZTC 23,682 (HC) per Robinson AJ.}

3 _{Refer Goh v Ridgeview at [24].}

4 Refer Argyle Estates Ltd at [33]; Apparel By Design Ltd v Team Kiwi Racing Ltd HC Auckland

CIV-2007-404-5790, 21 December 2007 at [24] per Sargisson AJ; and Goh v Ridgeview at [30].

_{[11] Costs are reserved.}

Associate Judge Abbott