Body Corporate 207650 v Singh - [2019] NZHC 1547

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-000116

[2019] NZHC 1547

BETWEEN
BODY CORPORATE 207650

Judgment Creditor

AND

CHERYL SITARA SINGH

Judgment Debtor

Hearing: 17 May 2019

Appearances:

T J G Allan and T P Kelly for the Judgment Creditor S Bryers for the Judgment Debtor

Judgment:

3 July 2019

Reissued:

4 July 2019

JUDGMENT OF HINTON J

This judgment was delivered by me on 3 July 2019 at 10.00 am pursuant to Rule 11.5 of the High Court Rules

…………………………………………………………………… Registrar/Deputy Registrar

Counsel/Solicitors:
Stephen Bryers, Barrister, Auckland Grove Darlow & Partners, Auckland

BODY CORPORATE 207650 v CHERYL SITARA SINGH [2019] NZHC 1547 [3 July 2019]

[1] This is an application to halt a bankruptcy adjudication under s 37 of the Insolvency Act 2006. The section refers to refusing an adjudication, but both parties have referred in their submissions to this being an application to halt adjudication.

Background

[2] There has been a lengthy and expensive history to this litigation, which is over non-payment of special levies. The levies relate to construction work undertaken to repair and maintain a building known as “Richmond Terraces”.

[3] On 20 December 2017, Judge G M Harrison entered judgment in the District Court at Auckland against Ms Singh for the sum of $181,561, plus costs.

[4] Prior to that there had been proceedings in the High Court over whether the levies were lawful.1

[5] After Judge Harrison’s decision, Ms Singh unsuccessfully appealed to this Court and unsuccessfully sought leave to appeal to the Court of Appeal. Both the appeal and the leave to appeal were heard before me.

[6] A number of the judgments have made comment on Ms Singh’s re-litigation of issues. Many of her arguments were technical. Even on the application for leave to the Court of Appeal, Ms Singh raised new and technical points which I allowed to be argued, erring materially in her favour in doing so. This resulted most unusually in a judgment longer than that she sought to appeal.

[7]As at 19 March 2018, Ms Singh owed the Body Corporate approximately

$207,000 on the basis of which the Body Corporate served a bankruptcy notice, having first obtained an order for substituted service.

[8] Ms Singh failed to comply with the bankruptcy notice and as a result committed an act of bankruptcy.

1 Body Corporate 207650 v Speck [2017] NZHC 966 per Lang J. The proceeding involved more parties than just Ms Singh.

[9] The Body Corporate applied for adjudication. That application and summons were served on Ms Singh on 26 November 2018.

[10] Ms Singh applied to halt the adjudication proceeding and it is that application that is addressed in this judgment.

Key arguments

[11] Ms Singh relies on two matters in submitting that the Court should exercise its discretion to decline adjudication and/or halt the bankruptcy for a defined period:

(a)She says she will be able to pay the amount of the judgment obtained by the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2019] NZHC 1547
Decision Date: 3 July 2019

CaseChat Overview and Summary

The case involves an application by Body Corporate 207650 to halt a bankruptcy adjudication against Cheryl Sitara Singh. The primary dispute revolves around non-payment of special levies for construction work undertaken at "Richmond Terraces". The matter has been litigated extensively, with Singh having unsuccessfully appealed against a District Court judgment and a subsequent High Court decision. The Body Corporate applied for adjudication after Singh failed to comply with a bankruptcy notice. Singh sought to halt the adjudication on the basis that she would be able to pay the debt once she sold her unit and that she had a claim against third parties that should be pursued first. The court considered the relevant legal principles, including the discretionary power to halt adjudication, and evaluated the arguments presented by both parties. The court found that Singh had not demonstrated a viable plan to pay the debt or a strong claim against third parties. It concluded that it would not be just and equitable to halt the adjudication and dismissed Singh's application. The court also made an order adjudicating Singh bankrupt and granted the Body Corporate costs.

The final orders of the court included dismissing the application to halt the bankruptcy, adjudging Cheryl Sitara Singh bankrupt, and awarding costs to the Body Corporate. The time of adjudication was set as the time of the release of the judgment. The Body Corporate was entitled to file submissions on costs within a specified period, and Singh was required to respond to those submissions within an additional period.

Orders