Boult v Cain - [2022] NZHC 3110

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2022-409-196

[2022] NZHC 3110

UNDER the Companies Act 1993

IN THE MATTER

of an application to reverse or modify a

liquidator’s decision in the liquidations of Stonewood Homes Limited (in liquidation), Stonewood Homes New Zealand Limited (in liquidation) and Holmfirth Group

Limited (in liquidation)

BETWEEN

JAMES BOULT and BRENT ALFRED METTRICK

Applicants

AND

RHYS JAMES CAIN

Respondent

Hearing: On the papers

Appearances:

R K P Stewart for Crux Publishing G J Ryan for Applicants

J K Stringer for Respondent M J Borcoski for G Ball

Judgment:

25 November 2022

JUDGMENT OF DUNNINGHAM J

This judgment was delivered by me on 25 November 2022 at 3.15 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

BOULT and METTRICK v CAIN [2022] NZHC 3110 [25 November 2022]

Introduction

[1] This litigation arises in the course of the liquidation of the Stonewood Group of companies. Mr Cain is the remaining liquidator of those companies. Mr Boult and Mr Mettrick, the applicants, were the directors of the companies.

[2] Mr Cain initiated proceedings alleging the directors breached the duties they owed to the companies (the Directors’ Duties Proceedings). However, the Directors’ Duties Proceedings were settled when the parties entered into a confidential settlement agreement dated 23 July 2021.

[3] The current proceedings were initiated by the directors to reverse the liquidator’s decision to allow the liquidation committee of Stonewood Homes Limited (in liq) to inspect some of the Court documents relating to the proceeding (the Liquidation Decision Proceedings).

The application for Access to Court Documents

[4] The application I have before me is an application by Crux Publishing Ltd (Crux) for access to Court documents. Crux operates a website publishing news and articles of interest to the Southern Lakes Area of New Zealand. Mr Boult was formerly the mayor of Queenstown Lakes District Council and Crux took a particular interest in Mr Boult’s role in the collapse of the Stonewood Group of companies.

[5] To that end, Crux has been following the Directors’ Duties Proceedings and made an application for access to Court documents in respect of those proceedings. While it was initially granted access to some documents by the High Court1 the Court of Appeal subsequently ruled that Associate Judges have no jurisdiction to grant access to court documents and the application is still to be determined by a High Court Judge.

[6] Crux has now become aware of these separate Liquidation Decision Proceedings and seeks access to certain documents on the Court file.

1 Cain & Logan v Mettrick & Boult [2022] NZHC 258.

[7]In its application, Crux says it seeks access to the documents because:

The public has a genuine interest in knowing about litigation involving the collapse of a substantial group of companies owing many millions of dollars to creditors … Access to these documents will assist Crux to fairly and accurately report the nature and purpose of…

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.

Continue reading Boult v Cain

Details

AGLC: Boult v Cain [2022] NZHC 3110
Case: [2022] NZHC 3110
Decision Date: 25 November 2022

CaseChat Overview and Summary

This case involved an application to reverse or modify a liquidator's decision in the liquidations of Stonewood Homes Limited (in liquidation), Stonewood Homes New Zealand Limited (in liquidation), and Holmfirth Group Limited (in liquidation). The applicants were James Boult and Brent Alfred Mettrick, former directors of the companies, and the respondent was Rhys James Cain, the remaining liquidator of the companies. The central issue was whether Crux Publishing Ltd, an entity operating a website publishing news and articles of interest to the Southern Lakes Area of New Zealand, should be granted access to certain court documents relating to the liquidation proceedings. The application was governed by the Senior Courts (Access to Court Documents) Rules 2017.

The Court considered the application under the Rules, particularly rule 8, which grants the right to access the formal Court record relating to a civil proceeding, unless limited or prohibited by any enactment or Court order or direction. The Court determined that Crux was entitled to access the originating application as it was part of the formal Court record. The Court also evaluated the factors outlined in rule 12, which include the orderly and fair administration of justice, the right of a defendant in a criminal proceeding to a fair trial, and the principle of open justice. The Court concluded that granting access to the documents would not compromise any privacy interests or fair trial concerns and would uphold the principle of open justice.

The Court granted the application by Crux for access to the originating application brought by Boult and Mettrick to reverse or modify a decision of a liquidator pursuant to s 284 of the Companies Act 1993. The Court did not need to determine the balance of the application, as the applicant had access to these documents as of right. The decision was made in accordance with the Senior Courts (Access to Court Documents) Rules 2017, ensuring the balance between open justice and the protection of privacy and fair trial rights.

Orders