Bradbury v Vance - [2009] NZCA 277

IN THE COURT OF APPEAL OF NEW ZEALAND
CA719/2008
[2009] NZCA 277
BETWEENGAYNOR NOREEN BRADBURY

Appellant

ANDDAVID STUART VANCE

Respondent

Hearing:18 June 2009

Court:Glazebrook, Potter and Keane JJ
Counsel:R C Laurenson for Appellant

J R Sumner and C L Potter for Respondent

Judgment:29 June 2009 at 3.30 pm

JUDGMENT OF THE COURT

A The appeal is dismissed.
BCosts are awarded to the respondent for a standard appeal on a Band A basis plus usual disbursements.

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REASONS OF THE COURT
(Given by Keane J)
[1]       On 31 October 2008, David Vance, the liquidator of Touchtec Equipment Marketing Limited (Touchtec), obtained summary judgment against Gaynor Bradbury for $40,000 under s 298 of the Companies Act 1993 (the Act).
[2]       Mrs Bradbury, it was uncontested, received from Touchtec two $20,000 payments, the first on 16 November 2004 and the second on 23 December 2004, at the behest of her son, Scott Anderson. Mr Anderson holds half the shares in Touchtec and was, until September 2004, a director of Touchtec, and at the time of the advances still retained control of Touchtec. It was also uncontested that these payments were made within three years of Touchtec going into liquidation on 31 August 2006.
[3]       The primary defence Mrs Bradbury then advanced, which Associate Judge Gendall rejected as untenable on the evidence, was that she did not receive the two payments from Touchtec. She contended that she received them from her son, or some entity other than Touchtec, on his instruction. On this appeal, she contends, the Associate Judge, in rejecting her defence, went against the weight of the evidence.
[4]       Mrs Bradbury’s second line of defence was that the payments to her resulted from the sale of shares, that she had purchased on her son’s advice, in a company in which her son also had an interest, Akamai Technologies New Zealand Limited (Akamai). That contention, the Associate Judge held, was unsupported by any evidence. On this appeal that finding is uncontested.
Central issue
[5]       It appears accepted on this appeal that the Associate Judge expressed accurately the effect of s 298(2)(b) of the Act, which captures company transactions entered into within three years of liquidation with directors, or persons in control, or relatives, and others closely related, where the consideration is either inadequate or excessive. So far as the provision applies, it says this:
Where, within the specified period, the company has disposed of … property … to –
(b)A … relative of a person, who, at the time of the disposition … had control of the company;

the liquidator may recover from the … relative … any amount by which the value of the … property … at the time of the disposition … exceeded the value of any consideration received by the company.

[6] Instead, on this appeal Mr Laurenson, counsel for Mrs Bradbury, contends that the Associate Judge wrongly gave summary judgment on the basis that, as it was put in Jowada Holdings v Cullen Investments Ltd CA 248/02, 5…

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 Bradbury v Vance

Details

AGLC: Bradbury v Vance [2009] NZCA 277
Case: [2009] NZCA 277
Decision Date: 29 June 2009

CaseChat Overview and Summary

In Bradbury v Vance, the Court of Appeal of New Zealand addressed an appeal brought by Gaynor Bradbury against the liquidator of Touchtec Equipment Marketing Limited, David Stuart Vance. The primary issue before the court was whether the Associate Judge correctly granted summary judgment against Mrs. Bradbury for $40,000 under section 298 of the Companies Act 1993. Mrs. Bradbury argued that the Associate Judge improperly rejected her defence that the payments she received from Touchtec were not made by the company but by her son, Scott Anderson, on his instruction. Additionally, she argued that the payments were made in relation to the sale of shares in Akamai Technologies New Zealand Limited. The court found that the Associate Judge accurately applied section 298(2)(b) of the Act, which allows for the recovery of excessive payments made to relatives of controlling persons within three years of a company's liquidation. The court concluded that the liquidator was entitled to summary judgment as the evidence did not support Mrs. Bradbury's defences. The appeal was dismissed, and costs were awarded to the respondent.

Orders