Broadbat Limited v Compass Group New Zealand Limited HC Auckland CIV 2008-404-001364

[2008] NZHC 2582

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2008-404-001364

IN THE MATTER OF     the Companies Act 1993

BETWEEN  BROADBAT LIMITED Applicant

ANDCOMPASS GROUP NEW ZEALAND LIMITED

Respondent

Hearing:         18 September 2008

Counsel:         No appearance for applicant

G A Hair for respondent

Judgment:      18 September 2008

ORAL JUDGMENT OF ASSOCIATE JUDGE ABBOTT

Solicitors:

Treadwells, PO Box 859, Wellington

Malley & Co, PO Box 1202, Christchurch

BROADBAT LIMITED V COMPASS GROUP NEW ZEALAND LIMITED HC AK CIV 2008-404-001364  18

September 2008

[1]      Broadbat Limited has applied to set aside a statutory demand served on it by the respondent, Compass Group New Zealand Limited.  The demand is for the sum of $35,853.81, and is pursuant to a judgment which Compass obtained against Broadbat (and another party jointly and severally) in the District Court at Dunedin on 12 September 2007.

[2]      Broadbat has applied to set aside the statutory demand on the grounds that there is a dispute as to whether it owes any money to Compass, notwithstanding this judgment.

Background

[3]      The matter has a complicated history.  Compass and the third party against whom it also obtained summary judgment (Southern Cleaning Services Limited) had a joint venture arrangement in relation to the provision of services to the Montecillo Rest Home in Dunedin.   Broadbat bought  the  assets  of  Southern  in  mid  2006, apparently including its contract with Montecillo.  Under a transitional arrangement Southern was to continue to collect debtors and account to Broadbat for them.  The collection of debtors was complicated by the fact that under the arrangement that had existed between Compass and Southern, Compass invoiced Southern for its services and Southern billed Montecillo for both parties’ services.

[4]      As I understand the application Broadbat says that Southern did not account to it for certain payments made to Southern by Montecillo under the transitional arrangement.   Broadbat contends that it is entitled to hold for itself certain other payments that Montecillo later made direct to Broadbat and which appear to include sums that should have been paid to Compass.

Non appearance by Broadbat

[5]      This application was listed for a defended hearing today at a list hearing on

7 May 2008.   Broadbat appeared by counsel at that hearing, and at a later call on

4 June 2008.   It subsequently filed a synopsis of argument in accordance with a direction given on 4 June 2008.

[6]      At the end of last week the solicitor for Broadbat wrote to the Court advising that he no longer had instructions from Broadbat.   He sought leave to withdraw, accordingly.  Broadbat has not appeared today.  I grant leave to withdraw as counsel, although the solicitor is to remain on the record until formal notice of change of representation is filed in accordance with the High Court Rules.

Disposal of application

[7]      Mr Hair has appeared today ready to argue the application should Broadbat have arranged alternative representation.  He informs me that Broadbat has not paid the debt.  In the absence of any appearance for Broadbat he asks that the application be dismissed, and seeks costs, including certification for the cost of his air travel from Christchurch.

[8]      I am satisfied that it is appropriate to strike the application out, both for non- appearance, and on substantive grounds.

[9]      In the latter respect I note that the matters which Broadbat has raised in its application and in the synopsis of counsel, were either traversed or were capable of being raised, in the summary judgment application under which Compass obtained its judgment.

[10]     I note that Broadbat’s director has contended that he was unaware of the summary judgment  proceeding  until  after  judgment  was  entered.    Whether  that would stand up to scrutiny I cannot say.  However, I note the application was served on Broadbat’s registered office on 20 July 2007, nearly 2 months prior to Compass obtaining its summary judgment in default of appearance.

[11]     Even more significantly, Broadbat has taken no steps since then to apply to set that judgment aside, notwithstanding that it has clearly been considering that as an option since demand for payment of the judgment was made in November 2007.

There was a short period where Compass agreed not to pursue its judgment whilst the dispute was considered, but Compass clearly indicated in February 2008 that it was proceeding and Broadbat (through its solicitor) indicated at that time that it saw “little option” but to apply to set aside.  I also adjourned the application at its first call specifically to allow the parties time to consider whether the alleged dispute was better addressed by Broadbat applying to set aside the judgment.  Mr Hair informs me no application has been made.

Decision

[12]     The application is struck out.

[13]     Broadbat is to pay costs to Compass of and incidental to this application on a

2B basis.

[14]     I also certify for the costs of Compass’ counsel in travelling to Auckland for this hearing.   Although Broadbat’s solicitor indicated by letter that he had no instructions, he did not apply to withdraw the application.  He simply sought leave to withdraw (as counsel and perhaps as solicitor on the record).  It was reasonable for Mr  Hair  to  come  to  Auckland  ready  to  argue  the  application.    A  synopsis  of argument had been filed for the applicant.   There was certainly a prospect that Broadbat could have sought to appear through other counsel (no reasons were give for the lack of instructions).

[15]     At  the  first  call  of  this  application  I  made  an  order  extending  time  for responding to the statutory demand pending further order of the Court.  I direct that

payment be made within 7 days, that is by 24 September 2008.

Associate Judge Abbott