Collins & May Law v Memelink - [2019] NZHC 36

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2018-485-000686

[2019] NZHC 36

UNDER the Insolvency Act 2006

IN THE MATTER

of the bankruptcy of HARRY MEMELINK

BETWEEN

COLLINS & MAY LAW

Judgment Creditor/Respondent

AND

HARRY MEMELINK

Judgment Debtor/Applicant

AND

OFFICIAL ASSIGNEE

Respondent

Hearing: On Memoranda filed 26 November 2018 and 28 November 2018

Appearances:

D G Dewar for Judgment Creditor (Collins & May Law) and for Supporting Creditor (M R Bott)

C Matsis for Supporting Creditors (Bodies Corporate 68792, 81012 and 378945)

G W D Manktelow for Bankrupt (H Memelink) P R W Chisnall for Official Assignee

Judgment:

29 January 2019

JUDGMENT OF JUSTICE OSBORNE

(on application to set aside stay on advertising)

Mr Memelink’s bankruptcy

[1] Mr Memelink was adjudicated bankrupt on 28 August 2018. He has subsequently applied for annulment of his adjudication. That application is opposed by the judgment creditor and others and is yet to be heard.

COLLINS & MAY LAW v MEMELINK [2019] NZHC 36 [29 January 2019]

The stay orders

[2] In the meantime, Mr Memelink had also filed an interlocutory application seeking orders staying advertising of his adjudication and the administration of his bankrupt estate.

[3] The Court on an urgent basis (without notice) made the requested interim orders on 7 September 2018.1

[4] On the application of creditors and the Official Assignee, the Court on 29 October 2018 rescinded the order staying the administration of Mr Memelink’s bankruptcy. The Court adjourned the remaining aspect of the application (for rescission of the stay on advertising) pending the filing of further evidence and submissions.

The statutory regime on adjudication

[5] Section 65 Insolvency Act 2006 requires that an adjudication be advertised. It provides:

65 Assignee must advertise adjudication

(1)The Assignee must advertise the adjudication of the bankrupt as soon as practicable after it has occurred.

(2)The Assignee must advertise the adjudication in the prescribed manner.

(3)Subsection (1) is subject to section 66.

[6] Section 65(3) of the Act makes advertising subject to the provisions of s 66 of the Act. Section 66 allows a stay of advertising (as in fact ordered by the Court on 7 September 2018). It provides:

66Order that Assignee must not advertise pending appeal or application for annulment

The court may order that the Assignee must not advertise the adjudication if the bankrupt has appealed against an order of

1 Counsel for Mr Memelink served the application and associated documents on the Official Assignee on a “Pickwick” basis. However the Assignee did not appear and the matter accordingly proceeded on a without notice basis.

adjudication or if the bankrupt has applied for an annulment of the adjudication.

[7] The powers under s 66 of the Act were considered by this Court in Re Parlane, ex parte Young.2 In that case the bankrupt had applied for orders suspending his adjudication and bankruptcy pending an appeal and requiring the Official Assignee not to advertise the adjudication until after the determination 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.

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Details

Case: [2019] NZHC 36
Decision Date: 29 January 2019

CaseChat Overview and Summary

Collins & May Law, a judgment creditor, brought an application to set aside an interim stay of advertising in the bankruptcy of Harry Memelink. Mr Memelink had earlier applied for an interim stay of advertising and the administration of his bankrupt estate. The Court granted the stay of advertising on 7 September 2018 and later rescinded the stay of administration on 29 October 2018. The Court heard the matter on 26 and 28 November 2018 and gave its decision on 29 January 2019. The main legal issues were whether the stay of advertising should be lifted and whether the Official Assignee should be allowed to advertise Mr Memelink’s bankruptcy. The Court found that advertising was necessary for the Assignee to obtain a full appreciation of the bankrupt’s estate and for the creditors to learn of the bankruptcy. It concluded that Mr Memelink’s health issues did not warrant a continued stay of advertising. The Court rescinded the stay of advertising and reserved costs.

Orders