CORNER TRADING LIMITED trading as Mitre 10 Mega Invercargill Judgment Creditor/ AND GARETH RICHARD MUIR Judgment Debtor/
[2024] NZHC 3199
•31 October 2024
IN THE HIGH COURT OF NEW ZEALAND INVERCARGILL REGISTRY
I TE KŌTI MATUA O AOTEAROA WAIHŌPAI ROHE
CIV-2024-425-21
[2024] NZHC 3199
UNDER the Insolvency Act 2006 IN THE MATTER
of the bankruptcy of GARETH RICHARD MUIR
BETWEEN
CORNER TRADING LIMITED trading as Mitre 10 Mega Invercargill
Judgment Creditor/Applicant
AND
GARETH RICHARD MUIR
Judgment Debtor/Respondent
Hearing: (On the papers) Counsel:
C Shannon and J Gunn for Judgment Creditor
Judgment:
31 October 2024
JUDGMENT OF ASSOCIATE JUDGE LESTER
(substituted service)
CORNER TRADING LIMITED trading as Mitre 10 Mega Invercargill v MUIR [2024] NZHC 3199 [31 October 2024]
[1] The judgment creditor, Corner Trading Limited trading as Mitre 10 Mega Invercargill, applies for an order for substituted service against the judgment debtor, Mr Muir.
[2] I am satisfied having regard to the evidence filed that reasonable efforts have been made to serve the bankruptcy notice on the judgment debtor and that it cannot be promptly served.
[3] I am further satisfied that the following directions I make represent the method of service likely to bring the bankruptcy notice to the attention of the judgment debtor.
Order
[4]I order:
(a)Personal service of the bankruptcy notice on the judgment debtor is dispensed with.
(b)Service of the bankruptcy notice on the judgment debtor will be deemed to be effected upon the completion of the following steps:
(i)the bankruptcy notice and a copy of the sealed order in respect of substituted service is to be emailed to the address given in the application dated 30 October 2024;
(ii)a copy of the bankruptcy notice and a copy of the sealed order for substituted service are to be served in a sealed envelope addressed to Mr Muir at the address given in paragraph [5] of the affidavit of Mr David Storey affirmed 30 October 2024 and either left with an adult occupant of that property or attached to the front door of the property if there is no adult occupant present.
(c)The documents will be treated as served one working day after the completion of both the above steps.
(d)The application for substituted service is adjourned with leave to the judgment creditor to request by memorandum a further order as to substituted service in the event any adjudication application cannot be promptly served (in which event the memorandum should contain counsel’s confirmation that either the judgment debtor can still not be located, or attaching evidence as to subsequent difficulties of service).
(e)The costs of the application are fixed on a 2B basis and are, with disbursements, to be costs in the cause.
Service of bankruptcy notice overseas
[5] The affidavit of Mr David Storey filed in support of the application for substituted service suggests Mr Muir is in Australia.
[6] McGechan on Procedure provides: “A bankruptcy notice is a document that may be served outside New Zealand only pursuant to leave granted under r 6.30”. Leave is not expressly sought by the judgment creditor but I have taken it that an application for leave is inherent in the judgment creditor seeking to serve Mr Muir who may well be in Australia.
[7] Section 17(3) of the Insolvency Act 2006 requires that a bankruptcy notice must be served on a debtor in New Zealand unless permission of the Court is granted for service outside of New Zealand. Associate Judge Bell in Westpac New Zealand Ltd v Bolton set out his approach when considering whether to grant leave which was to look ahead to any future bankruptcy application by the creditor which relied on non-compliance with the bankruptcy notice.1 His Honour had regard to the criteria under r 6.28(5) of the High Court Rules 2016 (the Rules) in considering whether leave should be granted to serve an adjudication application out of New Zealand. The Judge then considered whether it was appropriate for the bankruptcy of the debtor to be administered in New Zealand. If the Judge was satisfied
1 Westpac New Zealand Ltd v Bolton [2014] NZHC 693. See also Jessica Gorman and others
McGechan on Procedure (online ed, Thomson Reuters) at [HR6.36.01].
on those factors he would generally grant leave for the bankruptcy notice and the bankruptcy application at the same time. I adopt his Honour’s approach.
[8] Under r 6.28(5) of the Rules, the Court may grant leave for an originating document to be served out of New Zealand if the claim has a real and substantial connection to New Zealand, there is a serious issue to be tried on the merits, and New Zealand is the appropriate forum for the trial.
[9] Mr Muir owns a property in Invercargill. The bankruptcy proceeding therefore has a real and substantial connection to New Zealand.
[10] I am satisfied it is appropriate that leave be granted under r 6.30 of the Rules that the bankruptcy notice be served outside of New Zealand I grant leave, if necessary, for the originating documents in this matter, that is the application for adjudication, to be served out of New Zealand.
[11] Pursuant to s 17(4)(b) of the Insolvency Act, the Court may extend the time for Mr Muir to comply with the bankruptcy notice. Given Mr Muir made a part-payment against the debt when contacted by the creditor’s process server, I extend the time for Mr Muir’s compliance with the bankruptcy notice from 10 working days to 20 working days pursuant to s 17(4)(b) of the Insolvency Act .
Associate Judge Lester
Solicitors:
Duncan Cotterill, Christchurch (for Judgment Creditor)
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