Dalton v Osmond - [2023] NZHC 282

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-1382

[2023] NZHC 282

UNDER the Companies Act 1993

IN THE MATTER OF

the liquidation of DELTA SHARED

SERVICES LIMITED (IN LIQUIDATION)

BETWEEN

SIMON DALTON and BENJAMIN BRIAN

FRANCIS as liquidators of
DELTA SHARED SERVICES LTD (In liq)
Applicants

AND

MURRAY ATHOL OSMOND

Respondent

Hearing: 21 November 2022

Appearances:

JRF Cochrane for the Applicants Respondent is self-represented

Date of judgment:

24 February 2023

JUDGMENT OF ASSOCIATE JUDGE C B TAYLOR

This judgment was delivered by me on 24 February 2023 at 3.00pm.
Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Solicitors:
Lane Neave, Auckland

Copy to:
Respondent

DALTON v OSMOND [2023] NZHC 282 [24 February 2023]

Introduction

[1] The applicants, the joint liquidators of Delta Shared Services Ltd (Delta), seeks orders under s 266 of the Companies Act 1993 that the respondent, Murray Osmond, produce company records and attend for examination.

Background

[2] Mr Osmond is the sole director of Deltrust Ltd (Deltrust). Deltrust is the sole shareholder of Delta Private Equity Ltd (Delta PE), which in turn is the sole shareholder of Delta.

[3] Delta was placed into liquidation on 27 May 2022. Simon Dalton and Benjamin Francis were appointed joint liquidators of the company. They attempted to contact Mr Osmond in relation to Delta. Mr Osmond did not respond.

[4] The liquidators subsequently served on Mr Osmond a Request for Documents and Information Letter under s 261 of the Companies Act (the Notice). The Notice required Mr Osmond to provide financial records of Delta and attend on the liquidators to be examined on oath on 6 July 2022. But Mr Osmond did not comply with the Notice. He did not provide the required documents or make himself available for examination.

Originating application

[5]The liquidators apply for orders requiring Mr Osmond:1

(a)to produce and deliver up to the liquidators all books, records, documents and any other property of or relating to the business, accounts or affairs of Delta in his possession or under his control;

(b)to confirm on oath by way of affidavit that he has diligently searched for all books, records, documents and other property of Delta and delivered what he has in his possession or control to the liquidators;

1 Originating application on notice for orders to produce books, records and documents and to attend before the court for examination dated 3 August 2022 at [1].

(c)to list in a schedule to his affidavit the books, records, documents and other property of Delta in his possession or control that he has produced or delivered to the liquidators; and all books, records, documents, and other property of Delta that are no longer in his possession or control, or which were never in his possession or control, including their last known or suspected location, and the name of the person or persons in whose possession or control they are believed…

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 Dalton v Osmond

Details

AGLC: Dalton v Osmond [2023] NZHC 282
Case: [2023] NZHC 282
Decision Date: 24 February 2023

CaseChat Overview and Summary

In Dalton v Osmond, the joint liquidators of Delta Shared Services Ltd (Delta) sought orders under the Companies Act 1993 that Murray Osmond produce company records and attend for examination. Osmond is the sole director of Deltrust Ltd, which is the sole shareholder of Delta Private Equity Ltd, which in turn is the sole shareholder of Delta. Delta was placed into liquidation, and the liquidators attempted to contact Osmond in relation to Delta, but he did not respond. The liquidators served Osmond with a Request for Documents and Information Letter under s 261 of the Companies Act, but he did not comply with the Notice. The liquidators applied for orders requiring Osmond to produce books, records, documents, and other property of or relating to the business, accounts, or affairs of Delta in his possession or under his control, and to attend before the Court and be examined on oath or affirmation. Osmond opposed the application on the grounds that he is not a director or shareholder of Delta and does not hold any books, records, or documents of the company. The Court held that Osmond is a person to whom ss 261, 266, and 274 of the Companies Act apply and granted the orders sought by the liquidators. The Court found that Osmond had had considerable involvement in Delta's affairs and that further inquiry as to any documents or records of knowledge he may have is justified. The Court also held that the liquidator's requests are reasonable and necessary and will not be unduly burdensome to Osmond.

Orders