Erwood v Maxted, Maxted and Glasgow - [2009] NZCA 19

IN THE COURT OF APPEAL OF NEW ZEALAND
CA567/07
CA631/07
CA545/2008
[2009] NZCA 19
BETWEENROBERT JOHN ERWOOD

Appellant

ANDJANET MAXTED AND JANET MAXTED AND ALEXANDER JAMES JEREMY GLASGOW AS TRUSTEES OF THE ESTATE OF EDWARD ERWOOD OF NELSON

First Respondents
ANDTHE OFFICIAL ASSIGNEE

Second Respondent

Hearing:17 February 2009

Court:William Young P, Hammond and Robertson JJ
Counsel:R J Erwood by video link

C R Carruthers QC for Mrs Harley and First Respondents
P R W Chisnall for Official Assignee
N Levy as amicus curiae

Judgment:17 February 2009 at 5.30 pm

JUDGMENT OF THE COURT

ATHE STAYS ON PUBLIC ADVERTISING AND THE CALLING OF CREDITORS’ MEETING ARE LIFTED.
BThe application for a stay pending appeal to the Supreme Court is dismissed.
CCosts are reserved.

____________________________________________________________________
REASONS OF THE COURT
(Given by William Young P)
[1]       At the end of the hearing this morning we lifted the stays on advertising and the calling of creditors’ meetings. We said we would give our reasons later. We also rejected an application by Mr Erwood for stays pending appeal to the Supreme Court. We now give our reasons.
[2]       This and related appeals have had a turgid history which is reviewed in our judgment delivered on 23 December 2008, Erwood v Maxted [2008] NZCA 571 – a judgment which concluded in this way:
[8]       Accordingly:
(a)    The proceedings are to be called on 17 February 2009, pending which the stay on public advertising is to remain in place.
(b)    If the creditors have been paid (or are satisfied with arrangements for resolution of any remaining dispute and payment) by that time, the bankruptcy will be annulled.
(c)    If not, the remaining applications will be adjourned for a fixture but on the basis that the stay will be lifted.
(d)    We reserve all questions of costs.

[3]       Mr Erwood has not ensured that his creditors have been paid and in practical terms has taken no steps towards providing security. Instead, he has filed a number of documents in the Court which are full of complaint about the processes which have been followed to date, including challenges to the composition of the bench – challenges which we reject as groundless.
[4]       The Official Assignee has collected or identified cash assets in excess of $900,000 which apparently belong to Mr Erwood, albeit that ostensibly they are owned by “Robert Wood”. The value of the assets collected far exceeds any likely exposure to creditors. Mr Erwood’s intransigence in relation to Mrs Maxted (who has not yet been paid) thus precipitated a bankruptcy which was eminently avoidable. Throughout he has chosen to insist on what he sees as his rights and has failed to recognise that other participants in this dispute also have rights. In that context, his failure to pick up the option which was left to him in the judgment of 23 December 2008 was unsurprising.
[5]       Mr Erwood would like the status quo to remain (ie the stays) while the outstanding proceedings in this Court are heard and…

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: [2009] NZCA 19
Decision Date: 17 February 2009

CaseChat Overview and Summary

The case of Erwood v Maxted, Maxted and Glasgow concerns the bankruptcy of Robert John Erwood, who appeals against the lifting of stays on public advertising and the calling of creditors’ meetings by the Court of Appeal of New Zealand. The respondents include Janet Maxted and Alexander James Jeremy Glasgow as trustees of the estate of Edward Erwood of Nelson, and the Official Assignee. The primary legal issues revolve around whether the stays on public advertising and creditors’ meetings should be lifted and whether there should be a stay pending appeal to the Supreme Court. The Court of Appeal rejected the application for a stay pending appeal to the Supreme Court.

The Court of Appeal found that Mr Erwood had not ensured his creditors were paid and had not taken steps to provide security, which led to the bankruptcy proceedings. The Official Assignee had collected cash assets exceeding $900,000, which appeared to belong to Mr Erwood. The Court emphasised that Mr Erwood's intransigence towards Mrs Maxted, who remained unpaid, precipitated a bankruptcy that was avoidable. The Court dismissed Mr Erwood's application for a stay pending appeal to the Supreme Court, noting that it would further disrupt the bankruptcy proceedings and potentially prejudice new creditors. The Court also lifted the stays on public advertising and creditors’ meetings, directing the bankruptcy to proceed in accordance with statutory procedures.

Orders