Finnigan v Butcher - [2012] NZHC 810

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

CIV-2011-488-301 [2012] NZHC 810

UNDER the Companies Act 1993

IN THE MATTER OF DRAGON FLYTE FARM LIMITED (In
Liquidation)

BETWEEN PERI FINNIGAN AND ROY HORROCKS
Applicants

ANDCARL DAVID GEORGE BUTCHER AND LYDIA KATE BUTCHER
Respondents

Hearing: 28 March 2012

Appearances: R Hern for Applicants (liquidators)
C D G Butcher, Respondent in person
R N Holdaway for AJ and RV Burgess (shareholders of Dragon Flyte) No appearance for L K Butcher

Judgment: 27 April 2012

RESERVED JUDGMENT OF ASSOCIATE JUDGE BELL

This judgment was delivered by me on 27 April 2012 at 4:30pm
pursuant to Rule 11.5 of the High Court Rules.
.......................................
Registrar/Deputy Registrar

Solicitors:
McElroys (Richard Hern) P O Box 835 Auckland 1140, for liquidators
Email: Richard.hern@mcelroys.co.nz

Norwest City Law (R N Holdaway), Waimauku Village Centre 0812
Email: admin@norwestcitylaw.co.nz

Copy for:
R V and A J Burgess, Turkey Flat Road, RD1, Te Kopuru 0391
Carl Butcher, 8 Settlers Way, RD 1 Okaihau 0475
Email: carlbutcher@xtra.co.nz

Case Officer: Paul.Lincoln@justice.govt.nz

FINNIGAN AND HORROCKS V BUTCHER AND BUTCHER HC WHA CIV-2011-488-301 [27 April 2012]

[1] The liquidators of Dragon Flyte Farm Ltd have applied for directions under s 284 of the Companies Act 1993. Mr Butcher also applied to the court for directions in respect of the liquidation. He sought leave to sue the company under s 248 of the Companies Act. This decision addresses matters in terms of the liquidators’ application, but also covers the matters which Mr Butcher raised in his application.

[2] Dragon Flyte Farm Ltd was incorporated on 4 December 2003. The company was a joint venture between two couples, Robert and Alison Burgess and Carl and Lydia Butcher. The Burgesses are the parents of Mrs Butcher. On incorporation there were 100 shares owned as follows:

68 shares owned by Robert and Alison Burgess and Hammonds Trustees Ltd as trustees of the Robert and Alison Burgess Family Trust;

28 shares owned by Carl and Lydia Butcher and Hammond
Trustees Ltd as trustees of the Carl and Lydia Family Trust;

1 share owned by Robert Burgess;

1 share owned by Alison Burgess;

1 share owned by Carl Butcher; and

1 share owned by Lydia Butcher.

The Burgess interests had 70 per cent of the original shareholding and the Butcher interests had 30 per cent.

[3] The Burgess’ shares were originally owned by the Robert and Alison Burgess

Family Trust. Those shares were later re-settled into the Burgess Family Trust on

15 December 2009. The trustees of the Burgess Family Trust were the same as the trustees of the Robert and Alison Burgess Family Trust until the resignation of Hammond Trustees Ltd.

[4] In February 2010 there was a shareholders’ resolution that the company be put into liquidation. The resolution appointed a Stephen Kim Bennett and Tim Hoyle of Whangarei as liquidators. The Burgesses and Butchers signed the resolution, but Hammonds Trustees Limited did not. Hammonds Trustees Limited resigned as shareholder of the Burgess Family Trust on 18…

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 Finnigan v Butcher

Details

AGLC: Finnigan v Butcher [2012] NZHC 810
Case: [2012] NZHC 810
Decision Date: 27 April 2012

CaseChat Overview and Summary

The High Court of New Zealand considered an application by the liquidators of Dragon Flyte Farm Ltd for directions under s 284 of the Companies Act 1993, as well as an application by Carl David George Butcher seeking leave to sue the company under s 248 of the Companies Act. The court heard arguments from the liquidators, the Burgesses, and Carl Butcher, who represented himself. The central issue was the ownership and disposition of the farm property at 590 Trounson Park Road. The court found that Dragon Flyte Farm Ltd was the legal owner of the property and that Carl Butcher and his wife did not have any legal or beneficial interest. The court rejected Butcher's claim that he was entitled to the property based on equity, pointing to the deed of 18 March 2005 which did not support such a claim. The court granted the liquidators directions to proceed with the sale of the property and to exclude Butcher from the premises. The court also rejected Butcher's claim for priority as an employee and ordered that his personal belongings be returned to him. The court declined to determine the amounts of the claims by Butcher and the Burgesses, as well as the validity of the former liquidators' appointment and their entitlement to remuneration, and directed a further hearing on these matters.

Orders