FLORANZ (2015) LIMITED AND ANDREW ROBERT RITCHIE
[2024] NZHC 2636
•12 September 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2024-404-1591
[2024] NZHC 2636
UNDER section 290 of the Companies Act 1993 IN THE MATTER
of an application to set aside a statutory demand
BETWEEN
FLORANZ (2015) LIMITED
Applicant
AND
ANDREW ROBERT RITCHIE
Respondent
Hearing: 28 August 2024 Appearances:
D M Kraitzick for Applicant N W Woods for Respondent
Judgment:
12 September 2024
JUDGMENT OF ASSOCIATE JUDGE PAULSEN
This judgment was delivered by me on 12 September 2024 at 4.15 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date:
FLORANZ (2015) LIMITED v RITCHIE [2024] NZHC 2636 [12 September 2024]
[1] This is an application to set aside a statutory demand issued by Mr Ritchie to Floranz (2015) Ltd demanding payment of $54,575.30, being a debt owing under an agreement dated 2 October 2019 granting Mr Ritchie a lease and option to purchase land. Floranz accepts the debt is owing but applies to set aside the statutory demand under s 290(4)(b) of the Companies Act 1993 on the ground that it has counterclaims against Mr Ritchie which exceed the amount of the demand.
[2]The issues that arise are:
(a)Does Floranz appear to have fairly arguable counterclaims against Mr Ritchie?
(b)Is the amount of Mr Ritchie’s demand less the amount of the counterclaims less than the prescribed amount of $1,000?1
(c)Should the Court set aside the statutory demand on terms?
Background
[3] Floranz owns 35 hectares of rural land at Paparoa (the Paparoa property). Michael Over (Mr Over) is Floranz’s sole director and shareholder. On 27 November 2019 Floranz and Mr Ritchie entered into a written agreement which is titled “Option to buy land and property: Lease to buy subject to conditions” (the Agreement). It is accurately described by Floranz’s counsel as a DIY document and is not as clear as it could be.
[4] Under the Agreement Mr Ritchie was granted an option to purchase a 50 per cent share of the Paparoa property. Relevant to the exercise of the option, cl 8 of the Agreement provides:
1 This is the confusingly worded formula in s 290(4)(b) of the Companies Act 1993. The prescribed sum is in the Companies Act 1993 Liquidation Regulations 1994, reg 5.
8. The agreement
8.1.For the Option Price, and subject to the terms of this agreement, the Seller agrees to grant the Option to purchase 50% or half of the interest of the Seller in the Land for the Sale Price.
8.2.The Option may be exercised by the Buyer at any time before the Last Exercise Date, by serving a Notice of Exercise to the above address of the Seller (or to any substituted address later notified to the Buyer in writing) such notice to be accompanied by the Deposit.
...
8.4The Option shall expire if not exercised by 24.00 hours on the Last Exercise Date or, if extended, the Extended Exercise Date.
8.5Exercise of the Option constitutes a binding contract for Sale between the parties in the terms of the Standard Agreement of Sale, so far as they are not inconsistent with this agreement.
[5] Pending the exercise of the option, Mr Ritchie was to lease the Paparoa property from Floranz. Attached as a schedule to the Agreement were some lease terms.2 Those terms include:
Property Based Costs while ‘option to buy land’ contract exists.
Both parties will share equally in the operational costs of the property. That would include Expenses, Repairs, and improvements. Examples would be things like fertilisers, up-keep of driveways, repairs and maintenance to things like fencing. Rates, Electricity, water usage and costs for new equipment or materials which would add to the improvement or usage of the property such as gates.
...
Operational Costs associated with generation of profit
The tenant will purchase, wean and sell his own calves and or any other farming related business work he can create for himself. Butchery work or something similar using the coolstores might be an example. That is to be kept separate from the property costs, and the associated profit/losses form [sic] these activities reside with the tenant.
...
There are no regular lease payments from the tenant to the landlord. Also, no wages issued in exchange for time spent operating farming activities.
2 I raised with counsel whether the Agreement created a lease or some other relationship between the parties. The parties have always proceeded on the basis that there was a lease between Floranz and Mr Ritchie, and that is the basis upon which this application has proceeded.
Payments are all based on profits as specified above, notwithstanding the other payments required in point 3.4 of the main contract above.
[6] Mr Ritchie was not required to pay “regular lease payments”. He was, however, to make payments of principal and interest towards Floranz’s mortgage which were referred to as the “Option Price”. Clause 3.2 of the Agreement provides:
3.2 The “Option Price” paid by the buyer, is to be made up of monthly payments toward the sellers existing ANZ Mortgage, covering both the Principal and Interest. The Interest Portion of those payments constitutes the Option Price, non-refundable, should the buyer either exercise their right to purchase, or not. ...
[7] Clause 13 of the Agreement deals with the circumstance where Mr Ritchie exercised his option but failed to complete the purchase. It provides:
13 Default by Buyer
If the Buyer, after exercise of the Option, fails to proceed with the completion of the Sale as required by this agreement, the Seller shall
17.1 [sic] be entitled to retain the Option Price as liquidated damages
17.2shall have no further recourse against the Buyer.
17.3shall refund the principal payments that make up the Option Price pertaining to the monthly payments to the ANZ mortgage, as well as the lump payments to the same account.
[8] Mr Ritchie went into occupation of the property and one of his activities was to raise pigs. The relationship between the parties soured. Notwithstanding that, in November 2022 Mr Ritchie exercised the option to purchase. However, in late January 2023 he vacated the property and then failed to settle.
[9] On 12 April 2023 Floranz cancelled Mr Ritchie’s contract to buy into the property. That is not challenged by Mr Ritchie. Relevantly, in the letter of cancellation Floranz’s lawyers raised with Mr Ritchie’s lawyers a number of issues, which included claims for:
(a)damage to a four-bay plastic tunnel house on the property;
(b)damage caused to four acres of the property by Mr Ritchie’s pigs; and
(c)non-payment of operational costs, of which Mr Ritchie’s share was said to be $19,037.55.
[10] On 2 May 2023 Mr Ritchie’s lawyers made demand under cl 13 of the Agreement for the refund of the principal payments made by Mr Ritchie towards Floranz’s mortgage, amounting to $54,575.30. They also disputed the claim for operational costs, but did not address the damage to the tunnel house or the land.
[11] On 4 May 2023 Floranz’s lawyers responded that the claims against Mr Ritchie substantially exceeded the refund of the principal payments he was claiming, and invited Mr Ritchie to take court action if he wished. There matters rested until 6 June 2024, when Mr Ritchie served the statutory demand.
The law
Section 290 of the Companies Act provides:
Court may set aside statutory demand
(1)The court may, on the application of the company, set aside a statutory demand.
…
(4)The court may grant an application to set aside a statutory demand if it is satisfied that—
…
(b) the company appears to have a counterclaim, set-off, or cross- demand and the amount specified in the demand less the amount of the counterclaim, set-off, or cross-demand is less than the prescribed amount; or
…
(7) An order under this section may be made subject to conditions.
[13] The Court of Appeal has provided guidance upon the approach to be taken to applications that engage s 290(4)(b) in Manchester Securities Ltd v Body Corporate 172108 as follows:3
3 Manchester Securities Ltd v Body Corporate 172108 [2018] NZCA 190, [2018] 3 NZLR 455 at [27].
[27] In relation to set-off, s 290(4)(b) provides that the court may grant an application to set aside the statutory demand if the company ‘appears to have a counterclaim, set-off or cross-demand’ and the amount specified in the demand less the amount specified in the counterclaim is less than $1,000. Just as any defence must be shown to be reasonably arguable, so must any set-off, counterclaim or cross-demand. However, the obligation is not to prove the actual claim. It is not expected that the dispute itself is to be tried in the course of hearing the application. It has been said that “clear and persuasive” grounds must be shown for a set-off, rather than a mere assertion. There must be a real evidential basis for the claim, and the claim must be arguable as a matter of law.
[28] In relation to contingent and unquantified counterclaims or set-offs, it has been held that the court must be able to determine from the material provided whether the amount of the set-off or counterclaim is more than the amount claimed in the statutory demand. Thus in Sunglass Hut New Zealand Ltd v Amtrust Pacific Properties Ltd, the High Court held that, while the applicant had shown an arguable counterclaim for damages or compensation, the unquantified nature of the counterclaim meant that it had not shown to the required standard that the counterclaim would have equalled or exceeded the amount claimed in the statutory demand …
(footnotes omitted)
[14] In Industrial Group Ltd v Bakker, the Court of Appeal reiterated that on an application such as this the Court does not attempt to resolve the dispute between the parties. It said:4
[24] We note that the statutory scheme is for applications to set aside statutory demands to be a summary proceeding. The application must be made within 10 working days of the date of service of the demand: s 290(2)(a). No extension of time may be given: s 290(3). It follows that it would be unusual for the High Court to engage in detailed analysis of the merit of any counterclaim, set off or cross demand. The section calls for a prompt judgment as to whether there is a genuine and substantial dispute. It is not the task of the Court to resolve the dispute. The test may be compared with the principles developed in cognate fields such as applications to remove caveats, leave to appeal an arbitrator’s award and opposition to summary judgment.
[25] The approach required by the “appearance” test in s 290 is a review with a low threshold. The tight time constraints distinguish the s 290 discretion from that to be exercised on, say, a summary judgment application, where the presence of complex legal issues is not necessarily a bar to a remedy. As with leave to appeal an arbitrator’s award, the hearing should, in the normal course, be short and to the point, and the judgment likewise.
(footnote omitted)
4 Industrial Group Ltd v Bakker [2011] NZCA 142, (2011) 20 PRNZ 413.
[15] In AAI Ltd v 92 Lichfield St Ltd (in rec and in liq), the Court of Appeal again noted the summary nature of applications to set aside statutory demands in these terms:5
[22] It is important to keep in mind the words of the statute. What the applicant must show is that the dispute it raises has substance; the applicant must explain to the court what the dispute is; and the dispute so shown must be a real and not a fanciful or insubstantial dispute. The Court must bear in mind that it is operating in the summary jurisdiction, with the accompanying disadvantages that brings for any applicant. The Court must also keep in mind the requirement that what is intended to be a summary hearing should not be converted into a full-blown trial.
(footnote omitted)
[16] The Court retains a discretion to refuse to set aside a statutory demand notwithstanding that an applicant has made out the grounds for setting it aside under s 290(4). The discretion will be exercised in rare cases. One case where the discretion may be exercised is where a counterclaim has been raised notwithstanding a “pay now, argue later” provision in a contract between the parties. That is not to say that where such a provision applies it will always be appropriate for the Court to exercise its discretion.6 Ultimately the governing consideration will be whether allowing the statutory demand to form the basis of an application for liquidation “savours of unfairness or undue pressure”.7
Does Floranz have reasonably arguable counterclaims against Mr Ritchie?
[17] Floranz argues that it has three counterclaims. All are founded on alleged breaches by Mr Ritchie of the express terms of his lease, or terms implied into the lease by ss 218 and 219 of the Property Law Act 2007 and, in particular, cls 5, 7 and 13 of sch 3 of that Act.
[18] Specifically, it is said that Mr Ritchie’s obligation to pay operational costs was an express term of the lease (see [5] above) and the damage Mr Ritchie caused to the tunnel house and the land was a breach of the implied terms. The most directly relevant of those implied terms is sch 3 cl 13 of the Property Law Act, as follows:
5 AAI Ltd v 92 Lichfield St Ltd (in rec and in liq) [2015] NZCA 559, [2016] NZAR 1338.
6 HWD NZ Investment Co Ltd v Body Corporate 392418 [2014] NZCA 33 at [49]; and N F Global Ltd v Sky Capital Management Ltd [2020] NZHC 2196 at [40].
7 Stewart’s Cycle City Ltd v Sheppard Industries Ltd [2013] NZHC 256 at [9].
13 Lessee to keep and yield up premises in existing condition
(1)The lessee will,—
(a)at all times during the currency of the lease, keep the leased premises in the same condition that they were in when the term of the lease began; and
(b)at the termination of the lease, yield the leased premises in that condition.
(2)However, the lessee is not bound to repair any damage to the leased premises caused by—
(a)reasonable wear and tear; or
…
[19] Mr Ritchie’s first contention is that cl 13 of the Agreement prevents Floranz from raising set-offs or counterclaims in opposition to his demand. He submits the words “no further recourse” in cl 13.2 (incorrectly numbered 17.2) mean that Floranz must repay principal payments and cannot off-set any claims it may have against him however they may arise. What is being contended for is that the words create a “pay now, argue later” obligation.
[20] The proper approach to contractual interpretation is as set out by the Supreme Court in Firm PI 1 Ltd v Zurich Australian Insurance Ltd and Bathurst Resources Ltd v L&M Coal Holdings Ltd.8 In particular, in Firm PI 1 Ltd the Supreme Court said:
[60] Given the issues in the case, it is not necessary that we discuss the approach to contractual interpretation in any detail. It is sufficient to say that the proper approach is an objective one, the aim being to ascertain “the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract”. This objective meaning is taken to be that which the parties intended. While there is no conceptual limit on what can be regarded as “background”, it has to be background that a reasonable person would regard as relevant. Accordingly, the context provided by the contract as a whole and any relevant background informs meaning.
...
[63] While context is a necessary element of the interpretive process and the focus is on interpreting the document rather than particular words, the text remains centrally important. If the language at issue, construed in the context
8 Firm PI 1 Ltd v Zurich Australian Insurance Ltd [2014] NZSC 147, [2015] 1 NZLR 432; Bathurst Resources Ltd v L & M Coal Holdings Ltd [2021] NZSC 85, [2021] 1 NZLR 696 at [43].
of the contract as a whole, has an ordinary and natural meaning, that will be a powerful, albeit not conclusive, indicator of what the parties meant. But the wider context may point to some interpretation other than the most obvious one and may also assist in determining the meaning intended in cases of ambiguity or uncertainty.
(footnotes omitted)
[21] I do not accept the interpretation Mr Ritchie seeks to put on the words “no further recourse”. Clause 13 is concerned with the consequences of Mr Ritchie’s failure to complete the purchase of the property after exercising the option. The intention of the parties is plain, that in such circumstances Floranz’s remedy was limited to retention of interest payments included in the Option Price. Floranz could not, for instance, sue for specific performance or damages in addition. The clause does not limit Floranz’s rights in respect to other breaches of the Agreement or the lease. If cl 13.2 was intended to create a pay now, argue later obligation on Floranz in respect to the principal payments that could easily have been said, but it was not.
[22] Mr Ritchie also argues that the principal payments were a deposit paid on a conditional contract to buy the Paparoa property, and he therefore retained a proprietary interest in either that money or the property. Mr Ritchie submits the money “belongs” to him, so Floranz cannot withhold payment or make any deduction from it because that would violate his rights to reclaim his own property.
[23] The payments Mr Ritchie made under the Agreement were applied toward reduction of Floranz’s mortgage. There is no fund against which Mr Ritchie could make a proprietary claim. Whether Mr Ritchie could assert an interest in the Paparoa property is not in issue in this proceeding.9 He has chosen to utilise the statutory demand procedure to recover a debt and does not make any claim to an interest in the property. Under the statutory demand procedure Floranz can both accept the existence of the debt and raise counterclaims in support of an application to set the demand aside.
[24] Mr Ritchie then argues that the counterclaims are not adequately evidenced. I will deal with each of the counterclaims in turn.
9 See for instance D W McMorland Sale of Land (4th ed, Cathcart Trust, Auckland, 2022) at [7.12].
Operational costs
[25] Initially Floranz claimed $19,037.55 under this head which it says is Mr Ritchie’s share of operational costs under the lease that he has not paid. Floranz now accepts some amounts are not Mr Ritchie’s responsibility and has reduced the claim to $14,581.65.
[26] The operational costs are electricity charges and rates. Mr Over has produced a spreadsheet of the amounts that make up this sum. He deposes that all the amounts have been paid by Floranz. Mr Ritchie does not dispute the calculation of the operating costs (for the reduced amount), but his position is that he has already paid his share and Floranz should provide evidence that it paid these costs.
[27] Floranz has satisfied me that it has an arguable counterclaim in respect to the operational costs. I accept these are actual costs that have been incurred. The schedule supporting the claim has been prepared by an accountant and is fully detailed. Mr Ritchie claims to have paid some or all of his share of the costs but has not produced any evidence of payment.
Four-acre paddock
[28] Mr Ritchie’s pigs are said to have uprooted some land resulting in the topsoil being washed away, taking the land down to its clay base and rendering it unsuitable for farming activity. Mr Over has produced photographs showing damage, including recent photographs he says show that the land now sustains nothing except weeds and rushes and is not suitable for grazing.
[29] Mr Ritchie’s case is that the pigs have not damaged the land but enhanced it. He relies upon an affidavit by Alan Eaton, a farmer, who supplied pigs to Mr Ritchie. Mr Eaton says the land in question was “rough”. He also says he inspected the land again in July 2024 and observed improved pastural rejuvenation, not that topsoil had been washed away.
[30] Mr Ritchie also submits there is no evidence, apart from Mr Over’s bare assertion, that there has been land damage. Mr Woods argues it is significant that
Floranz has called no expert evidence, and it could be expected to have done so in respect to the topsoil depth before and after the pigs were on the land, the loss of fertility of the land and increased sedimentation elsewhere on the property that would have resulted had the topsoil been washed away. It is also argued that it is significant no complaint was made about land damage during the term of the lease, no remediation work has been carried out and there has been no attempt to recover any loss for 16 months after cancellation of the Agreement.
[31] I am satisfied that Floranz’s counterclaim is fairly arguable on the basis that Mr Ritchie breached an implied term to yield up the property in the condition it was when the lease began under sch 3 cl 13 of the Property Law Act. The photographs produced do appear to show land damage going beyond what might be considered reasonable fair wear and tear. It also appears from the photographs and Mr Over’s evidence that there may not have been rejuvenation of the land as Mr Ritchie and Mr Eaton describe.
[32] While Mr Ritchie relies on the evidence of Mr Eaton, his evidence has not been given in accordance with s 26 of the Evidence Act 2006 or the Code of Conduct for Expert Witnesses in sch 4 of the High Court Rules 2016. To the extent that Mr Eaton expresses opinions it is not substantially helpful and is not admissible.10
[33] I also do not accept the submission that Floranz could have been expected to file expert evidence on the range of matters that Mr Woods identified. This is a summary application and the threshold that Floranz must satisfy is low. It is also unrealistic to expect such evidence to be available within the timeframe that the summary process allows.
Four-bay tunnel house
[34] The tunnel house is skinned with plastic and had been used by Floranz for flower growing and to house calves. Mr Over says the tunnel house was reskinned in 2016 and he could have expected 15 years’ use from it. He says it was damaged because Mr Ritchie used it to house pigs which forced their way through the plastic
10 Evidence Act 2006, s 25(1).
sides. The damage is shown in photographs he has produced. In his reply affidavit, Mr Over also says that Mr Ritchie went against his instructions by removing tie wires, causing the roofs of three of the bays to fail.
[35] Mr Ritchie denies he is liable for the damage to the tunnel house. He considers Floranz’s position that calves could be housed in the tunnel house but pigs could not is counterintuitive and that the tunnel house was simply at the end of its useful life. He relies upon a quotation and warranty agreement from an installer which he considers supports the position that the typical lifespan of plastic tunnel houses is just 10 years. He also implies that Cyclone Gabrielle may have caused damage. Mr Over’s evidence that Mr Ritchie caused damage to the tunnel house by removing ties was raised late and Mr Ritchie had no opportunity to respond to it.
[36] Again, I am satisfied that Floranz’s counterclaim is at least fairly arguable on the basis that Mr Ritchie breached the implied term of the lease. It appears the tunnel house was damaged during the lease and that such damage exceeds fair wear and tear. The damage to the plastic skin of the tunnel house is extensive in parts. It appears there is likely other damage also. Included in Mr Over’s reply affidavit are satellite images from different points in time. They appear to show the tunnel house in a good state of repair on 18 August 2019 (a few months prior to the Agreement) but then significantly damaged on 31 January 2024. Mr Ritchie’s evidence concerning Cyclone Gabrielle is a red-herring.
[37] The argument raised for Mr Ritchie concerning the typical lifespan of a plastic tunnel house is not supported by any admissible evidence. I can take nothing from the quotation and warranty documents he has filed, nor can I take anything from his opinions on that subject. Furthermore, it appears that even on Mr Ritchie’s evidence the lifespan of this tunnel house had several years to run at the time the damage occurred.
Is the amount of Mr Ritchie’s demand, less the amount of the counterclaims, less than the prescribed amount of $1,000?
[38] Mr Ritchie is owed $54,575.30 and to have the statutory demand set aside it is not enough for Floranz to show that it has arguable counterclaims, it must also provide
evidence that the amount of the counterclaims is approximate to or exceeds the amount of the statutory demand. The Court cannot set aside the statutory demand unless there is a real basis for a finding that the amount of the counterclaims is sufficient to show that Mr Ritchie’s claim to be a creditor is seriously in doubt.
[39] I accept that Floranz has provided sufficient evidence of a counterclaim for the operational costs of $14,581.65. However, the evidence of the amount of its counterclaims for land and tunnel house damage is not satisfactory.
[40] Before turning to that evidence, I note Mr Ritchie raises an argument that if Floranz has valid counterclaims in respect to land and tunnel house damage then under the lease the repair costs are to be shared equally. In my view that argument is unlikely to succeed because such repair costs are not operational costs. They are costs to remedy Mr Ritchie’s failure to deliver up the property in proper condition in breach of the lease.
[41] Mr Over has said he has not had time to get evidence of repair costs. He raised his counterclaims in May 2023 and has had since then to obtain evidence of the repair costs. All that would be required is to have suitably qualified persons inspect the property, identify the repair work and provide costings. There has been sufficient time for this to have been done, even since the statutory demand was served.
Cost of land repair
[42] Mr Ritchie argues that all that is required is to resow the land. He has provided an estimate from an agricultural contractor that this cost would be approximately
$1,000 and that to spray, rotary hoe, drill and level four acres of land would cost “a few thousand dollars but not more”.
[43] Floranz’s position is that the land repair would cost in the region of $40,000 but it has not provided evidence to substantiate that. Mr Over does not appear to dispute the cost of resowing the land but says the topsoil must be replaced also and that would cost in the region of $17,480. This is on the basis that 400 m³ of soil is required and one 10 m³ truckload of topsoil costs $437 ($437 x 40).
[44] While I accept there is evidence of land damage there is no evidence, apart from Mr Over’s assertion, that topsoil was washed away or of the amount of topsoil that needs to be placed on the land. I have no idea how Mr Over has arrived at his estimate that 400 m³ of soil is required or why he says his repair estimate of $40,000 is not unreasonable. Mr Over’s assertions do not discharge Floranz’s onus to provide evidence of the amount of its counterclaim. On what is before me I can only find that there is evidence of land repair costs to spray, rotary hoe, drill and relevel the land in the region of $2,500.
Cost of tunnel house repair
[45] As far as the tunnel house is concerned, again Floranz has not provided evidence of the cost of repair. Mr Over says the tunnel house was reskinned in 2016 yet gives no evidence about what that work cost, which would at least provide some rough guidance as to what that work would cost today. Mr Over filed a late affidavit attaching a quotation from a company for the supply and build of a tunnel house of
$157,674.20. That is of no assistance as the quotation is not for repair of the existing tunnel house but for the supply and build of a new one on a different footprint.
Should the Court set aside the statutory demand on terms?
[46] The position I have reached is that Floranz has failed to provide evidence that the amount of its counterclaims exceed or even roughly equate to the amount undoubtedly owing to Mr Ritchie.11 I cannot therefore be satisfied that Mr Ritchie’s claim to be a creditor of Floranz is seriously in doubt except to the extent of the operational costs and the cost of land repair provided by Mr Ritchie. It follows, in my view, that Mr Ritchie’s statutory demand should be set aside only to the extent of those costs.
[47] This result may appear harsh upon Floranz. However, I consider the result cannot be avoided when Floranz has failed to provide evidence of repair costs that should have been readily available. It should also be remembered that Floranz has not
11 Willows Group Ltd v Inghams Enterprises (New Zealand) Pty Ltd HC Gisborne SC2/01, 10 August 2001 at [4].
incurred the costs of repair, and it is not clear that such costs will ever be incurred. It is also the case that it was open to Floranz to pursue its claims against Mr Ritchie well before now, but it appears it had no intention of doing so, preferring to retain the money that is indisputably owing to Mr Ritchie. There is nothing to prevent Floranz from now pursuing its counterclaims against Mr Ritchie in other proceedings.
Result
[48] The statutory demand is set aside, except for the sum of $37,493.65, being the amount of Mr Ritchie’s demand of $54,575.30 less the operational costs of $14,581.65 and $2,500 for repair of land damage.
[49]Under s 291 of the Companies Act, Floranz is to pay Mr Ritchie the sum of
$37,493.65 within 15 working days of this judgment. If it does not do so, Mr Ritchie may apply to have Floranz put into liquidation.
[50] I reserve costs. If either party wishes to apply for costs they may file a memorandum within 10 working days, with five working days for any memorandum in reply. Memoranda shall be no longer than six pages and I will determine costs on the papers.
O G Paulsen Associate Judge
Solicitors:
Lovegrove Lawyers, Auckland Rice Craig, Auckland
0
8
0