Gibson v Platt - [2024] NZHC 351

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2023-404-3110

[2024] NZHC 351

BETWEEN
BRENDON JAMES GIBSON and NEALE JACKSON

First Applicants

JOHN FISK and RICHARD NACEY
Second Applicants

AND

JASON PLATT, SAM CLARKSON, ROBERT KREBS, ROGER BOYD and PETER BAYNE

First Respondents

CROWN REGIONAL HOLDINGS LIMITED

Second Respondent

Hearing: 8 February 2024

Appearances:

D J Friar for the first applicants

L C Sizer and C Morrison for the second applicants M Tingey and C Jiang for the first respondents
L Fraser and J Marcetic for the second respondent

Judgment:

28 February 2024

JUDGMENT OF CAMPBELL J

This judgment was delivered by me on 28 February 2024 at 3.00 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar

GIBSON and JACKSON v PLATT and OTHERS [2024] NZHC 351 [28 February 2024]

[1] Ruapehu Alpine Lifts Ltd (RAL) operates the Whakapapa and Tūroa ski fields on Mt Ruapehu. RAL was placed into voluntary administration in October 2022, into liquidation in June 2023 and into receivership in October 2023.

[2] The liquidators decided, soon after their appointment in June 2023, to continue to trade RAL’s business while seeking a purchaser for the ski fields. From then until the appointment of receivers four months later, significant income was earned from that trading. A dispute has arisen as to who is entitled to that income. RAL’s principal secured creditor says the income is subject to its security. RAL’s liquidation committee says the income is not subject to any security and that, accordingly, the committee is entitled to be reimbursed from the income for out-of-pocket expenses it has incurred.

[3]The receivers and the liquidators seek directions in respect of this dispute.

Background

[4] Whakapapa and Tūroa are in Tongariro National Park. RAL owns the assets of the ski fields and holds licences from the Department of Conservation allowing it to operate. During each ski season, RAL employs hundreds of staff. It makes a significant contribution to the central North Island economy.

[5] From 2017, RAL embarked on a development of the ski fields. This included the construction of a $25 million Sky Waka gondola at the Whakapapa ski field. RAL borrowed substantial amounts to fund the development.

[6] After two years of COVID-19 restrictions (including border closures), and unfavourable weather in 2022, RAL became insolvent.1

Administration, liquidation and receivership

[7] The directors of RAL appointed the second applicants, Mr Fisk and Mr Nacey, as administrators on 11 October 2022. At that time, ANZ Bank New Zealand Ltd

1 To be clear, I was not called upon to make any findings as to the causes of RAL’s insolvency, and I do not do so.

(ANZ) and the Ministry of Business, Innovation and Employment (MBIE) were two of RAL’s secured creditors:

(a)ANZ had a General Security Agreement (GSA) dated 12 April 2007 over all of RAL’s present and after-acquired property.

(b)ANZ released its security interest over…

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 Gibson v Platt

Details

AGLC: Gibson v Platt [2024] NZHC 351
Case: [2024] NZHC 351
Decision Date: 28 February 2024

CaseChat Overview and Summary

In Gibson v Platt, the liquidators of Ruapehu Alpine Lifts Ltd (RAL), which operates the Whakapapa and Tūroa ski fields, sought directions regarding the entitlement to income earned from trading the ski fields in liquidation. The dispute was between the liquidation committee and the receivers appointed by Crown Regional Holdings Ltd (CRHL), the holder of a security interest over RAL's assets. The central issue was whether the funds held by the liquidators were subject to CRHL's security, which would preclude the committee from claiming those funds in priority to CRHL's secured claim.

The court examined the terms of the General Security Agreement (GSA) between RAL and ANZ Bank (now CRHL), which granted a security interest over all of RAL's present and after-acquired property. The funds held by the liquidators were from trading while RAL was in liquidation, making them after-acquired property. The court found that these funds were subject to CRHL's security under the GSA, as they did not fall within the excluded property released by a prior deed of release.

The committee argued that the funds should be held for the benefit of unsecured creditors, not subject to CRHL's security. They contended that liquidators could only trade to the extent necessary for the liquidation and that any funds generated should benefit unsecured creditors. The court rejected this argument, stating that the rights to funds generated from trading are determined by general contract and property law, the PPSA, and the Companies Act. The committee's second argument, that priority disputes are determined at the date of liquidation, was also rejected. The court held that the funds were subject to CRHL's security, and thus the committee did not have a preferential claim to those funds.

The court granted the directions sought by the receivers and liquidators, confirming that CRHL was entitled to the funds held by the liquidators. The committee's claim to those funds in priority to CRHL was dismissed. If costs are sought by any party and cannot be agreed upon, the parties may file memoranda.

Orders