Grant v Pandey - [2013] NZHC 3330

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-000648 [2013] NZHC 3330

UNDER Section 266 of the Companies Act 1993

IN THE MATTER of the liquidation of Capital Hospitality
Holdings Limited (in liquidation)

BETWEEN DAMIEN GRANT and STEVEN KHOV as liquidators of CAPITAL HOSPITALITY HOLDINGS LIMITED (IN LIQUIDATION)
Applicants

ANDPRAKASH PANDEY First Respondent

C P HOTELS LIMITED Second Respondent
C P INVESTMENTS LIMITED Third Respondent
C P CARPARKS LIMITED Fourth Respondent
intituling cont'd

Hearing: 23 October, 28 November 2013

Appearances: B J Norling and A Ho for Applicants
R B Hucker for Respondents

Judgment: 12 December 2013

JUDGMENT OF COURTNEY J

This judgment was delivered by Justice Courtney on 12 December 2013 at 12.30 pm
pursuant to R 11.5 of the High Court Rules

Registrar / Deputy Registrar

Date……………………….

CAPITAL HOSPITALITY HOLDINGS LTD (IN LIQUIDATION) v PANDEY & ORS [2013] NZHC 3330 [12
December 2013]

C P PROPERTY INVESTMENTS LIMITED
Fifth Respondent

C P ASSET MANAGEMENT LIMITED
Sixth Respondent

J D RAI & SONS LIMITED Seventh Respondent

ASIA PACIFIC HOTEL INVESTMENTS
Eighth Respondent

RAISONS PACIFIC INVESTMENTS LIMITED
Ninth Respondent

BABOO MAHENDRA PRATAP RAI Tenth Respondent

CAPITAL INVESTMENTS CORPORATION LIMITED Eleventh Respondent

Introduction

[1] The applicants, Damien Grant and Steven Khov, are the liquidators of Capital Hospitality Holdings Limited (in liquidation) (CHH). They have been hampered in their investigations into CHH’s affairs by a lack of records and other documents and are seeking orders under s 266 of the Companies Act 1993 to compel the production of records relating to CHH’s affairs and the attendance of two parties with knowledge of its affairs.

[2] One of those whom the liquidators wish to interview is a former CHH director, Baboo Mahendra Pratap Rai, who is the tenth respondent. They also wish to obtain documents held by Mr Rai and by CHH’s sole shareholder, Capital Investments Corporation Ltd, (CIC), which is the eleventh respondent and controlled by Mr Rai. They have served s 261 notices on Mr Rai, requiring him to attend for interview, which he has not done. They have served notices on Mr Rai and CIC, requiring them to produce documents relating to CHH’s financial affairs. Apart from a small number of documents provided very recently, this request has not been complied with.

[3] The liquidators of CHH are also the liquidators of NZ Properties Holding Ltd (in liquidation). They believe there is a connection between the two companies, including the likelihood that the financial affairs of both companies were managed by the first respondent, Prakash Pandey, who controls the sixth respondent, CP Asset Management Ltd. Prakash Pandey’s father, Charles Pandey, controlled NZ Properties (in liquidation) and other companies in the “CP” group, including the second to ninth respondents (other than CP Asset Management). One of the issues the liquidators want to find out about is substantial payments made to the company by the second to ninth respondents.

[4] In August 2012 the liquidators sent Prakash Pandey a notice requiring him to attend an interview with them on the ground…

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 Grant v Pandey

Details

AGLC: Grant v Pandey [2013] NZHC 3330
Case: [2013] NZHC 3330
Decision Date: 12 December 2013

CaseChat Overview and Summary

The applicants, Damien Grant and Steven Khov, liquidators of Capital Hospitality Holdings Limited (CHH), sought orders to compel the production of records and the attendance for interview of various respondents with knowledge of CHH’s affairs. The applicants are also the liquidators of NZ Properties Holding Ltd, which was controlled by Charles Pandey, and believe there is a connection between the two companies. The applicants served notices on Baboo Mahendra Pratap Rai, a former CHH director, and Capital Investments Corporation Ltd (CIC), controlled by Mr Rai, requiring them to produce documents relating to CHH’s financial affairs. The applicants also served notices on Prakash Pandey, who controls CP Asset Management Ltd, and the second to ninth respondents, requesting explanations as to the purpose of the payments made to CHH. The respondents opposed the application on various grounds. The Court found that the liquidators' application was brought under ss 261-266 of the Companies Act 1993, with some orders sought under s 266(1) and others under s 266(2). The Court rejected the respondents' objections to evidence, finding that the affidavit and transcript were admissible. The Court found that Mr Rai had been served with the s 266 notices and that the Court had jurisdiction to make an order under s 266 in respect of a person residing outside the jurisdiction. The Court made orders under s 266(1) that Prakash Pandey and Baboo Rai attend for interview and under s 266(2) that Baboo Rai, the second to ninth respondents, and the eleventh respondent produce books, records, or documents relating to the business, accounts, or affairs of CHH. The Court made costs orders against the respondents.

Orders