Green Meadow Holdings ApS v Sargison

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-3098 [2018] NZHC 2216

UNDER

the Building Societies Act 1965

IN THE MATTER

of Kiwi Deposit Building Society (in
Dissolution)

BETWEEN

GREEN MEADOW HOLDINGS APS First Plaintiff

LILAC POND HOLIDNGS APS Second Plaintiff

AND

PAUL GRAHAM SARGISON AND SIMON DALTON

Defendants

Hearing:	22 June 2018
Appearances:	D McGill and D Bennington for the Plaintiffs S McAnally for the Defendants
Judgment:	5 October 2018

JUDGMENT OF ASSOCIATE JUDGE BELL

This judgment was delivered by me on 5 October 2018 at 3:30pm

pursuant to r 11.5 of the High Court Rules 1985.

Registrar/Deputy Registrar

……………………………………

Solicitors:

Duncan Cotterill (D McGill/D Bennington), Auckland, for the Plaintiffs Keegan Alexander (S O McAnally) Auckland, for the Defendants Counsel:

Noel Ingram QC, Auckland, for the Plaintiffs

GREEN MEADOW HOLDINGS APS v SARGISON AND DALTON [2018] NZHC 2216 [5 October 2018]

Table of Contents

Security for costs application  [4] Building Societies – legislation  [5] This building society  [10] The dissolution  [14] The trustees’ application for directions  [18] The start of this proceeding  [20] The plaintiffs’ pleadings  [21] Strike out application – principles  [25] Priority of creditors  [26] The absence of a liquidation  [34] The defendants as trustees  [38] The first cause of action  [41] The second cause of action  [43] The proposed fourth cause of action  [45] The proposed fifth cause of action  [48] The proposed third cause of action  [50] Outcome   [62]

[1]      Traditionally people joined building societies to finance the purchase of a home. That was shown in s 9 of the Building Societies Act 1965:

The purpose for which a building society may be established under this Act is

that of raising, by the subscriptions of members, a fund for making advances to members out of the funds of the society on security by way of mortgage of land, or on the security of the shares of members, or on other or no security, in accordance with this Act.

But that changed in the 1980s.   Building societies may now do much more.   As financial institutions they have much wider functions.  Section 9 has been repealed and replaced with this:

9A      Functions of building societies

(1)       Subject to any restrictions or prohibitions contained in the rules of a society, the functions of every building society registered under this Act shall

be—

(a)to provide services of any kind for its members or other persons, including, without limiting  the  generality  of  the foregoing, to provide services consisting of, or relating to,—

(i)       the lending of money:

(ii)      the provision of credit:

(iii)     the giving of guarantees and indemnities:

(iv)     the sale and purchase of financial obligations, debts, and securities:

(v)      the discounting of credit instruments: (vi)  banking:

(vii)     investment: (viii) insurance: (ix)     trusteeship:

(x)      foreign exchange dealing:

(b)to acquire by purchase, lease, exchange, or in any other way, land or any interest in land:

(c)to  develop,  improve,  manage,  sell,  lease,  exchange,  or otherwise deal in land or…