Honey v Nottingham - [2018] NZHC 2382

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-2004

[2018] NZHC 2382

UNDER the Insolvency Act 2006 and the High Court Rules 2016

BETWEEN

MARTIN RUSSELL HONEY, STEPHANIE HONEY and HEMI TAKA

Judgment creditors

AND

DERMOT GREGORY NOTTINGHAM

Judgment debtor

CIV-2018-404-1224

UNDER

the Insolvency Act 2006

IN THE MATTER

of an application to prove a proposal under pt 5(2) of the Insolvency Act 2006

BY

DERMOTT GREGORY NOTTINGHAM

Applicant

Hearing: 6 September 2018

Appearances:

Mr D Grove for Martin Honey, Stephanie Honey and Hemi Taka, and H T & E Ltd, in CIV-2017-404-2004 and CIV-2018-404-1224

Ms N Tabb for Kelvin Prentice in CIV-2018-404-1224

Mr W Wright for Allied Press Ltd (by memorandum only) in CIV-2018-404-1224

Mr P D George (by memorandum only) in CIV-2018-404-1224

Judgment:

11 September 2018

JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

HONEY v NOTTINGHAM [2018] NZHC 2382 [11 September 2018]

This judgment was delivered by me on 11 September 2018 at 3.30 pm, pursuant to
Rule 11.5 of the High Court Rules Registrar/Deputy Registrar

Introduction

[1] Two proceedings which incorporate two applications and one appeal are before the Court for determination:

(a)in 2017-404-2004, an application by the judgment creditors, Mr Martin Honey, Mrs Stephanie Honey and Mr Hemi Taka, for an order pursuant to pt 2(2) of the Insolvency Act 2006 that the judgment debtor, Mr Dermot Nottingham, be adjudicated bankrupt;

(b) in 2018-404-1224:

(i)an application by Mr Nottingham for approval of a proposal pursuant to pt 5(2) of the Insolvency Act; and

(ii)an appeal by Mr and Mrs Honey and Mr Taka pursuant to r 32(1) of the Insolvency (Personal Insolvency) Regulations 2007 against the decision of the proposed trustee under the pt 5(2) proposal to recognise a number of claimants as creditors of Mr Nottingham and allow them vote on his proposal.

[2] Logically, it appears to me that the two applications and the appeal are best addressed in this order:

(a)Mr and Mrs Honey and Mr Taka’s appeal against the decision of the proposed trustee;

(b)Mr Nottingham’s application for approval of his proposal; and

(c)Mr and Mrs Honey and Mr Taka’s application for an order that Mr Nottingham be adjudicated bankrupt.

A preliminary issue concerning standing

[3] Administratively, the two proceedings have been travelling together. On 9 July 2018 Associate Judge Bell set both down for hearing. In his minute of that date his Honour issued comprehensive pre-trial directions.

[4] One of those directions was that Mr Nottingham or any other party wishing to oppose the appeal against the proposed trustee’s decision or support Mr Nottingham’s application for approval of his proposal should file and serve notification of their intention and any affidavit evidence by 6 August 2018.

[5]Neither Mr Nottingham nor any other party did so.

[6] Counsel for Mr & Mrs Honey and Mr Taka, Mr Grove, drew the Court’s attention to this in a memorandum dated 27 August 2018 and sought a telephone conference. Laing J declined to convene a telephone conference.…

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 Honey v Nottingham

Details

AGLC: Honey v Nottingham [2018] NZHC 2382
Case: [2018] NZHC 2382
Decision Date: 11 September 2018

CaseChat Overview and Summary

In the case of Honey v Nottingham, the High Court of New Zealand was tasked with addressing several applications and an appeal concerning the insolvent debtor, Dermot Gregory Nottingham. The judgment creditors, Martin Honey, Stephanie Honey, and Hemi Taka, sought an order for Nottingham's adjudication as bankrupt, while Nottingham applied for approval of his proposal under the Insolvency Act 2006. Additionally, Nottingham's judgment creditors appealed against the decision of the proposed trustee to recognise certain creditors and allow them to vote on Nottingham's proposal.

The primary legal issue before the Court was whether the proposed trustee's decision to accept certain creditors' claims and permit them to vote on Nottingham's proposal was correct. The Court found that the claims did not comply with the necessary requirements under the Insolvency (Personal Insolvency) Regulations 2007. Consequently, the appeal against the proposed trustee's decision was allowed, and Nottingham's application for approval of his proposal was declined, as 100 per cent of the creditors eligible to vote had rejected the proposal.

Furthermore, the Court considered the application for an order adjudicating Nottingham bankrupt, based on a judgment debt of $15,000. Despite Nottingham's arguments, the Court held that there was a significant public interest in adjudicating Nottingham bankrupt, given his history of pursuing unsuccessful private prosecutions and his alleged inability to meet his financial obligations despite receiving approximately $2 million from his creditors. For these reasons, the Court made an order adjudicating Nottingham bankrupt on the application of the judgment creditors.

In summary, the Court overturned the proposed trustee's decision, declined Nottingham's application for approval of his proposal, and made an order adjudicating Nottingham bankrupt on the application of the judgment creditors.

Orders