Innovate Civil and Construction Limited (in liquidation) v Hayes

[2024] NZHC 1012

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2024-404-374

[2024] NZHC 1012

IN THE MATTER

of the liquidation of Innovate Construction Limited (in liquidation)

BETWEEN

INNOVATE CIVIL AND CONSTRUCTION LIMITED (IN LIQUIDATION)

Plaintiff

AND

BARRY OWEN HAYES

Defendant

Hearing:

30 April 2024

Appearances:

A Ho for Plaintiff

No appearance for Defendant

Judgment:

30 April 2024

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 30 April 2024 at 2:15 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar

………………………

INNOVATE CIVIL AND CONSTRUCTION LIMITED (IN LIQUIDATION) v HAYES [2024] NZHC 1012

[30 April 2024]

[1]        The defendant, Mr Hayes, was the director of Innovate Civil and Construction Limited (in liquidation) (Innovate).

[2]        The liquidator of Innovate seeks to recover from Mr Hayes amounts that he owes to Innovate on an overdrawn current account.

[3]        Mr Hayes   was   served   with   the   liquidator’s   summary   judgment   on   5 March 2024 but has taken no steps.

[4]        The liquidator’s evidence is that Mr Hayes caused Innovate to make payments to him totalling $154,894.27. That amount is recorded in a Xero Report produced by the liquidator.

[5]        In the Xero Report the liquidator records that some transactions were coded as “drawings” while the rest were coded as “salary”. The liquidator does not consider those payments to be salary as there was no employment agreement with Mr Hayes nor any resolutions in particular, pursuant to s 161 of the Companies Act 1993, authorising remuneration to be paid by Innovate to Mr Hayes. Nor are the amounts coded as “salary” consistent amounts, that is, they were not regular routine payments that might suggest they were salary. The irregular payments in the liquidator’s opinion are more likely to be drawings than salary.

[6]        The liquidator wrote to Mr Hayes in July 2023 demanding the overdrawn current account to be paid. No response was received and, as I have said, Mr Hayes has taken no steps to defend this proceeding.

[7]        In the circumstances I am satisfied that Mr Hayes does not have a reasonably arguable defence to the liquidator’s claim.

[8]        Accordingly, there is judgment in favour of the liquidator for $154,894.27 together with interest on that sum from the date of judgment until the debt is paid pursuant to section 10 of the Interest of Money Claims Act 2016.

Costs

[9]There is an award of costs on a 2B basis of $9,560 plus disbursements of

$190.44.

Associate Judge Lester

Solicitors:
Crimson Legal, Auckland (for Plaintiff)