Ireland

[2024] NZHC 3915

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2024-409-543

[2024] NZHC 3915

IN THE MATTER

of a proposal by insolvent to creditors under subpart 2 of Part 5 of the Insolvency

Act 2006

IN THE MATTER

of a proposal by HAMISH ROBERT KAY IRELAND

Insolvent

Hearing:

On the papers

Counsel:

C T Jolliffe as trustee for the Insolvent

E A Everingham for Christchurch International Airport

Judgment:

18 December 2024

JUDGMENT OF ASSOCIATE JUDGE LESTER

RE IRELAND [2024] NZHC 3915 [18 December 2024]

[1]                 The insolvent, Hamish Ireland, seeks approval of a Proposal under pt 5 of the Insolvency Act 2006 (the Act).

[2]                 The insolvent’s Proposal was filed in the Court on 4 September 2024 with notice of the Proposal given to the insolvent’s creditors by Mr Oorschot who is the provisional trustee under the Proposal on 15 September 2024.

[3]                 A creditors meeting was held on 24 September 2024 and the Proposal was passed when two of the three creditors who chose to take part in the Proposal voted in favour, their votes representing 80.3 per cent of Mr Ireland’s debts with the opposing creditor representing 19.7 per cent of Mr Ireland’s creditors who voted. Mr Ireland’s total indebtedness is $2,634,643.34. However, one creditor representing $458,259.28 chose not to take any role in the Proposal, albeit they attended the creditors meeting as an observer.

[4]                 While the Proposal and the notice of the creditors’ meeting was emailed to creditors as they either voted or attended the meeting convened by the trustee, it is safe to conclude they received notice of the Proposal.

[5]                 An application for approval of the Proposal by the Court was filed in early October 2024.

[6]                 Service of the application was undertaken at the email addresses used by the trustee to give notice of the Proposal. Service of proceedings by email absent an agreement is not good service.

[7]                 However, a solicitor acting for the creditor who voted against the Proposal attended calls of the application for approval and so I am satisfied that creditor received a notice of the application for approval.

[8]                 Under s 327 of the Act, the Proposal must be in the prescribed form and accompanied by a statement of affairs in the prescribed form. I am satisfied these requirements have been met.

[9]                 Unless it is apparent that one of the grounds for refusing approval under        s 333(3) of the Act applies, the approach adopted by the Court is that the Court should accept the view of the creditors or the majority of them.1

[10]             Mr Ireland’s proposal is that he will make a one-off payment to his creditors of five cents in the dollar.

[11]             The Proposal is being funded by a third party, along with the costs and expenses of and incidental to the Proposal. But for the funds coming from a third party based on his statement of assets and liabilities, there is  no prospect of any recovery to     Mr Ireland’s creditors if he was made bankrupt.

[12]             Nothing about the Proposal is unreasonable or not calculated to benefit the general body of creditors which are the guiding criteria for approval under s 333(3) of the Act.

[13]             As I have already indicated, the Proposal was passed by the required majority of creditors, that is, a majority in number and three-quarters majority in value.2 The creditors who voted in favour of the Proposal have made their own assessment based on their commercial experience and in the absence of there being some factor that stands against the approval of the Proposal, I adopt the normal approach being, as said, that the Court should accept the view of the creditors unless it is apparent there exists a good ground for refusing approval.3 I note the creditor who voted against the Proposal (the Christchurch International Airport) is represented by experienced commercial solicitors who have attended calls of the application for approval apparently on a watching brief basis. That the creditor who voted against the Proposal did not oppose this application is consistent with my conclusion that there are no grounds for declining approval.

1      Farmer v Rowley (1992) 2 NZLR 195.

2      Section 331(3) of the Act.

3      Re Bennetts Proposal High Court Christchurch B138/81 and M306/81, 1 February 1982 (alternative citation: Re Duncan Holdings Ltd (in liq).

[14]             Accordingly, I am satisfied it is appropriate that the Proposal be approved. There  is  an  order  in  terms  of  paragraph  [1](b)  of  the  application  filed  on      2 October 2024.

Associate Judge Lester

Solicitors:

Anthony Harper, Christchurch Buddle Findlay, Christchurch

Copy to:
Mr H Ireland, West Eyreton