Jacomb v Wikeley - [2013] NZHC 3368

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
IN BANKRUPTCY

CIV-2013-485-3414 [2013] NZHC 3368

UNDER the Insolvency Act 2006

IN THE MATTER OF

the bankruptcy of KENNETH DAVID WIKELEY

BETWEEN

MICHAEL JOHN JACOMB, TRENA KATHLEEN JACOMB AND PETER REGINALD RICHARDSON Judgment Creditors

AND

KENNETH DAVID WIKELEY Judgment Debtor

Hearing: 13 December 2013

Counsel:

J Toebes for Judgment Creditors
A Sorrell for Judgment Debtor

Judgment:

13 December 2013

JUDGMENT OF ASSOCIATE JUDGE BELL

This judgment was delivered by me on 13 December 2013 at 4.30 pm pursuant to Rule 11.5 of the High Court Rules.

...................................
Registrar/Deputy Registrar

Solicitors:
JT Law, Wellington for Judgment Creditors
Jones Young, Auckland for Judgment Debtor

JACOMB v WIKELEY [2013] NZHC 3368 [13 December 2013]

[1] Mr Wikeley has appealed against my decision of 14 November 2013 dismissing his application to set aside the bankruptcy notice. Since that decision, the judgment creditors have filed an adjudication application. The act of bankruptcy they rely on is Mr Wikeley’s non-compliance with the bankruptcy notice served on him. The bankruptcy notice identified two separate sums payable under the judgment of Kós J of 10 April 2013: US$875,768.42 and NZ$48,130.18. The US$875,768.42 was the amount payable under a guarantee that Mr Wikeley had given, plus interest. The NZ$48,130.18 was the costs payable in the proceeding in which Kós J gave judgment.

[2] In my decision dismissing the application to set aside the bankruptcy notice I

awarded the creditors costs. So far costs have not been fixed.

[3] Mr Wikeley has applied for a halt of the bankruptcy application under s 38 of the Insolvency Act 2006 and for a stay under r 20.10 of the High Court Rules.1 The grounds of the application for the halt and stay are that, if the bankruptcy application is not halted, Mr Wikeley will be declared bankrupt before his appeal can be heard and that would render nugatory his right of appeal. The application also states that Edel Metals Group Limited is to shortly issue proceedings against the creditors for not having met the call on them for unpaid share capital. If Edel Metals Group Limited is successful in that proceeding, that would extinguish the debt owing by
Edel Metals Group Limited to the creditors, which Mr Wikeley guaranteed in part. The effect of a successful judgment for Edel Metals Group Limited against the judgment creditors would extinguish Mr Wikeley’s liability under the judgment of Kós J.

[4] The grounds of Mr Wikeley’s appeal to the Court of Appeal are:

(i)that I was wrong to find that a claim against the principal debtor, Edel Metals Group Limited, under s 174 of the Companies Act 1993 was bound to result in relief; and

(ii) that I was wrong to find that if such relief were granted, it would make

Mr Wikeley’s set off argument ineffective.

[5] Mr Wikeley applies for the stay under r 20.10 of the High Court Rules. That is not the correct rule for a stay on an appeal from this…

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 Jacomb v Wikeley

Details

AGLC: Jacomb v Wikeley [2013] NZHC 3368
Case: [2013] NZHC 3368
Decision Date: 13 December 2013

CaseChat Overview and Summary

In the case of Jacomb v Wikeley, the central issue revolved around the validity of a bankruptcy notice served on Kenneth David Wikeley by Michael John Jacomb, Trena Kathleen Jacomb, and Peter Reginald Richardson. The creditors sought to declare Mr. Wikeley bankrupt due to his non-compliance with the bankruptcy notice, which cited two sums payable under a previous judgment. Mr. Wikeley contested the validity of the bankruptcy notice and appealed the decision dismissing his application to set it aside. The court examined whether interim relief should be granted pending the appeal and if so, under what conditions.

The legal issues before the court included determining the correct rule for staying proceedings on an appeal to the Court of Appeal, the potential grounds for halting the bankruptcy application, and the balance of convenience between the parties. Mr. Wikeley argued that halting the bankruptcy application was necessary to preserve his right to appeal and to prevent the potential extinguishment of his liability under the judgment debt. The judgment creditors contended that they should be allowed to proceed with their application, especially since Mr. Wikeley had committed an act of bankruptcy by not complying with the notice.

The court ruled that while Mr. Wikeley’s appeal might not entirely nullify the bankruptcy notice, it could still serve a useful purpose by clarifying the status of the judgment debt. The court granted interim relief under the Court of Appeal (Civil) Rules and halted the bankruptcy application on specific conditions. These included Mr. Wikeley paying the costs ordered by Justice Kós plus interest, promptly pursuing his appeal, and informing the court and creditors of any change of address. The court emphasized that the halt was not intended to indefinitely delay the creditors’ rights but to balance the interests of both parties pending the outcome of the appeal. The judgment creditors retained the right to enforce the costs order from the previous proceedings.

Orders