Jones v IBC Japan Ltd

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-002070

[2024] NZHC 2454

2454

the Companies Act 1993 and Part 19 of the High Court Rules

IN THE MATTER

of the liquidation of Autoterminal New Zealand Ltd (in Liquidation)

BETWEEN

AND AND

KIERAN MICHAEL JONES, STEVEN KHOV and THOMAS LEE RODEWALD

(as liquidators of Autoterminal New Zealand Ltd)
Applicants

IBC JAPAN LTD
First Respondent

KEVYN BOTES

Intervener

Hearing:

4, 5 and 6 June 2024

Closing submissions: 21 June 2024

Counsel:

B J Burt and J Tunna for Applicants

R J Hollyman KC and E K J Gamet for IBC B Gustafson for Intervener

Judgment:

30 August 2024

JUDGMENT OF BREWER J

This judgment was delivered by me on 30 August 2024 at 3 pm pursuant to Rule 11.5 High Court Rules.

Registrar/Deputy Registrar

JONES & ORS v IBC JAPAN LTD & ANOR [2024] NZHC 2454 [30 August 2024]

Introduction.......................................................................................................... [1]

Background.......................................................................................................... [8]

The law............................................................................................................... [22]

Reasonable remuneration  [25]

Medforce 1  [27]

Medforce 2  [30]

Re Roslea Path Ltd  [31]

Expenses  [38]

What was done?................................................................................................. [43]

Witnesses and evidence..................................................................................... [51]

Evidence admissibility  [59]

The issues............................................................................................................ [60]

Discussion........................................................................................................... [78]
The complexity of the liquidation  [80]

Conclusion  [88]

Whether it was necessary to retain three liquidators  [91]

Conclusion  [98]

Over servicing  [104]

Conclusion  [116]

Over resourcing  [120]

Conclusion  [122]

IBC  [124]

Conclusion  [131]

The liquidators and Mr Tyler  [135]

Conclusion  [138]

Expenses  [140]

Conclusion  [147]

Decision............................................................................................................. [150]

Costs.................................................................................................................. [160]

Introduction

[1]                 Section 284 of the Companies Act 1993 (the Act) empowers a court to, among other things, review or fix the remuneration of a liquidator at a level which is reasonable in the circumstances.

[2]                 On 11 September 2021, Messrs Khov, Jones and Rodewald (the liquidators) were appointed liquidators of Autoterminal New Zealand Ltd (ATNZ) by its sole director, Mr Tyler.  On 11 September 2023, the liquidators filed an application under s 284 of the Act for orders:

1.1fixing    the    applicants’   remuneration    to    20   August    2023 at

$1,232,801.41 + GST and disbursements of $618,706.15 + GST; and

1.2directing the applicants to deduct their remuneration, and fees and expenses properly incurred, in bringing this application from the funds held by them in the liquidation of Autoterminal New Zealand Limited (ATNZ); and

1.3to the extent the funds held by the applicants in the liquidation of ATNZ are insufficient to satisfy the remuneration, and the fees and expenses properly incurred by the applicants, in bringing this application, those fees and expenses be paid (on a solicitor and client basis) by IBC Japan Limited (IBC).

[3]                 IBC Japan Ltd (IBC) filed a notice of opposition as an interested party on    13 October 2023. The grounds of its opposition are:

aThe liquidation of Autoterminal New Zealand Limited (in Liquidation) has been carried out in an inefficient manner with the result that excessive time has been spent on certain aspects of the liquidation.

bA large percentage of hours applied to the liquidation have been charged by the three applicants personally…