McConnell Dowell Constructors Limited v Hurlstone Earthmoving Limited (in rec) HC Auckland CIV-2011-404-4410

[2011] NZHC 784

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2011-404-4410

UNDER  CIV-2011-404-4410

BETWEEN  MCCONNELL DOWELL CONSTRUCTORS LIMITED Plaintiff

ANDHURLSTONE EARTHMOVING LIMITED (IN RECEIVERSHIP) Defendant

Hearing:         (on papers)

Appearances: D M Hughes for plaintiff

Judgment:      26 July 2011 at 4:30 PM

JUDGMENT OF ASSOCIATE JUDGE J P DOOGUE [Judgment granting leave to commence liquidation proceedings]

This judgment was delivered by me on

26.07.11 at  4.30 pm, pursuant to

Rule 11.5  of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:

Kensington Swan, Private Bag 92101, Auckland – by email:  [email protected]

MCCONNELL DOWELL CONSTRUCTORS LIMITED V HURLSTONE EARTHMOVING LIMITED (IN RECEIVERSHIP) HC AK CIV-2011-404-4410 26 July 2011

[1]      The plaintiff seeks leave under s 288(5) of the Companies Act 1993.  That section provides that a contingent creditor may commence proceedings against a company for its liquidation on the ground of inability to pay debts only if it is satisfied that a prima facie case has been made out that the company is unable to pay its debts.

[2]      I am satisfied on the material that has been placed before the Court that the applicant is a prospective creditor of the company.   The brief grounds for that conclusion are that the applicant has established that it is likely that it will suffer loss which is claimable from the company as a result of the company ceasing to carry out its obligations under the sub-contract agreements that it entered into with the applicant.

[3]      The second issue is whether the Court is satisfied that a prima facie case has been  made  out  that  the  company  is  unable  to  pay  its  debts.    Receivers  were appointed to the company on or about 13 July 2011.   I accept that because the company has been placed in receivership a presumption arises under s 287(c) of the Companies Act 1993 that the company is unable to pay its debts.

[4]      I am therefore satisfied that this is a proper case for granting leave and I order accordingly.  Costs on the without notice application are reserved.  If the applicant wishes to obtain an order for such costs, that can be dealt with in due course when

any substantive liquidation proceeding is dealt with.

J P Doogue

Associate Judge