McKay v Bartlett
[2025] NZHC 3275
•3 November 2025
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2025-404-1138
[2025] NZHC 3275
BETWEEN ANDREW MCKAY and REES LOGAN as
liquidators of Aisleworx Limited (in liquidation)
First Judgment CreditorsAISLEWORX LIMITED (in liquidation) Second Judgment Creditor
PGL ADMIN LIMITED
Third Judgment Creditor
AND
DOUGLAS JAMES BARTLETT
Judgment Debtor
Hearing: On the papers Counsel:
M Tingey and TL Utama for the Judgment Creditors D Bartlett, Judgment Debtor in Person
Judgment:
3 November 2025
JUDGMENT OF ASSOCIATE JUDGE SUSSOCK
This judgment was delivered by me on 3 November 2025 at 10 am pursuant to r 11.5 of the High Court Rules
Registrar/Deputy Registrar
Solicitors:
Fee Langstone, Auckland
MCKAY v BARTLETT [2025] NZHC 3275 [30 October 2025]
Introduction and background
[1] Andrew McKay and Rees Logan, as liquidators of Aisleworx Limited (in liquidation), together with the company in liquidation, and a third judgment creditor, PGL Admin Limited, served a bankruptcy notice on the judgment debtor, Douglas James Bartlett, on 23 May 2025. The bankruptcy notice follows judgment being entered against Mr Bartlett in High Court proceedings for the sum of $361,188.00 plus interest from 20 September 2015. By the date of the bankruptcy notice interest amounted to $140,043.70.
[2] This judgment determines the question of whether a document headed “Notice of Opposition to Bankruptcy Notice” filed on 6 June 2025 by Mr Bartlett ought to be treated as a valid application to set aside the bankruptcy notice served.
[3] Section 17 of the Insolvency Act 2006 provides that a debtor commits an act of bankruptcy where they fail to comply with the requirements of a bankruptcy notice served on them within 10 working days of service.
[4] Any application to set aside a bankruptcy notice must therefore be filed and served within 10 working days of service. The Court has no discretionary power to extend the time for filing such an application because once the ten working day period has expired, an act of bankruptcy has occurred. The act of bankruptcy cannot then be reversed.1
[5] I issued a minute on 17 July 2025 recording that it appeared that the “Notice of Opposition” filed by Mr Bartlett may have been filed on the eleventh working day. I recorded that if the notice of opposition had been filed outside the ten working day period, Mr Bartlett's “opposition” could not proceed as an application to set aside the bankruptcy notice and the judgment creditors could file adjudication proceedings. I directed Mr Bartlett to file an affidavit if he considered he had filed and served the opposition and affidavit within ten working days of service of the bankruptcy notice. The judgment creditors were then to have an opportunity to respond.
Jessica Gorman McGechan on Procedure (online ed, Thomson Reuters) at [HR 24.10.01], citing
Re Scott, ex parte ANZ Banking Group (NZ) Ltd HC Rotorua B 113/89, 15 September 1989.
[6] Mr Bartlett filed an affidavit as directed dated 24 July 2025 confirming that he was served with the bankruptcy notice on 23 May 2025 and had filed and served the notice of opposition and affidavit in support on Friday, 6 June 2025, by hand to the judgment creditors at their nominated addresses.
[7] A memorandum was filed in response on behalf of the judgment creditors dated 8 August 2025 confirming that service was effected on 6 June 2025 but submitting that the documents served were invalid as they were a notice of opposition to the bankruptcy notice and not an application to set aside the bankruptcy notice as required.
[8] The judgment creditors have now filed adjudication proceedings, consistent with their position that no valid application to set aside the bankruptcy notice has been filed. Mr Bartlett has filed a notice of opposition to those proceedings repeating the grounds set out in the “Notice of Opposition to Bankruptcy Notice.”
Has a valid application to set aside a bankruptcy notice been filed?
[9] The judgment creditors submit that an application to set aside must be a standalone new proceeding and the “notice of opposition” filed cannot be treated as an application whose defects may be corrected as it does not satisfy the required criteria in any way and is therefore a nullity.
[10] In Re Reynolds, ex parte Bartlett, Associate Judge Bell confirmed that any application to set aside must be both filed and served in time, although his Honour held that there may be some flexibility in terms of complying with service requirements by applying s 418 of the Insolvency Act and following the approach of the Court of Appeal in Best v Watson.2
[11]Section 418 of the Insolvency Act provides:
(1)A proceeding under this Act must not be invalidated or set aside for a defect (which includes misdescription, misnomer, or omission) in a step that must be taken as part of, or in connection with, the proceeding, unless a person is prejudiced by the defect.
2 Re Reynolds, ex parte Bartlett [2014] NZHC 447 at [19] referring to Best v Watson [1979] 2 NZLR 492 (CA).
(2)The court may order the defect to be corrected, and may order the proceeding to continue, on the conditions that the court thinks appropriate in the interests of everyone who has an interest in the proceeding.
[12] The Court of Appeal in Best v Watson adopted a broad reading of s 11 of the Insolvency Act 1967 (the predecessor to s 418):3
It will always be a question of degree whether or not it can be said that, notwithstanding failure to comply with an apparently mandatory requirement of the Act or of the Rules, there is before the Court what can fairly be described as proceedings under the Act; and that question should not be approached in a mechanical or technical way.
[13] However, the Court confirmed that “if the document is so defective that it is a nullity there is nothing before the Court capable of rectification”.4
[14] The “Notice of Opposition” filed by Mr Bartlett says that the judgment debtor “opposes” the bankruptcy notice rather than applies to set it aside, but it was filed and served with a supporting affidavit and within the required ten working day period. The fact that it was called a “Notice of Opposition to Bankruptcy Notice” could be described as a misdescription or misnomer as specifically referred to in s 418.
[15] However, r 5.1B(2) of the High Court Rules provides that a document is not filed until the earlier of the time that any fee prescribed for the filing of that document by the High Court Fees Regulations 2013 has been paid, or a solicitor’s or barrister’s undertaking has been given or the Registrar has determined the document can be treated as filed despite non-payment of the fee.
[16] Mr Bartlett filed the “Notice of Opposition to Bankruptcy Notice” and supporting affidavit by electronic filing. A notice of opposition attracts a fee of $148 whereas an application to set aside a bankruptcy notice has a fee of $728. Only $143 was paid by Mr Bartlett, not even the full amount for a notice of opposition. Furthermore, the options available in the file and pay system for electronic filing, once the bankruptcy case type is selected, clearly include “set aside bankruptcy notice” so it ought to have been clear that was the appropriate application to make and fee to pay.
3 At 494.
4 Best v Watson, above n 3, at 494.
[17] Mr Bartlett is acting for himself so no undertaking was given by a barrister or solicitor and nor did the Registrar determine that the document ought to be treated as an application to set aside despite non-payment of the fee. No application to set aside has therefore been filed in time because the prescribed fee has not been paid.
[18] As set out above, s 418(2) allows the Court to order a defect is corrected and that the proceeding continue if the Court considers it is in the interests of everyone who has an interest in the proceedings.
[19] In the circumstances of this case, I do not consider it is in the interests of everyone who has an interest in the proceedings to exercise my discretion to correct the defects in the form of the document filed and the non-payment of the filing fee. The grounds set out in the notice of opposition are matters that can be raised in opposition to the bankruptcy proceeding itself, and now have been, as noted in the introduction. No stay of enforcement has been ordered in respect of the judgment debt that is the subject of the bankruptcy notice so the appeal proceedings Mr Bartlett refers to are more appropriately raised in opposition to the bankruptcy proceedings rather than in an application to set aside the bankruptcy notice. Furthermore, Mr Bartlett again relies in his opposition to the bankruptcy proceedings on amounts allegedly owed by the judgment creditors by way of counterclaim. Mr Bartlett will therefore still have an opportunity to raise the points referred to in the “Notice of Opposition to Bankruptcy Notice” in defending the bankruptcy proceeding itself.
[20] Finally, I record that the bankruptcy notice does not appear to include the notes required by Form B2, the mandatory form for bankruptcy notices, as provided for in r 24.8(3) and sch 1 to the High Court Rules.
[21] I correct this omission, relying on s 418 of the Insolvency Act, as Mr Bartlett did not raise this issue and has clearly understood the need to file and serve his response within ten days. He has simply chosen to do so in the form of the “notice of opposition” rather than an application to set aside. I accept that he is acting for himself but in circumstances where Mr Bartlett is raising the same grounds in opposition to the bankruptcy proceeding itself, it is not in the interests of those with an interest in
the bankruptcy proceedings not to correct this omission as otherwise there will be additional time and cost for all parties.
Result
[22]I order:
(a)any omission to include the notes in the bankruptcy notice as set out in Form B2 does not invalidate the bankruptcy notice;
(b)the document headed “Notice of Opposition to Bankruptcy Notice” is not to proceed as an application to set aside the bankruptcy notice;
(c)Mr Bartett is entitled to repayment of $143 paid in partial payment of the filing fee.
[23] The act of bankruptcy therefore occurred on 9 June 2025 and the bankruptcy proceedings filed by the judgment creditors can proceed in the usual way.
Associate Judge Sussock
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