McNair v ASB Bank Limited

[2020] NZHC 707

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2020-419-31

[2020] NZHC 1707

UNDER

the Insolvency Act 2006

BETWEEN

ANNALESE MAREE McNAIR

Insolvent

AND

ASB BANK LIMITED,

HARMONEY LIMITED and LATITUDE FINANCIAL SERVICES LIMITED

Creditors

Hearing:

13 July 2020

Counsel:

Ms Parker for Insolvent

No appearance for creditors

Judgment:

15 July 2020

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 15 July 2020 at 4.00pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 15 July 2020

McNAIR v ASB BANK LIMITED [2020] NZHC 1707 [15 July 2020]

[1]                 The insolvent, Annalese Maree McNair, seeks approval of her creditors proposal under Part 5 of the Insolvency Act 2006 (the Act).

[2]The insolvent lodged her proposal with the Court on 28 January 2020.

[3]                 Ms Liggins accepted the role as provisional trustee and took on the task of sending the proposal to creditors.

[4]                 Ms Liggins, in her trustee’s report to the Court (dated 23 March 2020), said that on 7 February 2020 she gave notice of the proposal to creditors by email. The practical confirmation that the email was received by the insolvent’s creditors is that all three creditors to whom the proposal was sent, voted in favour of the proposal.

[5]                 The creditors’ meeting was held on 19 March 2020. All creditors voted by way of postal vote. As I have said, all creditors voted in favour of the proposal and accordingly the proposal was accepted by the required majority of creditors that voted at the meeting, both in number and in value.

[6]                 The proposal was modified at the creditors’ meeting, extending the period for which the insolvent is to make payments from three years to four years, thereby increasing the amount to be received by the creditors. Such was a condition of the insolvent’s major creditor voting in favour of the proposal.

[7]                 Ms Liggins has filed an affidavit (sworn 26 June 2020) confirming that notice of the present application was sent to the creditors. Two creditors were advised of the application by email and they acknowledged receipt of the notice, with a third creditor being sent notice by way of standard post.

[8]                 The proposal is in the prescribed form as required by s 327 of the Act, and the trustee’s report confirms the prescribed procedure at the meeting of creditors was followed, and the report produced complies with the Insolvency (Personal Insolvency) Regulations 2007.

[9]                 I consider the proposal is reasonable and calculated to benefit the general body of creditors, such being the guiding criteria for approval under s 333(3) of the Act.

[10]              The Court should only refuse to give approval if one or more of the trigger paragraphs in s 333(3) of the Act applies. Here, commercially experienced creditors have decided to accept the proposal. The proposal is calculated to meet approximately 80 per cent of the insolvent’s indebtedness (less costs of administering the proposal).

[11]As was held in Farmer v Rowley:1

… the Court should accept the view of the creditors, or the majority of them, and grant approval unless it is apparent that one of the grounds for refusing approval exists.

[12]              Given all creditors support the proposal, I am satisfied it is appropriate there be  an  order  as  sought  approving  the  proposal  by  the  insolvent,  Annalese Maree McNair, at the creditors meeting, being the proposal lodged on 28 January 2020 save that the term of the proposal is varied from three years to four years. There is an order accordingly.

Associate Judge Lester

Solicitors:
Webster Malcolm Law, Warkworth

1      Farmer v Rowley [1992] 2 NZLR 195 (CA) at 205.