MG International Limited v Chawla

[2025] NZHC 1781

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2025-419-0204

[2025] NZHC 1781

UNDER

Part 19 High Court Rules 2016

Part 32 High Court Rules 2016

BETWEEN

MG INTERNATIONAL LIMITED

Applicant

AND

BIKRAMDEEP SINGH CHAWLA

First respondent

GURPREET KAUR

Second respondent

Hearing:	On the papers
Counsel:	G Jindal for applicant
Date of judgment:	1 July 2025

JUDGMENT OF JAGOSE J

This judgment was delivered by me on 1 July 2025 at 4.00pm.

Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Solicitors:
Ormiston Legal, Auckland

MG INTERNATIONAL LTD v CHAWLA [2025] NZHC 1781 [1 July 2025]

[1]    I have MG International Limited’s 30 June 2025 without notice originating application for freezing orders in respect of the respondents’ assets.

Background

[2]    Mr Chawla is the sole shareholder and director of Gurhar Holdings Limited, now in liquidation. Gurhar Holdings is said to be liable to MG International in the amount of some $178,000, for goods supplied on terms including a 29 May 2022 guarantee and indemnity in favour of MG International from Mr Chawla and Ms Kaur.

Law on freezing orders

[3]    Freezing orders may be ordered if I am satisfied, having regard to all the circumstances, there is a danger a prospective judgment in MG International’s favour will be wholly or partly unsatisfied because the value of the respondents’ assets is alienated from them in some manner.1

[4]    Freezing orders are “a valuable protective measure for those commencing civil proceedings”,2 for which applicants must show “a good arguable case on an accrued or prospective cause of action”.3 By ‘good arguable case’ is meant establishment of “a sufficiently plausible foundation” such that “the cause of action is at least tenable”:4

A good arguable case against the respondent is therefore established if the allegations in the proposed claim are capable of tenable argument and are supported by sufficient evidence, bearing in mind the early stage at which the application is likely to be brought.

[5]    As to the danger of alienation, I must be satisfied assets may be removed or dealt with in a way that may frustrate the prospective judgment; that there are

1      High Court Rules 2016, r 32.5(4).

2      Hannay v Mount [2011] NZCA 530 at [20], referring to Deutsche Schachtbau-und Tiefbohrgesellschaft MBH v Shell International Petroleum Co Ltd (trading as Shell International Trading Co) [1990] 1 AC 295 (HL) at 317.

3      High Court Rules, r 32.5(1)(b).

4      Hannay v Mount, above n 2, at [21], citing Wing Hung Printing Co Ltd v Saito Offshore Pty Ltd [2011] 1 NZLR 754 (CA) at [41] and referring to Kuwait Asia Bank EC v National Mutual Life Nominees Ltd (No 2) [1989] 2 NZLR 50 (CA) at 55, and [22].

“circumstances from which a ‘prudent, sensible commercial man, can properly infer a danger of default’” on adverse judgment.5

[6]    I then must consider where lies the balance of convenience,6 meaning if it bears harder on MG International to be without prospective recourse to the respondents’ assets, or on the respondents to have their assets frozen, pending judgment in their respective favours.7

[7]    The form of any freezing order must not prohibit dealings with the assets to pay ordinary living expenses and legal expenses relating to the freezing order or in the ordinary course of business,8 and where made without notice be limited to a particular date as early as practicable after the freezing order is made,9 and with leave reserved to discharge or vary the freezing order urgently on notice.10

Discussion

[8]    Being satisfied r 32.2(1) of the High Court Rules 2016 expressly permits the application to be made without serving notice of the application, I determine the application can properly be dealt with without notice.11

[9]    I am not satisfied by Suneet Gupta’s affidavit evidence affirmed 30 June 2025 MG International’s allegations against the respondents are capable of tenable argument. Certainly Gurhar Holdings appears to have defaulted in its payment of sums due to MG International, which payment the respondents have guaranteed on demand. But there is no evidential foundation of any demand having been made, or any danger of the respondents’ default on adverse judgment. The evidence goes no further than to establish they own assets, which is an insufficient basis for freezing orders. Mr Gupta

5      Murren v Schaeffer [2018] NZCA 318, (2018) 24 PRNZ 285 at [16], citing Raukura Moana Fisheries Ltd v The Ship “Irina Zharkikh” [2001] 2 NZLR 801 (HC) (citing Third Chandris Shipping Corporation v Unimarine SA [1979] QB 645 at 671).

6 At [17].

7      By analogy with Wellington International Airport Ltd v Air New Zealand Ltd HC Wellington CIV- 2007-485-1756, 30 July 2008 at [4] citing Cayne v Global Natural Resources Plc [1984] 1 All ER 225 (CA) at 237.

8      High Court Rules, r 32.6.

9      Rule 32.7.

10     Rule 32.8.

11     Rule 7.46(3).

only raises as a possibility “significant sums from [Gurhar Holdings] may have been moved to [the respondents’] personal bank accounts”. Even if so, such does not infer circumstances of prospective default by the respondents.

Result

[10]The application is declined.

—Jagose J