Moorhouse Panel & Spray Limited v The Energy Saving Company Limited

[2019] NZHC 2671

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2019-409-269

[2019] NZHC 2671

UNDER

The Companies Act 1993

IN THE MATTER

of a statutory demand served on 9 May 2019

BETWEEN

MOORHOUSE PANEL & SPRAY LIMITED

Applicant

AND

THE ENERGY SAVING COMPANY LIMITED

Respondent

Hearing:	17 October 2019
Appearances:	K L Vilsbaek for Applicant I B Paterson for Respondent
Judgment:	18 October 2019

JUDGMENT OF ASSOCIATE JUDGE LESTER

(in respect of application for stay of costs judgment)

This judgment was delivered by me on 18 October 2019 at 3.00pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 18 October 2019

MOORHOUSE PANEL & SPRAY LTD v THE ENERGY SAVING COMPANY LTD [2019] NZHC 2671

[18 October 2019]

[1]    The Energy Saving Company Ltd (“Energy Saving”) has applied for a stay of my costs judgment which followed my setting aside a statutory demand issued by Energy Saving against Moorhouse Panel & Spray Ltd (“Moorhouse”).1

[2]    By coincidence, the costs judgment is very close to the amount that is subject to the statutory demand.

[3]    With me having determined that there was an arguable defence to the statutory demand, Energy Saving has taken its claim to the Disputes Tribunal to seek judgment for the disputed amount. That hearing is scheduled for 11 November 2019.

[4]    In the meantime, Moorhouse has issued a further statutory demand for the costs awarded after the statutory demand hearing  and  that  demand  has  now  expired. Ms Vilsbaek has calculated that the time limit for her client to file winding up proceedings in reliance on the expired statutory demand is 8 November 2019 which is a few days prior to the Disputes Tribunal hearing.

[5]    While 17 October 2019 was only the first call of the application for a stay, I am very conscious that the amounts in issue are relatively modest. There is no point having an interlocutory hearing to argue about a stay of a $12,000 judgment when the costs consequences of that interlocutory hearing will themselves be a significant percentage of the costs order sought to be stayed.

[6]    The applicant for a stay is seeking an indulgence. In my view, a reasonable and pragmatic outcome in this case is to grant a stay but on conditions. Accordingly, I advised counsel during the hearing that the following orders would be made and recorded in this Judgment:

(a)The application for a stay of my costs judgment is granted on the condition that the amount of the costs judgment (dated 30 August 2019) is paid into the trust account of Energy Saving to be held undisbursed in the trust account subject to the outcome of the Disputes Tribunal hearing to be held on 11 November 2019.

1      Moorhouse Panel & Spray Ltd v The Energy Saving Company Ltd [2019] NZHC 1804.

(b)The amount in (a) above is to be paid into the trust account by Thursday 31 October 2019.

(c)If the amount is not paid by 31 October 2019 then the stay will lapse automatically.

(d)If Energy Saving is not successful in the Disputes Tribunal then Energy Saving’s solicitors are to release the funds directly to Moorhouse’s solicitors. For the avoidance of doubt, any appeal against the Disputes Tribunal hearing will not be justification for the funds not being disbursed.

(e)Costs of the stay application are reserved.

(f)On the assumption that the condition for a stay is met, Moorhouse is not to issue liquidation proceedings in reliance on its expired statutory demand but will instead be protected by the amount paid into the trust account held subject to the outcome of the Disputes Tribunal hearing.

Associate Judge Lester

Solicitors:

Anthony Harper, Christchurch

Ronald W Angland & Son, Leeston, Canterbury