Nguyen v Registrar of Companies

[2024] NZHC 3848

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2024-404-003231

[2024] NZHC 3848

UNDER

the Companies Act 1993

IN THE MATTER

of an application to restore a company to the Companies Office Register

BETWEEN

KHANH NGOC NGUYEN, THANH THI NGUYEN, and HOAN VAN NGUYEN

Applicants

AND

REGISTRAR OF COMPANIES

Respondent

Hearing:	16 December 2024
Appearances:	M Orange for the Applicants
Judgment:	16 December 2024

JUDGMENT OF ASSOCIATE JUDGE COGSWELL

This judgment was delivered by me on 16 December 2024 at 12.30 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date.......................................

Solicitors:

Fortune Manning, Auckland

NGUYEN & Ors v REGISTRAR OF COMPANIES [2024] NZHC 3848 [16 December 2024]

[1]    The applicants, Khanh Ngoc Nguyen, Thanh Thi Nguyen and Hoan Van Nguyen, seek an order that HMTK Property Investment Limited (the Company) be restored to the New Zealand Register of Companies.

[2]    The application is made under s 329 of the Companies Act 1993 (the Act) and Part 19 of the High Court Rules.

[3]    Rule 19.2(c) requires an application under s 329 of the Act to be brought by originating application.

[4]    The applicants seek to have the matter heard with urgency, due to the need to settle the sale of a property owned by the Company.

[5]    The application is made by the three directors and shareholders of the Company, who are permitted applicants by s 329(2)(a)(i) of the Act.

[6]    The application has been served on both the respondent Registrar of Companies and the Treasury.

[7]    The Registrar consents to the order restoring the Company to the Register of Companies.

[8]    The Treasury has confirmed that it does not oppose or have any interest in the application.

[9]The application relies on the following grounds:

(a)that the company was carrying on business, or a proper reason exists for the company to continue in existence – s 329(1)(a)(i) of the Act; or

(b)that it is just and equitable to restore the company to the New Zealand Register – s 329(1)(b) of the Act.

[10]   The Company was removed from the Register of Companies on 19 July 2024 for failing to file its annual return. The reasons for that failure are explained in the

two affidavits of Thanh Thi Nguyen, affirmed on 12 December 2024 and 13 December 2024.

[11]   The 2024 annual return was not filed due to the relevant director not receiving reminders about the 2024 annual return. It is noted that the Company filed its 2023 annual return. It appears from the evidence filed that reminders from the Registrar of Companies were not received, because they were filtered out by a spam filter.

[12]   I am satisfied that the failure to file returns arose from inadvertence by the Company.

[13]   The applicants have provided evidence outlining the Company’s financial position and have deposed that the Company is solvent. They have provided evidence of the debts owed by the Company and that the proceeds of sale of the Property will be sufficient to meet all outstanding debts.

[14]   The urgency in seeking restoration is so that the Company can settle the sale of a property it owns at 179 Grey Avenue, Papatoetoe, Auckland (the Property).

[15]   The Property was sold by auction on 26 June 2024, and settlement is now due. In fact, settlement was supposed to have occurred on 9 December 2024, but was unable to proceed due to the discovery that day that the company had been removed from the Register.

[16]   The Company’s business is described as a property investment business, which explains its ownership and dealing with the Property.

[17]   On discovery that the Company had been removed, the applicants applied to the Registrar of Companies for restoration. The application was accepted, but allowing for advertising, the restoration process will not be completed until 28 January 2025.

[18]   The applicants do not wish to wait until the end of January next year for the formal restoration process to conclude. They want the Company to settle the sale of the Property now.

[19]   The general approach of the Courts in applications to restore a company to the Register is that cases in which the Court will decline such an application will be quite unusual. The Court’s discretion to refuse restoration has been described as a negative discretion – negative in the sense that, unless there are some discretionary factors that point against restoration, the order should be made.

[20]   Here both the Registrar of Companies and the Treasury consent to or do not oppose the application.

[21]   In the present case there are good grounds to restore the company to the Register, to enable it to deal with the settlement of the sale of its property. It is an appropriate case for the orders sought to be granted.

[22]   The effect of s 331(1) of the Act is that property owned by the company automatically re-vests in the Company on restoration, except for interests in land where transmission to the Crown has been registered under the Land Transfer Act 20171. The applicants have provided a recent copy of the Record of Title to the Property which records that there has not been a registration of the transmission of the Property to the Crown.

[23]   The Court in R H Tregoweth Ltd v Registrar of Companies2 restored a company to the Register in order to enable that company to transfer a property registered in its name to a third party in satisfaction of the terms of a pre-existing agreement for sale and purchase. That case involved a company that had been removed from the Register some 26 years before the application was made.

[24]   Here, the application for restoration has been made promptly following discovery of the removal of the Company from the Register. There appears to be no grounds that point away from the Court exercising its discretion to restore the Company to the Register.

1       Companies Act 1993, s 331(3)

2      R H Tregoweth Ltd v Registrar of Companies [2014] NZHC 1899.

[25]   The grounds for restoration being made out and there being no opposition to the application, I make the following orders:

(a)there is an order that HMTK Property Investment Limited is restored to the New Zealand Companies Register;

(b)the company is to file its outstanding annual return within five working days of the date of this order for restoration;

(c)there is no order as to costs.

Associate Judge Cogswell