Official Assignee v Stretton

[2015] NZHC 33

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2015-409-000006 [2015] NZHC 33

BETWEEN

THE OFFICIAL ASSIGNEE

Plaintiff

AND

AMY LOUISE STRETTON Defendant

Hearing:	27 January 2015 (On the papers)
Appearances:	G Slevin for Plaintiff Defendant in person
Judgment:	27 January 2015

JUDGMENT OF DUNNINGHAM J

[1]      This  is  an  application  by  the  Official  Assignee  under  s  374  of  the Insolvency Act 2006 for various orders in relation to the application for adjudication of the defendant, Ms Stretton.

[2]      On 4 December 2014 Ms Stretton applied to the Official Assignee to be adjudicated bankrupt. As part of her application she completed a statement of affairs in which she stated that her total debts amounted to $17,478.21.  In her statement of affairs Ms Stretton did not disclose that she held bank accounts with Westpac New Zealand Limited (Westpac) or a KiwiSaver Account.

[3]      On 10  December 2014  the Official Assignee  advised  the defendant  that, based on the information contained in her application, the most suitable application for her to make was the no asset procedure.   On the same day she applied for admission   to   the   no   asset   procedure   under   subpart   4   of   part   5   of   the Insolvency Act 2006, relying on her previously submitted statement of affairs and,

on 11 December 2014, she was admitted to the no asset procedure.

THE OFFICIAL ASSIGNEE v STRETTON [2015] NZHC 33 [27 January 2015]

[4]     However, it transpires that the information contained in the defendant’s application  for bankruptcy was  false.    In  fact  she had  two  bank  accounts  with Westpac which had a combined credit balance of more than $40,000.  She also has savings of an unknown amount in a KiwiSaver Account with the ASB Bank.

[5]      On   or   about   11   December   2014   the   defendant   travelled   to   the

United Kingdom where she remains.

[6]      On 18 December Westpac advised the Official Assignee that the defendant had bank accounts with it containing in excess of $44,000, which it had frozen.  On the same day the defendant contacted the Official Assignee and asked if her entry into the no asset procedure could be cancelled so that she could pay creditors in Australia.

[7]      On 22 December the defendant then advised the Official Assignee that she had no creditors in Australia, that she wanted the money released for her own use and was seeking help for mental health issues.  Enquiries carried out by the Official Assignee led to the discovery of the defendant’s KiwiSaver asset but did not identify any history of defaulting on debts.

[8]      In  these  circumstances  the  Official Assignee  sought,  initially,  an  interim preservation order preserving the funds held by Westpac for the credit of the defendant or any pending the Court’s determination of the plaintiff ’s substantive claim  in  this  proceeding.    That  order  was  made  by  consent,  by  Mander  J,  on

16 January 2015.

[9]      Since the making of those orders, the Official Assignee has filed an amended statement of claim and memorandum of counsel updating the position to record that the Official Assignee has terminated the defendant’s participation in the no asset procedure on the grounds that she has concealed assets and misled the plaintiff.

[10]     The Official Assignee now seeks orders:

(a)      preserving the funds held by Westpac for the credit of the defendant (the funds) pending an application for her adjudication or compliance with further orders of the Court;

(b)      directing Westpac to pay the funds to the Official Assignee;

(c)      directing the Official Assignee to confer with the defendant in respect of identifying her creditors and making proper payments to them on her behalf;

(d)reserving  leave  to  the  parties  to  further  apply  to  the  Court  for directions in respect of any issues that may arise as to the identity of the defendant’s creditors, the amounts owed to them, or any other matter;

(e)      reserving costs and directing the parties to confer with a view to reaching agreement as to costs;

(f)      directing the Official Assignee to pay the defendant any of the funds remaining after payment of the defendant’s debts and the plaintiff’s costs as agreed.

[11]     The  defendant  has  been  in  communication  with  the  Official  Assignee’s

solicitor,  and  the  Court  regarding  the  proceedings.    She  has  sent  an  email  on

23 January 2015 in response to the filing of the amended statement of claim and the attached memorandum of counsel confirming that she wants the matter “dealt with as soon as possible”.  She says she does not have a job in the UK, nor does she have any money to use which is causing her much hardship.  I accept, therefore, that she consents for the orders to be made, so that her financial position can be resolved and any surplus funds released to her as soon as possible.

[12]     Accordingly, I make the following orders as set out in the amended statement of claim:

(a)      the funds held by the Westpac New Zealand Limited (Westpac) (the funds) for the credit of the defendant are preserved pending an application for her adjudication or compliance with further orders of the Court;

(b)      Westpac is to pay the funds to the Official Assignee;

(c)      the Official Assignee is to confer with the defendant in respect of identifying her creditors and is to make proper payments to them on her behalf;

(d)leave  is  reserved  to  the  parties  to  further  apply  to  the  Court  for directions in respect of any issues that may arise as to the identity of the defendant’s creditors, the amounts owed to them, or any other matter;

(e)      costs are reserved and the parties are directed to confer with a view to reaching agreement as to costs; and

(f)      the Official Assignee is to pay to the defendant any of the funds remaining after payment of the defendant’s debts and the plaintiff’s costs, as agreed, or as ordered by the Court.

Solicitors:

The Official Assignee, Insolvency and Trustee Service, Christchurch