Ott v Holt - [2024] NZHC 3832

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2024-404-002358

[2024] NZHC 3832

IN THE MATTER OF Section 174 of the Companies Act 1993

IN THE MATTER OF

GOLD CRESCENT (NZ) LIMITED

BETWEEN

GEORGINA MARLENE OTT

Plaintiff

AND

STEPHEN HOLT

Defendant

Hearing: 14 November 2024

Appearances:

D Grove for the Plaintiff C Jiang for the Defendant

Judgment:

13 December 2024

JUDGMENT OF TAHANA J

[Reasons]

This judgment was delivered by me on 13 December 2024 at 4.00pm Pursuant to Rule 11.5 of the High Court Rules

…………………………

Registrar/Deputy Registrar

Solicitors/Counsel:
Foy & Halse, Auckland O’Connell Chambers, Auckland Tompkins Wake, Auckland

OTT v HOLT [Reasons] [2024] NZHC 3832 [13 December 2024]

Introduction

[1] On 19 November 2024, I made orders removing the current directors and appointing an independent director to progress the sale of two properties owned by Gold Crescent (NZ) Ltd (Gold Crescent).1 I now set out my reasons for making those orders.

[2] Ms Ott and Mr Holt are both directors and shareholders of Gold Crescent. They were married for 13 years and have now separated. Their separation is acrimonious. Gold Crescent owns six properties and while it is solvent, it is generating insufficient cashflow from those properties and has defaulted on loan repayments owed to the Bank of New Zealand (the BNZ). The BNZ has threatened to issue notices under the Property Law Act 2007 (the PLA) if Gold Crescent does not pay the outstanding amounts, which now exceed $100,000.

[3] The parties had agreed to sell two of Gold Crescent’s properties located in Mangakino and Taupō. The Mangakino property was put on the market but did not sell. The Taupō property has not been put on the market. Mr Holt no longer agrees to the sale of these two properties and says that a company property in Barrington Road, Grey Lynn (the Barrington property) should be sold. Ms Ott resides at the Barrington property and does not agree to its sale.

[4] Ms Ott applies for interim relief under s 174 of the Companies Act 1993 (the Act) for the removal of Mr Holt as director and the appointment of an independent director to oversee the sale of the Mangakino and Taupō properties so that the proceeds of sale can be used to repay borrowings from the BNZ. In her substantive claim (which is not the subject of this application for interim relief), Ms Ott also seeks orders for the independent director to liquidate the balance of Gold Crescent’s assets by sale on the open market or by transferring the assets to the shareholders on an equal basis.

[5] Mr Holt does not oppose the appointment of an independent director but opposes orders requiring the independent director to sell the Mangakino and Taupō properties.

1 Ott v Holt [2024] NZHC 3468.

[6] Before considering whether interim relief should be granted, I set out the relevant background and law.

Background

[7]Ms Ott and Mr Holt married in…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Ott v Holt

Details

AGLC: Ott v Holt [2024] NZHC 3832
Case: [2024] NZHC 3832
Decision Date: 13 December 2024

CaseChat Overview and Summary

In the High Court of New Zealand, Georgina Marlene Ott, a shareholder and director of Gold Crescent (NZ) Limited, sought interim relief under Section 174 of the Companies Act 1993 against Stephen Holt, another director and shareholder. Ott sought the removal of Holt as a director and the appointment of an independent director to oversee the sale of two Gold Crescent properties to repay loans owed to the Bank of New Zealand (BNZ). Holt opposed the sale of the specified properties and proposed selling a different property instead. The court had to determine whether it had jurisdiction to grant interim relief for the sale of land, whether there was a serious issue to be tried, and if the balance of convenience favoured granting the interim relief sought. Tāhana J held that the court had jurisdiction to grant such interim relief and that there was a serious issue to be tried as to whether Holt's change of mind about selling the properties was oppressive. The balance of convenience favoured granting the interim relief, as it would prevent a mortgagee sale by the BNZ and allow Gold Crescent to meet its debts. The court appointed Benjamin Francis as an independent director to sell the specified properties, with the proceeds used to repay the BNZ, cover Francis's costs, and fund Gold Crescent's operations. The court encouraged the parties to reach an amicable resolution to avoid further legal costs that would reduce the relationship property pool for division.

Orders