Pacific Plumbing Services Limited (in liquidation) v Archibald

[2022] NZHC 1163

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2022-408-203

[2022] NZHC 1163

IN THE MATTER

of the Insolvency Act 2006

AND

IN THE MATTER

of the bankruptcy of Matthew Archibald

BETWEEN

PACIFIC PLUMBING SERVICES LIMITED (IN LIQUIDATION)

Judgment Creditor

AND

MATTHEW ARCHIBALD

Judgment Debtor

Hearing:	(Determined on the papers)
Appearances:	G J Ryan for Judgment Creditor
Judgment:	25 May 2022

JUDGMENT OF ASSOCIATE JUDGE LESTER

(Granting leave to serve bankruptcy notice overseas)

PACIFIC PLUMBING SERVICES LIMITED (IN LIQUIDATION) v MATTHEW ARCHIBALD [2022] NZHC 1163 [25 May 2022]

[1]    The judgment creditor, Pacific Plumbing Services Limited (in liquidation), applies for permission  to  serve  a  bankruptcy  notice  on  the  judgment  debtor,  Mr Matthew Archibald, overseas.

[2]McGechan on Procedure provides:1

A bankruptcy notice is a document that may be served outside New Zealand only pursuant to leave granted under r 6.30.

[3]    Under s 17(3) of the Insolvency Act 2006 (the Act), a bankruptcy notice must be served on a debtor in New Zealand unless permission of the Court is granted for service outside of New Zealand.

[4]    Associate Judge Bell in Westpac New Zealand v Bolton, when considering an application to serve a bankruptcy notice outside New Zealand, set out the approach he adopted which is to look ahead to any future bankruptcy application by the creditor relying on non-compliance with the bankruptcy notice.2 Associate Judge Bell had regard to the criteria under r 6.28(5) of the High Court Rules 2016 (the Rules) when considering whether leave would be grant to serve an adjudication application out of New Zealand.3 The Associate Judge then considered whether it was appropriate for any bankruptcy of the debtor to be administered in New Zealand. If he was satisfied on those factors, he would generally give leave for the bankruptcy notice and the bankruptcy application at that time. I adopt his approach in relation to this application.

[5]    Under r 6.28(5), the Court may grant leave for an originating document to be served out of New Zealand if the claim has a real and  substantial  connection  to New Zealand, there is a serious question to be tried on the merits, and New Zealand is the appropriate forum for the trial.

[6]    The debt which is the foundation of the bankruptcy notice relates to the operation  of  the  plaintiff’s  business  in  New  Zealand  and  funds  drawn  from  the plaintiff’s business by the debtor. Other than that, I do not know of the connection

1      Andrew Beck and others McGechan on Procedure: High Court Rules 2016 (online ed, Thomson Reuters) at [HR6.30.02].

2      Westpac New Zealand v Bolton [2014] NZHC 693, (2014) 22 PRNZ 183.

3 At [14].

of the proceeding with New Zealand or whether, for example, the debtor owns property in New Zealand.   The Court would have been assisted by the filing of        a memorandum in support or an affidavit explaining Mr Archibald’s connection to New Zealand. Given judgment has already been entered against him in proceedings issued in this Court, I am satisfied it is appropriate to grant leave under r 6.30 for the bankruptcy notice to be served outside of New Zealand. I grant leave, if necessary, for the originating documents in this matter, that is the application for adjudication, to also be served outside of New Zealand.

[7]    Under s 17(4) of the Act, the time for compliance with the bankruptcy notice is 10 days if the debtor is served with the bankruptcy notice in New Zealand or “if the debtor is served outside New Zealand, the time specified in the order of the court permitting service outside New Zealand”. Normally, a greater time is allowed for compliance where a debtor  is  served  outside  New  Zealand.  I  amend  the  time for compliance to 20 working days. An amended bankruptcy notice will need to be tendered. I also note that a time limit requiring the notice to be served within six months of issue was adopted as a standard practice by Associate Judge Osborne in Re Commissioner of Inland Revenue, as a condition of leave under r 6.30. I adopt that practice and impose the same condition here.4

Associate Judge Lester

Solicitors:
White Fox & Jones, Christchurch

4      Re Commissioner of Inland Revenue [2016] NZHC 1344.