PMT (2010) Limited (in liquidation) v Mark - [2023] NZHC 584

IN THE HIGH COURT OF NEW ZEALAND BLENHEIM REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WAIHARAKEKE ROHE

CIV-2018-406-010

[2023] NZHC 584

BETWEEN IAIN NELLIES as liquidator Plaintiff

AND

PETER MARK and JEANETTE MARK

Defendants

CIV-2021-406-013

BETWEEN

PMT 2010 LIMITED (in liquidation) First Plaintiff

IAIN NELLIES

Second Plaintiff

AND

PETER MARK and JEANETTE MARK

First Defendants

WISHEART MACNAB & PARTNERS TRUSTEE COMPANY LIMITED and

DAVID JOHN PAUL in their capacities as the trustees of the Mark Family Trust Second Defendants

Hearing: 15 March 2023

Appearances:

D P MacKenzie for Plaintiffs in both proceedings P Morten for Defendants in both proceedings

Judgment:

22 March 2023

JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

NELLIES v MARK [2023] NZHC 584 [22 March 2023]

Introduction and background

[1] These two proceedings (the “2018 proceeding” and the “2021 proceeding”) are closely related and are to be heard together. Accordingly, in this judgment, references to “the plaintiffs” and “the defendants” apply to the parties in both proceedings.

[2] The proceedings involve a claim by the plaintiffs, PMT 2010 Ltd (in liquidation) (PMT) and the company’s liquidator, Mr Iain Nellies, against the defendants, Mr Peter and Mrs Jeanette Mark, who are the company’s directors, and the trustees of Mr and Mrs Mark’s family trust, for over $2,750,000.

[3] Four causes of action are pleaded. In the end, though, all are directed at clawing back monies to which the plaintiffs say they are entitled but that the defendants have received and refused to disgorge.

[4] PMT was placed in liquidation at the suit of judgment creditors (who have still not been paid) in March 2015. The first proceeding was commenced in March 2018. It is no exaggeration to say that the company’s affairs have taken an inordinately long time to be resolved.

[5] Before the Court for determination are two interlocutory applications and a case management issue:

(a)The first application is by the plaintiffs for leave to file and serve an amended statement of claim. This is not opposed. It can be dealt with very briefly.

(b)The second application is by the defendants for further discovery pursuant to r 8.19 of the High Court Rules 2016.

(c)The determination of those issues will, as counsel say, inform the next steps in the proceedings, in relation to which counsel are seeking different directions.

[6]I will deal with those matters in the order I have summarised them.

Proposed amended pleading

[7] However awkward it may be for a defendant to face amended pleadings, and however much the defendant may feel that they are having to deal with shifting goal posts, in the absence of a direction from the Court, or the passing of a close of pleadings date, and subject to the Court’s overarching discretion in relation to costs if a party is amending pleadings excessively, there is no bar to a plaintiff (or other party) amending their pleadings.1

[8] Of course, if a plaintiff amends the claim in a way that the defendant regards as objectionable, the defendant is entitled to challenge…

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.

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Details

Case: [2023] NZHC 584
Decision Date: 22 March 2023

CaseChat Overview and Summary

The High Court of New Zealand heard two proceedings involving a claim by PMT 2010 Limited (in liquidation) and its liquidator, Mr Iain Nellies, against the company's directors, Mr Peter and Mrs Jeanette Mark, and the trustees of their family trust, for over $2.75 million. The plaintiffs seek to recover monies they believe were wrongfully extracted from the company and held by the defendants. Before the court were two interlocutory applications and a case management issue: the plaintiffs' application for leave to file and serve an amended statement of claim, the defendants' application for further discovery, and the next steps in the proceedings.

The court granted the plaintiffs leave to file and serve an amended statement of claim, noting that there is no bar to amending pleadings in the absence of a direction from the court, a close of pleadings date, or excessive amendment leading to costs. The court also granted the defendants' application for further discovery, finding that the documentation sought was relevant and important, and that the discovery was proportionate. The court rejected the plaintiffs' argument that the discovery was irrelevant to the main claim and that the limitation defences were precluded by a previous judgment. The court emphasized that the defendants should have access to potentially relevant material.

The court then provided directions for the next steps in the proceedings, including deadlines for filing amended pleadings, discovery, and briefs of evidence, and a trial date. The court emphasized the need to resolve the litigation as soon as possible and reserved leave to either party to apply further in relation to the pre-trial directions if necessary. The court also reserved costs, expressing confidence that counsel would be able to resolve them.

Orders