Product Development Solutions Limited v Parametric Technology Corporation - [2013] NZHC 33

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-804 [2013] NZHC 33

IN THE MATTER OF section 290 of the Companies Act 1993

BETWEEN PRODUCT DEVELOPMENT SOLUTIONS LIMITED Plaintiff

ANDPARAMETRIC TECHNOLOGY CORPORATION
Defendant

Hearing: 24 January 2013

Appearances: M S Gilmour for the Applicant
M Kersey and S C Vickers for Respondent

Judgment: 24 January 2013

ORAL JUDGMENT OF ASSOCIATE JUDGE BELL

Solicitors:
Spencer Legal, P O Box 8080 Auckland 1150 for Applicant
Email: david@spencerlegal.co.nz

Russell McVeagh, PO Box 8 Auckland 1140 for Respondent
Email: Matthew.Kersey@russellmcveagh.com / spencer.vickers@russellmcveagh.com

Copy for:
Sandra Grant (M Sophie Gilmour), P O Box 4338 Auckland 1140 for Applicant
Email: sgrant@shortlandchambers.co.nz / sgilmour@shortlandchambers.co.nz

PRODUCT DEVELOPMENT SOLUTIONS LIMITED V PARAMETRIC TECHNOLOGY CORPORATION HC AK CIV-2012-404-804 [24 January 2013]

[1] Product Development Solutions Ltd applies under s 290 of the Companies Act 1993 to set aside a statutory demand. It relies on all three grounds under s 290(4). The statutory demand is for the sum of USD$229,460.23 under a summary judgment of Associate Judge Faire made on 31 August 2012 in CIV-2012-404-804.

[2] Parametric Technology Corporation (“PTC”), the creditor, is a Massachusetts corporation. It is a software developer and supplier. It also operates out of Hong Kong, but there is no evidence that it has a place of business in Australia or New Zealand.

[3] Product Development Solutions Ltd (“PDS”) used to carry on business as a supplier of software. It is a New Zealand company and carries on business solely in New Zealand. Its director is Mr Zlatko Staka. PDS has a related company in Australia, PDS Australia Pty Ltd. I will refer to that as the “Australian company”.

[4] PTC supplied product and services to PDS under reseller agreements. The products were software and the services included maintenance associated with the software. The first reseller agreement was in 2003. The most recent reseller agreement ran from January 2009 until 30 November 2010. That reseller agreement provided that the agreement was governed by New Zealand law and all disputes were to be litigated exclusively in Auckland and in no other court or jurisdiction. The agreement has entire agreement provisions, and provisions against any amendments made otherwise than in writing and signed by the parties’ counsel. There were comparable provisions in the 2003 reseller agreement, except that that agreement was governed by Hong Kong law.

[5] Associate Judge Faire’s judgment of 31 August 2012 in favour of PTC was made on a claim for unpaid debt for products and services ordered and supplied between July 2010 and December 2011.

No basis for applying under s 290(4)(a)

[6] In the present application PDS essentially raises two matters:

(a) It says that there was an oral maintenance agreement entered into in December 2004. That oral maintenance agreement was invalidly terminated on the expiry of the reseller agreement at the end of November 2010. It has a claim arising out of that unlawful termination. It says that its claim is available under s 9 of…

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: [2013] NZHC 33
Decision Date: 24 January 2013

CaseChat Overview and Summary

Product Development Solutions Limited (PDS), a New Zealand software supplier, sought to set aside a statutory demand issued by Parametric Technology Corporation (PTC), a US corporation. The statutory demand, issued under section 290 of the Companies Act 1993, sought payment of a debt of USD$229,460.23, which arose from an earlier summary judgment in favour of PTC. PDS argued that the demand should be set aside on three grounds under section 290(4): (a) there was a substantial dispute as to liability; (b) PDS had a counterclaim that exceeded the amount of the judgment; and (c) other grounds. The court considered the merits of PDS's claims, including an alleged oral maintenance agreement and claims of unconscionable conduct under Australian law. The court found that PDS had not demonstrated a substantial dispute as to liability, nor had it established clear and persuasive grounds for its counterclaims. The court also noted that PDS's solvency was in question and that it did not appear just to set aside the statutory demand. The application was dismissed, and PDS was ordered to pay PTC's costs.

Orders