Re Willis, ex parte Willis - [2017] NZHC 2586

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2016-404-000092 [2017] NZHC 2586

BETWEEN
LESLIE ARNOLD WILLIS

Judgment Creditor

AND

EILEEN ANNE WILLIS Judgment Debtor

Hearing: 16 August 2017

Appearances:

A Paterson for the Judgment Creditor
H Fulton for the Judgment Debtor

Judgment:

24 October 2017

JUDGMENT OF ASSOCIATE JUDGE SARGISSON

This judgment was delivered by me on 24 October 2017 at 3.30 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date.......................................

Solicitors:

Rennie Cox, Auckland

H Fulton, Auckland

WILLIS v WILLIS [2017] NZHC 2586 [24 October 2017]

Application to annul bankruptcy order

[1] Eileen Willis (Anne) was adjudicated bankrupt on 2 June 2016 on the application of her husband, Leslie Willis. At issue is her application to annul that adjudication order. The Official Assignee, who has control of Anne’s estate, has agreed to abide by the court’s decision.

[2] Leslie bankrupted her to pursue a debt of just over $12,000. The Assignee records that in total, her remaining debts to creditors in her bankruptcy amount to approximately $16,000. There is no question that Anne has not paid — and according to the Assignee cannot pay — this amount. Leslie insists the court focus its attention on this and this alone.

[3] But Anne invites the court to take a broader and more robust approach. Relying on s 309(a) of the Insolvency Act 2006, she says that the adjudication order should never have been made. In essence, her claim is that the adjudication was an abuse of process; and she says, in effect, that Leslie’s part in it was oppressive. Anne has the onus to satisfy the court that this is so.

[4] Hers are fighting words, yet her characterisation is accurate. Indeed, rare is a case that strikes so directly at the court’s conscience. For the reasons that follow, I am satisfied that the s 309(a) threshold is met, and that it is fair and just that Anne’s bankruptcy be annulled.

A short narrative — the beginnings of a case for Leslie

[5] I begin with the events highlighted by Leslie, before broadening the discussion to consider the wider and more troubling narrative emphasised by Anne.

Events preceding bankruptcy

[6] The parties met in 1988, and lived together for a number of years before their marriage in 1996. A few years after their separation, relationship property proceedings commenced in 2011 to settle the distribution of their assets.

[7] In the course of those proceedings, Anne was ordered by this Court to pay Leslie $12,263.50 in costs and disbursements. Leslie took action to pursue that debt. It remained unpaid. So on the basis of its non-payment, Leslie served her with a Bankruptcy Notice on 10 February 2016. Anne did not comply, and therefore committed an act of bankruptcy on 25 February. Anne was equally unresponsive to the Summons to Debtor served on her on 28 April.

[8] On 18 March, Leslie had provided Anne with a comprehensive relationship property settlement proposal, which outlined two options for…

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 Re Willis, ex parte Willis

Details

AGLC: Re Willis, ex parte Willis [2017] NZHC 2586
Case: [2017] NZHC 2586
Decision Date: 24 October 2017

CaseChat Overview and Summary

The case of Re Willis, ex parte Willis [2017] NZHC 2586 involved an application by Eileen Anne Willis, the judgment debtor, to have her bankruptcy annulled. Leslie Arnold Willis, her former husband, had applied for her to be adjudicated bankrupt over a debt of just over $12,000. The primary legal issue was whether the bankruptcy order should be annulled under section 309(1)(a) of the Insolvency Act 2006, which allows for the annulment if the court considers the bankrupt should not have been adjudicated bankrupt. The court examined whether Leslie's actions amounted to an abuse of process. Associate Judge Sargisson found that Leslie's adjudication application was an abuse of process, as Leslie had bankrupted Anne over a minor debt while she stood to receive substantially more from their relationship property settlement. The court annulled the bankruptcy order, effective retrospectively from the date of adjudication. The court also found that costs should be awarded against Leslie.

Orders