Redwood Group Limited v Queenstown Gateway (5M) Limited

[2018] NZHC 2311

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2017-404-3101

[2018] NZHC 2311

BETWEEN

REDWOOD GROUP LIMITED

Plaintiff

AND

QUEENSTOWN GATEWAY (5M) LIMITED

First Defendant

AND

CRAIG DALLAS GREENWOOD

Second Defendant

AND

CQ TRUSTEE COMPANY LIMITED

Third Defendant

AND

CLEARMONT (QUEENSTOWN) LIMITED

Fourth Defendant

Hearing:

27 & 31 August 2018

Appearances:

J W H Little and R J Hollyman for Plaintiff

P Skelton QC & M Greenop for First, Second & Third Defendants P Watts QC for Fourth Defendant

Judgment:

4 September 2018

INTERIM JUDGMENT OF VAN BOHEMEN J

(ON APPLICATION FOR LEAVE TO FILE THIRD PARTY NOTICE)

Solicitors:

Harmos Horton Lusk, Auckland Beca & Co, Auckland

Wynn Williams, Auckland

REDWOOD GROUP LIMITED v QUEENSTOWN GATEWAY (5M) LIMITED & ORS [2018] NZHC 2311 [4 September 2018]

[1]    On 27 and 31 August 2018, I heard the interlocutory application by the defendants dated 11 June 2018 and that by the plaintiff dated 27 June 2018. I reserved my decision on both applications.

[2]    At the close of the hearing on 31 August 2018, Mr Skelton, counsel for the first to third defendants, submitted that I should make the first order sought in the defendants’ application, namely an order under s 248(1)(c) of the Companies Act 1993 and r 4.4(2)(b) of the High Court Rules 2016 granting leave to the defendants to issue a third-party notice against Victoria Street West Ltd (In Liquidation) (Company No. 1838672) (“Victoria Street West”) even before I hand down my decision.

[3]    Mr Skelton correctly observed that it might take some time for me to issue my decision on the other orders sought. He said it would be prudent nonetheless for Victoria Street West to be joined in the proceeding as soon as possible given that the close of pleadings date is 4 February 2019 and the proceeding has been set down for hearing commencing 17 June 2019.1 I agree those are relevant considerations.

[4]    In its notice of opposition dated 27 June 2018, the plaintiff opposed the defendants’ application for leave to issue a third-party notice against Victoria Street West.   However, in a memorandum filed on 23 August 2018, Mr Hollyman and    Mr Little, counsel for the plaintiff, advised that the plaintiff would abide the Court’s decision on the joinder of the intended third party.

[5]    Consistently with that position, the plaintiff made no submissions on the application for joinder of Victoria Street West at the hearing on 27 and 31 August 2018. It is appropriate to record, however, that when Mr Skelton made his submission that I make the order granting the defendants leave to issue a third-party notice against Victoria Street West, Mr Little noted that the plaintiff did not consent to the joinder although it would abide the Court’s decision.

1      Minute of Associate Judge Andrew dated 12 June 2018.

[6]    Mr Hollyman informed me at the hearing on 27 August 2018 that Victoria Street West had been removed from the Companies Register. Counsel agreed that I could make no third-party order in respect of Victoria Street West while it was unregistered. However, at the hearing on 31 August 2018, Mr Skelton informed me that Victoria Street West had been restored to the Register and handed up a copy of the relevant Company Extract confirming that position. Accordingly, there is no impediment in terms of the company’s registration to making the order sought by the defendants.

[7]    I will canvass more fully in my final decision on the interlocutory applications by the defendants and the plaintiff the issues around Victoria Street West’s involvement in the disputes between the plaintiff and the defendants. For now, it is sufficient to record that it is not contested among the parties that Victoria Street West was previously called Redwood Group Ltd prior to a change of name in October 2014. It is also not contested among the parties that the initial arrangements for the Five Mile development in Queenstown that is central to the dispute involved Victoria Street West when it was called Redwood Group.

[8]    Among the issues that are in dispute and will require resolution at the substantive hearing are whether Victoria Street West made a valid nomination of its interests in the Five Mile development to the plaintiff and, if so, the terms on which that nomination was made. Those matters are clearly relevant to Victoria Street West and its creditors. In this regard, in an affidavit sworn on 4 July 2018, Colin McCloy, the liquidator of Victoria Street West, deposed that he consents to proceedings being commenced against Victoria Street West, and does not oppose leave being granted for the issue of the third-party notice, because there is an issue to be determined in this proceeding as to whether the plaintiff or Victoria Street West is entitled to a beneficial interest in the assets of the first defendant.

[9]    I agree it is necessary to determine in this proceeding whether the plaintiff or Victoria Street West is entitled to a beneficial interest in the assets of the first defendant. Accordingly, and as I indicated at the hearing on 31 August 2018, I am satisfied that it is appropriate that a third-party notice be issued against Victoria Street West.

[10]   To that end and in accordance with s 248(1)(c) of the Companies Act 1993 and r 4.4(2)(b) of the High Court Rules 2016, I grant leave to the defendants to issue a third-party notice against Victoria Street West Ltd (In Liquidation) (Company No. 1838672).

G J van Bohemen J