Ridgway v Sharma

[2024] NZHC 2432

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-000883

[2024] NZHC 2432

UNDER

the Insolvency Act 2008

IN THE MATTER

of the bankruptcy of Ashutosh Sharma

BETWEEN

AARON WAYNE RIDGWAY

Judgment Creditor

AND

ASHUTOSH SHARMA

Judgment Debtor

Hearing:

22 August 2024

Appearances:

A Mandal for the Judgment Creditor

No appearance by or for the Judgment Debtor

Judgment:

28 August 2024

JUDGMENT OF ASSOCIATE JUDGE GARDINER

This judgment was delivered by me on 28 August 2024 at 3.30 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date.......................................

Solicitors:

Turner Hopkins, Auckland

RIDGWAY v SHARMA [2024] NZHC 2432 [28 August 2024]

Introduction

[1]    At 11.53 am on Thursday, 22 August 2024 I made an order in open court adjudicating the judgment debtor (Mr Sharma) bankrupt. This judgment sets out my reasons and the circumstances of the hearing.

[2]    On 5 October 2023, Mr Sharma committed an act of bankruptcy by not complying with a bankruptcy notice deemed to have been served on him by the judgment creditor on 21 September 2023. The bankruptcy notice was based on an unpaid order of the Tenancy Tribunal that Mr Sharma pay the judgment creditor rental arrears and a filing fee reimbursement amounting to $51,449.01. Following the issue of the bankruptcy notice, Mr Sharma authorised the release of a $9,000 bond payment to the judgment creditor, thereby reducing the unpaid amount to $42,499.01.

[3]    Mr Sharma applied for a rehearing of the order of the Tenancy Tribunal. The Tribunal declined a rehearing on 24 February 2023.

[4]    The application for adjudication was listed for first call on 1 February 2024. It was adjourned to 29 February 2024 because Mr Sharma was said to be in hospital.

[5]    On 29 February 2024, the matter was adjourned again to 21 March 2024, because Mr Sharma was said to be in hospital but was also going to Dubai to get some money.

[6]    Prior to the call on 21 March 2024, Mr Sharma filed a notice of opposition and an unsworn affidavit. The grounds for opposition were a “[miscarriage] of justice due to negligence from Auckland District Court with failure to inform [counsel] for re-appeal hearing on tenancy tribunal orders”, and that the rent arrears payments were overstated.

[7]    The call was adjourned  to  a telephone  conference on 22 March 2024  so  Mr Sharma could provide the Court and the judgment creditor with a copy of his application for a rehearing of the Tenancy Tribunal decision.

[8]    The application was  then  adjourned  to  11 April  2024,  and  then  again  to 8 August 2024, because  Mr Sharma’s  appeal  had  been  set  down to  be heard on  4 July 2024.

[9]    In an oral judgment delivered on 4 July 2024, Judge M E Sharp dismissed  Mr Sharma’s appeal of the  Tenancy  Tribunal’s  decision  declining  a  rehearing.1  Mr Sharma did not appear at the hearing. Judge Sharp said that the District Court Registry had tried to reach Mr Sharma by email throughout the day.

[10]On 17 July 2024, Judge Sharp issued a minute:

As Mr Sharma has not provided medical evidence proving he was unable to access and deal with his emails, thus perhaps excusing his failure to participate in the hearing of his application for rehearing (or contact the Court about it), I consider that he has failed to prosecute his application which is accordingly declined. In so doing I express the greatest reservations about Mr Sharma’s veracity given that on a number of occasions he has made similar excuses to delay proceedings. This appears to be the latest in a growing line.

[11]   On 26 July 2024, the District Court sealed orders dismissing Mr Sharma’s appeal for a rehearing.

[12]   Prior to the call of the bankruptcy application on 8 August 2024, the judgment creditor’s counsel filed a memorandum informing  the  Court  of  the  outcome  of Mr Sharma’s appeal and the fact that he appeared to have filed a notice of appeal to this Court. They noted that in the notice, Mr Sharma contended that he had attempted to transfer USD30,000 to the trust account of the judgment creditor’s solicitor to settle the debt. The payment was not received into the trust account because Mr Sharma had entered the final three digits incorrectly. The judgment creditor’s counsel expressed doubt about the genuineness of the purported transfer, but proposed a final two-week adjournment for Mr Sharma to make the payment. The application was adjourned to 22 August 2024.

[13]   In a memorandum dated 7 August 2024, Mr Sharma claimed to the judgment creditor’s counsel and to the Court that he had rectified his error with the trust account bank account number, and that he had made the transfer on 6 August 2024.

1      Sharma v Ridgway [2024] NZDC 15819.

[14]   Then, on 19 August 2024, Mr Sharma sent the judgment creditor’s solicitors an email claiming that the transfer was rejected by their banking provider, ANZ Bank New Zealand (ANZ), on 16 August 2024.

[15]   At the hearing on 22 August 2024, the judgment creditor’s solicitor certified that the judgment debt remained unpaid and sought an order adjudicating Mr Sharma bankrupt.

[16]   The judgment creditor filed an affidavit by Anna Rippon, legal administrator. Ms Rippon provided a letter from ANZ dated 19 August 2024 in which ANZ confirms that there is no record  of a  receipt  or rejection  by the  bank  of  a payment from  Mr Sharma between 7  and 16 August 2024.   Ms Rippon sets out  the history of    Mr Sharma’s repeated claims of problems transferring money to the judgment creditor or his solicitors and attaches relevant evidence.

[17]   Mr Sharma filed a memorandum on the morning of the hearing. He said he had attempted to pay the judgment creditor. He also attached a notice of appeal of Judge Sharp’s decision dismissing Mr Sharma’s appeal of the decision of the Tenancy Tribunal declining a re-hearing. It was unclear whether this notice of appeal had been accepted for filing.2

[18]   Mr Sharma had not specifically applied for a stay of this bankruptcy proceeding pending his intended appeal, but I was not persuaded that a stay was warranted in any event. Mr Sharma has no right of substantive appeal against the judgment of Judge Sharp. Section 119 of the Residential Tenancies Act 1986 states that any party who is dissatisfied with the decision of the District Court on an appeal from the Tenancy Tribunal as being erroneous on a point of law may appeal to the High Court on that question of law. Mr Sharma had not identified any arguably erroneous point of law in the notice of appeal document attached to his memorandum.

[19]   The day before the hearing, on 21 August 2024, Mr Sharma requested and was given VMR details for the hearing. When his matter was called in the 10.45 am Bankruptcy List, Mr Sharma failed to appear by VMR.  He sent a series of emails to

2      The Registry has since confirmed that the document has not been accepted for filing.

the Case Officer saying that the connection was not working. The Case Officer responded  to  these   emails   asking   Mr   Sharma   to   call   into   the   hearing.   Mr Sharma replied that he had attempted to do so, but had not been successful. The Case Officer then suggested that Mr Sharma log on again after they had rebooted the system. Mr Sharma reported that he was still unable to access the Court by VMR. The Case Officer sent a further email to Mr Sharma providing a phone number and asking him to try to dial in; Mr Sharma again responded that he had attempted to do so without success.

[20]   The Case Officer tested the VMR connection and had no issue connecting to the Court.

[21]   Mr Sharma asked the Case Officer to call him on a phone number which he provided by email. The Case Officer tried calling that number, but it did not connect.

[22]I stood the matter down to the 11.45 am list.

[23]   At 11.30 am, the Case Officer sent an email to Mr Sharma confirming my direction that the hearing would go ahead at 11.45 am, and that he needed to appear via VMR through the details provided or call into Court on the phone number provided.  The case officer re-sent the VMR meeting ID and  passcode  and gave   Mr Sharma the Court phone number.

[24]   Mr Sharma still made no appearance by VMR. He continued to email the Case Officer claiming that he was attempting to connect to the Court but was still unable to do so.

[25]   I was of the view that Mr Sharma was deliberately making excuses to delay the hearing. Even if he was unable to connect by VMR, I was doubtful that there were genuine technological issues that also prevented him from calling the Court on the telephone number provided, and that prevented the Court from reaching him on the phone number he supplied. It seems improbable that the Court would have been unable to reach Mr Sharma if that telephone number was genuinely in use.

[26]Accordingly, I proceeded to make an order adjudicating Mr Sharma bankrupt.

[27]   I awarded the judgment creditor costs on a 2B basis of $7,042.00 and disbursements of $4,161.38.

Associate Judge Gardiner