Rolleston v Christchurch Residential Care Limited HC Christchurch CIV 2011-409-001301

[2011] NZHC 1949

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV 2011-409-001301

BETWEEN  TE TUMU ROLLESTON Plaintiff

ANDCHRISTCHURCH RESIDENTIAL CARE LIMITED

First Defendant

ANDDONNA CELIA ROLLESTON Second Defendant

Hearing:         28 November 2011

Counsel:         K W Clay for Plaintiff

No appearance for First Defendant
D C Rollo for Second Defendant

Judgment:      1 December 2011

JUDGMENT OF FOGARTY J

[1]      The context of this case is that Mr and Mrs Rolleston are 50/50 owners of the first defendant.   Their relationship has broken up and they have a relationship property dispute which is filed in the Family Court.  There have been delays getting that case ready for hearing but I understand it is likely to go into the ready list early in the New Year.

[2]      In the meantime it has been necessary for them to come to the High Court by way of  s  174  of  the  Companies Act  1993  as  the  Family Court  does  not  have jurisdiction to deal with adjusting the responsibilities for management and issues as to drawings from the first defendant.   Ms Rolleston is essentially on garden leave from the first defendant pending resolution of the relationship property issues.  Up to now she has been receiving $1,994.53 gross per fortnight with PAYE deducted at source.   In addition to that $494.10 which Mr Rolleston says are drawings per

fortnight not necessarily PAYE earnings.  Those figures have come from Mr Clay.

TE TUMU ROLLESTON V CHRISTCHURCH RESIDENTIAL CARE LIMITED HC CHCH CIV 2011-409-

001301 1 December 2011

They may or may not be correct but I will be reserving leave at the end of this judgment to apply to adjust if need be.

[3]      There has been a dispute as to whether or not that remuneration will continue in the meantime.  The occasion of dispute falls out of agreements which have been reached  between  Mr  Rolleston  and  Ms  Rolleston  as  follows:  Ms Rolleston  has agreed that she will resign as a director of the company.   The second part of that agreement though is that she will still receive company information. The formula for the receipt of company information is now as follows:   she will receive from the company accountants, at the same time as the company accountants provide it to her husband, the monthly profit and loss statement and the company bank statements.

That is likely from the 25th  to the 25th  of the month.   In addition she will receive

from the accountants the raw company data that the accountants received from the company to prepare the profit and loss statements.   On top of that she has the right to ask any questions in respect of this information of the company accountants or of Mr Rolleston and technically of the first defendant.   If she has any problems with either asking the questions or getting the answers she has leave to come back to this Court for resolution of those problems.

[4]      In that context, Mr Clay, for Mr Rolleston, has argued that she should not be entitled to receive the $494.10 because she has resigned as a director.   That is disputed.   I do not propose today to express any view as to the merits of that argument.  It does seem to me that the appropriate solution here is to make interim orders pursuant to s 174(2) which enables me to make such orders as I think just and equitable. The interim order that I make is that she receive the same remuneration as she has been receiving.   I am not going to try to put figures on that.   As I have indicated, I am not sure, and I do not think she is sure, precisely what those figures are.  But that is the principle.  She is to receive the same remuneration that she has been receiving in the past.  That is an interim order.  It is subject to final adjustment if the parties come back to this Court.

[5]      So leave is reserved for what would be further interim orders or further final orders in these proceedings under the Companies Act.   I think that is just and equitable because that essentially preserves the status quo pending what I think is

going to be the main argument between Mr Rolleston and Ms Rolleston in the

Family Court.

[6]      What I have in mind is that although there is the right to come back to this Court under these proceedings, hopefully this decision today will be sufficient to meet the parties’ needs under they get a fixture and a decision from the Family Court.  At that time, there may be a need, in any event, to come back to the High Court to complete these proceedings, even if it is by way of an agreed position in which case it can be done on the papers and that will minimise the expense to the parties so that there would not need to be a hearing.  But, of course, if there needs to be a hearing there can be.

[7]      Costs on all of this are reserved.

[Judge checks with counsel if they need any matters]

[8]      As a formality, there is an order of the Court that Ms Rolleston resigns as a director.

Solicitors:

K W Clay, Christchurch, for Plaintiff

Steven Rollo, Christchurch, for Second Defendant