Sharrock v Kipping - [2018] NZHC 3421

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2018-409-000244

[2018] NZHC 3421

IN THE MATTER of the Insolvency Act 2006

AND

IN THE MATTER

of the bankruptcy of JOHN BRIAN KIPPING

BETWEEN

GERALD ERRINGTON SHARROCK

Judgment Creditor

AND

JOHN BRIAN KIPPING

Judgment Debtor

Hearing: 10 December 2018

Appearances:

R Hucker and R Selby for Judgment Creditor J B Kipping (Judgment Debtor) in person

Judgment:

19 December 2018

JUDGMENT OF JUSTICE OSBORNE

on adjudication application

Introduction

[1] Gerald Sharrock has three judgment debts (being costs orders) against John Brian Kipping. They total $35,858.99 (without interest and subsequent costs).

[2] The background to the debts lies in events examined by this Court in a number of judgments1 and by the Court of Appeal.2 Mr Kipping had involved himself in the

1 These include Sharrock v Wedd [2016] NZHC 1477; Sharrock v Wedd [2017] NZHC 1739;
Sharrock v Kipping [2018] NZHC 2210.
2 Kipping v Sharrock [2018] NZCA 289 [“the Court of Appeal judgment”].

SHARROCK v KIPPING [2018] NZHC 3421 [19 December 2018]

affairs of a Mr Wedd. Mr Wedd, through entities he controlled, had dealings with Mr Sharrock’s company, Affordable Residential Ltd (“Affordable”). The litigation (which was unsuccessful for Mr Wedd) led to adverse costs judgments. Subsequent litigation has led to further costs orders.

The adjudication application

[3] Mr Sharrock applies for an order adjudicating Mr Kipping bankrupt. He relies on an available act of bankruptcy which occurred when Mr Kipping failed to meet the requirements of a bankruptcy notice – the time for payment of which had been extended by this Court when it dismissed Mr Kipping’s application for an order setting aside the bankruptcy notice.3

Mr Kipping’s opposition

The basis of opposition

[4] Mr Kipping opposes the making of an adjudication order on the basis that the Court should exercise its discretion under s 37 Insolvency Act 2006 or on the alternative basis that the Court should grant a halt under s 38 of the Act.

[5] Leaving aside for the moment particular arguments advanced in opposition, Mr Kipping asserts two over-arching grounds:

(a)adjudication would cause a miscarriage of justice;

(b)there has been a breach of natural justice.

[6] Mr Kipping also asserted that he has no assets and is unlikely to be able to pay these judgment debts in the coming three years.

[7] In the course of his submissions, Mr Kipping accepted that the reliance on a breach of natural justice takes matters no further than the assertion of a miscarriage of justice. Mr Kipping conceded that he does not rely on there having been any breach

3 Sharrock v Kipping [2018] NZHC 2210, at [40].

of fair process by any tribunal or court. The reference to “natural justice” was his alternative way of expressing the “miscarriage of justice” ground.

Adjudication under s 37 of the Act

[8]I adopt these principles in relation to this adjudication application:

(a)the creditor has the onus of establishing the…

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 Sharrock v Kipping

Details

AGLC: Sharrock v Kipping [2018] NZHC 3421
Case: [2018] NZHC 3421
Decision Date: 19 December 2018

CaseChat Overview and Summary

Gerald Errington Sharrock sought an order adjudicating John Brian Kipping bankrupt in relation to three judgment debts totalling $35,858.99. The basis of the adjudication application was an act of bankruptcy by Mr Kipping in failing to meet the requirements of a bankruptcy notice. Mr Kipping opposed the application on a number of grounds, including a submission that adjudication would cause a miscarriage of justice or breach natural justice. The Court rejected all the grounds of opposition and made the sought order. The Court held that it was not appropriate to embark on an exercise akin to a retrial of the case which gave rise to the underlying judgment. The Court found that there was no basis to conclude that the judgments were the result of dishonesty or perjury. It was also clear that Mr Kipping’s financial position would not change in a way that would prevent the Official Assignee from undertaking her responsibilities. The Court found that Mr Kipping had no arguable crossclaims and that there was no justification for halting the adjudication application. The Court found that there were no grounds on which the discretion under s 37 of the Insolvency Act 2006 should be exercised in favour of Mr Kipping. The Court made an order adjudicating Mr Kipping bankrupt and ordered him to pay the costs of the application.

Orders