Shephard v Rabson - [2015] NZHC 3137

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2014-485-000036 [2015] NZHC 3137

BETWEEN
IAIN BRUCE SHEPHARD AND

CHRISTINE MARGARET DUNPHY Plaintiffs

AND

MALCOLM EDWARD RABSON First Defendant

MALCOLM EDWARD RABSON and

RICHARD JOHN CRESER Second Defendants

WAYNE SEYMOUR CHAPMAN Third Defendant

Hearing: 16-18 November 2015

Counsel:

H L Thompson for Plaintiffs
M E Rabson in person for First and Second Defendants
S A Barker for third Defendant abides

Judgment:

9 December 2015

JUDGMENT OF COLLINS J

Summary of judgment

[1] I am issuing judgment in favour of the plaintiffs against Mr Rabson for the sum of $782,531. I am satisfied the plaintiffs are entitled to judgment for this sum because that is the amount Mr Rabson is owed by the Malcolm Rabson Family Trust (MRFT). Judgment is issued for this sum in favour of the plaintiffs because the Official Assignee has assigned to the plaintiffs all claims and causes of action in
Mr Rabson’s bankrupt estate.

SHEPHARD v RABSON [2015] NZHC 3137 [9 December 2015]

[2] I am also issuing a declaration that the plaintiffs are entitled to payment from funds held by the third defendant in his capacity as a trustee of the Gallagher-Rabson Family Trust (GRFT) towards settling the judgment debt. However, before the third defendant pays anything to the plaintiffs he must ensure all payments due to Ms Gallagher pursuant to the Court of Appeal judgments, which I refer to in this decision, have in fact been paid. Excluded from this declaration are any reasonable fees and expenses incurred by the third defendant.

PART I BACKGROUND

The plaintiffs

[3] The plaintiffs are the liquidators of two companies, Double Zero Holding Ltd (Double Zero) and Vision Ltd (Vision). Vision was a wholly owned subsidiary of Double Zero. The plaintiffs are also the directors of Shephard Dunphy Ltd.

[4] The plaintiffs have brought this proceeding as assignees from the Official Assignee of all claims and causes of action in Mr Rabson’s bankrupt estate. That assignment was recorded in a deed dated 18 November 2013.

[5] The two shareholders of Double Zero were the MRFT and the David

Hitchens Family Trust. Those two trusts owned equal shares in Double Zero.

[6] Double Zero was placed into liquidation by order of the High Court on

5 February 2010 following an irremediable breakdown in the business relationship between Mr Rabson and Mr Hitchens.1

[7] Ms Dunphy and Mr Croad, who were at the time employees of Shephard Dunphy Ltd, were appointed as liquidators of Double Zero. They passed a resolution appointing themselves to be also the liquidators of Vision. Mr Croad resigned as a liquidator of Double Zero and Vision on 29 May 2013. Mr Shephard
was appointed in his place.

1 Hitchens v Double Zero Holdings Ltd HC Wellington CIV-2009-485-001961, 5 February 2010.

[8] Vision carried on its business from premises owed by Casino Properties Ltd (Casino). Mr Rabson was the sole director of Casino, and the MRFT was the sole shareholder of that company.

Mr Rabson

[9] Mr Rabson…

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 Shephard v Rabson

Details

AGLC: Shephard v Rabson [2015] NZHC 3137
Case: [2015] NZHC 3137
Decision Date: 9 December 2015

CaseChat Overview and Summary

This case involved a claim for money owed by Mr Malcolm Edward Rabson, who had been adjudged bankrupt, to the plaintiffs, who were the liquidators of Double Zero Holding Ltd and Vision Ltd, and the directors of Shephard Dunphy Ltd. The plaintiffs sought judgment against Mr Rabson for the sum of $782,531, which was the amount owed to Mr Rabson by the Malcolm Rabson Family Trust (MRFT). The plaintiffs also sought a declaration that they were entitled to payment from funds held by the third defendant in his capacity as a trustee of the Gallagher-Rabson Family Trust (GRFT) towards settling the judgment debt. The court found in favour of the plaintiffs and issued judgment for the sum of $782,531 in their favour against Mr Rabson. The court also issued a declaration that the plaintiffs were entitled to payment from funds held by the third defendant in his capacity as a trustee of the GRFT towards settling the judgment debt, but only after all payments due to Ms Gallagher pursuant to the Court of Appeal judgments had been made. The court found that the deeds of acknowledgement of debt relied upon by Mr Parsons were valid and binding, and that Mr Rabson's attempts to challenge their accuracy were an abuse of process. The court also found that the financial statements reconstructed by Mr Parsons were accurate and that Mr Rabson had not repaid the debt owed to him by the MRFT. The plaintiffs were awarded costs on a scale 2B basis against the first and second defendants.

Orders