Sorensen v Wikeley

[2025] NZHC 1237

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2025-404-853

[2025] NZHC 1237

BETWEEN

JOHN ANDREW SORENSEN

Plaintiff

AND

KENNETH DAVID WIKELEY

First Defendant

GLOBAL CR HOLDINGS LIMITED

Second Defendant

Hearing:

On the papers

Counsel:

C T Patterson and E J Grove for the Plaintiff First Defendant in person

MIS Phillipps for the Second Defendant

Judgment:

20 May 2025

JUDGMENT OF HARVEY J

This judgment is delivered by me on 20 May 2025 at 11.30 am. pursuant to r 11.5 of the High Court Rules

………………………………
Deputy Registrar

Counsel/Solicitors:

C T Patterson and E J Grove, Auckland Heimsath Alexander, Auckland

Vicki Ammundsen Trust Law Limited, Auckland Copy to: K D Wikeley

SORENSEN v WIKELEY & ANOR [2025] NZHC 1237 [20 May 2025]

Introduction

[1]                 On 16 May 2025, John Sorenson filed a without notice application seeking a variation of interim-interim preservation orders issued by van Bohemen J on 28 April 2025. The plaintiff also seeks leave to vary his extant 10 April 2025 on notice application for interim orders, due to be heard on 15 July 2025.

[2]                 In essence, the plaintiff seeks to replace the interim-interim preservation orders over specific shares owned by the second defendant with interim-interim freezing orders over all of the second defendants’ assets. This is because of alleged steps the second defendant has already taken to transfer said shares to non-parties and to, consequently, render the plaintiff’s proceedings nugatory.

Background

[3]                 On 10 April 2025, Mr Sorenson applied for interim orders restraining the defendants from disposing of, or otherwise dealing with, 66,243,920 shares in the Bioxyne Ltd pending further order of this Court. On 28 April 2025, van Bohemen J ordered that the second defendant is restrained from disposing of, or otherwise dealing with, the shares in Bioxyne Ltd it currently holds pending further order from the Court. This order was made with the consent of the second defendant and adopted language proposed by the second defendant’s memorandum of counsel dated 24 April 2025.

[4]                 The plaintiff now alleges that on 7 May 2025 the second defendant transferred 65,914,000 of its 73,550,086 shares in Bioxyne Ltd to two non-parties, both of whom are resident in Australia. This left the second respondent holding only the remaining 7,636,086 shares. Therefore, the plaintiff submitted that van Bohemen J’s order of 28 April 2025 has been deliberately and materially breached. In these new circumstances, the plaintiff contended that the interim orders it seeks are no longer fit for purpose and will achieve little, given the first defendant now only holds 7,636,086 shares in Bioxyne Ltd.

[5]                 The plaintiff highlighted that the second defendant has not disclosed its alienation of these shares to the plaintiff or to the Court. This is despite the fact that the director of the second defendant, Mr Gibson, filed and served on 12 May 2025 an

affidavit in support of its notice of opposition to the interlocutory application — being five days after the second defendant transferred the majority of its shares to non- parties.

Legal principles

[6]                 Rule 32.2 of the High Court Rules 2016 enables the Court to make a freezing order restraining a respondent from removing any assets  located  in  or  outside  New Zealand or from disposing of, dealing with, or diminishing the value of, those assets. As Asher J said in Oaks Hotels & Resorts NZ Ltd v Body Corporate 358851:1

[18] … the fact that an asset is to be disposed of is in itself not enough to invoke the jurisdiction. The heart of the jurisdiction is a real risk that a judgment or award may go unsatisfied. There must be a danger that the prospective judgment creditor’s ability to recover will be defeated because assets have been disposed of. In Bank of New Zealand v Hawkins it was observed that there had to be a “... real risk that the defendant will dissipate or dispose of assets so as to render himself ‘judgment proof’”. … As Lawton LJ observed in Third Chandris Shipping Corporation v Unimarina SA, there must be facts from which the commercial court, like a prudent sensible commercial person, could properly infer a danger of default if assets are removed. This test is “not unduly exacting”.

(Footnotes omitted)

[7]                 To secure a freezing order under r 32.5, the plaintiff must first demonstrate a good arguable case in their substantive claim. Secondly, that assets exist over which the order can apply. Thirdly, that there is real risk of dissipation.2 The Court must also consider where the overall justice of the case lies. As above, the heart of the jurisdiction is whether there is a real risk that a judgment or award may go unsatisfied.3 The need for a good arguable case will be satisfied where the allegations in the applicant’s proposed claim are capable of tenable argument and are supported by sufficient evidence, taking into account the early stage of the proceeding.4 This is not

1      Oaks Hotels & Resorts NZ Ltd v Body Corporate 358851 [2013] NZHC 2695.

2      Shaw v Narain [1992] 2 NZLR 544 (CA). See also Mareva Compania Naviera SA v International Bulkcarriers SA (“The Mareva”) [1980] 1 All ER 213 (CA).

3      See Oaks Hotels & Resorts NZ Ltd v Body Corporate 358851, above n 2, at [18].

4      Wing Hung Printing Ltd v Saito Offshore Pty Ltd [2010] NZCA 502, [2011] 1 NZLR 754; and Dotcom v Twentieth Century Fox Film Corp [2014] NZCA 509, (2014) 110 IPR 442 at [18] and [31].

a high threshold. While an applicant’s case should be more than barely arguable, it need not have a greater than 50 per cent chance of success.5

[8]                 In addition, an applicant must provide evidence to justify a belief that the respondent will dissipate the assets such that there is a real risk a judgment in favour of the applicant will be partly or wholly unsatisfied if the freezing order is not made.6

[9]                 When determining an application for freezing orders, the Court must consider the overall justice of the case. This involves weighing the need to protect the applicant to ensure that they are not deprived of the benefit of any judgment against any prejudice or hardship that may be caused to the respondent if the orders are issued.

Discussion

[10]             The plaintiff submitted there is a real concern that any on notice application would result in further alienations or dispositions by the second defendant of any remaining assets it holds. I accept that requiring the plaintiff to proceed on notice would cause undue delay or prejudice to the plaintiff, and that the interests of justice require this application to proceed without notice. Given the allegations and associated evidence provided by the plaintiff, I find there is a real risk that if notice was given, further assets may be disposed of or dealt with in such a manner as to undermine the plaintiff’s application or to render it nugatory. I am also satisfied that the plaintiff has made all reasonable inquiries and taken all reasonable steps to ensure their application contains all relevant material.

[11]             After reading the plaintiff’s statement of claim dated 10 April 2025 and his affidavit in support sworn on 9 April 2025 (along with its attached exhibits), I accept that Mr Sorenson’s case is capable of tenable argument and is supported by sufficient evidence — bearing in mind the early stage of these proceedings. It also appears that

5      Wilsons (NZ) Portland Cement Ltd v Gatx-Fuller Australasia Pty Ltd [1985] 2 NZLR 11 at 21–22; and Ninemia Maritime Corp v Trave Schiffahrtsgesellschaft mbH “The Niedersachsen” [1983] 1 WLR 1412 (CA) at 1417.

6      Oaks Hotels & Resorts NZ Ltd v Body Corporate 358851, above n 2, at [18], [19] and [22]. The applicant must point to circumstances from which “a prudent, sensible commercial [person] can properly infer a danger of default”, a test which is “not unduly exacting”: Raukura Moana Fisheries Ltd v The Ship “Irina Zharkikh” [2001] 2 NZLR 801, [2001] 2 Lloyd's Rep 319 (HC) at [122].

the second defendant does have assets over which a freezing order might apply as the plaintiff has provided relevant concerning assets over which a freezing order might apply, namely its remaining Bioxyne Ltd shares.

[12]             It is also evident from the allegations raised and evidence filed by the plaintiff that there is a real risk of those remaining shares, as well as other assets held by the second defendant, being dissipated or dealt with in such a manner so as to render it “judgment proof” or so as to otherwise render the plaintiff’s substantive application nugatory. In these circumstances, I consider that the balance of convenience and overall justice lies in favour of granting the application. Although the freezing orders are wide, the hardship and burden placed on the second defendant is mitigated with the short period of time until the 15 July 2025 hearing, and by the caveats I intend to impose on the variation — being those contained in form G 38.

Decision

[13]The application is granted and the following orders are now issued:

(a)The terms of the interim-interim preservation orders made by van Bohemen J on 28 April 2025 are varied to:

(i)1. The second defendant, Global CR Holdings Ltd, is restrained from disposing of or otherwise dealing with any of the assets it currently holds, pending further order of the Court — except for the purpose of paying legal expenses related to the freezing order, or disposing of assets or making payments in the ordinary course of business including business expenses incurred in good faith. This order will have no effect after 15 July 2025 unless on that date it is continued or renewed. On that date, the second defendant’s counsel is entitled to be heard in opposition.

(ii)2. The second defendant, or any other party, may apply to discharge or vary this order, and in doing so must give five working days’ notice.

(b)The plaintiff is given leave to vary his extant on notice application for interim orders of 10 April 2025 so that instead of the orders currently sought as “Order 1.1” in that application, the plaintiff instead seeks an order that:

(i)1.1 The second defendant, Global CR Holdings Limited, is restrained from disposing of or otherwise dealing with any of the assets it currently holds, pending further order of the Court.

[14]             The plaintiff must serve the defendants with a copy of the application and related documents along with a copy of this judgment as soon as possible.

[15]Costs are reserved.

Harvey J