Southern Springs LP v Fisk

[2013] NZHC 1614

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2013-485-001847 [2013] NZHC 1614

UNDER  Part 19 of the High Court Rules and

Section 280 of the Companies Act 1993

IN THE MATTER OF       an application for orders that JOHN HOWARD ROSS FISK and TONY WAYNE PATTISON not be disqualified from appointment as liquidators of Southern Springs LP and for directions for service

IN THE MATTER OF       SOUTHERN SPRINGS LP

IN THE MATTER OF       JOHN HOWARD ROSS FISK and TONY WAYNE PATTISON

Applicants

Judgment:                28 June 2013

JUDGMENT OF WILLIAMS J

[1]      The applicants Fisk and Pattison apply urgently and without notice for orders that they as liquidators not be disqualified from performing such function in terms of s 280(ca) and (cb) of the Companies Act 1993.  This provision applies despite the fact that the entity to be the subject of liquidation is a Limited Partnership.  By the terms of s 92 of the Limited Partnerships Act 2008, s 280 of the Companies Act 1993 applies to any liquidation of such partnership.  The problem is that the applicants are partners in the firm of PwC and the firm (but not the applicants) have provided various forms of accounting and other advice to the secured creditors of Southern Springs.  It is also apprehended that there will be a continuing business relationship between PwC and the secured creditors in terms of providing accounting and other

advice.

Fisk & Anor v Southern Springs LP [2013] NZHC 1614 [28 June 2013]

[2]     Section 280 prohibits people in the position of Fisk and Pattison from appointment  as  liquidators  unless  the secured  creditors  consent  or the  Court  so orders.

[3]      The partners of Southern Springs wish to appoint the applicants as liquidators and  the  applicants  say  that  it  will  not  be  consistent  with  the  interests  of  the partnership to delay the liquidation in order for their application to be served on the secured creditors and a hearing held.

[4]      I have been referred to the guidance provided by Associate Judge Gendall (as he then was) in his decision in Huntleigh Downs Ltd v Fisk.[1]   I have found that very helpful.  Associate Judge Gendall pointed to a long series of other cases in which orders under s 280 have been granted by this Court in very similar circumstances to the present case.

[1] Huntleigh Downs Ltd v Fisk HC Wellington CIV-2009-485-001498, 11 August 2009.

[5]      I am satisfied therefore that the orders sought are appropriate.   I am also satisfied that they can be made on a without notice basis.

[6]      I am  satisfied  that  the interests  of secured (and  unsecured) creditors  are protected notwithstanding such orders in light of the applicant’s suggestion that the orders be served on all known creditors of the partnership when they first report to liquidators under s 255 of the Companies Act 1993 and that any creditors may apply within five working days to set aside the appointment.

[7]      There will be orders as sought accordingly.

Williams J

Solicitors:

Simpson Grierson, Wellington for Applicants