Thomson v Surch

[2023] NZHC 850

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-863

[2023] NZHC 850

IN THE MATTER

of the Insolvency Act 2006

AND

IN THE MATTER

of the bankruptcy of Troy Adam Surch

BETWEEN

CHRISTOPHER BRUCE THOMSON and DALE ANTHONY WADSWORTH

Judgment Creditors

AND

TROY ADAM SURCH

Judgment Debtor

Hearing:	30 March 2023
Appearances:	S T Dymond for Judgment Creditors S M Kilian for Judgment Debtor
Judgment:	20 April 2023

JUDGMENT OF ASSOCIATE JUDGE LESTER

This Judgment was delivered by me on 20 April 2023 at 12:00pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date: …..

THOMSON v SURCH [2023] NZHC 850 [20 April 2023]

[1]                  In April 2022, Christopher Thomson (Chris) and Dale Wadsworth (Dale) obtained a costs judgment against Troy Surch (Troy).

[2]                  The costs judgment arose in a proceeding commenced by Chris and Dale which resulted in a judgment of Justice Eaton following a formal proof hearing.1

[3]                  As I will discuss in more detail below, the proceeding resulting in the formal proof judgment, was served on Troy by way of substituted service. Service was completed in accordance with the orders for substituted service and Troy took no steps.

[4]                  The proceeding concerned a company called NZ Radiators Ltd. Chris and Dale sought orders under s 91 of the Companies Act 1993 rectifying the Share Register of a company called NZ Radiators Trustee Ltd  of  which  Troy  was  a  shareholder. NZ Radiators Trustee Ltd is the shareholder of NZ Radiators Ltd.

[5]                  Eaton J was satisfied that Troy had effectively withdrawn from the business, leading to Chris and Dale issuing a notice of default under their shareholders’ agreement. Chris and Dale then invoked the process specified in the shareholders’ agreement to acquire the beneficial interest in Troy’s shares. That process required the shares to be independently valued. Troy did not engage in that process.

[6]                  With Troy not having taken any steps to action the share transfer or in relation to the proceeding under the Companies Act, orders were made rectifying the Share Register as sought, along with an order for costs.

[7]                  Chris and Dale arranged for personal service of a bankruptcy notice on Troy which took place on 17 August 2022. In September 2022, the application to adjudicate Troy bankrupt was served by agreement on Troy’s counsel, Mr Kilian. Troy opposed the application to have him adjudicated bankrupt.

[8]                  At the commencement of the hearing of the opposed adjudication application on 30 March 2023, Mr Kilian advised the Court that Mr Surch had applied to the New Zealand Insolvency and Trustee Service to be adjudicated bankrupt. Mr Kilian

1      Thomson & Wadsworth v Surch [2022] NZHC 820.

provided the Court with a copy of Mr Surch’s statement of affairs dated 29 March 2023 and a verification document bearing the same  date.   I  advised counsel that     I would check the Insolvency Register to see if Mr Surch’s application to be adjudicated bankrupt had been accepted/actioned by the Official Assignee as if it was, it would overtake this proceeding.

[9]                  Having checked the Insolvency Register on 5 April 2023, Mr Surch is now recorded as being bankrupt on his own application.

[10]              With Mr Surch now being bankrupt I dismiss the judgment creditors’ application to have Mr Surch adjudicated bankrupt. Costs are reserved.

[11]              If no memorandum in respect of costs is filed on behalf of the judgment creditors within five working days, then the order of the Court as to costs is that the judgment creditors are entitled to costs as on a 2B basis plus disbursements as fixed by the Registrar.

Associate Judge Lester