Time3 Global Limited v Norrie - [2013] NZHC 3007

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-2176 [2013] NZHC 3007

IN THE MATTER of the Companies Act 1993

IN THE MATTER of an application to set aside a statutory demand

BETWEEN TIME3 GLOBAL LIMITED Applicant

ANDMARK HECTOR NORRIE as liquidator of Pakiri Investments Limited Respondent

Hearing: On the papers
Submissions filed 5 November 2013

Counsel:

Appearance:

RB Hucker for applicant

MH Norrie, respondent in person

Judgment: 13 November 2013

JUDGMENT OF ASSOCIATE JUDGE FAIRE [on costs]

This judgment was delivered by me on 13 November 2013 at 4:30pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors: Hucker & Associates, Auckland 1140

And To: Norrie & Daughters, Auckland 1642

TIME3 GLOBAL LIMITED v NORRIE as liquidator of Pakiri Investments Limited [2013] NZHC 3007 [13 November 2013]

[1] On 26 July 2013 I made an order by consent that a statutory demand be set aside. The order was made during a fixture that had been allocated to determine the applicant’s application to set aside the statutory demand.

[2] In addition, I made an order for costs on a 2B basis together with disbursements to be fixed by the Registrar against Pakiri Investments Ltd. That company is the company for whom the liquidator was appointed and is nominally the respondent. I reserved the question of costs against the liquidator in person and in respect of the liquidator’s application for an enforcement order. I gave directions for the filing and service of memoranda if a party sought costs.

[3] The applicant seeks costs against the liquidator in person. Memoranda have been filed and served. I have sought clarification from the parties. Additional memoranda have been filed covering the points that I have raised.

[4] The application for costs in this case raises several issues, namely:

(a) In issuing the statutory demand was the liquidator acting for himself or as agent for the company?

(b)If the liquidator was acting as agent for the company, are the circumstances of this case such that an order for costs should be made against the liquidator personally?

(c) Was the issue of the statutory demand by the liquidator in this case fundamentally flawed because there was no contractual basis for the demand that was made? If so, do such circumstances justify an order for costs against the liquidator in person?

(d)Should there be any departure from Band B in respect of each of the steps that are referred to in Schedule 3 of the High Court Rules?

(e) Should there be a reduction in costs because the applicant failed to comply with the court’s order relating to the exchange of submissions for the fixture which default became the subject of a separate application by the respondent which was duly filed and served seeking an order striking out the application to set aside the statutory demand?

[5] I deal with each issue.

[6] The alleged debt in this case was a debt due to the company. Any enforcement action that was justified…

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 Time3 Global Limited v Norrie

Details

AGLC: Time3 Global Limited v Norrie [2013] NZHC 3007
Case: [2013] NZHC 3007
Decision Date: 13 November 2013

CaseChat Overview and Summary

Time3 Global Limited applied to the High Court of New Zealand to set aside a statutory demand issued by Mark Hector Norrie, the liquidator of Pakiri Investments Limited. The primary issue was whether Norrie, acting as liquidator, could be held personally liable for costs due to the flawed issuance of the statutory demand. The court also considered whether the applicant's failure to comply with a court order regarding the exchange of submissions should affect the quantum of costs awarded.

The court concluded that Norrie was acting as an agent for the company when issuing the statutory demand, and not for his personal benefit. However, given the fundamental flaw in the demand—lacking a contractual basis—the court found that this case fell within the exceptional circumstances where a liquidator may be held personally liable for costs. The court emphasised the importance of solicitors issuing statutory demands, highlighting ethical obligations that must be adhered to before such demands are issued.

Regarding the costs, the court decided not to reduce the applicant's claim for the preparation of written submissions due to the applicant's failure to comply with a court order. However, it disallowed the time spent on those submissions from the overall quantum of costs, resulting in a final award of $5,671.50 plus disbursements to be fixed by the Registrar. The court also rejected Norrie's request for a set-off against future costs in a related proceeding, stating that the current case was standalone.

Orders