Westpac New Zealand Limited v Registrar of Companies HC Auckland CIV 2011-404-4812

[2011] NZHC 1033

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2011-404-4812

BETWEEN  WESTPAC NEW ZEALAND LIMITED Applicant

ANDTHE REGISTRAR OF COMPANIES Respondent

Hearing:         7 September 2011

Counsel:         S F Pearson for Plaintiff

No appearance by or on behalf of Respondent (abides decision of

Court)

Judgment:      7 September 2011

(ORAL) JUDGMENT OF HEATH J

Solicitors:

Minter Ellison Rudd Watts, PO Box 3798, Auckland
Copy to:

Ministry of Economic Development, Private Bag 92513, Wellesley Street, Auckland (G Caro)

WESTPAC NEW ZEALAND LIMITED V THE REGISTRAR OF COMPANIES HC AK CIV 2011-404-4812 7

September 2011

Introduction

[1]      Westpac New Zealand Ltd (Westpac)   seeks an order, under s 323 of the Companies Act 1993 (the Act) that Totara Tranquility Ltd not be removed from the register of companies.   The application follows notice from the Registrar of Companies of his intention to remove that company from the register.

[2]      The  application  has  been  served  on  the  Registrar  of  Companies.    The Registrar  has  acknowledged  receipt  of  the  Court  proceedings.    He  abides  the decision of the Court.

[3]      Application has also been made for an order that the substantive application be made by originating application. That is appropriate.

Background

[4]      On 21 December 2007, Totara Tranquility entered into a loan agreement with

Westpac, through which a loan facility was to be provided up to a maximum of

$355,000.  Security for the loan was given on 15 January 2011, in the form of a first registered mortgage over a property situated at 127 Totara North Road, RD 2, Kaeo. Totara Tranquility is the registered property of that property.

[5]      By 16 February 2011, Totara Tranquility had fallen into default under the terms of the loan agreement and mortgage.  At that stage there were arrears due and owing of just over $3000.  A notice was issued under s 119 of the Property Law Act

2007.   That notice was served on 21 February 2011.   The notice has not been complied with. As a result of its expiry, all moneys payable to Westpac have become due and Westpac has rights to sell the mortgaged property or to enter into possession of it.

[6]      As at 4 August 2011, the amount owing to Westpac was $362,105.39.

[7]      The Registrar of Companies initiated action to remove Totara Tranquility from  the  register  on  the  basis  that  it  had  ceased  to  carry on  business.    Under s 321(1)(d) of the Act, Westpac gave notice of objection to the proposed removal. That sub-section permits a creditor such as Westpac to object on the grounds that it has an undischarged claim against the company.

[8]      The Registrar responded to the objection on 12 July 2011.  The effect of that response was to temporarily suspend the removal process.  Section 322(2) of the Act provides  that  an  application  must  be  made  to  this  Court  for  an  order  that  the company not be removed from the register, if the ground of objection is under s 321(1)(d).

[9]      A timely application has been filed. As indicated, there is no opposition to it. It seems to me clear that it is desirable that Totara Tranquility remain on the register, to avoid unnecessary difficulties for Westpac in enforcing its debt against the mortgaged property.

[10]     In  those  circumstances,  I  am  satisfied  that  the  discretion  conferred  by s 323(2) of the Act may properly be exercised to make the order sought.

Result

[11]     I make the following orders:

(a)       Leave is granted for the application under s 323 to be brought by originating application.

(b)Totara Tranquility Ltd shall not be removed from the New Zealand register of companies.

(c)       A copy of the sealed order shall be lodged with the Registrar of

Companies.

[12]     Costs are not sought. There is no order as to costs.

[13]     I thank Mr Pearson for his helpful documentation that has enabled me to give

judgment orally today.

P R Heath J