CP Asset Management Ltd (Prakash Pandey) has lost a Supreme Court bid to overturn a Court of Appeal judgment which reinstated the original court-appointed liquidators to another Pandey company.
Moteliers Brian & Bridgit Lawrence, now of Tauranga, got summary judgment for $1 million against NZ Properties Holding Ltd (director Charles Pandey, Mt Roskill, head of the Pandey/CP hotel group), weren’t paid and had the company wound up in 2012.
The claim arose from the state of a building the Lawrences leased from the Pandey group and the consequent effect on their business. The Rotorua motel flooded 51 times in 5 years and went out of business in 2008.
Damien Grant & Steven Khov (Waterstone Insolvency) were appointed liquidators of NZ Properties Holding, but CP Asset Management Ltd, listed as an NZ Properties Holding creditor, had the support of 5 related companies and another with the same registered office (the Pandey hotel group’s Queen St office) at a creditors’ meeting in August 2012 to oust Mr Grant & Mr Khov and replace them as liquidators with Arron Heath & Mike Lamacraft (Meltzer Mason Heath).
Justice Geoffrey Venning declined Mr Grant & Mr Khov’s application to set aside the creditors’ resolution and appointed Mr Heath & Mr Lamacraft in their place. The Court of Appeal reversed that decision on the basis that the resolution was contrary to the interests of unsecured creditors and was causing prejudice to the Lawrences.
The Supreme Court said in yesterday’s decision: “The Court of Appeal’s concern was that the creditors may not get an adequate investigation into the affairs of the company if the replacement liquidators remained in office and, in particular, that the possibility of recovery from the Pandey family would not be adequately investigated.
“Various transfers of assets over the period 2006-11 out of NZ Properties (then called CP Holdings Ltd) were outlined by the Court of Appeal. These had left the company without assets. The Court of Appeal noted that Justice Venning’s attention does not seem to have been drawn to these dispositions.”
The Supreme Court ruling went on to say that the difference between the lower courts’ decisions depended largely on a differing view of the facts: “There is thus no point of general, public or commercial significance. Nor is there the possibility of a miscarriage of justice.”
For their efforts, the Supreme Court made costs orders of $2500 in favour of Mr Grant & Mr Khov as liquidators, and secondly in favour of the Lawrences.