Published 19 October 2006
Associate Judge David Abbott removed Peter Brannigan today as liquidator of Newport Projects Ltd, more than 2 years after his appointment.
The judge said Mr Brannigan had failed to investigate transactions, or possible transactions, and had given no indication he was likely to.
He had given his consent after Newport Projects director Richard Cleave signed the resolution to appoint him. Associate Judge Abbott said neither the original consent to act, nor others with annotations relating to the sale of a property, was valid.
The action against Mr Brannigan arose after Inland Revenue returned its attention to a file on which it hadn’t been paid and saw no sign of payment. The company had been placed in liquidation shortly after a property sale, on which gst was owed.
Said the judge: “The present liquidator has taken no steps to investigate and given no indication that he is likely to do so. Inland Revenue has a liquidation application waiting which is likely to result in appointment of a liquidator who will investigate.” He appointed Inland Revenue’s choice of liquidators, Richard Agnew & Vivian Fatupaito (PWC).
Mr Cleave, as shareholder, signed a special resolution on 20 June 2004 appointing Mr Brannigan. Mr Brannigan signed a consent to act on 8 July 2004. A second version of the document had the handwritten annotation: “Or such time & date as shall be after the settlement of sale of Awatea Rd”.
He also produced a further copy of the letter of acceptance of appointment on which it was noted that it was to be held in escrow until settlement of the sale & purchase. Escrow was lifted on 15 July 2004.
“The original unannotated resolution & acceptance of appointment were signed, and would appear to have been valid at the time of signing. There is no indication when the annotation has been added,” the judge said.
Tim Chemaly, counsel for Inland Revenue, produced authorities to the effect that a resolution before consent has been given is invalid.
The judge said: “I take the view, particularly with no opposition from the parties involved, that the original resolution passed unannotated prior to giving of Mr Brannigan’s consent, even if it was annotated at that time (and I have some doubts about it). I also consider it inappropriate to hedge the appointment of a liquidator, as appears to have been the intention. The object of the statutory requirements for appointment are that there must be certainty, including time & date. The annotated resolution & consent to act, in my view, do not achieve that.”
The judge found that Mr Brannigan wasn’t validly appointed, either pursuant to the 20 June resolution or the escrow version released on 16 July. Associate Judge Abbott then made the order appointing Richard Agnew & Vivian Fatupaito (PWC) as liquidators.
Mr Cleave is a former director of Artifakts Design Group Ltd and is a director of Pilot Construction Ltd (wound up & struck off). Mr Chemaly said Mr Cleave now spent a substantial amount of time in Fiji.
Attribution: High Court hearing, story written by Bob Dey for this website.