Off the shelf

Change demand lodged at the PPSR
A case seeking maintenance of financing statements on the PPSR when a change demand had been lodged by the debtor.

An individual who signed as a director was not personally bound
This case was an appeal by an individual who, in the lower court, was found personally liable under a guarantee in a sale and purchase agreement, even though she signed that agreement as a director of the principal debtor and not as a guarantor.

Director's bankruptcy does not invalidate company actions and failure to disclose does not preclude enforcement
The High Court has decided that the bankruptcy of a director does not invalidate actions taken on behalf of the company and that failure by a lender to disclose under the Credit Contracts Act does not necessarily preclude enforcement.

Unusual history of payments prevents them being set aside on insolvency
An unusual history of payments prevented payments from being set aside even though they were made within the specified period and when the company was unable to pay its debts.

Sale at undervalue can prejudice a lender's ability to claim under a guarantee
Guarantors successfully claimed that the value of their guarantee should be reduced by the amount lost on sale.

Drawings or shareholder loans?
The court decided that payments made to directors and shareholders of a company in liquidation were shareholder loans, and not drawings.

Relief orders granted under Securities Act for late filing
An Australian-based fund manager failed to comply with certain requirements of the New Zealand Securities Act (Australian Registered Managed Investment Schemes) Exemption Notice 1999.

Analysis of a one page guarantee
The court had to consider whether a non-standard one page guarantee adequately identified the plaintiff, whether it was simply an agreement to guarantee, whether consideration was given and whether the guarantee was an independent obligation.

Enquiries and information

For more information on any of the cases, articles and features in Financial Services Quarterly, please email Rachel Gowing or call on 64 9 916 8825.