New Zealand courts say ‘yes’ to Common Fund Orders in representative proceedings

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New Zealand courts say ‘yes’ to Common Fund Orders in representative proceedings

In the recent decision of Simons & Ors v ANZ Bank New Zealand Limited & ASB Bank Limited, the Court of Appeal approved the High Court judgment of Venning J, in which it was held that the High Court has jurisdiction to issue a common fund order (CFO) – the first authority of its kind in New Zealand.  CFOs “are a mechanism which provide a way of sharing the costs of bringing a class action between all class members, regardless of whether they have signed the funding agreement” with the litigation funder.

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Focus on directors’ duties:  UK Supreme Court’s “momentous” decision on creditors’ interests

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Focus on directors’ duties:  UK Supreme Court’s “momentous” decision on creditors’ interests

BTI 2014 LLC v Sequana SA [2022] UKSC 25.

On 5 October 2022, the UK Supreme Court released its long-awaited and self-described “momentous” decision considering the fiduciary duty of directors to act in good faith in the interests of the company. Specifically, this decision is the first time that the UK Supreme Court (or the House of Lords) has confirmed that directors owe a duty to consider or act in the interests of the company’s creditors if the company becomes or is at risk of becoming insolvent. In so doing, the decision has implications for directors in New Zealand.

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Multi-disciplinary firms:  the scope of legal professional privilege

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Multi-disciplinary firms:  the scope of legal professional privilege

Commissioner of Taxation v PricewaterhouseCoopers [2022] FCA 278

In late March 2022, after a five-day virtual hearing conducted using Microsoft Teams, the Federal Court of Australia delivered a highly anticipated judgment in a long-running privilege dispute between the Commissioner of Taxation (the Commissioner) and PricewaterhouseCoopers Australia (PwC) and its clients, Flora Green Pty Limited, and JBS Australia Pty Limited, finding that only some of the documents for which PwC claimed legal professional privilege (privilege) were accurately withheld.

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Clarifying minority shareholder’s buy out rights

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Clarifying minority shareholder’s buy out rights

Birchfield v Birchfield Holdings Limited [2021] NZCA 428

The Court of Appeal considered recently the issue of a minority shareholder’s rights in a case where the minority shareholder refused to accept buy-out offers and then claimed the company had acted in an unfairly prejudicial manner towards him. In so doing, the Court of Appeal also provided useful guidance on how the majority can use the summary judgment fast track procedure to buy out the minority.

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The end of the Feltex litigation

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The end of the Feltex litigation

Houghton v Saunders [2021] NZSC 38

A recent decision by the Supreme Court has brought an end to a long-running saga through the New Zealand courts. Commenced in 2008, a class action suit of some 3,600 shareholders has rolled on against the directors of Feltex Carpets Limited (Feltex) and its (former) private equity owner, Credit Suisse, for thirteen years.

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Location of insurer imperative to s 9 LRA claim

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Location of insurer imperative to s 9 LRA claim

Livingstone v CBL Corporation Ltd (in liq) [2021] NZHC 755

The High Court has recently issued a decision in the CBL litigation which concerned the territorial ‘location’ of a charge under s 9 of the Law Reform Act 1936 (the LRA). In so doing, the Court reinforced the necessity of using the correct procedure for any jurisdictional challenge.

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Solvency the key

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Solvency the key

Supreme Court decision a warning to directors trading near-insolvent companies

Madsen-Ries v Cooper [2020] NZSC 100

Debut Homes Limited (Debut) was a property developer. Mr Cooper is Debut’s sole director. In November 2012, Mr Cooper decided to wind down Debut’s operations. Existing developments would be completed but no new developments undertaken. At the time this decision was made, it was forecast that there would be a deficit of over $300,000 in GST once the wind-down was completed. The liquidators of Debut sued Mr Cooper. They claimed that he incurred debts on behalf of Debut without a reasonable belief that Debut would be able to meet them when they fell due, in breach of ss 135 & 136 of the Companies Act 1993 (the Act),. The liquidators claimed the full amount of unsecured creditor claims, being $449,507. The High Court found that Mr Cooper had breached the above provisions. This decision was reversed in the Court of Appeal but was later reinstated by the Supreme Court.

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The final stage in the real estate price-fixing saga:  Penalty

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The final stage in the real estate price-fixing saga:  Penalty

Commerce Commission v Lodge Real Estate Limited [2020] NZHC 2329

In our April blog we summarised the effect of the Supreme Court’s decision in the Trade Me/real estate agents price-fixing saga. On dismissal of the real estate agents’ appeal, the Supreme Court referred the matter back to the High Court for determination of the penalty to be paid by Lodge Real Estate and Monarch Real Estate.

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The end of the road in the real estate price-fixing saga

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The end of the road in the real estate price-fixing saga

Lodge Real Estate Limited v Commerce Commission [2020] NZSC 25

The Supreme Court has recently delivered its judgment in the Trade Me/real estate agents price-fixing case, making this the final episode (on liability at least). Two Hamilton real estate agencies lost their seven-year battle against price-fixing allegations by the Commerce Commission.

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Deceitful practices lands Canterbury wine company $1.7m fine

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Deceitful practices lands Canterbury wine company $1.7m fine

R v Southern Boundary Wines Ltd (in liq) [2020] NZHC 514

Two directors and an employee of Southern Boundary Wines Ltd (Southern Boundary) have been sentenced along with the company itself for charges under the Wine Act 2003 involving deception and selling and exporting non-compliant wines. This is the third sentencing to occur under the Act.

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