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{\title \'93this is a quote, has said, of me saying \'91this is a quote\'92\'94}{\author raikatalau_l}{\operator raikatalau_l}{\creatim\yr2011\mo6\dy14\hr13\min49}{\revtim\yr2011\mo6\dy14\hr13\min57}{\version4}{\edmins3}{\nofpages3}{\nofwords1216}
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\fs20\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\fs16\insrsid8421204 \tab }{\cs17\fs16\insrsid8421204 In Re Kennedy Hotels Ltd }{\fs16\insrsid8421204 (HC)   }{\fs16\insrsid8421204\charrsid933470 \tab }{\field{\*\fldinst {
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\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 High Court Civil Jurisdiction
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\par }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Companies Law - dissolution of injunction \endash  petition to wind up \endash  whether material non disclosure of correspondence in injunctive application fatal \endash 
 whether petitioning creditor}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s winding up petition on undisputed debt an abuse of process - Companies Act (Cap. 249) s221}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
\par 
\par The }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 d}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 ebtor obtained an ex parte injunction against the }{
\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 reditor to prevent the }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning }{
\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 reditor from winding up the company.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning }{
\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 reditor sought to have the injunction dissolved.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
ompany admitted receiving chlorine and the debt but counterclaimed for damages caused by the chlorine subsequent to supply.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
It alleged that in face of a negligent supply of chlorine, the }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning Creditor}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s petition was an abuse of process.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The Court considered that the consequences after supply and the debt were two different transactions. The debt being undisputed, it was proper for the }{
\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning}{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  c}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 reditor to pressure the company to pay its debts as due. 
\par 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Held\endash }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 (1) The duty cast on party seeking injunctive relief is total. Failure to disclose vital 
correspondence by }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}
{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
reditor on a without prejudice basis, making offer of repayment of amounts owing by instalment, when making an ex parte application has restrictive consequences for the party affected and injunction is dissolved forthwith. 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 (2) It is not an abuse of process for a }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 p}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 etitioning }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
reditor to pursue its remedies against a }{\caps\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 c}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
ompany which admits a debt, but fails to pay after 21 days of a service of demand and wrongly sets up a counterclaim for 2 different transactions. 
\par 
\par Injunction to restrain petitioner from proceeding with winding up action dissolved.
\par 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Cases referred to in Decision
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\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Anglian Sales Ltd v South Pacific Manufacturing Co. Ltd}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  [1984] 2 NZLR 249
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Re a company}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  (No. 006273 of 1992)
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\par }\pard \s15\ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16149102 {\b\f0\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Madraiwiwi, J.}{\b\f0\lang2057\langfe1033\langnp2057\insrsid4989941 
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The Petitioning Creditor Gremm Chemicals (Fiji) Limited has by motion dated 21 August 1998 sought an order that the ex parte injunction made on 9 January 1998 be dissolved and the Respondent Kennedy Hotels Limited pay the costs of this application.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The application is supported by an affidavit sworn by Rishi Ram Sharma on 2 March 1998.
\par 
\par The parties rely on the following documents in this application:}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102\charrsid16149102 
\par }\pard\plain \s18\ql \li720\ri0\nowidctlpar\faauto\rin0\lin720\itap0\pararsid16149102 \f29\fs24\lang1033\langfe3081\cgrid\langnp1033\langfenp3081 {\f0\lang2057\langfe3081\langnp2057\insrsid4989941\charrsid16149102 1.\tab 
Notice of motion dated 21 August 1998;
\par 2.\tab Affidavit in support of Rishi Ram Sharma sworn 3 March 1998;
\par 3.\tab Affidavit of Mohammed Aleem Khan sworn 9 January 1998;
\par 4.\tab Notice of Petition dated 19 December 1997;
\par 5.\tab Affidavit verifying petition sworn 8 December 1997;
\par 6.\tab Ex parte summons dated 9 January 1998;
\par }\pard\plain \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16149102 \fs20\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
\par On 23 April 1997 the petitioning creditor by its solicitors issued a notice of demand and notice of intention to wind up claiming from the Respondent the sum of $9424.08 for liquid chlorine supplied to it.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Various correspondence then passed between the par
ties and in December 1997 the petitioning creditor filed a winding up petition against the Respondent.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
The ex parte injunction was obtained by the latter on 9 January 1998 and continues to date hence this application.
\par 
\par The petitioning creditor in its affidavit in support refers to a letter dated 7 May 1997 that was addressed to the Respondent}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
s solicitors on a }{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 "}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 without prejudice}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 "}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  basis.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
The latter combines an offer to repay the amounts owing in instalments.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 This correspondence was omitted when the Responden
t made its application for an ex parte injunction.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 In the court}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s respectful opinion, this correspondence ought to have been disclosed when the ex parte injunction was made.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The duty cast upon the party seeking such relief is total.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
That is because the nature of the relief has restrictive consequences for the party affected.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
Because of that omission, the injunction is dissolved forthwith.
\par 
\par Even were the court mistaken in this regard, there is the basis on which the ex parte injunction was granted.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The confl
icting principles in this area of law were settled by the New Zealand Court of Appeal in }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 {\*\bkmkstart Anglian_Sales_v_SP_Manuf_In_Re_Kennedy_H}Anglian Sales Ltd v South Pacific 
{\*\bkmkend Anglian_Sales_v_SP_Manuf_In_Re_Kennedy_H}Manufacturing Co. Ltd}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  [1984] 2 NZLR 249.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Greig J.A. explained it in these terms at 255:}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102\charrsid16149102 
\par }\pard \ql \li720\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0\pararsid16149102 {\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 "}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
Reference has been made in this and other previous High Court decisions in New Zealand to a number of Australian decisions which display a conflict between the view that a substantial counterclaim rai
ses a question of locus standi resulting in preference for an exercise of the inherent discretion against the petitioner and the view that, on the other hand, the existence of a counterclaim does not affect locus standi.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 I think that those who prefer the f
ormer view have failed to make the distinction between the inherent jurisdiction to prevent in special cases on abuse of the court}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s process and the exercise of jurisdiction on the hearing of the petition.
\par 
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16149102 {\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 This is not a case in which the petitioner}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s case debt is disputed or in which it can be said the petition must fail.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  
}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The Respondent is a creditor in what is conceded to be a substantial amount. The Appellant has a cross-claim sounding in unliquidated damages.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 That may leave it in doubt as to whether the Respondent on the hearing of the petition is bound to fail.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The petitioner, the Respondent in this case, ought to be entitled to present its petition.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 "}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
\par 
\par A careful consideration of the affidavit relied upon by the Respondent reveals that Mohammed Aleem Khan has essentially admitted the supply of chlorine and the debt by paragraph 12 of the same.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 He then sets up his counterclaim in relation to the alleged damage caused by the chlorine subsequent to the incurring of the debt as the basis for his contention, t
he petitioning creditor}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s application is an abuse of process.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 But what may one ask has the alleged negligent supply of chlorine and its consequences to do with the earlier supply of chemicals for which the petitioning creditor demanded payment?}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 They are two different transactions and in seeking recompense the petitioning creditor was only pursuing its remedies.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 How is that an abuse of process?}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 As their Lordships of the New Zealand Court of Appeal stated in }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Anglian Sales Ltd}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  supra at 252:}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102\charrsid16149102 
\par }\pard \ql \li720\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0\pararsid16149102 {\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 "}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 In bringing his petition, the creditor is doing no more than asserting the right to which the statute entities him to do.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 In our opinion a creditor}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
s right in this respect ought not to rest simply on the balance of convenience considerations which may be relevant to an interim injunction.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Something more than that is required.
\par }\pard \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16149102 {\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
\par All that the Respondent says is that it has substantial assets and that it will be unnecessarily embarrassed by presentation of the creditor}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102 '}{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 s petition.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 In the interim the twenty-one days has passed 
from service of demand in which the Respondent is deemed to be unable to pay its debts under {\*\bkmkstart s221_Companies_Act_In_Re_Kennedy_Hotels}section 221 {\*\bkmkend s221_Companies_Act_In_Re_Kennedy_Hotels}of the Companies Act Cap. 247.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 It was held in }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
{\*\bkmkstart Re_a_Company_In_Re_Kennedy_Hotels_Ltd}Re a company}{\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102  {\*\bkmkend Re_a_Company_In_Re_Kennedy_Hotels_Ltd}
(No.006273 of 1992) that presentation of a petition to wind up a company based on an undisputed debt was not an abuse of process.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 It was proper to present such a petition to pressure the Respondent to pay debts that was not disputed.}{\fs24\lang2057\langfe1033\langnp2057\insrsid16149102  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 The court respectfully adopts that reasoning.
\par 
\par }\pard\plain \s15\ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16149102 \f40\fs24\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\f0\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
The application to dissolve the injunction forthwith is accordingly granted and costs summarily assessed for the petitioning creditor at $500.00.
\par }{\i\f0\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 
\par Application granted.
\par 
\par }{\f0\lang2057\langfe1033\langnp2057\insrsid4989941\charrsid16149102 Marie Chan
\par }\pard\plain \ql \li0\ri0\nowidctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0\pararsid16149102 \fs20\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\fs24\lang2057\langfe1033\langnp2057\insrsid1972231\charrsid16149102 
\par }}