Justice Aru, on August 22, 2014 has dismissed a petition in Vanuatu Supreme Court Company Case 7 of 2013 to wind up Chiko Farm Products Limited (CFPL), a local company that supplies eggs and fresh chicken.
Ex-employee of Chiko, Mark Nutley represented by Marie-Noelle Patterson, brought the petition to the Court alleging, based on simple contract, that Nutley had loaned funds to the Company totaling Vt28,916,687 and that despite a demand for payment of this amount issued by him to the Company on October 23, 2010 the debt remained outstanding.
The Supreme Court, under Section 223 of the Companies Act may wind up a company if the company is unable to pay its debts while Section 224 sets out the circumstances under which such a wind up may be ordered.
Options available to the Court are to dismiss the wind up petition, adjourn the hearing conditionally or unconditionally, make any interim order or any other order it thinks fit but the Court shall not refuse to make a winding up order on the ground only that the assets of the company have been mortgaged to an amount equal to or in excess of those assets or that the company has no assets.
In the case of CPFL there exists a sizeable mortgage with the National Bank of Vanuatu, which was represented in the Court proceedings by Mark Hurley.
CPFL, represented by Tom Botleng, opposed the petition and, relying on sworn statements filed by Ken Thode (co-owner of CPFL with his wife Suzanne) denied that it owed Mark Nutley the sum claimed.
Justice Aru, having heard the parties, observed in his judgment that Chiko Farm Products was registered as a business name twice on November 25, 2011 – once to Richard Nutley and Kenneth Wayne Thode and also, on the same day to Mark Nutley and there is no evidence that either registration has been cancelled.
The Company, Chiko Farm Products Limited was incorporated on February 9, 2012.
There was also no evidence before the Court of any written contract or loan agreement or arrangement between Mark Nutley and the Company.
Mark Nutley stated that he took a loan and mortgaged his house for Vt27 million and that that amount was credited on the same day to the Company’s account with Westpac as loan proceeds.
The Westpac bank statement annexed to Mark Nutley’s submission shows that, although by then the Company CPFL had been incorporated, the account credited with the amount of Vt 27 million on February 28, 2012 is in the name of Chiko Farm Products. The bank statement is addressed to Richard Nutley as Managing Director, Chiko Farm Products which is a registered business name [not the Company Chiko Farm Products Limited].
Justice Aru concluded “This is a winding up petition, given that there are contested issues as to disputes of facts I am not satisfied that there is a debt owed by the company as alleged by the petitioner to warrant its winding up.
The petition is therefore dismissed and the respondents [CPFL] are entitled to costs on a standard basis.”
Justice Aru, on August 22, 2014 has dismissed a petition in Vanuatu Supreme Court Company Case 7 of 2013 to wind up Chiko Farm Products Limited (CFPL), a local company that supplies eggs and fresh chicken.Ex-employee of Chiko, Mark Nutley represented by Marie-Noelle Patterson, brought the petition to the Court alleging, based on simple contract, that Nutley had loaned funds to the Company totaling Vt28,916,687 and that despite a demand for payment of this amount issued by him to the Company on October 23, 2010 the debt remained outstanding.The Supreme Court, under Section 223 of the Companies Act may wind up a company if the company is unable to pay its debts while Section 224 sets out the circumstances under which such a wind up may be ordered.Options available to the Court are to dismiss the wind up petition, adjourn the hearing conditionally or unconditionally, make any interim order or any other order it thinks fit but the Court shall not refuse to make a winding up order on the ground only that the assets of the company have been mortgaged to an amount equal to or in excess of those assets or that the company has no assets.In the case of CPFL there exists a sizeable mortgage with the National Bank of Vanuatu, which was represented in the Court proceedings by Mark Hurley.CPFL, represented by Tom Botleng, opposed the petition and, relying on sworn statements filed by Ken Thode (co-owner of CPFL with his wife Suzanne) denied that it owed Mark Nutley the sum claimed.Justice Aru, having heard the parties, observed in his judgment that Chiko Farm Products was registered as a business name twice on November 25, 2011 – once to Richard Nutley and Kenneth Wayne Thode and also, on the same day to Mark Nutley and there is no evidence that either registration has been cancelled.The Company, Chiko Farm Products Limited was incorporated on February 9, 2012.There was also no evidence before the Court of any written contract or loan agreement or arrangement between Mark Nutley and the Company.Mark Nutley stated that he took a loan and mortgaged his house for Vt27 million and that that amount was credited on the same day to the Company’s account with Westpac as loan proceeds.The Westpac bank statement annexed to Mark Nutley’s submission shows that, although by then the Company CPFL had been incorporated, the account credited with the amount of Vt 27 million on February 28, 2012 is in the name of Chiko Farm Products. The bank statement is addressed to Richard Nutley as Managing Director, Chiko Farm Products which is a registered business name [not the Company Chiko Farm Products Limited].Justice Aru concluded “This is a winding up petition, given that there are contested issues as to disputes of facts I am not satisfied that there is a debt owed by the company as alleged by the petitioner to warrant its winding up.The petition is therefore dismissed and the respondents [CPFL] are entitled to costs on a standard basis.”
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