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Disputes

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Litigation

When parties end up in civil disputes in New Zealand resort is invariably had to the Court process. This involves at the most modest level resort to the Disputes Tribunal. This has a jurisdiction at present of $7,500.00 and lawyers are not permitted to appear in the Tribunal. This Tribunal does not actually administer law in the strict sense but rather administers a form of justice between the parties.

At the lowest level in the formal Court structure is the District Court. It has jurisdiction for all civil disputes up to the sum of $200,000.00. It is wise for parties involved in a dispute before the District Court to be represented by lawyers and this of course applies for all higher Courts as well.

The next Court up the structure is the High Court. It has original jurisdiction in various areas but otherwise exercises an appeal jurisdiction from the District Court.

At the top of the hierarchy within New Zealand is the Court of Appeal which generally sits in Wellington. It hears appeals from the High Court.

In certain circumstances there is the opportunity of a further appeal to the Privy Council which is located in London. This naturally occurs very rarely.

Civil disputes of all kinds are dealt with by this Court structure. The only ones not dealt with are those that come within other specific jurisdiction such as the Employment Tribunal or the Motor Vehicle Dealers Institute etc.

Generally the method of commencing a claim before the Courts is by way of Statement of Claim which when served upon the opposition requires a Statement of Defence to be filed within 30 days. After this various procedural steps come into force such as the obligation to give discovery of all documents in ones possession. Once these procedural steps have been disposed of the matter will then go to a hearing before a Judge.

If you wish to know more about the litigation process in New Zealand please contact:

Contact:

Dunedin:

Frazer Barton Jenny Beck

Christchurch:

Glenda Murphy

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Alternative Dispute Resolution

Traditionally of course the role of lawyers has been one of acting as advocates for the purpose of conducting litigation through the Courts. In recent times people have become increasingly aware of problems associated with this process. Problems involve extensive delays, heavy costs outcomes over which the parties have little control and outcomes which are not always practical in the circumstances.

An alternative approach which is being taken now is to offer the option of going to mediation rather than litigation. This of course requires both parties to the dispute having the will to resolve that dispute by agreement. This can be a real challenge on occasions because simple disputes of course are generally resolved long before lawyers become involved. By the time lawyers are involved positions have hardened and there is often little option but to go to a Court and have a Judge adjudicate on the issue.

If however there is a will to reach some form of agreed settlement a trained mediator can be appointed by the parties and a formal mediation can take place. The advantage of this is that it gives the parties the ability to come up with a solution which can be the result of lateral thinking. This can mean that both parties can in fact have a degree of satisfaction with the outcome rather than it being all one way or the other.

There are a number of lawyers at Caudwells that have been trained to act as advocates for mediations and who have also been trained to act as mediators. If you require any further information please contact:

Contact:

Frazer Barton Jenny Beck

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Insolvency

(A) CORPORATE INSOLVENCY

Corporate Insolvency in New Zealand is governed by the Companies Act 1993. The two most obvious manifestations of insolvency are receiverships and liquidations.

RECEIVERSHIPS

In general terms when a company borrows funds these will often be secured by way of a debenture which contains a fixed and floating charge over all the company’s assets and undertaking. Debentures generally provide that in the event of a default by the borrower the lender has the ability to appoint a receiver and manager over the company. This receiver can choose to continue trading the business or sell as a going concern or close the business down and sell the assets. Generally in this situation there is a shortfall of funds and there is a scramble to obtain priority. Debenture holders of course have a form of priority but so also do Inland Revenue and employees. In addition some creditors who can assert reservation of title clauses or rights of set off may be able to obtain some form of priority. For creditors it is important to take legal advice on the options open to them in order to avoid any unnecessary loss.

LIQUIDATIONS

Liquidations generally are commenced voluntarily by a resolution of a company or by order of the High Court. The latter occurs if a credit has made application to the High Court for the winding up of the company. In either event a liquidator is appointed and trading will generally cease. It is the liquidator’s job to realise all assets and then distribute the proceeds to creditors in accordance with the provisions of the Act. Once again, it is important for creditors to ensure that their rights are being protected.

(B) INSOLVENCY ACT 1967

This Act covers individuals who become insolvent and ultimately bankrupt. A person can become bankrupt either voluntarily or by a creditor’s application to the High Court. In either case the Official Assignee then has the task of realising the persons assets and making a distribution in accordance with the Act to creditors.

An increasingly used option is for insolvent persons to attempt to put together a proposal which is then put to a meeting of creditors and sanctioned by the High Court. This involves all creditors agreeing to compromise their claims.

Contact:

Frazer Barton Jenny Beck

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Debt Recovery

Sometimes it happens that despite your best efforts, a debtor simply won’t pay !

Caudwells is able to offer two different types of services to assist:

  1. We can advise you on the procedures available which may force recovery of payment; or
  2. We can act for you in the recovery of the debt.

And there are a variety of approaches we can take:

  • A letter of demand - for some debtors, it is amazing what a difference a lawyer’s letter can make;
  • Ordinary Proceedings or Summary Judgment Proceedings in the District Court - after service of documents and expiry of the statutory period for the defendant to respond, these can result in judgment being entered against the defendant;
  • Order for Examination - requiring a defaulting defendant to appear in Court so that his or her financial circumstances can be scrutinised;
  • A Distress Warrant - allowing the defendant’s good to be seized by a court bailiff and sold to pay debt;
  • Bankruptcy - by way of proceedings in the High Court;
  • Statutory Demand against a Company - failure to effectively respond to this can result in an application to liquidate the company;
  • Liquidation - where a liquidator is appointed, trading generally ceases, and the liquidator sells up the company’s assets so they can be distributed to creditors.

For more information on how these procedures can be used to assist you, contact:

Dunedin:
Ellen Langley

Christchurch:
Glenda Murphy

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