Wine company fails to have debt to parent firm set aside

Gibbston Downs Wines has failed in its attempt to have set aside a $1.52 million debt owed to its failed parent Property Ventures.

That is the judgment of Associate Judge Rob Osborne who dismissed the application. His decision was given on December 21.

Bankrupt Christchurch developer David Henderson is a former director of both companies.

Property Ventures (PVL), the central company of the Henderson property development ventures, was put into receivership in March 2010, and then into liquidation in July the same year.

Liquidator Robert Walker had his powers suspended while PVL appealed to the Court of Appeal. That appeal was subsequently withdrawn and the liquidation proceeded. Walker had retrieved, ‘‘after some resistance’’, electronic files that showed an advance made by PVL to Gibbston Downs of $1.5m in the trial balance at March 31, 2008. That was matched by a liability reported in Gibbston Downs’ records. That remained at the time of liquidation.

In June, Walker wrote to Gibbston Downs director Ian Hyndman demanding the money. Hyndman replied saying he would have nothing to do with Walker, calling him ‘‘a crook’’. Walker then issued the statutory demand for payment of the debt.

Gibbston applied to the High Court to set aside the demand on the grounds that the debt was disputed, the liquidator was not authorised to issue the demand, and the liquidator had acted improperly.

Osborne said Gibbston Downs had to show there was a genuine and substantial dispute over the debt. He found the liquidator was entitled to order repayment of debt owing to the company.

Henderson, who was a director of both PVL and Gibbston Downs, told the court another PVL subsidiary had bought the Gibbston shares and taken the rights to the $1.5m advance with it in June 2009.

Henderson had been the sole director and shareholder of that company, Anthem, at the time.

He claimed there was a wider network of debt that meant the transfer of shares could be done without any cash changing hands.

Osborne said there were sparse records of the deal, including an unsigned share purchase agreement from two years before the transaction was finalised and a lawyer’s letter advising on contract wording.

Another, fundamental weakness in Gibbston Downs’ case was that debt owed to PVL which was passed between them was not ratified by PVL, he said.