Official Assignee

The apparently limitless powers of the Official Assignee do not extend to 3rd parties

At least not without the backing of a court. ? The NBR writes

The Official Assignee has a wide range of powers but not quite as wide as accounting firm Xero [NZX: XRO] has been suggesting.

NBR asked two lawyers about the rights and powers of the Official Assignee ? both were speaking about the provisions of the Insolvency Act 2006 generally, and not about any specific case ? and both have the same view.

Mike Whale, a lawyer at Lowndes Law and the editor with Justice Paul Heath of a book on insolvency, says the Official Assignee?s powers to request documents or to examine witnesses are indeed wide.

Mr Whale says it would be difficult to challenge any requirement to produce documents or be examined, unless it can be shown that the Official Assignee was exercising his or her powers unfairly, oppressively or vexatiously.

?The powers that the Official Assignee has been given in these circumstances are really designed to discover the truth of the circumstances connected with the affairs of a bankrupt, information about trading, dealings and so forth,? he says.

The Official Assignee can ask just about anybody just about anything, so long as it?s related to the property conduct or dealings of a bankrupt.

?There?s an obligation on virtually anyone to comply with the Official Assignee?s requests, if they have information or hold documents.?

However, that doesn?t give the Official Assignee free rein to go on fishing expeditions.

There has to be a direct cause for the OA to go for information. ?They can’t just, for example, request the password to a bank account of someone just to have a good look around. ? Read more »

NZ’s VW? Questions over Xero remain unanswered

We’ve seen Rodney Hide explain how Xero gave personal data away?without notifying the person or requiring a legal request to do so. ?Then Xero?denied it – which is not very truthful. ?If they do it with someone, they can do it with you. ? The NBR revisits the case.



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Good job, ratbag bankrupt loses his inheritance to his creditors

A ratbag bankrupt, who has been fighting to keep his inheritance has?lost his court case and the creditors will now get paid as a result of the Official Assignee doing their job for once.

A man whose parents died in a car crash has lost his fight to keep his inheritance out of the pockets of his creditors.

Warren Sutton lost his appeal in the High Court to redirect his inheritance to his children. He was an undischarged bankrupt at the time of his father’s death.

The inheritance was that of prominent Taranaki couple Ern and Nancy Sutton, both 83, who were killed in May 2012 when their car was crushed by metal pipes which fell from a truck on State Highway 3 near Motunui.

The estate was to be divided between the Suttons’ three living children, one of whom was property developer Richard Warren Sutton, known as Warren Sutton.

Warren Sutton was described in court documents as “a businessman who has experienced highs and lows.” ?? Read more »

Rodney Hide on insolvency and the wild west of the industry

Rodney Hide writes in the NBR of the gobsmacking arrogance of the Official Assignee, the lack of accountability and the general parlous state of insolvency.

I have hitherto reported the Official Assignee of New Zealand, Mandy McDonald, spending a gobsmacking $835,000 administering Jamie Peters? bankruptcy.

I wanted to find out how she spent the money, first, to tell astonished?NBR?readers; second, to make an uninvited report to the minister; and third, to complain to the Auditor General.

I made a s.227(2) application under the Insolvency Act 2006 to inspect the Assignee?s accounting records.

I had a back-and-forth with a number of staff and finally received a ?statement of receipts and payments? from Robert Rendle, Lead Business Registries, Legal Services, Ministry of Business, Innovation and Employment. The statement was three lines long. Now remember, the Official Assignee excused the $835,000 cost because Mr Peters? bankruptcy was ?complex.? And here it was, ?sale of assets: $388.35; legal fees: $288.79; service of documents: $99.56.? That?s it.

That three-line statement of receipts and payments perfectly illustrates the lack of transparency of the New Zealand Insolvency Service.

The Official Assignee tells us how she spent the $388.35 she raised from Mr Peters? estate but not the $835,000 plus of taxpayers? money she spent getting it. Our spooks and spies are more forthcoming than the Official Assignee. And less intrusive.

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Bankruptcy is just a joke, really


Bankruptcy is like a toothless tiger that benefits the bankrupt more than the victims

A former rich-lister recently discharged from bankruptcy is heading back to court, facing charges including misleading authorities and concealing property.

Jamie Peters, who made the National Business Review Rich List in 2006 with an estimated fortune of $40 million, was declared bankruptin 2009 owing more than $100 million. Read more »