The Vintage Aviator Limited v DeMarco

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2017-485-001027

[2021] NZHC 1912

BETWEEN
THE VINTAGE AVIATOR LIMITED

First Plaintiff/First Counterclaim Defendant

PETER ROBERT JACKSON, FRANCES ROSEMARY WALSH and

PHILIPPA JANE BOYENS (as trustees of Film Property Trust)
Second Plaintiffs/Second Counterclaim Defendants

AND

EUGENE JOHN DEMARCO including as trustee of the Airflight Trust

First Defendant/First Counterclaim Plaintiff

OLD STICK & RUDDER CO LIMITED

Second Defendant/Second Counterclaim Plaintiff

CIV-2018-485-000417

BETWEEN

OLIVER WULFF
Plaintiff

AND

EUGENE JOHN DEMARCO

First Defendant

THE OLD STICK & RUDDER CO LIMITED

Second Defendant

Hearing: 19 July 2021

Appearances:

B A Scott and J E Henderson for The Vintage Aviator Ltd, the trustees of the Film Property Trust and Sir Peter Jackson

M G Colson QC and D W Ballinger for Mr Oliver Wulff S J Fraser for The Old Stick & Rudder Co Ltd

G A D Neil for Official Assignee

Judgment:

19 July 2021

THE VINTAGE AVIATOR LIMITED v EUGENE JOHN DEMARCO including as trustee of the Airflight Trust [2021] NZHC 1912 [19 July 2021]

JUDGMENT OF GRICE J

(granting limited leave for proceedings to continue under s 76(2) of the Insolvency Act 2006)

[1] These proceedings were automatically halted when Mr DeMarco was adjudicated bankrupt on 14 July 2021. Earlier that day I heard an application for leave to appeal an interlocutory judgment of Johnston AJ debarring the defendants from calling evidence and cross-examining in the trial due to start last week.

[2] I delivered a decision dismissing the application for leave to appeal the Associate Judge’s decision and associated stay application in relation to the second defendant as a results decision only on 15 July 2021. In the meantime counsel for the respondents initiated discussions with the Official Assignee with a view to ascertaining the Official Assignee’s views on their continuing the proceedings against Mr DeMarco, at least to enable the decision on the stay and leave to appeal to be delivered.

[3] The Official Assignee, on 16 July 2021, indicated that he would consent to a limited continuation to enable the delivery of the stay/leave decision that I had heard argument on. The Official Assignee reserved his position as to whether he consented to the substantive proceedings going to trial. He sought further time to consider his position.

[4] I consider that it is right and fair to grant leave pursuant to s 76(2) of the Insolvency Act 2006 for the limited purpose of delivering the stay/leave decision. This is because: the application has already been heard; Mr DeMarco was represented at the hearing; the plaintiffs will not be gaining an advantage by the determination of the application in view of the fact that it does not determine the outcome of the proceedings; and the Official Assignee has consented to the limited continuation to enable the delivery of the decision.

[5] Accordingly, limited continuation leave is granted to enable the delivery of my judgment on the leave/stay applications.

Grice J

Solicitors:
Chapman Tripp, Wellington for The Vintage Aviator, the trustees of the Film Property Trust and Sir Peter Jackson
Finn Collins, Wellington for Oliver Wulff Civil Aviation Authority, Wellington
John Miller Law, Wellington for Eugene DeMarco and The Old Stuck & Rudder Co Ltd

CaseChat Overview and Summary

In The Vintage Aviator Limited v DeMarco, the High Court of New Zealand was asked to decide whether to allow certain legal proceedings to continue against Eugene John DeMarco, who had recently been declared bankrupt. The proceedings involved multiple parties, including The Vintage Aviator Limited, the trustees of the Film Property Trust, Sir Peter Jackson, and Oliver Wulff. The dispute centred on issues of bankruptcy, insolvency, and the admissibility of evidence in ongoing litigation. The court was tasked with determining whether the plaintiffs could continue their legal action against DeMarco despite his bankruptcy and whether the defendants could present evidence in the trial.

The primary legal issue before the court was whether to grant leave under section 76(2) of the Insolvency Act 2006 to allow the proceedings to continue against DeMarco. This section allows the court to permit certain actions to continue against a bankrupt person if it is fair and just to do so. The court had to consider the impact of DeMarco's bankruptcy on the proceedings, the Official Assignee's consent to the continuation of the case, and the potential advantage or disadvantage to the parties involved. The court also had to decide whether to stay the trial proceedings based on the interlocutory judgment that had previously debarred the defendants from calling evidence and cross-examining.

In granting limited leave for the proceedings to continue, the court found that it was fair and just to deliver the judgment on the leave/stay applications. The court noted that the application had already been heard, DeMarco was represented, and the plaintiffs would not gain an unfair advantage by continuing the proceedings for this limited purpose. Furthermore, the Official Assignee had consented to the limited continuation to enable the judgment to be delivered. The court concluded that the circumstances justified the limited continuation of the proceedings, allowing the judgment on the leave/stay applications to be issued.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

CIV-2018-485-000417
BETWEEN	OLIVER WULFF Plaintiff
AND	EUGENE JOHN DEMARCO First Defendant
THE OLD STICK & RUDDER CO LIMITED Second Defendant