Why companies fail: Some common examples
Companies fail for a variety of reasons, sometimes it is due to one large instance, but most often it’s an aggregate of small decisions, or inaction, that leads to insolvency.
Direct claims against insurers under Section 9 of the Law Reform Act 1936
When a party suffers loss or damage due to the actions of another, and the “wrongdoer” is indemnified by insurance, section 9 of the Law Reform Act 1936 (the LRA) may become relevant.
What is the PPSR and what can it do for you?
If your business sells goods, leases goods, or provides consignment stock it will be beneficial to familiarise yourself with the Personal Property Security Register (PPSR)
Is your company solvent? – Risks for directors and their accountants
Knowing whether your company is solvent, and what risks might present if it is not, is very important for every director to know.
Small Business Cashflow (Loan) Scheme (SBCS) enforcement: IRD moves to recover outstanding COVID support loans
As winter sets in, many New Zealand business owners face a critical financial burden: the final repayment deadline for SBCSs issued during the COVID-19 pandemic. What You Need to Know The loan scheme was introduced in May 2020 to provide financial support to small and medium-sized businesses affected by the pandemic. Over 129,000 businesses across […]
Limitations on director’s powers: An overview
The Companies Act 1993 (“the Act”) accords extensive, wide-ranging powers upon the director(s) of a company. Section 128(2) gives the board of directors “all the powers necessary for managing, and for directing and supervising the management of the business and affairs of the company”. However, these powers are subject to a number of limitations within […]
Admissible claims in liquidation: What creditors should know
When a company goes into liquidation, creditors must act quickly – but they can only recover what the law allows. The Companies Act 1993 provides the rules for determining which claims are admissible, offering a broad framework with key exclusions and specific rules for complex debts. What qualifies as an admissible claim? Section 303(1) casts […]
Behind closed doors: Understanding legal privilege in New Zealand
In the world of litigation and legal advice, few doctrines carry as much weight or mystique as legal privilege. It’s the quiet powerhouse of the legal system: a rule that shields communications, safeguards confidentiality, and empowers clients to speak freely with their lawyers. It’s a curious creature, acting as both sword and shield, and while […]
Restoring the Balance: Directors’ Breach Claims and the Augmentation of Company Assets
When directors of a company breach their statutory duties, the consequences can be significant—not only for the directors themselves but also for the creditors of an insolvent company. Recent case law confirms that funds recovered from directors for such breaches are not ring-fenced for specific claimants. Instead, they are considered company assets and are to […]
The wider powers of section 266 of the Companies Act 1993
A liquidator has the duty to take possession of, and to protect the company assets. In the process of discharging this duty, the liquidator may need to request information and documents from parties holding the relevant documents. The liquidator has two avenues under the Companies Act 1993 to request such information. Section 261 The first […]
