SUPREME COURT Company Appeals Against Liens Act Decision

Press, Volume CIV, Issue 30843, 31 August 1965, Page 14

SUPREME COURT Company Appeals Against Liens Act Decision

Decision In an appeal against a decision on the disposal of funds under the Contractors Liens Act 1939 was reserved by Mr Justice Wilson in the Supreme Court yesterday. Martin Ormandy Ltd. (Mr A. D. Holland) appealed against a decision given by Mr E. S. J. Crutchley, S.M., on July 7, when it was ruled that Vibrapac Blocks, Ltd., Martin Ormandy Ltd., and McSkimming Industries, Ltd., should share pro rata in the £316 available to creditors of I O. K. Scott and Company, Ltd.

The appellant company submitted it should have priority over all other claimants. Mr Holland said the Precision Building Company Ltd. contracted with the Waimairi County Council to erect pensioner cottages in Raleigh street. I. O. K. Scott and Company Ltd. contracted with the Precision Building Company to do part of the work. I. O. K. Scott and Company Ltd. had gone into liquidation. Martin Ormandy Ltd., Vibrapac Blocks Ltd. (Mr D. J. Marshall) and McSkimmihg Industries Ltd. were sub-con-tractors of I. O. K. Scott. These companies were owed by Scotts' £lB2 14s 6d, £527 9s 2d and £77 3s lOd. The date of the completion of the main contract was November 29, 1963. Martin Ormandy gave notice of charge on January 17. 1964. within the 60 days laid down. The firm started its action on January 21. McSkimming Industries gave notice of charge on February 11, 1964. This was after the expiration of the 60-day period. On November 4, 1964, the liquidator of Scotts and the solicitor, and the solicitors for

McSkimmings and Martin Ormandy’s met and agreed that £316 was available. The liquidator said only two notices of charge had been given under the Liens Act—that of Martin Ormandy and that of McSkimmings. It was agreed the notices of charge were valid charges on the £316. It was agreed £lB2 14s should be paid Martin Ormandy’s and £77 3s lOd should be paid McSkimmings, the balance of- £56 2s 2d being available for general Creditors.

The next day, before discontinuance of proceedings had been filed, notice of charge for £727 19s 2d was given by Vibrapac Blocks Ltd. In the Magistrate’s Court it was held all three applicants—Vibrapac, Ormandy and McSkimmings—should share pro rata in the £316. It was against this judgment that Martin Ormandy, Ltd., appealed. Mr Holland submitted that Martin Ormandy, Ltd., had priority over all other claimants. He submitted Vibrapac shbuld not have been allowed to join in the action of Martin Ormandy, Ltd., because the action was settled.

The action ended on November 4 by consent of all the parties In the action. Vibrapac Blocks was not in this action. In the 60-day period provided by the act only one notice of charge had been filed—that of Martin Ormandy, Ltd. After November 4 the only money payable to Scotts against which there could be action was £56 2s 2d. Mr Holland submitted that the appellant company’s costs should be paid out of the fund of £316. Mr Marshall submitted the action had been open for Vibrapac to join in.