A Whangarei company which tried to liquidate another commercial entity over an unpaid bill not only failed in its bid but also had costs awarded against it.
CablePrice in Whangarei applied to the High Court at Whangarei under the Companies Act for an order that Taimona Haulage be liquidated over an unpaid bill of $14,607 for repairs and parts. Before the application the company served a statutory demand for payment but Taimona Haulage did not comply with the notice.
However, Taimona Haulage director James Diamond argued the debt which CablePrice relied upon was subject to a genuine and substantial dispute.
His company owned a Scania truck and there was a contract with CablePrice to repair the vehicle.
In his statement of defence, Mr Diamond claimed CablePrice breached the agreement by failing to diagnose a problem in the truck's engine. There was a further breach, he said, when the truck was involved in an accident at the CablePrice workshop on South End Ave and sustained damage when a CablePrice mechanic was caught under its cab.
Mr Diamond said the alleged breaches caused him to lose a valuable contract worth $209,000 in total between January 2014 and October 2015.
He said the truck was not returned to him until March 7, 2015.
In dismissing CablePrice's application, Associate Judge Roger Bell said for a creditor whose debt was subject to a dispute to apply for liquidation they have to establish a prima facie case that the company was unable to pay its debts.
He said there may be grounds for Taimona Haulage not paying the bill as well as grounds for a counterclaim for the economic losses arising out of CablePrice's alleged failures to carry out the work properly. Part of the affidavit filed by CablePrice's treasury and risk manager, John Bateson, was termed by the court "inadmissible hearsay" because he did not have firsthand knowledge of the work carried out on the truck.
CablePrice spokeswoman Steve Young said the company would not comment on the case.