Inland Revenue's application to bankrupt Auckland property developer David Henderson was adjourned by three weeks yesterday to allow him and his creditors time to discuss another proposal.
High Court Associate Judge Jeremy Doogue dismissed Henderson's first proposal last month because the Bank of Western Australia (BankWest), that is owed about
$33 million, did not have an opportunity to vote on the proposal.
Other claims by Bridgecorp, in liquidation, and Downer Construction, owed $5.3 million, were also not part of that proposal.
Judge Doogue said a meeting, where creditors will again vote on an acceptable cent-in-the-dollar payout, had to be held within the next 10 days.
A hearing has been scheduled for April 19, when Judge Doogue will make a decision on whether another creditor's proposal should be heard or whether Henderson will be bankrupted.
IRD and BankWest strongly opposed the adjournment yesterday. IRD lawyer Nick Malarao said the IRD had had an application to bankrupt Henderson since 2008 and proceedings had been "on foot" since 2009. He said any transactions that Henderson makes are at risk and the public needs to be protected from that.
BankWest is pursuing bankruptcy proceedings against Henderson in Australia.
The initial proposal was to drip-feed $1.5 million, about 4c in the dollar, on a $105 million debt over three years.
IRD, which is owed $3.7 million, opposed the proposal because it claims the size of the payment is too small and there is no assurance the payments will be made.
Malarao said last month it was in the public interest that Henderson be bankrupted so his affairs could be further investigated by the Official Assignee.
Henderson's lawyer Daniel Grove said yesterday that his client was confident he would get the votes needed from the creditors' meeting.
Judge Doogue said there was no further obligation on the court to adjourn the proceedings any longer than three weeks.
He said that Henderson was not to make any commercial deals or take on any liabilities during this period.
Judge Doogue dismissed the first proposal on the "overall conclusion" that had BankWest been served, it would have been able to "defeat" the proposal.
In his judgment, Judge Doogue said it was a "matter of central importance to the [Insolvency] Act that the requisite majority be obtained to the creditors' meeting".
Henderson has settled his $28 million debt with Westpac through the sale of his stake in the Victoria Park redevelopment, a project he is still expected to be associated with whether he is bankrupted or not.
