12 June 2015

Bankruptcy: Henderson v. Official Assignee

The Official Assignee’s refusal to allow bankrupt property developer David Henderson to leave the country has been upheld by the High Court.  Bankrupt on debts exceeding $100 million with no dividend paid out to creditors and described by the Official Assignee as being unco-operative, Henderson is looking to depart New Zealand permanently to pursue offshore business opportunities in the biogas industry.
Mr Henderson was bankrupted in 2010.  It is his second bankruptcy.  He remains bankrupt after the Insolvency Service blocked his automatic discharge from bankruptcy after three years.  It alleges Mr Henderson has failed to respond to requests for financial information relevant to his bankruptcy.  He complains the Insolvency Service is being vindictive and punitive.
In June 2014, he emailed the Insolvency Service requesting approval to leave New Zealand.  The following month a border alert was lodged to block any unauthorised departure. In the 2013 calendar year, over 1300 bankrupts were given approval to travel outside New Zealand. 
The High Court was told Mr Henderson plans to visit unspecified sites in North America, South America and Hong Kong to finalise licensing of a biogas engine.  Installation in Christchurch is envisaged.  Mr Henderson indicated there are employment possibilities arising from the proposed project.  He stated an intention to leave New Zealand permanently.
The Official Assignee asked for some corroborative evidence of the employment possibilities and how these might benefit Mr Henderson’s New Zealand creditors.   No evidence was provided to the Official Assignee’s satisfaction.  Approval to travel was refused.  The Official Assignee also expressed concern that Mr Henderson’s plans appeared to envisage carrying on a business while overseas.  There are tight constraints on any person managing a business while bankrupt.
Associate Judge Osborne ruled the Official Assignee was justified in refusing permission to travel.  Mr Henderson may still make a second application for consent to travel, said Judge Osborne, but he would have to meet the Official Assignee’s request for further information.
Henderson v. Official Assignee – High Court (12.06.15)

15.067