Having
carried out her part of a separation agreement by paying off family company secured
debts, it would be unconscionable for the company to then sue her on an
unsecured current account debt of $130,700 which her errant husband had agreed
to take over, the Court of Appeal ruled.
Angela Moncur, with her former husband
Paul now in Australia, was sued by liquidators of their family company on a
debt she thought had been sorted out in a 2010 relationship property agreement
following the end of a 25 year marriage.
The court was told the Moncurs’ financial
affairs were covered in fine detail in the 2010 separation agreement. She agreed to surrender her interest in
family company Monocrane NZ Ltd. She
refinanced loans to Sovereign Finance secured over both the family home and
company assets, with her husband agreeing to pay her $200,000 as his share of
the secured debt. Paul ageed to take
over full liability for the $130,700 company current account debt arising from personal
drawings.
Five months after signing the agreement,
Mr Moncur, now in full control of Monocrane NZ, put the company into
liquidation. Evidence was given that
company assets were then sold to a new company owned by the father of his then
girlfriend with Mr Moncur becoming an employee of the new company. Mr Moncur did not pay the promised $200,000
to his former wife.
Liquidators of Monocrane NZ sued Mrs
Moncur, alleging she was liable to repay the company $130,700 in current
account drawings, a debt her former husband had agreed to take over.
The Court of Appeal blocked the liquidators
from suing Mrs Moncur. The Court ruled
it would be unconscionable for the company to sue for the debt when Mrs Moncur
had paid off the company’s secured debt in return for an agreement with her
husband that she was not liable on the debt to the company for current account
drawings.
The Court emphasised its ruling did not weaken
the position of companies suing for debts due.
The case was unusual, it said. Mrs
Moncur had paid the company’s secured debts in return for an understanding that
there would be a “clean break” and she was free of any further claims from the
company.
Monocrane
NZ Ltd v. Moncur – Court of Appeal (19.04.16)
16.059