Notorious Wellington debtor Harry Memelink, now bankrupt, remains trustee of a family trust owning commercial units on Hutt Road/Wakefield Street in Lower Hutt. If outstanding body corporate levies are not paid by mid-November, court-appointed receivers take control.
For year ended March 2020, his family trust received gross rentals of $466,800. The Body Corporate has been long frustrated in its campaign to recover levies due from Memelink’s family trust. Mr Memelink claims a set off; the Trust is entitled to reimbursement for work done on the Body Corporate’s behalf, he says. Levies also include amounts not properly chargeable to unit holders, he claims. Resolution is compounded by Mr Memelink’s current bankruptcy. Mr Memelink says he is owed $4.064 million by his family trust.
Payment of outstanding body corporate levies will likely require sale of one of the units or some form of refinancing, Justice Dobson commented. This will require Insolvency Service agreement. He appointed BDO Wellington’s Iain Shephard and Jessica Kellow as receivers to take control of Trust assets for payment of outstanding levies. Effect of the court order was suspended until mid-November.
The Body Corporate canvassed possibility of having Mr Memelink removed as trustee of his family trust. Bankrupt trustees can be removed by court order. The Trustee Act requires evidence that a bankrupt trustee as acting contrary to beneficiaries’ interests. Trust beneficiaries in this case were described as members of Mr Memelink’s family and friends.
Body Corporate 68792 v. Memelink – High Court (13.10.20)
20.166