Fearing that Masterton builder Mark Hewitt was deliberately running down his home renovation business Hewitt Building Ltd as a ploy to avoid paying a $392,400 court judgment, Barbara Palmer forced him back into court to admit Hewitt Building was profitable and in a position to pay over time.
In June 2021, the High Court ordered Mark Hewitt personally pay $67,500 and his company separately pay $392,400 following the failure to complete a fixed price home renovation according to contract specifications. His company Hewitt Building Ltd did not bother to defend the claim and Mr Hewitt defiantly told the court that his company had no assets to meet any damages claim. Ms Palmer called his bluff.
In late December 2021, she had Mr Hewitt ordered into court to answer questions about his company. Financial statements for the year ended March 2021 evidenced that Hewitt Building had earnings before interest and tax of some $250,000. If it continued trading, the $392,400 court order could be paid over time. Ms Palmer expressed concern that Mr Hewitt was running down his company’s operations, switching key staff and existing work across to a new company. Associate judge Johnstone ordered Hewitt Building Ltd start making instalment payments at $8000 per month to Ms Palmer.
This instalment payment order reminds Mr Hewitt of his potential personal liability for the company’s debt. If assets are stripped out of Hewitt Building making it unable to continue instalment payments, Mr Hewitt faces liability as director for actions leaving his company insolvent.
The court was told that Mr Hewitt had taken steps to pay Ms Palmer $184,000 being the June 2021 court judgment against him personally plus a substantial costs order he was subsequently ordered to pay.
Palmer v. Hewitt Building Ltd – High Court (17.02.22)
22.035