Unsympathetic to claims he had no assets, the High Court bankrupted Ticket Rocket entrepreneur Matt Davey owing BNZ more than $4.7 million. Associate judge Lester queried what happened to ticket buyers’ money which was apparently not held in trust. Mr Davey is currently in Australia.
Mathew Robert Davey controlled Fortress Information Systems Ltd which traded as ticketing company Ticket Rocket, competing against Ticketek and Ticketmaster. Ticket Rocket collapsed following event cancellations forced by covid pandemic lockdowns. Prior to that, Ticket Rocket was a ten million dollar company, Mr Davey claimed.
Fortress had funding from Bank of New Zealand; repayment supported by Mr Davey’s personal guarantee. The High Court was told Mr Davey responded to lockdown event cancellations by repaying ticket holders with BNZ money; overdrawing Fortress’ BNZ account without BNZ agreement to the tune of $1.7 million. Receivers took control of Fortress. BNZ sued to bankrupt Mr Davey on his guarantee.
Mr Davey said bankruptcy was pointless (he had no assets, he claimed) and would hamper attempts to restart his life in Australia (he was having trouble getting credit, he said).
He claimed BNZ should be held responsible for alleged negligence by Fortress’ receivers, reducing the amount owed BNZ. Judge Lester said chances of making a successful claim against BNZ were limited. As a general rule, secured creditors are not responsible for the actions of any receiver they appoint to recover a secured debt. Claims must be made against the receiver directly. Judge Lester said he was unwilling to defer Mr Davey’s bankruptcy for the several years it would take to get to trial on a speculative claim against BNZ. Following bankruptcy, it is for Insolvency Service to decide whether there is any merit in continuing such a claim for the benefit of Mr Davey’s creditors.
BNZ v. Davey – High Court (31.05.23)
23.083