With Insolvency Service about to close the file on bankrupt Gerald Norman Williams, unpaid creditor Wenzhou Trading had the High Court order a further investigation into Williams’ business affairs alleging he was living off assets he managed to shield from creditors.
Mr Williams automatic discharge from bankruptcy was to have been triggered on 24 November 2023, three years from the date he engaged with Insolvency Service after creditor Wenzhou Hongliang Trading Co Ltd forced him into bankruptcy.
One day prior, Wenzhou halted this automatic discharge, asking the High Court for a further investigation into Mr Williams’ financial circumstances.
Wenzhou is based in China. It was stung in 2010 after an importation of infant milk powder went sour. Mr Williams was one of three directors controlling a New Zealand company exporting this milk powder to China. The product was rejected on arrival; labelling did not comply with local regulations. Wenzhou lost the $306,000 paid in advance of shipment.
With Mr Williams’ New Zealand company in liquidation, Wenzhou funded a successful legal action by liquidators against all three directors. Ordered to pay $900,000, two directors settled with Wenzhou. Mr Williams did not contribute.
In 2020, Wenzhou bankrupted Mr Williams.
Insolvency Service told the High Court it has spent some $62,400 in chargeable time investigating Mr Williams financial position, finding no assets available to pay creditors.
Mr Williams, now aged 77, was described as now retired, living solely off his pension.
Wenzhou said further investigation is needed; in particular, earlier dealings surrounding a Drury subdivision in South Auckland and sale of a property at Papamoa in the Bay of Plenty.
Wenzhou alleges profits wound up in the hands of Mr Williams’ family trust.
In the High Court, Associate Judge Taylor suspended the automatic discharge, ordering Insolvency Service carry out a more detailed investigation into Mr Williams’ financial affairs.
Wenzhou complains that Insolvency Service has failed to follow up on a 2021 court ruling requiring interests associated with Mr Williams hand over $575,000; funds arising from the Drury subdivision diverted from Mr Williams’ pocket at a time when he was insolvent.
Wenzhou Hongliang Trading Co Ltd v. MSUT Trustee Ltd – High Court (11.11.21) & Wenzhou Hongliang Trading Co Ltd v. Williams – High Court (2.05.25)
25.113