Injurious Falsehood: Rascals International v. Taylor

  

Zuru escaped by a whisker after being sued for $1.18 million by owners of rival nappy brand Treasures: a Fair Trading claim filed one month out of time meant no damages were awarded despite Zuru’s Nick Mowbray making multiple false statements to retailer Woolworths intended to keep Treasures off its shelves; an injurious falsehood claim failed because while Mr Mowbray did intend to harm Treasures, he did not do so maliciously, mistakenly thinking he was correct in the damaging statements he made.

This commercial dispute was over nappies: a Zuru subsidiary produces the Rascals brand; Auckland-based JJK Group Ltd the Treasures brand.  Both products are manufactured in China.

Zuru alleged former director Grant Taylor provided proprietary commercial information to JJK Group, enabling JJK to revive the Treasures brand after it bought the product line from a former owner.

The High Court dismissed Zuru’s claim that JJK Group improperly benefitted from Mr Taylor’s assistance.

In return, JJK Group sued Zuru, alleging Nick Mowbray’s concerted campaign to keep rival Treasures out of the market was anti-competitive.

Evidence was given of Nick Mowbray contacting senior staff at Countdown, now trading as Woolworths, within days of learning that Countdown had ordered new stock from JJK Group.

In a May 2021 chatty email to Countdown’s general manager introduced in the first line as a ‘heads up,’ he then proceeded to describe JJK Group as acting in a ‘completely underhanded and illegal’ way with what Mr Mowbray claimed to be clear breaches of Rascal’s intellectual property rights.

Follow-up emails to Countdown included what he described as further evidence of illegal activity, coupled with preliminary negotiations to instead have Zuru’s nappy products stocked by Countdown.  

In the High Court, Justice Gardiner ruled there were multiple instances where Mr Mowbray deceived Countdown about the true commercial position: Mr Taylor was not in breach of a restraint of trade agreement made on his departure from Zuru as claimed (Mr Taylor’s general advice given to JJK Group was not covered by wording of the restraint); Mr Taylor had not disclosed any intellectual property rights to JJK Group (there is no copyright or patent attached to nappies in general or to Rascals product in particular); and JJK Group had not contacted Zuru’s China manufacturer as alleged (JJK representatives had been in touch with a former Rascals manufacturer in China). 

These false statements were in breach of the Fair Trading Act, causing Countdown to cancel its JJK Group supply contract within days of making a first purchase order for JJK’s product, Justice Gardiner ruled.

After receiving Nick Mowbray’s emails, Countdown was concerned that if the allegations proved true, it would be left with one million dollars of Treasure nappies on its shelves that it could not sell.

Countdown’s terms of trade with JJK Group were renegotiated, shifting the commercial risk on to JJK Group.  This resulted in JJK Group incurring increased transport and warehousing costs, totalling $1.18 million JJK claimed.

Countdown subsequently reinstated its original terms of trade with JJK Group, the High Court was told.

Whilst having a valid Fair Trading Act claim, JJK Group filed its claim too late, Justice Gardiner ruled.

JJK Group filed one month outside a three year time limit.

No damages were awarded.

Separately, JJK Group sued Zuru alleging injurious falsehood; an action in tort requiring proof of false statements published maliciously, causing financial loss.

Nick Mowbray’s statements to Countdown were in part untrue and misleading and were made with the intention of harming JJK Group’s business, Justice Gardiner said.

But he seemed genuinely convinced that Mr Taylor was involved in JJK’s business in breach of the restraint of trade, she said.

A lack of malice meant JJR Group’s claim of injurious falsehood failed.

Rascals International Ltd v. Taylor – High Court (5.08.26)

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Director Duties: Rascals International v. JJK Group

  

Zuru’s $20.5 million dollar legal action against JJK Group was a claim to take ownership of potential profits in a business purchased by JJK that Zuru had already decided it had no interest in and would not buy, the High Court stated.

Zuru’s damages claim failed; a claim criticised by upstart competitor JJK as simply a ploy to gain market dominance in retail sales of disposable nappies.

Zuru sells nappies under the Rascal brand.

The nearly month-long court hearing centred on allegations that former Zuru director Grant Taylor disclosed confidential Zuru information to a consortium of Auckland businessman allowing them to snatch competing Treasures nappy product from under Zuru’s nose.

Zuru alleged JJK Group benefitted from supposed wrongdoing by a Zuru director and must hand over that benefit to Zuru.

Justice Gardiner ruled most of the information Mr Taylor provided to his acquaintance Jarrod Armitage prior to his purchase of Treasures was no more than generic market and product information.

In August 2020, JJK Group Ltd was incorporated, pooling the funds and expertise of Mr Armitage, businessman James Collie and professional basketball player Kirk Penney, to purchase then then Treasures Kawarau business owned by Asaleo Care.

The High Court was told Mr Taylor and Mr Armitage were near neighbours in the Auckland suburb of Coatesville when Mr Armitage began talking about buying Treasure’s nappy business during their joint covid-19 lockdown walks.

Mr Armitage thought he was simply getting general industry advice from a friend.

There was no evidence of Mr Armitage being aware that Mr Taylor at this point was still ‘on the books’ as a Zuru director, while his involvement with Zuru was slowly wound down.

Mr Taylor had done well from his involvement with the Rascal nappy brand, selling his part interest in the business to fellow shareholders, the Mowbray family, for $30 million.     

Both he and Mr Armitage were aware Treasure’s New Zealand operation was up for sale; manufacturer Asaleo Care unable to compete with cheaper imports.

The High Court was told Zuru made an indicative offer for the business in February 2020 at two million dollars, later going no further than offering $200,000 to buy Treasure’s trade-marked brand only.

Asaleo did not respond, instead selling its business in August 2020 for $300,000 to JJK Group Ltd.

With continued input from Mr Taylor, JJK Group established manufacturing operations in China.

Zuru sued after learning of JJK Group’s first New Zealand sale of Treasure nappies, alleging JJK Group took advantage of confidential Zuru information provided by Mr Taylor to snatch the Treasure product line from it.

The High Court was told Countdown, now trading as Woolworths, placed its first order for JJK Group’s China-manufactured Treasure product mid-May 2021.  Three days later, Nick Mowbray leaned on Countdown to cancel the order, threatening legal action.

Mr Taylor settled out of court Zuru’s claim that he disclosed confidential Zuru information.

Following Zuru’s subsequent claim against JJK Group, Justice Gardiner ruled most of the information Mr Taylor provided to JJK about re-invigorating the Treasure nappy brand was general industry information about sourcing product and appropriate business structures when manufacturing off-shore; all information in the public domain.

Much of the information he provided about Rascal’s business success was a matter of public record, publicised by the Mowbray family itself in media interviews and public presentations.

There is no legal liability on a former director’s disclosure of trivial, widely-known, industry information.  Potential liability does follow disclosure of corporate inside non-public information.

Mr Taylor did not discuss Zuru’s pricing or margins with JJK Group, the court was told.

There is no evidence that he provided JJK Group with technical specifications for Rascal’s current product, Justice Gardiner said.

JJK Group could not be held liable for Mr Taylor’s indiscretion in disclosing some information that was confidential to Zuru, Justice Gardiner ruled.

Mr Taylor personally did not benefit financially from any information he provided to JJK, be it confidential or not.  He was not paid for his advice to JJK.  He did not have any financial interest in JJK Group.

Since Mr Taylor made no profit from his involvement with JJK Group, JJK could not be held liable for damages as ‘dishonestly assisting’ any failure by him to keep information about Zuru’s Rascal product line confidential, Justice Gardiner ruled.

Rascals International Ltd v. JJK Group Ltd – High Court (5.08.26)

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Bankrupt: BNZ v. Kerr

  

A case of international arbitrage.  Former high flying businessman George Kerr, now bankrupt in both England and New Zealand, unsuccessfully attempted to have his New Zealand bankruptcy put on hold while his England bankruptcy plays out.

Insolvency law in New Zealand has its origins in English bankruptcy law, but the two have now diverged with differing rules potentially resulting in differing outcomes.

Mr Kerr told the High Court there could be multiple problems should both his England and New Zealand bankruptcies run in parallel, particularly questions over control of assets and allocation of liabilities.

In England, he was bankrupted in July 2026 on an unpaid business debt of some US$400,000.

Ten days later in New Zealand, he was bankrupted on a $88.3 million debt owed Bank of New Zealand.

Now aged sixty, he has had a colourful business career with more than a decade of New Zealand litigation behind him, primarily disputes relating to operation of Pyne Holdings and his Torchlight Fund.

Most recently, his business operations have been run out of Guernsey, a crown dependency technically not part of the United Kingdom.

Refusing to put Mr Kerr’s New Zealand bankruptcy on hold, Associate Judge Malarao said both New Zealand and England have in place similar rules to deal with concurrent bankruptcies; rules based on a 1997 model law proposed by the United Nations Commission on International Trade Law, setting a framework to deal with any legal complications in concurrent bankruptcies of having assets and liabilities extending beyond national boundaries.

Bank of New Zealand v. Kerr – High Court (5.08.26)

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Restraint of Trade: Mirabito v. Waterman

  

While Kevin Waterman denies bad-mouthing purchasers of his Kerikeri dairy shed maintenance business beyond jokingly calling them ‘dumb Aucklanders’ and equally denies going behind their backs in breach of a restraint of trade on sale of his business by offering to continue working for former customers with under the table payments in cash, Justice MacGillivray issued a strongly-worded High Court injunction reinforcing the restraint of trade pending any further court hearing.      

The court was told Lauren Moribito paid $585,000 in 2025 to purchase assets of Mr Waterman’s business: Northern Dairy Specialists Ltd.

Northern Dairy installed and maintained dairy sheds.

Sale price included $362,000 paid for goodwill; payment for anticipated future revenue expected for ongoing work coming from Mr Waterman’s existing Northern Dairy customers.

As is the norm, the sale agreement contains a restraint of trade clause.  Mr Waterman promised for the next five years not to compete against Ms Moribito’s business in areas of North Auckland, north of Kawakawa.

Ms Moribito alleged in the High Court that Mr Waterman instead set out to undermine her new business from the outset.

A Northern Dairy staffmember, now working for Ms Moribito, reported hearing Mr Waterman tell his former customers that Ms Moribito and her spouse were dumb Aucklanders, useless, incompetent and destined to fail. 

Various witnesses said they had seen Mr Waterman giving former customers his personal mobile number, telling them that he was available for work with payments to be in cash and the Moribitos not told.

Mr Waterman denied all these allegations.

Comments about the Moribitos’ abilities were made as a joke, he said.

He passed on his personal mobile number just to keep in touch with customers he considered personal friends, he said.

He denied doing any under the table jobs for cash since selling in 2025.

Justice MacGillivray ruled there was sufficient evidence to justify issuing an injunction, reinforcing terms of the restraint of trade, pending a full court hearing into whether Mr Waterman had in fact breached the restraint of trade he signed.

Mirabito v. Waterman – High Court (4.08.26)

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Asset Forfeirture: Commssioner of Police v. Pritchard

  

Having their family home registered in the sole name of his partner Angelina Singh did not stop Police claiming a half share in the net equity of Martin Pritchard’s Auckland home, seized as proceeds of crime after his conviction for drug offences.

Pritchard was convicted and sentenced in 2024 to twelve years six months imprisonment for methamphetamine importation.

His partner Ms Singh did not face any related criminal charges.

Police seized cash and motor vehicles in Pritchard’s possession, allegedly proceeds of crime.

The High Court was told Criminal Proceeds (Recovery) Act negotiations with Police saw Pritchard agree assets to the value of $558,500 would be surrendered as a profit forfeiture order.

Cash and motor vehicles already seized did not cover this amount.

Police said his family home on Waituarua Drive in Takanini was liable to forfeiture as ‘tainted property.’  Cash generated from illegal activity was used in part to pay down a mortgage over the house, Police allege.  

While the family home is registered in name of Ms Singh alone, it is relationship property with Pritchard entitled to a relationship property half share.

As part of a court-approved proceeds of crime settlement, Pritchard was given time to raise further finance, potentially on security of Waituarua Drive, up to the value of his relationship property interest, to pay the balance of the agreed $558,500 profit forfeiture order.

Failure to do so may lead to a forced sale of Waituarua Drive.

Commissioner of Police v. Pritchard – High Court (4.08.26)

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Building Consent: Complete Shelf Co No.8 Ltd v. Chrictchurch City

  

It is a protracted legal game of cat and mouse.  Christchurch property developer Wolfbrook Residential claims Christchurch City must cover losses on a planned multi-storey development after errors by Wolfbrook’s own consultants led to council approval of a non-compliant building consent.  After losing a preliminary round in the High Court, Wolfbrook put into liquidation its subsidiary nominated for the projected build; by mistake, it says.

Associate Judge Lester ordered Wolfbrook pay $162,400 into court within three weeks to cover Christchurch City’s possible trial costs if it wants to proceed further.

This ruling negates Wolfbrook’s otherwise tactical advantage of pursuing litigation for its benefit in the name of a subsidiary, now in liquidation, whilst insulating itself from liability for costs if losing.

The High Court was told existing proposals for a sixty unit residential block on Lincoln Road in Christchurch were picked up by Wolfbrook subsidiary Complete Shelf Company No.8 Ltd in 2022. 

Architects acting for Complete Shelf exchanged emails with Christchurch City over balcony design changes necessary to achieve building code compliance.

Six weeks after building consent was granted, Christchurch City realised required changes to Wolfbrook’s application had not been made.

Complete Shelf alleges negligence by Christchurch City, claiming council staff should have picked up the error.

Complete Shelf is claiming damages for what it says are increased costs: management time, further design work and holding costs for project delays.

In a May 2025 High Court fast track summary judgment ruling, Associate Judge Lester ruled there are too many unknowns.  A full court hearing is needed to determine if there was any liability, and if so, how it should be spread between council, Complete Shelf and its consultants.

He questioned why Complete Shelf claimed this issue has put its whole project on hold.

Its code compliance dispute concerned balconies.  That should not delay ground-level preliminary site works, he suggested.

Just over one year later, Christchurch Council was in court demanding Complete Shelf pay money into court as security should the dispute come to a full hearing and Complete Shelf lose.

Wolfbrook as shareholder put Complete Shelf into liquidation in early 2026, council told the court.

Council potentially faces substantial legal costs defending Complete Shelf’s claim, and Complete Shelf had no means to pay if it loses, council alleges.  

Complete Shelf claimed it has a litigation funder willing to cover all legal costs.

Under questioning from Judge Lester, Complete Shelf eventually disclosed that its parent company Wolfbrook Residential is its litigation funder.

Judge Lester questioned the legality of such an arrangement; any damages recovered would be for the sole benefit of the supposed litigation funder: Wolfbrook.

He ruled Complete Shelf cannot progress its claim against Christchurch City unless it first pays into court council’s potential legal costs.

Council should not carry the risk of an unrecoverable costs award against a shell company when that company claims to have arranged financial support to pay, Judge Lester said.

Complete Shelf complained potential legal costs set at $162,400 is too high.

Judge Lester ruled Christchurch Council is entitled to take into account extra legal costs it may face given that Wolfbrook consultants involved in the building consent application are now involved in the litigation.

Complete Shelf Company No.8 Ltd v. Christchurch City Council – High Court (20.05.25 & 4.08.26)

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Family Trust: Ross v. Hoffman

  

Weeks before Carl Hoffman’s death in 2024, former spouse Moyra shifted into his family trust-owned Rotorua home against his express wishes and remained, with a court order needed to evict her.

The two had separated thirty-two years previously.  Moyra was paid $320,000 in 2006 on condition that she then surrendered all rights as beneficiary of Carl’s family trust; a trust he had established in 1981 at conclusion of an earlier relationship.

The trust subsequently purchased a family home on State Highway 30 at Rotorua where Carl lived with their two children: Kurt and Kane.

As trust settlor, Carl indicated to trustees that he wished to have the property sold on his death and the proceeds divided equally between his four children: Kurt and Kane, plus two children from an earlier relationship.

He also firmly told trustees that his former wife Moyra was to have no access to trust assets or the Rotorua home, saying ‘she has already had more than enough money from me.’

In the nearly two years since Carl’s death, Moyra and Kurt have continued living in the house, despite being asked to leave in readiness for a sale, paying no rent and in the company of ten cats, a dog, plus several sheep and pigs, trustees told the High Court.

The property is not being properly maintained, they claimed.

Vacant possession is necessary to achieve Carl’s wish that the property be sold and net proceeds divided amongst his children, trustees said.

Associate Judge Wild ruled Moyra and Kurt had no legal rights to remain in possession.  They were given three weeks to leave.

Trustees had offered special assistance for Kurt, Judge Wild said, offering to assist with any bond needed for a new rental and assistance in re-homing his animals.  Kurt was described as having ongoing mental health issues.

Neither Moyra nor Kurt defended the eviction application.

Ross v. Hoffman – High Court (3.08.26)

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Estate: Abel v. Jessiman

  

Adamant that their late father intended to leave them his share of a Hawkes Bay home owned jointly with their stepmother, Nathan and Rebecca Abel attempted unsuccessfully to bring a relationship property claim on his behalf intended to extract half the value of a $1.35 million home.

The disputed property at Clive had been purchased jointly.  Their late father’s half share passed automatically to their step-mother by survivorship on his death.

His children from an earlier relationship sued, seeking to establish what would be their late father’s share of relationship property if he had been alive, intending to then split his share between themselves.

Relationship Property Act rules allow claims to be made against an estate.  Where effective beneficiary of any claim is children exercising rights of a deceased parent, courts look closely at any financial justification for this claim.    

In the High Court, Justice Radich ruled the relationship property claim promoted by siblings Nathan and Rebecca could never succeed; their father’s estate was not substantial and they are comfortably well off.

Evidence was given of Rebecca working for an oil company in Texas and her family home having net equity of some $1.6 million.  Nathan was described as owning four properties in Hawkes Bay, together with his wife, plus a fifth property through a company he controls; properties sufficient to currently support borrowings of $2.6 million.

Their father Glenn was in a relationship with their stepmother Jan Jessiman for about 26 years before his death in 2024 at age seventy.

His only asset of substance was their home in Clive, owned jointly.

Son Nathan claimed it was never their father’s intention that Ms Jessiman take full ownership on his death.

Joint ownership of their Clive home should have been registered as tenants in common, to prevent Ms Jessiman inheriting their late father’s share by survivorship, he claimed.

Nathan said his father had stated it was intended that his children would inherit his half share in conversations both with himself and a family friend.

Even if that were his intention, it was not acted on, Justice Radich said.  

Nathan pointed to a 2002 family trust established by their father which stated a wish that, if the trust owned a home on his death, then his children could live in the property for the duration of their lives.

No money ever held by this trust was used to buy the Clive property.  The trust did not own any share of the Clive home, Justice Radich pointed out.

Evidence was also given of a Microsoft word document left on their late father’s computer titled as ‘last will and testament of Glenn Abel.’  This document was created just over two years prior to his death.  Part of this document stated: ‘Jan to live in the house at Clive, but when it is sold half the proceeds go to Nathan.’

Ms Jessiman told the court she did not know who drafted the document, adding that it was full of factual errors and did not match her late spouse’s writing style.

With provenance in question, this document could not be accepted in court as evidence of Mr Abel’s intentions, Justice Radich ruled.

Collectively, evidence before the court was insufficient to override Ms Jessiman’s current right of survivorship, Justice Radich ruled.

Mr Abel’s children provided no evidence of a serious injustice to themselves sufficient to support a possible relationship property claim on behalf of their father, Justice Radich ruled.

Their stepmother retains full ownership of the Clive property.

The court was told she has children of her own from an earlier relationship.  Her and Glenn had no children themselves. 

Abel v. Jessiman – High Court (3.08.26)

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