Arthur Sylvan Morgenstern and Tanya May Lavas v Stephanie Beth Jeffreys and Timothy Wilson Downes - SC 109/2014

Civil Appeal – Companies Act 1993, ss 131, 135, 137, 138 and 301 – Whether the Court of Appeal erred in finding that, in a claim for breach of ss 131 (duty to act in good faith and in the best interests of the company), 135 (duty not to agree to, cause or allow reckless trading) and 137 (duty of care), in relation to selling an asset (shares) to the company at an alleged undervalue, the onus is on the director to prove that the asset was transferred for fair value – Whether the Court of Appeal erred in finding that a director facing claims under ss 131, 135 and 137, who relied on professional advice, is required by s 138 to plead this as an affirmative defence and bears the onus of proof – Whether the Court of Appeal erred in finding that, in a claim under s 301, the onus is on the director to prove that the breach caused no loss to the company – Whether the Court of Appeal erred, in fixing the amount to be paid or contributed under s 301, by proceeding on a restitutionary basis and failing to take into account the actual loss caused to creditors – Whether the Court of Appeal erred in finding that an inference could be drawn against the first appellant, by reason of failure to call evidence from the company’s accountants, when the respondents, as liquidators, were in an equal or better position to call that evidence.[2014] NZCA 449     CA 122/2014