Liquidators of China milk exporter may claw back $145,200 from Chinese directors
Liquidators of a failed milk exporting company, which became insolvent after losing an unfair dismissal case with employees, may force the company's Chinese-based directors to pay back $145,200 to creditors.
NCF International was tipped into liquidation last June, after former shareholders and employees David Cardno and Jan Wolyncewicz won an unfair dismissal case and were awarded $83,408 by the employment court in January 2014, according to a ShephardDunphy liquidators report by Iain Bruce Shephard and Heath Leslie Gair. The company was set up by Chinese and New Zealand-based investors, to export milk into China, with Wolyncewicz and Cardno employed for "their expertise in food exportation and marketing".
Chinese investment in New Zealand, particularly in the agriculture sector, has been growing, as the world's most populous country looks to secure its food supply. Earlier this year, the farming arm of Shanghai Pengxin Group, which is owned by Chinese billionaire Jiang Zhoabai, said it plans to double its $500 million of local assets within the next five years.
Wolyncewicz and Cardno still hold 2.5 percent of NCF each, but ceased being directors in April 2013, while in March 2014 NCF's China-based directors Bing Li, Lai Yebin, Guo Xiaohai, Chen Junliang resigned as directors, leaving Wellington-based Fu Bihua as the sole director, according to records on the Companies Office website.
After the legal stoush, NCF assets were transferred to a related company and cornerstone shareholder, Pairua Investment Group, which is jointly owned by former directors of NCF, Li and Yebin. Prior to the transfer of NCF assets to Pairua, $145,200 was paid to China-based directors in February, in what appears to be a voidable transaction, meaning liquidators Shephard and Gair can claw it back for creditors, they said.
NCF had no secured creditors. Liquidators have received a preferential claim from Inland Revenue for $15,189, on top of Wolyncewicz and Cardno's $83,408 claims, while five unsecured creditors have claimed $49,759. So far liquidators have sold $1,725 worth of office furniture, while the NCF bank balance prior to liquidation was $60.18.