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fairness in all circumstances, while at the same time it needs to pay attention to the
principle of pari passu among creditors of equal standing. 137
To assist the court in deciding what is tantamount to just and equitable for the
purpose of contribution order, section 272(1) provides as follows:
(a) The extent to which the related company took part in the management of the
company in liquidation.
(b) The conduct of the related company towards the creditors of the company in
liquidation.
(c) The extent to which the circumstances that gave rise to the liquidation of the
company are attributable to the actions of the related company.
(d) Such other matters as the court thinks fit.
Section 272(2) which deals with guidelines for pooling order has similar conditions
to section 272(1) 138 to determine just and equitable. The only difference is that under
a pooling order there is an additional requirement that the court has to consider the
extent to which the businesses of the companies have intermingled. Courts have to
interpret whether it is just and equitable to make such orders in the light of the
fundamental principle of the legislations; the separate legal entity principle. 140
137 (1983) 1 NZCLC 98,581 at 98,583-98,584.
138 See also Lewis v Poultry Processors (Holdings) Limited (1988) 4 NZCLC 64,508 the court made a
distinction between what constitutes just and equitable under section 315A and section 315B (the
old provisions equivalent to section 271(1) (a) and (b) in the Companies Act 1955), and held that
the extent to which the businesses of the companies have been intermingled was relevant in the
latter but not in the former.
140 Mountford v Tasman Pacific Airlines of NZ Limited [2006] [2006] 1 NZLR 104 at 125. The judge
expressed the opinion that it was not the intention of the Parliament to allow judges to use the said
provision to disapply or to dilute the separate legal entity principle.
102