Wang ready to fight against dismissal of creditors' proposal

May Wang was a prime mover in the offer for the Crafar dairy farms. Photo / Greg Bowker

May Wang has appealed against the dismissal of her creditors' proposal on eight grounds including an allegation the court overemphasised the amount UBNZ stands to benefit from the Natural Dairy transaction.

Wang, the director and sole shareholder of New Zealand-based UBNZ's trustee, was bankrupted last week after her proposal was dismissed.

Since then she has filed an appeal against the judgment to dismiss the proposal and against the bankruptcy, as well as an application to suspend the bankruptcy until the case can be heard in the Court of Appeal.

High Court Associate Judge Hannah Sargisson said in her judgment on Wang's bankruptcy that she was "satisfied" an appeal would not have a "very high chance of success".

"I would not wish to speculate on whether it has absolutely no prospect of success. I am content to regard it as falling somewhere in the middle and afford it no further weight."

Sargisson said Wang's interest in the Natural Dairy transaction was contingent but not valueless.

The UBNZ group is fronting Natural Dairy's bid to buy 16 Crafar farms. UBNZ bought four Crafar farms earlier this year. Natural Dairy intends to buy all 20 farms from UBNZ.

"No issue is taken on appeal with the findings that the property of the UBNZ Trust extends beyond its interest in the Natural Dairy transaction to the processing business [in Tauranga] and shares in publicly listed Natural Dairy," said Sargisson.

She added that these interests were not contingent and a prudent approach would be to hand over Wang's assets to the Official Assignee (OA).

Sargisson said Wang's disclosure of her assets had been entirely inadequate and that there was considerable worth in an investigation of her financial affairs by the OA.

"If there is not effective and immediate control exercised by the OA, I am of the view that her creditors will be put at risk." Sargisson said her decision would not prevent Wang from pursuing her appeal (against the creditors' proposal) or appealing against the bankruptcy.

Before Wang was bankrupted her lawyer Paul Sills said evidence had been filed in support of her appeal against the dismissal of the proposal by creditors Dominion Finance and the liquidators of Dynasty Group - her former property development group.

An unnamed representative of Natural Dairy and Wang herself filed affidavits in support.

Sargisson said Wang's bankruptcy could significantly affect the Natural Dairy transaction.

On Friday Crafar receivers Kordamentha said the UBNZ bid was still "on foot".

Insolvency lawyer Graeme Christie said the OA would take control of Wang's personal assets but not those of UBNZ. He said a company was a separate and different legal entity from a person and not necessarily affected by a person's bankruptcy.

"So bankruptcy of a person does not see the company put into liquidation or the company's assets available to pay the personal debts."