Supreme Court grants leave to appeal in PAYE trust case
2014 case note - Supreme Court granted leave to appeal Court of Appeal's decision in PAYE trust case – s 167(1), schedule 7 Companies Act, trust, liquidation.
The Supreme Court has granted leave to Jennings Roadfreight Limited (in liquidation) to appeal the decision of the Court of Appeal.
Jennings Roadfreight Limited (in liquidation) applied to the Supreme Court for leave to appeal the decision of the Court of Appeal, which overturned the decision of the High Court, and concluded after consideration of the legislative scheme and history and applicable case law that an established section 167(1) trust will not be extinguished upon liquidation (Commissioner of Inland Revenue v Jennings Roadfreight Limited (in liq)  NZCA 455).
The Supreme Court granted leave to appeal.
The approved grounds for appeal are whether:
- the trust arising under section 167(1) of the Tax Administration Act 1994 continues in existence upon the liquidation of a company, in respect of funds held in the company's account; or
- the trust is extinguished upon the liquidation, so that the funds held are dealt with in accordance with Schedule 7 of the Companies Act 1993.
Tax Administration Act 1994