Costs awarded against Spring, Atkins in messy liquidation of Whale Oil

Costs have been awarded against Marc Spring, Juana Atkins, Brian Henry and Howard Taylor in what looks to me like an attempt to interfere in the liquidation of the Whale Oil company, Social Media Consultants Limited.

It seems to have been orchestrated by Spring. I suspect that Taylor and Henry won’t be pleased to be caught up in this but the High Court says they signed the court application for “a number of orders against the respondent as liquidator of Social Media Consultants Limited, including an order that she resign from that office effective immediately”.

The application was discontinued, but costs have been awarded for what the court described as:

The proceedings were vexatious and improperly brought in the form they were commenced. They wrongly alleged fraud, criminal harassment and blackmail without any proper basis for such scandalous allegations.

In February 2019 the company running the Whale Oil blog site, Social Media Consultants Limited, was put into voluntary liquidation. At that time the sole director and shareholder was Juana Atkins, wife of Cameron Slater. At about the same time Slater declared himself bankrupt and has since then unsuccessfully tried to claim bankruptcy exempted him from ongoing defamation actions against him.

Whale Oil was moved to a new site, The BFD, which continues to operate. The new site is registered to Suva Media Company Limited, with Atkins sole director and shareholder. Howard Taylor was the founding director and shareholder but handed over to Atkins in March last year.

March 2019: Liquidated Whale Oil company owes more than half a million dollars

In August 2019: Liquidator message on Whale Oil

It is the liquidator’s opinion that the director of Social Media Consultants Limited, Juana Atkins or someone directed by her has illegally used the customer database for the benefit of another business entity.

The Six Monthly Liquidators Report for Social media Consultants Limited in October 2019 showed there were issues with assets related to the blog:

The Six Monthly Liquidators Report in June 2020 repeated the above statement and also included:

This has now been dealt with further in High Court.

On 13 November 2019 the applicants issued an originating application seeking a number of orders against the respondent as liquidator of Social Media Consultants Limited, including an order that she resign from that office effective immediately.

On 16 March 2020 the applicants discontinued the application. The respondent now seeks costs.

The proceedings were misconceived from the outset. The applicants are stated to be Frog Rock Trust and four named persons. The trustees of the Frog Rock Trust were not identified. It is now accepted that the Frog Rock Trust is not a legal entity.

It may not be a coincidence that a company FROG ROCK MANAGEMENT LIMITED has Atkins as the sole director and shareholder (Slater was also a shareholder up to 2005).

The four other named applicants all signed the application, which was stated to be made under s 284 of the Companies Act 1993 for urgent emergency orders.

The four are named as BRIAN HENRY, HOWARD TAYLOR, JUANA ATKINS and MARC SPRING.

Henry is well known as friend and lawyer of Winston Peters, a trustee of the NZ First Trust, and has represented Slater in defamation proceedings (not any more).

It seems remarkable that an experienced lawyer would sign an application with a lay litigant trying to represent him, this just doesn’t make sense to me.

The application came before Associate Judge Andrew on 13 December 2019. Mr Spring, one of the named applicants, sought to appear on behalf of all the applicants. The Judge recorded that Mr Spring had no authority to represent parties in this Court and it would be necessary for the applicants to obtain proper legal representation. The Judge also noted there were issues as to whether the respondent Ms Toon had been properly served with the proceedings. She had only obtained copies of the relevant documents by picking up copies from the Registry.

Spring has been associated with Slater and Dermot Nottingham in a number of failed legal actions, including against myself. He has not properly served proceedings before, including to me.

It’s basic that a lay litigant cannot represent others in court. Nottingham has had similar difficulties so Spring should be aware of that.

By the time the matter next came before Associate Judge Sargisson on 6 March 2020 Mr Nicholls had been instructed by the applicants. Mr Nicholls …had some difficulty to support the standing of the remaining applicants except for Ms Atkins (who was a director and shareholder of the company in liquidation). Judge Sargisson directed further steps be taken in relation to the standing of Mr Henry, Mr Taylor and Mr Spring if the matter was to be pursued. As noted, shortly afterwards, on 16 March, the proceeding was discontinued.

But costs were sought.

The application contained a number of extreme allegations against the
respondent.

That sounds typical of Spring, Slater, Nottingham et al.

The allegations were purportedly supported by affidavits from Mr Spring, Ms Atkins and Mr Cunliffe. The allegations are serious, particularly when made against a professional person such as Ms Toon acting in the course of her profession. If made publicly and found to be wrong they would support a claim in defamation. Allegations made in Court proceedings are privileged. With that privilege comes a responsibility to ensure that allegations of fraud or dishonest behaviour have a proper basis.

A solicitor associated with such pleadings or allegations has an additional
responsibility and can be the subject of disciplinary proceedings if the allegations are made without a substantive basis. Quite apart from the solicitor’s responsibility, a party who wrongfully makes such allegations is at risk of sanction by an adverse costs award.

Mr Nicholls submitted that the situation fundamentally arose from lay people attempting to avert what they honestly believed to be an injustice. The application was not intentionally vexatious.

My response based on past experience with Spring to “honestly believed to be an injustice” and “not intentionally vexatious” is ‘yeah right’.

I am satisfied that the criteria for indemnity costs is made out in this case.

The proceedings were vexatious and improperly brought in the form they were commenced. They wrongly alleged fraud, criminal harassment and blackmail without any proper basis for such scandalous allegations. Such serious allegations against a professional person in the role of liquidator required a serious and detailed response.

In bringing the proceedings the applicants acted improperly and unreasonably. To exacerbate matters, it appears the proceedings were brought with the intention of preventing Ms Toon from carrying out her proper functions as liquidator. The proceedings were hopeless and on the information before the Court would never have succeeded.

Not only hopeless. Spring, like his associate Nottingham, has a record of making accusations and claims in courts unsupported by evidence or facts.

So far Spring has managed to avoid being held to account (while Slater and Nottingham have both been convicted, bankrupted and having their reputations publicly damaged by their own actions.

But in this case Spring and Atkins have been to the fore in proceedings and there will be a financial cost.

The respondent is to have costs against the applicants Brian Henry, Howard Taylor, Juana Atkins and Marc Spring, jointly and severally, in the sum of $15,983.15.

Compared to costs incurred by Slater and Nottingham that isn’t a lot, but at least Spring and Atkins are being held to account for some of their actions. I can only guess why Spring has involved himself in this.

Atkins is deep in it due to taking on the legal and financial responsibility of Whale Oil. This may just be the start of the financial repercussions for her.

Judgment: FROG ROCK TRUST v TOON (as liquidator of Social Media Consultants Ltd) [2020] NZHC 1407 [22 June 2020]

Slater officially bankrupt, Whale Oil, Whale Meat ownership changes

On Tuesday at 8:00 am Whale Oil announced that legal costs had led Cameron Slater “to make the very difficult decision to declare bankruptcy, since he is unable to generate enough passive revenue to fund the three extremely expensive and in his opinion, vexatious, defamation actions against him.”

Slater has followed through on this, with it being adjudicated yesterday on his own petition.

Estate Details
Insolvency Type   Adjudicated bankrupt on debtor’s application under S.47
Estate Number   891053
Name   SLATER, Cameron John
Month & Year of Birth   November 1968
Alternate Names   SLATER, Cameron John Dalley
Supplied Address  
Insolvency Status   Current Bankrupt
Adjudication Date/Time   27-Feb-2019 14:20
Occupation at Adjudication   Unemployed
Multiple Insolvencies   No
Petition Type   Debtor Petition

Bankruptcy can be tough, but it can also be a relief to have someone else (the Official Assignee) dealing with your financial problems.

A comment at The Standard yesterday from Redbaiter:

Among all the commentary on this event, there is little information on blogs or in the MSM on how the bankruptcy will effect the Whaleoil blog and its subscribers,

My understanding is that if someone becomes bankrupt then the official assignee takes over all of their affairs. The idea is to ascertain what revenue is available for the creditors.

One assumes the blog is a business, with revenue from subscription and advertising, and it also has some connection with the Whaleoil Meat Company.

So will this “business” be henceforth run by an Administrator appointed by the Official Assignee, and/ or will it be closed down as a loss making enterprise & therefore of no value to creditors?

If it is deemed of value, could it be sold off?

Would guess Slater’s legal team will have done what they could to minimise the effects of his bankruptcy on the blog, but IIRC, the OA can look at what happened in the recent past and reverse any actions taken to hide assets away.

People who have subscriptions to the blog, or are considering renewing them need answers to these questions. Same goes for meat purchasers.

Good points. Readers of Whale Oil don’t appear to have been informed about the implications of the bankruptcy. They were still advertising for subscriptions and trying to sell meat yesterday and again today.

Ownership of various things could take a while to sort out. There have been a number of changes over the last couple of months.

Social Media Consultants Limited

On 22 February 2019 documents were filed with the Companies Register removing Slater as a director and shareholder of Social Media Consultants Limited, effective 1 February 2019.

Juana Atkins (Slater’s wife and apparent manager of the Whale Oil blog, is now sole director and shareholder.

The registered office is shown as Howard K TAYLOR – ACCOUNTANT.

Social Media Consultants Limited is named as second defendant in the Blomfield v Slater defamation. In October a court found that Slater and Social Media Consultants Limited had no credible defence – see What Whale Oil isn’t telling their readers

Whale Meat Company Limited

http://app.companiesoffice.govt.nz/co/7292558

In advertising last year the Whale Oil meat selling venture was described at Whale Meat Company.

On 25 February 2019 Whale Meat Company Limited was registered. Incorporation date 25 February 2019.

Sole director and shareholder is Howard Karl TAYLOR.

From The Whale Meat Company website About:

Whale Meat became a reality when Cam tapped some of his many contacts to help supply meat, set up and run The Whale Meat Company.

You can take advantage of the buying power of Cam and the Oilers and enjoy restaurant quality meat delivered to you, by buying the pack that suits you, when it suits you.

The impression there is that Cam was instrumental in setting up and running the company.

WOHB Limited

http://app.companiesoffice.govt.nz/co/7271736

On 13 February  2019 WOBH Limited was registered, Incorporation date: 13 Feb 2019

Sole director and shareholder Howard Karl TAYLOR.

whaleoil.co.nz

https://www.dnc.org.nz/whois/search?domain_name=whaleoil.co.nz

The domain name was first registered on 2 November 2005.

It was last modified 25 February 2019 11:00 pm

Registrant name: WOBH Limited

However the address remains as Slater’s address, and the contact is sb at whaleoil – aka ‘spanish bride’ and Juana Atkins, Slater’s wife.

I expect that the Official Assignee will be looking at some of these ownership changes.

I’m not sure that these various ownership switches are a good way of reducing Slater’s stress.