Neither debt behind creditor’s claim is currently owing, with one paid and one under appeal
The High Court has paused a bid to liquidate Mega Aqua Ltd, even though the company failed to prove it could pay its debts.
In Sunnya Pty Ltd v Mega Aqua Ltd [2026] NZHC 3196, released 16 October 2026, the court stayed the liquidation application until further order and barred Sunnya Pty Ltd (Sunnya) from advertising it. Mega Aqua has been involved in various proceedings in New Zealand and New South Wales (NSW) arising from its dealings with Sunnya, and costs orders have been made against it in Sunnya’s favour in both countries.
Sunnya served a statutory demand on Mega Aqua in April 2026 for $21,115.26 in unpaid High Court costs and disbursements. Mega Aqua neither paid nor challenged the demand, and Sunnya applied to liquidate the company on 16 June 2026. Mega Aqua paid the debt six days later.
Sunnya then amended its claim to rely on an Australian costs order, claiming $51,417.43 including interest. Mega Aqua challenged that order, and on 17 September 2026 the NSW District Court suspended the costs certificates behind the debt pending an appeal. Sunnya accepted that this second debt was not currently due.
The court found that Mega Aqua had not displaced the presumption of insolvency that arose from its failure to comply with the statutory demand under s. 287 of the Companies Act 1993. It said the company’s sole director had “ample opportunity” to provide evidence of solvency.
“His bare assertion is not enough,” the court said.
Mega Aqua also offered no evidence that advertising would harm it.
Still, the court held that the application rested on “a debt that has been paid and one that is not currently due and owing.” It found that a court would be unlikely to order liquidation in those circumstances, and that it would be unfair to let the application proceed until Mega Aqua’s appeal clarified the second debt.
Sunnya acknowledged that its ultimate aim was to recover about $3.6 million that HLW Investments Pty Ltd, now in receivership and liquidation, paid to Mega Aqua. Mega Aqua alleged that Sunnya had an ulterior motive: it said Sunnya hoped liquidators would produce court-ordered documents under a NSW subpoena, which Sunnya believed would support criminal proceedings against Mega Aqua’s director. The court did not need to decide that issue.
The court refused a permanent stay. The presumption of insolvency still stood, and it had heard no convincing reason why the appeal would reduce the second debt to nil. It also rejected Sunnya’s request that Mega Aqua pay the second debt into a trust account or into court, because the costs certificates were suspended and the final amount remained unknown.
Sunnya was ordered to pay Mega Aqua’s costs of the stay application on a 2B basis, plus disbursements. The court reserved costs in the substantive proceeding.
