Section 269 — Companies Act 1993: Power to disclaim onerous property

269 Power to disclaim onerous property (1) Subject to section 270 of this Act, a liquidator may disclaim onerous property even though the liquidator has taken possession of it, tried to sell it, or otherwise exercised rights of ownership in relation to it. (2) For the purposes of this section, onerous property — (a) Means— (i) An unprofitable contract; or (ii) property of the company that is unsaleable, or not readily saleable, or that may give rise to a liability to pay money or perform an onerous act; or (iii) a litigation right that, in the opinion of the liquidator, has no reasonable prospect of success or cannot reasonably be funded from the assets of the company; but (b) does not include— (i) a netting agreement to which sections 310A to 310O apply; or (ii) any contract of the company that constitutes a transaction under a netting agreement; or (iii) a payment instruction or a settlement under the rules of a payment system that is declared to be a designated payment system under Part 5C of the Reserve Bank of New Zealand Act 1989 . (3) A disclaimer under this section— (a) Brings to an end on and from the date of the disclaimer the rights, interests, and liabilities of the company in relation to the property disclaimed: (b) Does not, except so far as necessary to release the company from a liability, affect the rights or liabilities of any other person. (4) A liquidator who disclaims onerous property must, within 10 working days of the disclaimer, give notice in writing of the disclaimer to every person whose rights are, to the knowledge of the liquidator, affected by the disclaimer. (5) A person suffering loss or damage as a result of a disclaimer under this section may— (a) Claim as a creditor of the company for the amount of the loss or damage, taking account of the effect of an order made by the Court under paragraph (b) of this subsection: (b) Apply to the Court for an order that the disclaimed property be delivered to or vested in that person. (6) The Court may make an order under subsection (5)(b) of this section if it is satisfied that it is just that the property should be vested in the applicant. Compare: 1955 No 63 s 312 Subsection (2) was substituted, as from 26 April 1999, by section 7 Companies Amendment Act 1999 (1999 No 19). Section 269(2)(a)(ii): substituted, on 1 November 2007, by section 22 of the Companies Amendment Act 2006 (2006 No 56). Section 269(2)(a)(iii): added, on 1 November 2007, by section 22 of the Companies Amendment Act 2006 (2006 No 56). Subsection (2)(b) was substituted, as from 21 August 2003, by section 48(1) Reserve Bank of New Zealand Amendment Act 2003 (2003 No 46).