23 New Zealand
Edited By: William Johnston, Thomas Werlen, Frederick Link
- Banks and cross-border issues — Guarantees and security — Liquidated and unliquidated monetary obligations — Contractual set-off — Insolvency set-off — Judicial set-off
This chapter provides an overview of the law of set-off in New Zealand, both outside and within the context of insolvency. There are numerous statutes in New Zealand that regulate set-off and are applicable in particular circumstances. Set-off may be divided into current account set-off, independent (or legal) set-off, transaction (or equitable) set-off, and contractual set-off. The chapter first considers these types of set-off between solvent parties, along with set-off in relation to competing security interests under the Personal Property Securities Act 1999 (PPSA), before discussing set-off against insolvent parties. In particular, it explains insolvency set-off in liquidation, set-off in voluntary administration, netting insolvency set-off in liquidation and voluntary administration, and statutory management set-off. It also analyses issues arising from cross-border set-off, including the choice of law and cross-border application of PPSA.