289 Grange Road Developments Pty Ltd v Dalle Projects Pty Ltd - [2017] VSC 409

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST

S CI 2017 01308

IN THE MATTER of 289 Grange Road Developments Pty Ltd (ACN 604 659 047)

289 GRANGE ROAD DEVELOPMENTS PTY LTD (ACN 604 659 047)	Plaintiff
v
DALLE PROJECTS PTY LTD (ACN 147 573 948)	Defendant

- AND -

S CI 2017 01310

IN THE MATTER of 11 Mitchells Lane Developments Pty Ltd (ACN 604 931 919)

11 MITCHELLS LANE DEVELOPMENTS PTY LTD (ACN 604 931 919)	Plaintiff
v
DALLE PROJECTS PTY LTD (ACN 147 573 948)	Defendant

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JUDGE:	RANDALL AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	30 May 2017
DATE OF JUDGMENT:	17 July 2017
CASE MAY BE CITED AS:	289 Grange Road Developments Pty Ltd & Anor v Dalle Projects Pty Ltd
MEDIUM NEUTRAL CITATION:	[2017] VSC 409

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CORPORATIONS – Corporations Act 2001 (Cth) – Statutory demand – Application pursuant to s 459G to set aside statutory demand – Building contracts – Payment claim – Payment certificate – Debt due and payable for the purposes of the statutory demand – Relevance of the Building and Construction Industry Security of Payment Act 2002 (Vic) – Whether debt was required to be due and payable for the periods set out in s 459F or whether sufficient that due and payable at the date of service of statutory demand.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr B P Devanny	Hall Partners Solicitors
For the Defendant	Dr M Wolff	M&K Lawyers Group Pty Ltd

TABLE OF CONTENTS

The application................................................................................................................................... 1

The statutory demand in the 289 Grange Road Developments Pty Ltd proceeding............ 1

The statutory demand in the 11 Mitchells Lane Development Pty Ltd proceeding............. 1

Issues.................................................................................................................................................... 2

Grange Road.................................................................................................................................. 2
Mitchells Lane............................................................................................................................... 2

Background......................................................................................................................................... 3

The contract.................................................................................................................................... 6
Mitchells Lane............................................................................................................................. 13
Grange Road................................................................................................................................ 17
In S CI 2017 01308: Grange Road............................................................................................... 24
In S CI 2017 01310: Mitchells Lane............................................................................................ 24

HIS HONOUR:

The application

Each of these applications is pursuant to s 459G of the Corporations Act 2001 (Cth) (‘Corporations Act’) to set aside separate statutory demands, each dated 15 March 2017. It is convenient to deliver the one judgment as the issues and factual background are similar, save for notable differences to which I will draw attention. Further, although each plaintiff is a different company, it is accepted by the parties that each plaintiff was incorporated for distinct projects. I will refer to each plaintiff collectively or individually in these reasons as ‘the plaintiff’.

The statutory demand in the 289 Grange Road Developments Pty Ltd proceeding

The schedule to the statutory demand sets out the description of the debt and amount of debts as follows:

Payment claim certificate 1 dated 24/10/16

$111,593.02

Less amount paid

$80,000.00

Total for payment claim certificate 2:

$31,593.02

Payment claim certificate 2 dated 30/11/16

$61,380.99

Payment claim certificate 3 dated 10/12/16

$65,573.65

Interest accrued to 1/02/17

$11,423.47

Total debts:

$169,971.13

The statutory demand in the 11 Mitchells Lane Development Pty Ltd proceeding

The…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] VSC 409
Decision Date: 17 July 2017

CaseChat Overview and Summary

289 Grange Road Developments Pty Ltd sought to recover a debt from Dalle Projects Pty Ltd, the latter having issued a statutory demand under the Corporations Act 2001 (Cth). Dalle Projects resisted the claim and applied to set aside the statutory demand under s 459G of the Act. The dispute centred on whether the debt claimed was "due and payable" for the purposes of the statutory demand and the applicability of the Building and Construction Industry Security of Payment Act 2002 (Vic) to the debt.

The court was required to determine if the debt claimed by 289 Grange Road Developments was due and payable for the periods specified in s 459F of the Corporations Act, or if it was sufficient that the debt was due and payable at the time the statutory demand was served. Additionally, the court needed to assess the interaction between the statutory demand process and the mechanisms provided by the Building and Construction Industry Security of Payment Act, particularly in the context of building contracts and payment claims.

The court found that the statutory demand was valid and enforceable. It held that the debt was required to be due and payable for the periods specified in s 459F of the Corporations Act, not merely at the date of the statutory demand. The court reasoned that the statutory demand process and the Security of Payment Act served different purposes and did not preclude one another. The statutory demand was valid because the debt was due and payable at the relevant time, notwithstanding any payment claim or payment certificate issued under the Security of Payment Act.

The court dismissed Dalle Projects' application to set aside the statutory demand. The court ordered Dalle Projects to pay the amount claimed by 289 Grange Road Developments, together with interest and costs.

Orders