Anderson Formrite Pty Ltd v CASC Hire Pty Ltd

Anderson Formrite Pty Ltd applied to set aside a statutory demand made by CASC Hire Pty Ltd under the Corporations Act 2001. The dispute arose from a subcontract for equipment hire and purchase between the plaintiff and the defendant, which was necessary for the plaintiff’s contract with Baulderstone Hornibrook Limited. After the termination of the contract with Baulderstone, the plaintiff breached its subcontract with the defendant, leading to a default judgment for $195,554.13. An agreement to pay this debt by instalments was made, but the plaintiff defaulted on the payments, prompting the defendant to issue a statutory demand and subsequently commence winding-up proceedings.

The legal issues before the court were whether the statutory demand could be set aside and if the terms of a proposed settlement between the parties could be enforced. The court had to determine if there was a genuine dispute over the debt, if the statutory demand was validly issued, and if the settlement proposal was binding. The court also needed to consider if there were any grounds under the Corporations Act to set aside the statutory demand.

In its reasoning, the court found that there was a genuine dispute over the debt due to the proposed settlement negotiations. The plaintiff had argued that it had an agreement with the defendant to assign a debt from Brands Construction Pty Ltd in partial payment and to deliver equipment in lieu of the remaining balance. Although the defendant did not explicitly accept these terms, the court inferred an agreement based on the conduct of the parties. The court concluded that the statutory demand was not validly issued as there was a genuine dispute over the debt. Therefore, the statutory demand was set aside, and the defendant was ordered to pay the plaintiff's costs.