B.S.B. Mining Pty Ltd v Ranger Resources Pty Ltd - [2018] VSC 263

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST

S CI 2018 01037

B.S.B. MINING PTY LTD (ACN 132 203 108)	Plaintiff
v
RANGER RESOURCES PTY LTD (ACN 603 852 213)	Defendant

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JUDGE:	RANDALL AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	11 April 2018 and supplementary submissions dated 20 April 2018
DATE OF JUDGMENT:	24 May 2018
CASE MAY BE CITED AS:	B.S.B. Mining Pty Ltd v Ranger Resources Pty Ltd
MEDIUM NEUTRAL CITATION:	[2018] VSC 263

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CORPORATIONS LAW – Statutory demand – Application to set aside – Corporations Act 2001 (Cth), s 459J(1)(b) – Some other reason – Proceedings in District Court of Queensland – Claim under guarantee – Plaintiff to this application not a party to the District Court proceeding – Abuse of process – Some other reason why the statutory demand ought to be set aside.

GENUINE DISPUTE – Graywinter principle – Was the 21 day affidavit an affidavit in support – Adjournment to augment.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Burnett	Roberts Gray Lawyers
For the Defendant	Ms R Zambelli	Oakley Thompson & Co

HIS HONOUR:

The plaintiff’s originating process filed 22 March 2018 seeks to set aside the defendant’s statutory demand dated 28 February 2018. The application was made pursuant to s 459G of the Corporations Act 2001 (Cth) (‘the Act’).

The plaintiff’s originating process was supported by an affidavit sworn by the director of the plaintiff, Mr Mark Brunner. The affidavit sets out an argument that the statutory demand ought to be set aside on the basis of some other reason under s 459J(1)(b) of the Act and that the plaintiff has an offsetting claim being the value of two gold nuggets in the sum of $2,000. The defendant quickly conceded that the offset ought to be allowed and the statutory demand rewritten to take that into account on the basis that the sum was de minimis and the cost of arguing about the same exceeded the amount of the offset. I will allow the offset.

During the course of argument, it also emerged that the plaintiff might be able to raise a ‘genuine dispute’ if the same could be verified by a supplementary affidavit. I requested the parties to file written submissions to assist me to determine if an adjournment ought to be permitted to allow the filing and service of a supplementary affidavit.

Some other reason

The schedule to the statutory demand identifies the debt as follows:

On 27 November 2016 the Creditor and the Company entered into a Loan Agreement pursuant to which on 30 November 2016 the Creditor advanced the amount of $500,000 to the Company. In breach of clauses 2.3 and 3.1(a) of the Loan Agreement by 6 September 2017 the Company had failed to repay the amount of $500,000 due to be paid to the Creditor under the Loan Agreement. On about 23 or 24 November 2017, the Company made a part payment to the Creditor in 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: [2018] VSC 263
Decision Date: 24 May 2018

CaseChat Overview and Summary

B.S.B. Mining Pty Ltd applied to the Supreme Court of Queensland to set aside a statutory demand issued by Ranger Resources Pty Ltd. The statutory demand was issued under section 459J(1)(b) of the Corporations Act 2001 (Cth) as it was alleged that Ranger Resources had a genuine dispute with B.S.B. Mining regarding the liability to pay a debt. The dispute arose from a claim under a guarantee, where B.S.B. Mining was not a party to the proceedings in the District Court of Queensland. The application sought to set aside the statutory demand on the grounds of abuse of process and other reasons.

The legal issues the court had to decide included whether the affidavit supporting the application to set aside the statutory demand was an affidavit in support of the application and whether an adjournment should be granted to allow B.S.B. Mining to augment its affidavit. The court also had to consider if there was a genuine dispute between the parties as per the Graywinter principle and if the statutory demand should be set aside for some other reason.

The court held that the affidavit provided was not an affidavit in support of the application, as it did not address the question of whether there was a genuine dispute between the parties. The court noted that the affidavit did not consider the Graywinter principle and therefore did not provide sufficient grounds to set aside the statutory demand. The court found that the plaintiff had not demonstrated any abuse of process or any other reason why the statutory demand should be set aside. The application to set aside the statutory demand was dismissed.

The court did not make any orders as the application to set aside the statutory demand was dismissed.

Orders