Bache Business & Printing Services Pty Ltd v SA Hub Productions Pty Ltd

[2009] SASC 369

SUPREME COURT OF SOUTH AUSTRALIA

(Civil: Application)

BACHE BUSINESS & PRINTING SERVICES PTY LTD v SA HUB PRODUCTIONS PTY LTD

[2009] SASC 369

Reasons of Judge Lunn a Master of the Supreme Court

1 December 2009

CORPORATIONS

Application to set aside statutory demand - copy of application, which served on last day under s 459G(3) of the Act, omitted name of Judicial Officer before whom it was to be heard and the date and time of the hearing - held application incompetent and to be dismissed.

BACHE BUSINESS & PRINTING SERVICES PTY LTD v SA HUB PRODUCTIONS PTY LTD
[2009] SASC 369

Reasons on competence of plaintiff’s application to set aside the statutory demand.

1. JUDGE LUNN: On 2 September 2009 the defendant served on the plaintiff a statutory demand under s 459E of the Corporations Act 2001 (“the Act”) demanding payment of $12,834. In this action the plaintiff seeks to set aside that statutory demand. The defendant disputes the competence of the application on the grounds that it is out of time under s 459G(3) of the Act. On 16 October 2009 I directed that the competency of the application be determined as a preliminary issue.

2. On 2 September 2009 the defendant also served a similar statutory demand on Toboja Nominees Pty Ltd (“Toboja”) in action 1464/09.  Toboja has also sought to set aside that statutory demand.  The facts and issues in 1464/09 are almost identical to those in this action.

3. S 459G of the Act provides:

   (1)A company may apply to the Court for an order setting aside a statutory demand served on the company.

   (2)An application may only be made within 21 days after the demand is so served.

   (3)An application is made in accordance with this section only if, within those 21 days:

   (a)an affidavit supporting the application is filed with the Court; and

   (b)a copy of the application, and a copy of the supporting affidavit, are served on the person who served the demand on the company.

4. Rules 2.2(1) and 2.3 of the Corporations Rules 2003 (South Australia), which apply in this action, provide:

   2.2(1)….. a person must make an application required or permitted by the Corporations Act to be made to the Court:

   (a)….. by filing an originating process …..

   2.2(3) An originating process must:

   (a) be in accordance with Form 2; and …..

   2.3     On receiving an originating process ….., the Registrar:

   (a)must fix a time, date and place for hearing and endorse those details on the originating process or interlocutory process; and

   (b)may seal a sufficient number of copies for service and proof of service.

5. In brief, what occurred here was that just after 4 pm on 23 September 2009, which was the 21^st and last day for the purposes of s 459G(3), Stephen Beach, the solicitor for the plaintiff, attended at the Court Registry seeking to issue the originating process in this action and to file the supporting affidavit. The originating process was in Form 2 of the Rules, but required the insertion of the name of the judicial officer who was to hear the application, the date and time at which it was to be heard, the date of its filing and the signature of the Registrar. The requisite fee was paid. The name of the judicial officer before whom the application was to be heard, the date and time for the hearing, the date of filing and the signature of the Registrar were not placed on the originating process. A “Court Received” stamp, bearing the date of 23 September, was placed on a copy of the originating process which was returned to the plaintiff’s solicitor. Immediately after leaving the Court Registry he went to the offices of the defendant’s solicitors, which was the address for service of the defendant given in the statutory demand, and served copies of the originating process and the supporting affidavit. The copy of the originating process given to the defendant’s solicitors did not contain the name of the judicial officer before whom the application was to be heard, the time and date of the hearing, the date of filing or the signature of the Registrar. No copy of the originating process bearing a Seal of the Court was given or shown to the defendant’s solicitors on 23 September 2009.

6. I am deciding the preliminary issue in favour of the defendant on the limited ground that s 459(G)(3)(b) was not satisfied by the documents which were served on the defendant on 23 September 2009.  I need not go into the issue raised by the defendant’s counsel about whether the originating process was filed on 23 September or whether that only occurred on a subsequent date when the name of the judicial officer to hear the application and the time and the date of the hearing were inserted into the original of the originating process.  (It should also be noted that the date of filing and the Registrar’s signature, which are required by Part D of Form 2 for the originating process, have never been completed on the original originating process on the Court file).  As it is possible that the plaintiff may contend that the Registrar was in default of his obligations under Rule 2.3 is it preferable that I do not make any further findings about what occurred in the Registry on 23 September.

7. The authorities are clear cut that a failure to serve a copy of the originating process giving notice of the time and place of the hearing of the application, let alone any other significant omissions from the Form 2, within the 21 day period is fatal to the application to set aside the statutory demand succeeding.  These authorities are conveniently summarised, and endorsed, by Chesterman J in Cooloola Dairys Pty Ltd v National Foods Milk Ltd (2004) 184 FLR 86, where he said:

   On 14 July 2004 the applicant filed and served its application.  The copy of the application actually served was defective in a number of respects.  The application number did not appear on the document.  The space for the insertion of the date on which the application would be heard by the court was left blank.  The seal of the court had not been affixed to the document which did not bear the Registrar’s signature. …..

   ….. The first service was of an incomplete copy of the application. A number of cases have established that an application deficient in the same particulars as was the applicant’s is not a copy for the purposes of s 459G(3)(b), which provides that an application is made within 21 days only if a copy of the application and of the supporting affidavit are served on the creditor.

   The Full Court of the Supreme Court of Western Australia in Robowash Pty ltd v Robowash Finance Pty Ltd (2000) 158 FLR 338 emphasised the need for strict compliance with the provisions of s 459G(3) in a case in which the debtor’s supporting affidavit served on the creditor omitted four pages of the annexures to the affidavit. The Court dismissed the application for non-compliance with the subsection. …..More to the immediate point is the decision of Santow J in Benonys Pty Ltd v Fetrona Pty Ltd (1999) NSWSC 1181, in which the applicant served a copy of the application which omitted the return date. His Honour thought that the document served was not a copy of the application at [6]:

   For how can the party who is served have received proper notice of the proceedings for which attendance is required within the twenty-one days when that party is not told of the important fact of the return date ….. until after the twenty-one days.

   Chelring Pty Ltd v Coombs [2000] WASC 60 was a case with facts identical to the present. A copy of the application.

   ….. did not have the action number on the ….. document and, perhaps most significantly, did not have the date and time on which the application would be heard.  The service copy of the document did not bear a mark denoting the seal of the Supreme Court.

   At [2]:

   Master Sanderson followed Benonyx.  He said at [9]:

   It may then be the case that if the copy served does not contain the seal of the ….. Court or ….. does not contain the action number, such omissions may be excused.  But a copy of the application must, I think, ….. require the important information to be included on the served document.  In particular, that must mean that the return date of the application and the date upon which the application was filed should be included.  Without these two ….. pieces of information a respondent is put at a disadvantage.  In the one case, it needs to know the date of filing to ensure that the procedure for setting aside a statutory demand has been followed.  In the other the respondent needs to know when it should appear in court to answer the application.

   The facts in LJAW Enterprises Pty Ltd v RJK Enterprises Pty Ltd [2004] QSC 134 are also relevantly identical. A copy of an application to set aside a statutory demand, which omitted the court’s seal, the return date and the action number, was served on the respondent. Holmes J followed Benonyx, Chelring, Universal Trade Exchange and Robowash to conclude that “the documents served failed to reflect the original application in a matter of substance: it did not contain the return date for the application.” At [9]. Her Honour pointed out, as had other judges, that the requirement that the copy served reflect the original may cause hardship. Indeed in some of the cases the deficiency was not the fault of the applicant, although in this case it was. The cases have also pointed out that the requirements of s 459G are inflexible, depriving the court of a discretion to overlook any defects in service.

   …..

   As with other line of authorities I should follow these cases unless convinced that they are wrong. I do not think they are. The opinion they express is a justifiable exposition of s 459G. The copy of the application which the section requires to be served must show that an application has been filed and when the respondent is required to attend and answer it. It will not perform these functions if it is not sealed and does not show the action number allocated by the court. The inclusion of the return date is obviously necessary.

   The authorities establish that the copy of the application served on the respondent must be such as to show that it is a replication of the application which has been filed in the court. To do that it must show the action number given it by the court and it must show the return date for the hearing of the application. It must, also, I think, show the seal of the court to indicate that there are curial proceedings on foot. The document in question did not exhibit those attributes. It was not therefore a copy of the application. The result is that the terms of s459G(3) were not complied with and the application must be dismissed with costs.

8. Counsel for the plaintiff argued that the plaintiff had done all it could on 23 September 2009 to comply with Rules 2.2 and 2.3 and it should not be defeated because of the defaults of the Registrar. Even assuming for this purpose that it was the fault of the Registrar which prevented the plaintiff from complying with s 459G(3)(b), on which I make no finding, it is contrary to the authorities mentioned that this would excuse in the law the plaintiff’s non-compliance with s 459G(3)(b). I am obliged to follow the authorities on the point.

9. Accordingly, this action is barred by s 459G(2) of the Act and must be dismissed.

   I have today made the following orders:

   1Application to set aside the statutory demand of 2 September 2009 is dismissed.

   2Costs of the action as agreed or adjudicated are to be paid by the plaintiff to the defendant on the basis that there is to be one set of costs for the defendant for both actions but both plaintiffs are to be jointly and severally liable for them.

   3Fit for counsel.

10. A similar result also follows in action 1464/09 where similar orders will be made.  The only difference between the 2 matters was that in the Toboja proceedings the copy of the originating process, which was served on 23 September, did not contain any action number, whereas the documents in 1463/09 did contain the action number.  However, that does not make any difference to the result.