Bentham Management Pty Ltd v Union Finance Pty Ltd - [2007] SASC 42

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
BENTHAM MANAGEMENT P/L v UNION FINANCE P/L
[2007] SASC 42
Judgment of The Full Court
(The Honourable Chief Justice Doyle, The Honourable Justice Perry and The Honourable Justice Debelle)
16 February 2007
CORPORATIONS - WINDING UP - WINDING UP IN INSOLVENCY - STATUTORY DEMAND - APPLICATION TO SET ASIDE DEMAND
Statutory demand – respondent applied for order setting aside statutory demand and filed affidavit in support of application – affidavit in support of statutory demand expressed in barest terms - loan agreement not proved in affidavit in support of statutory demand – respondent denied loan agreement exists – statutory demand and loan agreement do not correspond – whether genuine dispute - whether first affidavit of respondent was sufficient to raise a genuine dispute and whether respondent could rely on second affidavit.
Corporations Act 2001 (Cth) s 459F, s 459G, s 459H, s 459J; Australian Securities and Investments Commission Act 2001 (Cth) s 12CC, referred to.
Edge Technology Pty Ltd v Lite-On Technology Corporation (2000) 18 ACLC 576; Elm Financial Services Pty Ltd v MacDougal [2004] NSWSC 560; Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785; Graywinter Properties Pty Ltd v Gas & Fuel Corporation Superannuation Fund (1996) 70 FCR 452; John Holland Construction and Engineering Pty Ltd v Kilpatrick Green Pty Ltd (1994) 14 ACSR 250; Mibor Investments Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 290; Re Morris Catering (Australia) Pty Ltd (1993) 11 ACSR 601; SMEC International Pty Ltd v CEMS Engineering Inc (2001) 162 FLR 383; Solarite Air Conditioning Pty Ltd v York International Australia Pty Ltd [2002] NSWSC 411; Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 452; Zenaust Imports Pty Ltd v Alembic Chemical Works Co Ltd (1998) 28 ACSR 465, applied.
Genesis Management Services Pty Ltd v Soniclean Pty Ltd (2005) 240 LSJS 383; Manzo v 555/255 Pitt Street Pty Ltd (1990) 21 NSWLR 1; Powell v Brodhurst [1901] 2 Ch 160; Steeds v Steeds (1889) 22 QBD 537; Wallace v Kelsall (1840) 7 M & W 264; 151 ER 765, considered.

BENTHAM MANAGEMENT P/L v UNION FINANCE P/L
[2007] SASC 42
Full Court: Doyle CJ, Perry and Debelle JJ

DOYLE CJ: I would dismiss the appeal for the reasons given by Debelle J.
PERRY J : In my opinion, the appeal should be dismissed. I agree with the reasons published by Debelle J. I have nothing to add.
DEBELLE J: This is an appeal from an order of a Master setting aside a statutory demand.
On 1 June 2006 the appellant served the respondent with a statutory demand pursuant to s 459F of the Corporations Act 2001 (Cth). The demand sought payment of the sum of $810,000, which the schedule to the demand stated was the unpaid amount (including principal and interest) pursuant to a loan agreement dated 30 January 2004. The affidavit in support of the statutory demand simply stated that the debt was due and payable as unpaid amounts of principal and interest pursuant to a loan agreement dated 30 January 2004. The affidavit did not prove the loan agreement.
Within the period of 21 days after service of the statutory demand prescribed by s 459G of the Corporations Act, the respondent applied for an order setting aside the statutory demand and filed an affidavit in support of that application. The affidavit was sworn by Mr A De Angelis, the only director of the respondent. He said that he did not have a copy of any loan agreement dated 30 January 2004 but had an undated loan agreement between himself, the respondent and two other companies called Rateki Pty Ltd and Silgena Pty Ltd as borrowers on the one part, and the appellant and Sanville Property Developers Pty Ltd (“Sanville Property”) as lenders on the other part. The loan agreement was exhibited to the affidavit of Mr De Angelis. Although provision is made for those terms to be stated in the schedule to the loan agreement, there is nothing in the schedule which specifies either the term of the loan or the repayment date. Mr De Angelis asserted that the loan agreement contained provisions as to the rate of interest which equated to an annual interest rate of 96 per cent, a rate which, he contended, was harsh and unconscionable and contrary to s 12CC of the Australian Securities and Investments Commission Act 2001 (Cth). Mr De Angelis also proved a demand for repayment of the loan for $250,000 which demand had a note of a default interest rate of 20 per cent per month. He pointed out that there is no provision for a default interest rate in the terms of the draft loan agreement exhibited to his affidavit. He asserted that there is a genuine dispute as to the amount, if any, due by the respondent to the appellant.
On 18 August 2006, Mr F Trimboli, a clerk in the employ of the appellant’s solicitors, swore an affidavit proving a letter dated 1 June 2006 sent by him to the respondent’s solicitors. In that letter he enclosed copies of three loan agreements, one of which is the loan agreement dated 30 January 2004. He said that in that letter he had mistakenly described the agreement dated 30 December 2004. He said that his letter should have stated that the date of the agreement was 30 January 2004. He added that the agreement enclosed was in fact dated 30 January 2004. He therefore contended that the respondent had a copy of the loan agreement.
On 18 August 2006 Ms Demaria also swore an affidavit. She is the only director of the appellant, Union Finance Pty Ltd. Ms Demaria exhibited to that affidavit a document which, she said, was a copy of the loan agreement dated 30 January 2004. The parties to that loan agreement are Rateki Pty Ltd, Silgena Pty Ltd, the respondent and Mr De Angelis. She said that the copy of the loan agreement exhibited to the affidavit of Mr De Angelis was not a true copy of the loan agreement. She also asserted that the sum of $250,000 had been paid on 29 January 2006 into the trust account of a firm of solicitors in Queensland called Lynch & Associates who, she said, were the former solicitors for the respondent. The payment had been made, she said, in anticipation of the execution of the loan agreement. Although Ms Demaria says the payment of $250,000 was made on 29 January 2006, I assume she intended to say 29 January 2004. The bank statement exhibited to her affidavit shows a withdrawal on 29 January 2004 of $250,000. She asserted that nothing had been repaid and that the balance of the loan due and owing was $850,645.16. It is to be noted that there are discrepancies between the appellants’ demand dated 19 April 2004 and the agreement on which Ms Demaria relies. It does not contain any provision for a default interest rate and the term of the loan is said to be for 12 months until 30 December 2004, not for 5 months until 29 June 2004, as stated in the demand dated 19 April 2004.
On 23 August 2006 Mr De Angelis swore a second affidavit. It was in answer to the affidavits of Mr Trimboli and Ms Demaria. He denied that the loan agreement sent to the respondent solicitors was a complete copy of the purported loan agreement dated 30 January 2004. He said it was a composite of other loan agreements. In support of that contention, he pointed out that he had not signed and initialled every page of the purported loan agreement. Although provision had been made for him to initial all pages, he had neither initialled nor signed five pages. Those pages included pages 7, 8 and 9, which are the operative pages of the document in the sense that they state the parties to the agreement, the loan, the terms of the loan, and the date of repayment. Those pages are not signed nor initialled by Mr De Angelis. Mr De Angelis said that the respondent did not enter into a loan agreement with either the appellant or with Sanville Property. Mr De Angelis also stated that the respondent did not do any business in Queensland or have any reasons for funds to be paid to solicitors in Queensland. He added that he had made a report to police in Adelaide on this and other associated matters.
On 23 August 2006, Mr Trimboli swore a further affidavit. It was in answer to that sworn by Mr De Angelis on 23 August. He exhibited to that affidavit an affidavit sworn by Ms Demaria on 6 June 2006 in an action in this Court numbered 693 of 2006 between the appellant as plaintiff and Rateki Pty Ltd. In paragraphs 22 to 29 of that affidavit, Ms Demaria exhibited the same loan agreement. The loan agreement dated 30 January 2004 is alleged to be one of four loans made to Rateki Pty Ltd. In that affidavit, Ms Demaria said that the loan was made by the appellant and Sanville Property to Rateki Pty Ltd, Silegna Pty Ltd, Mr De Angelis and the respondent. She said that it was a loan of $250,000 for 12 months at a rate of interest of eight per cent per month, which equates to an interest rate of 96 per cent per annum. Thus, Ms Demaria has asserted that there are four borrowers in all. The respondent is not the only borrower.
Mr Trimboli also exhibited an affidavit sworn by Mr De Angelis in the action No. 693 of 2006 in which Mr De Angelis does not admit or deny the paragraphs in Ms Demaria’s affidavit, proving a loan agreement of 30 January 2004. The appellant sought to gain some support from that paragraph, asserting that it shows there is no genuine dispute about that loan agreement. However, it does not materially assist as Mr De Angelis states the matters in paragraphs 22 to 29 (the paragraphs referring to the loan agreement) are irrelevant to the issues in the action.
Mr Trimboli also exhibited a letter dated 23 August 2006 to the appellant’s solicitors from Mr Patrick Lynch of Lynch & Associates in which Mr Lynch stated that the sum of $250,000 was deposited into his firm’s trust account by Sanville Property. Mr Lynch does not, however, state to whom the payment was made.
The Master made an order setting aside the statutory demand and gave ex tempore reasons for his decision. He noted that, although the purported loan agreement shows that the appellant was one of two lenders, that is to say, the appellant and Sanville Property, the statutory demand had been executed on behalf of the appellant only. It had not been executed on behalf of Sanville Property Developers Pty Ltd. Referring to Manzo v 555/255 Pitt Street Pty Ltd (1990) 21 NSWLR 1, he said that it was arguable that both the appellant and Sanville Property should have signed the demand. He then went on to hold that the contention by Mr De Angelis in his second affidavit that he did not sign the loan agreement was a sufficient ground on which to set aside the statutory demand. The Master, therefore, held that the fact that the statutory demand was not signed by both lenders and the contention of Mr De Angelis that he did not sign the loan agreement, both individually and when combined, constituted sufficient grounds on which to set aside the statutory demand.
The appellant relies on two grounds of appeal. The first is that there was no genuine dispute as to the evidence or amount of the debt within the meaning of s 459H of the Corporations Act. That contention involves two subsidiary issues as to whether the first affidavit of Mr De Angelis was sufficient to raise a genuine dispute and whether the respondent can rely on the second affidavit of Mr De Angelis. The second ground of the appeal is that the statutory demand did not have to be signed by both the appellant and Sanville Property.
The question what is meant by the expression “genuine dispute” has been frequently considered. The expression denotes a plausible contention requiring investigation, raising similar considerations to the requirement of a serious question to be tried which arises on an application for an interlocutory injunction: Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785 at 787 per McLelland CJ in Eq. As Young J said in John Holland Construction and Engineering Pty Ltd v Kilpatrick Green Pty Ltd (1994) 14 ACSR 250 at 253:
It is clear that what is required in all cases is something between mere assertion and the proof that would be necessary in a court of law. Something more than mere assertion is required because if that were not so then anyone could merely say it did not owe a debt.
On the other hand, if proof of a claim was required then one would be doing the very thing that one is not to do, and that is to try this sort of dispute in the Companies Court. What more than assertion is required is something that may differ from case to case.
The question whether there is a genuine dispute requires that the dispute be bona fide and truly exist in fact and that the grounds for alleging the existence of the dispute are real and not spurious, hypothetical or misconceived: Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 452 at 464. In Solarite Air Conditioning Pty Ltd v York International Australia Pty Ltd [2002] NSWSC 411, Barrett J said that once the company shows that even one issue has a sufficient degree of cogency to be arguable, a finding of genuine dispute must follow. The various formulations of the test which have been expressed in the decided cases should not become a substitute for the words of the statute: Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd at 464.
The Court should not embark upon an extended inquiry in order to determine whether there is a genuine dispute nor attempt to weigh the merits of that dispute: Mibor Investments Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 290 at 295; Re Morris Catering (Australia) Pty Ltd (1993) 11 ACSR 601 at 605. In Eyota Pty Ltd v Hanave Pty Ltd (supra) at 787-788, McLelland CJ in Eq. expressed what the court must do in these terms:
But it does mean that, except in such an extreme case, a court required to determine whether there is a genuine dispute should not embark upon an inquiry as to the credit of a witness or a deponent whose evidence is relied on as giving rise to the dispute. There is a clear difference between, on the one hand, determining whether there is a genuine dispute and, on the other hand, determining the merits of, or resolving, such a dispute. In Mibor Investments (at 366-7) Hayne J said, after referring to the state of the law prior to the enactment of Div 3 of Pt 5.4 of the Corporations Law, and to the terms of Div 3:
These matters, taken in combination, suggest that at least in most cases, it is not expected that the court will embark upon any extended inquiry in order to determine whether there is a genuine dispute between the parties and certainly will not attempt to weigh the merits of that dispute. All that the legislation requires is that the court conclude that there is a dispute and that it is a genuine dispute.
In Re Morris Catering (Aus) Pty Ltd (1993) 11 ACSR 601 at 605 Thomas J said:
There is little doubt that Div 3 … prescribes a formula that requires the court to assess the position between the parties, and preserve demands where it can be seen that there is no genuine dispute and no sufficient genuine offsetting claim. That is not to say that the court will examine the merits or settle the dispute. The specified limits of the court’s examination are the ascertainment of whether there is a ‘genuine dispute’ and whether there is a ‘genuine claim.
It is often possible to discern the spurious, and to identify mere bluster or assertion. But beyond a perception of genuineness (or the lack of it), the court has no function. It is not helpful to perceive that one party is more likely than the other to succeed, or that the eventual state of the account between the parties is more likely to be one result than another.
The essential task is relatively simple – to identify the genuine level of a claim (not the likely result of it) and to identify the genuine level of an offsetting claim (not the likely result of it).
I respectfully agree with those statements.
In short, the Court’s task is not to seek to resolve the competing claims of the applicant or respondent but to resolve whether a genuine dispute exists or whether there is a genuine counterclaim, set-off or cross-demand. It is not to try the claim but merely to establish its genuineness: Edge Technology Pty Limited v Lite-On Technology Corporation (2000) 18 ACLC 576 at para [27].
A related question concerns the sufficiency of the affidavit in support of the application to set aside the statutory demand. Section 459G requires that the application and the affidavit in support of the application be filed within 21 days after the demand has been served. Both the application and the first affidavit of Mr De Angelis were filed within that time. The question is whether the affidavit of Mr De Angelis established that there was a genuine dispute.
The affidavit filed in support of the application to set aside the demand must disclose facts showing that there is a genuine dispute between the parties. A mere assertion that there is a genuine dispute or that the debt is disputed will not suffice. A mere claim that the debt is disputed is not sufficient. Unlike the usual function of an affidavit, it may read like a pleading. At the other extreme, the affidavit need not detail in admissible form all the evidence that supports the contention of a genuine dispute. All of those propositions were established in John Holland and in Graywinter PropertiesPty Ltd v Gas & Fuel Corporation Superannuation Fund (1996) 70 FCR 452 at 459. The principles have been repeatedly applied. The first affidavit must alert the person issuing the statutory demand to the nature of the case the company will seek to make: Elm Financial Services Pty Ltd v MacDougal [2004] NSWSC 560 at [7].
The affidavit in support of the statutory demand contained little evidence to support the demand. It is expressed in the barest terms. It merely stated that the debt due and payable was unpaid amounts of principal and interest pursuant to a loan agreement dated 30 January 2004. It does not prove the loan agreement. It does not prove that there is any lender other than the appellant. It does not prove the terms of repayment. It does not prove that the debt is payable. It does not prove demands for payment. The affidavit represents the barest compliance with s 459F. In those cases where the creditor has imperfectly articulated the statutory demand, the affidavit in support of the application to set the demand aside cannot be fairly expected to do the creditors’ job by articulating with greater particularity his response to a claim which is itself barely articulated: Zenaust Imports Pty Ltd v Alembic Chemical Works Co Ltd (1998) 28 ACSR 465 at 469; SMEC International Pty Ltd v CEMS Engineering Inc (2001) 162 FLR 383 at 387.
The initial affidavit sworn by Mr De Angelis in support of the application to set aside the statutory demand spells out in some detail the grounds on which the respondent disputes the debt. The affidavit is more than a bare denial of liability. Mr De Angelis states that he does not have a copy of a loan agreement dated 30 January 2004, the loan agreement upon which the statutory demand is based. He says that he has an undated loan agreement which has been made between different parties. Although the parties include the appellant and the respondent, there are other parties both as lenders and as borrowers. He then says that he has not received a demand for payment under the loan agreement. He disputes any liability of the respondent to the appellant. Mr De Angelis says that, although that loan agreement states that the lender has agreed to make a loan, he does not know whether a loan was ever made and, if it was, on what date that it was made or in what amount. He goes on to state that the loan agreement in his possession does not state a term for the loan nor a repayment date. The absence of the repayment date is critical. Proof of the fact that the debt is due and payable is central to the appellant’s capacity to maintain its demand for payment. The affidavit of Mr De Angelis, therefore, puts in issue the existence of the loan agreement on which the appellant grounds the statutory demand as well as whether the loan is due for repayment. There is, therefore, a genuine dispute both as to the existence of the loan and, if it exists, whether the loan is due for repayment. Given the paucity of evidence in the affidavit supporting the statutory demand, this is sufficient to raise a genuine dispute.

Stripped to essentials, this is a case where a statutory demand has been made for money said to be due on a loan agreement. The loan agreement was not proved in the affidavit supporting the statutory demand. The respondent denies that a loan agreement exists between it and the appellant. The appellant then replies by stating that the respondent is one of four borrowers, that the loan was made by Sanville Property for and on behalf of Union and was paid into the trust account of solicitors in Queensland. The respondent’s answer to that allegation is to continue to deny the loan agreement and deny that the appellant conducts business in Queensland. Throughout this dispute, the respondent points to the discrepancies between the alleged loan agreement and other documents issued by the appellant. What is particularly important is that the appellant does not link the statutory demand to the agreement which it asserts is the loan agreement pursuant to which the respondent is liable to the appellant. The loan agreement on which the appellant relies is a loan agreement between two lenders and two borrowers, not between one lender and one borrower. Furthermore, its terms are not consistent with other documents.
It was contended that the Master had not correctly applied the principles in Graywinter. His was an ex tempore judgment. When his reasons are read as a whole, it is apparent that the Master considered whether the first affidavit raised a genuine dispute. Although he referred at length to the evidence in the second affidavit of Mr De Angelis, he did so because it was an elaboration of the grounds in the first affidavit as well as being a reply to other assertions by the appellant.
Counsel for the appellant also submitted that the Master had held that the respondent did not in the initial affidavit of Mr De Angelis raise any matters capable of giving rise to a genuine dispute. He relied on the following remarks at the conclusion of the Master’s reasons:
A number of other grounds were advanced by the plaintiff to support the proposition that there was a genuine dispute as defined in the cases. The relevant law is set out clearly in the written submissions of Mr Lazarevich and I accept the authorities that he relies upon as a correct statement of the approach to be taken by the court on an application such as this.
Those submissions advanced by the plaintiff in further support of setting aside the statutory demand either taken individually or cumulatively, would not, in my opinion, constitute a proper basis for setting aside the statutory demand. However, I am of the opinion that the contention based on the second affidavit of Mr De Angelis, namely that he did not sign the agreement, which is Exhibit D1, and the other contention that in any event, the statutory demand was not signed by both lenders, are both individually and in combination sufficient to justify the granting of the application to the plaintiff.
In that passage, the Master is dealing with submissions made on behalf of the respondent, not with the sufficiency of the initial affidavit. If my understanding of that passage is mistaken and the Master did decide that the initial affidavit of Mr De Angelis did not raise a genuine dispute, I respectfully disagree with the Master for the reasons already expressed.
I turn to the appellant’s contention that the respondent should not have been permitted to rely on the second affidavit of Mr De Angelis. That contention is grounded on the fact that the initial affidavit of Mr De Angelis did not raise a genuine dispute. For the reasons already expressed, that ground must fail.
A company is at liberty to rely on a supplementary affidavit in support of its application to set aside the demand provided that the initial affidavit does in fact raise a genuine dispute: Graywinter at 460 where Sundberg J said:
In several cases it has been held that an applicant is not restricted on the hearing to the affidavit that is served with the application. See Scanhill at 467 and Mibor Investments Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 290 at 296. An applicant whose initial affidavit has satisfied the threshold test must be able to supplement the material, because while the ‘supporting’ affidavit does not have to deploy the evidence, on the hearing only admissible evidence can be relied on. In Louisbridge, Ryan J said that ‘provided that an affidavit is filed and served within the 21-day period which supports the application by providing grounds for concluding that there is a genuine dispute … or that the company has an offsetting claim’, supporting affidavits may be filed after the period has expired.
That reasoning is consistent with decisions such as Mibor Investments Pty Ltd v Commonwealth Bank of Australia at 296; and SMEC International Pty Ltd v CEMS Engineering Inc at 388. There is a substantial body of judicial opinion to the effect that, while a supplementary affidavit may adduce further evidence in support of grounds raised in the initial affidavit, the supplementary affidavit cannot introduce a new ground on which to set aside the demand for that would be to extend the 21-day period prescribed by s 459G: see Genesis Management Services Pty Ltd v Soniclean Pty Ltd (2005) 240 LSJS 383 at [63] and the decisions listed in footnote 23 in McPherson’s Law of Company Liquidation at 3.610. In the particular circumstances of this case it is not necessary to decide between these two lines of authority because, for the reasons which follow, the supplementary affidavit does no more than adduce further evidence in support of the ground in the initial affidavit that there is no loan agreement between the parties.
The second affidavit of Mr De Angelis was sworn in answer to an affidavit sworn by Mr Trimboli and to a second affidavit of Ms DeMaria. Mr Trimboli had sworn that he had provided the solicitors for the appellant with a copy of the loan agreement dated 30 January 2004. He also asserted that Sanville Property had paid $250,000 into the trust account of Lynch & Associates, solicitors in Queensland. Ms DeMaria exhibited to her affidavit the document which she asserted was the loan agreement. It was an agreement between the appellant and Sanville Property as lenders and the respondent, Rateki Pty Ltd, Silgena Pty Ltd and Mr De Angelis as borrowers. She also asserted that Sanville Property had paid the sum of $250,000 into the trust account of Lynch & Associates on 29 January 2006. The answer given by Mr De Angelis to that affidavit was to state that the copy of the loan agreement was a composite of other documents. There is a real question to be tried because some of the pages in the document bear the initials of Mr De Angelis but others, including those pages which contain the operative part of the agreement, do not. It was on that evidence that the Master relied when setting aside the statutory demand. The evidence of Mr De Angelis in his second affidavit did not raise any new ground. Instead, it was evidence which supplemented the ground taken in his initial affidavit which denied the existence of any loan agreement.
Mr De Angelis also replied to the evidence of the payment of $250,000 into the trust account of Lynch & Associates by stating that the appellant had not done any business in Queensland and had no reason to have funds paid to solicitors in Queensland. He denied that the sum of $250,000 had been paid into the trust account of Lynch & Associates on behalf of the applicant or any entity associated with it. This is not a new ground of dispute. Instead, it is but further evidence to support his contention that there is no loan agreement between the appellant and respondent.
For these reasons the Master did not err in setting aside the statutory demand.
Given this conclusion, it is unnecessary to examine the question whether the statutory demand should have been signed by or on behalf of both the appellant and Sanville Property. In Manzo v 555/255 Pitt Street Pty Ltd at 7, Hodgson J noted the common law rule that a payment to one of a number of joint creditors discharges a joint debt: see Chitty On Contracts: General Principles, 24^th ed (1977) para 192, Halsbury’s Laws of England, 3^rd ed, vol 8, para 357; Wallace v Kelsall (1840) 7 M & W 264; 151 ER 765; Steeds v Steeds (1889) 22 QBD 537 and Powell v Brodhurst [1901] 2 Ch 160. He expressed the view that it was arguable that one joint creditor could demand payment of a joint debt. I respectfully suggest that there is a real question whether that is the correct view. The principle that a payment to one of a number of joint creditors discharged the debt jointly due to all of them does not necessarily lead to the conclusion that one joint creditor can demand payment of the whole of the joint debt without the consent of the other lenders. The other lender or lenders might not consent to the demand. They might, say, have reasons which justify giving the debtor time to pay. That might apply a fortiori in the case of a statutory demand upon a company which is capable of leading to the winding up of the company. The lenders may prefer to give the borrower time to pay rather than liquidate the company. The question whether both lenders must execute the statutory demand is an issue for later determination. In any event, even if both lenders had to sign the statutory demand, it would be necessary to consider whether the failure to do so caused substantial injustice and so required the statutory demand to be set aside: see s 459J of the Corporations Act. That too is a question which need not now be considered.
For these reasons, I would dismiss the appeal.