BSC Assets Pty Ltd v Sand 4 U Supplies Pty Ltd

BSC Assets Pty Ltd (the applicant) sought to set aside a statutory demand issued by Sand 4 U Supplies Pty Ltd (the respondent). The dispute concerned whether the applicant had a genuine dispute about the existence of the debt claimed in the statutory demand, or whether there were substantial grounds to set aside the demand under section 459G of the Corporations Act 2001 (Cth). The application was heard in the Supreme Court of Victoria by Justice Robert Wilson.

The primary legal issue before the Court was whether the applicant had demonstrated a "genuine dispute" regarding the debt. This required the Court to assess whether the applicant's grounds for disputing the debt were real and arguable, rather than merely a sham or a tactic to delay payment. The Court also considered whether there were other substantial grounds for setting aside the statutory demand, as contemplated by the Corporations Act.

Justice Wilson reasoned that the applicant's purported grounds for disputing the debt lacked substance and did not raise a genuine dispute. The Court found that the applicant had failed to provide sufficient evidence to support its claims of set-off or counter-claim, which were central to its argument. The legal principle applied was that a genuine dispute requires more than a mere assertion of a counter-claim; it necessitates evidence that demonstrates a real prospect of success. Without such evidence, the Court would not be satisfied that a genuine dispute existed.

The Court therefore dismissed the application to set aside the statutory demand.