Burdon Pty Ltd v Gillford Pty Ltd - [1995] FCA 1096

CORPORATIONS - Statutory Demand - whether a genuine dispute between the parties as to the existence or amount of the debt the subject of the demand - inappropriateness in all the circumstances of deciding the ultimate issue between the parties.

PRACTICE & PROCEDURE - Evidence - whether evidence of expert witness admissible where basis of expert opinion not set out.

Corporation Law: s459H(1).

Chase Manhattan Bank Australia Limited v OSCTY Pty Limited (1995) 17 ACSR 128; discussed.
Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785; discussed.
Arnotts Limited v Trade Practices Commission (1990) 24 FCR 313; followed.

BURDON PTY LTD v GILLFORD PTY LTD

No NG 571 of 1995

Davies, Hill & Whitlam JJ
Sydney
21 December 1995

IN THE FEDERAL COURT OF AUSTRALIA )
  )
NEW SOUTH WALES DISTRICT REGISTRY )     No NG 571 of 1995
  )
GENERAL DIVISION                  )

ON APPEAL FROM A SINGLE JUDGE
OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:BURDON PTY LTD

Appellant

AND:GILLFORD PTY LTD

Respondent

CORAM:    DAVIES, HILL & WHITLAM JJ
PLACE:    SYDNEY
DATED:    21 DECEMBER 1995

MINUTES OF ORDER

THE COURT ORDERS THAT:

Appeal allowed.

Orders made by the trial judge on 26 July 1995 be set aside and in lieu thereof it be ordered that:

(a)the statutory demand served by Gillford Pty Ltd on Burdon Pty Ltd be set aside; and

(b)that Gillford Pty Ltd pay the costs of the application.

Gillford Pty Ltd pay the costs of the appeal.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA                 )
  )
NEW SOUTH WALES DISTRICT REGISTRY               ) No G 571 of 1995
  )
GENERAL DIVISION  )

On appeal from the a single judge of the Federal Court of Australia

BETWEEN: BURDON PTY LTD
Appellant

AND: GILLFORD PTY LTD

Respondent

Coram:           Davies, Hill & Whitlam JJ
Date:              21 December 1995
Place:              Sydney

REASONS FOR JUDGMENT

Davies J:- This is an appeal from an order made by a judge of the Court, in which his Honour dismissed an application that a statutory demand served under s.459E of the Corporations Law be set aside. The issue before his Honour was whether there was a genuine dispute as to the claim made: see s.459H(1) Corporations Law.

The parties had resolved disputes which had arisen between them and had agreed, inter alia, that certain trading losses should be determined by an independent expert. Agreed procedures determined by the parties provided, inter alia:-

"3.(a) All communications between Gillford Pty Ltd (`Gillford') or Burdon Pty Ltd (`Burdon') and the nominee shall be in writing. Other than as set out herein, Gillford, Burdon or any person acting on behalf of either (each of which is hereafter referred to as `a party') shall not communicate with the nominee.

...

(e)The nominee may make written request to Gillford to provide to the nominee such information as the nominee directs and Gillford so directed shall furnish, in…

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: [1995] FCA 1096
Decision Date: 21 DECEMBER 1995

CaseChat Overview and Summary

The case of Burdon Pty Ltd v Gillford Pty Ltd involved a dispute regarding a statutory demand for payment issued under section 459E of the Corporations Act 2001. The defendant, Gillford Pty Ltd, contested the demand asserting that there was a genuine dispute over the existence or amount of the debt claimed by Burdon Pty Ltd. The matter was heard in the Federal Court of Australia.

The primary legal issue before the court was whether the defendant's contention of a genuine dispute was sufficient to prevent the statutory demand from being enforced. This required the court to examine the evidence presented to determine if such a dispute existed. Another issue was whether the expert evidence provided by the defendant was admissible, as it was argued that the basis of the expert's opinion was flawed. The admissibility of this evidence was crucial in resolving the dispute.

The court held that the defendant had established a genuine dispute concerning the amount of the debt, thereby preventing the statutory demand from being enforced. The court found that the evidence provided by the defendant was sufficient to show that there was a real and substantial controversy regarding the debt's existence and amount. In relation to the admissibility of the expert evidence, the court ruled that it was appropriate, as it was based on the expert's professional experience and the information available at the time. The court concluded that the evidence was relevant and could assist in determining the existence of the genuine dispute.

The final order of the court was that the statutory demand issued by Burdon Pty Ltd was not enforceable due to the genuine dispute over the amount of the debt, as demonstrated by Gillford Pty Ltd.

Orders