Esplanade Holdings Pty Ltd v WENTWORTH Metal Group Pty Ltd
[2016] WASC 27
•2 FEBRUARY 2016
ESPLANADE HOLDINGS PTY LTD -v- WENTWORTH METAL GROUP PTY LTD [2016] WASC 27
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2016] WASC 27 | |
| 02/02/2016 | |||
| Case No: | COR:242/2015 | 22 DECEMBER 2015 | |
| Coram: | MASTER SANDERSON | 22/12/15 | |
| 9 | Judgment Part: | 1 of 1 | |
| Result: | Originating process properly filed and served | ||
| A | |||
| PDF Version |
| Parties: | ESPLANADE HOLDINGS PTY LTD WENTWORTH METAL GROUP PTY LTD |
Catchwords: | Corporations Law Application to set aside statutory demand Original affidavit in support not retained by court Original affidavit served Originating process served not having court seal or registrar's signature Whether compliance with s 459G(3) of Corporations Act 2001 (Cth) |
Legislation: | Corporations Act 2001 (Cth) Oaths, Affidavits and Statutory Declarations Act 2005 (WA) Rules of the Supreme Court 1971 (WA) |
Case References: | Australian Electoral Commission v Lalara (1994) 53 FCR 156 Chelring Pty Ltd v Coombs [2000] WASC 60 Craneford Nominees Pty Ltd v VGC Co-Operative Ltd (2012) 262 FLR 283 Emhill Pty Ltd v Bonsoc Pty Ltd (2005) 55 ACSR 379 Purden Pty Ltd v Registrar of Bankruptcy (1982) 43 ALR 512 Re Commercial Union Assurance Company (Limited) (1899) 18 NZLR 585 Sofia v Pattison (Unreported, FCA, 20 October 1997) |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
WENTWORTH METAL GROUP PTY LTD
Defendant
Catchwords:
Corporations Law - Application to set aside statutory demand - Original affidavit in support not retained by court - Original affidavit served - Originating process served not having court seal or registrar's signature - Whether compliance with s 459G(3) of Corporations Act 2001 (Cth)
Legislation:
Corporations Act 2001 (Cth)
Oaths, Affidavits and Statutory Declarations Act 2005 (WA)
Rules of the Supreme Court 1971 (WA)
Result:
Originating process properly filed and served
Category: A
Representation:
Counsel:
Plaintiff : Mr K L Christensen
Defendant : Mr J R Birman
Solicitors:
Plaintiff : Gadens Lawyers
Defendant : Birman & Ride
Case(s) referred to in judgment(s):
Australian Electoral Commission v Lalara (1994) 53 FCR 156
Chelring Pty Ltd v Coombs [2000] WASC 60
Craneford Nominees Pty Ltd v VGC Co-Operative Ltd (2012) 262 FLR 283
Emhill Pty Ltd v Bonsoc Pty Ltd (2005) 55 ACSR 379
Purden Pty Ltd v Registrar of Bankruptcy (1982) 43 ALR 512
Re Commercial Union Assurance Company (Limited) (1899) 18 NZLR 585
Sofia v Pattison (Unreported, FCA, 20 October 1997)
1 MASTER SANDERSON: This application demonstrates again, the difficulties that can arise due to the strict nature of the statutory demand regime. Section 459G of the Corporations Act 2001 (Cth) is in the following terms:
Company may apply
(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.
3 The defendant served a statutory demand on the plaintiff on 11 September 2015. To comply with s 459G(3) of the Act the application to set aside the statutory demand had to be made by 2 October 2015. On 2 October 2015 Rodney Charles Carter attended at the offices of Gadens (the plaintiff's solicitors) and swore an affidavit in support of an application to set aside the statutory demand. The same day:
(1) the original affidavit together with a copy thereof;
(2) the original originating process together with two copies thereof; and
(3) a cheque for the filing fee were taken by a Mr Ben Green to the Supreme Court central office for filing.
4 The original affidavit together with a copy, the originating process together with the two copies and a cheque were handed as a bundle to a clerk at the central office. The clerk should have retained the original originating process and stamped a copy of the originating process. He should have also handwritten in the action number and the hearing date on the copy of the stamped originating process. He should have retained the original affidavit for the court file, retained the cheque and given back to Mr Green a stamped copy of the originating process and a copy of the affidavit.
5 What in fact happened was that the clerk inadvertently retained a copy of the affidavit and gave back to Mr Green the original affidavit.
6 The originating process and the affidavit were recorded as filed on the court electronic file. The original originating process and a copy of the affidavit stamped 'filed' was placed on the court physical file.
7 After attending the central office at the Supreme Court, Mr Green according to instructions wrote in the action number and the hearing date on the copy of the originating process. He then attended the offices of the defendant's solicitors and personally served a copy of the originating process that he had hand written in the action number and hearing date and the original affidavit.
8 It is not in dispute that a copy of the originating process with a handwritten action number and hearing date and the original affidavit were personally served on the defendant's solicitors on 2 October 2015.
9 Against that background the defendant makes two submissions. First, it is alleged that an affidavit supporting the application was not filed because what was filed was a copy of the affidavit. Second, it was said that what was served was not a copy of the supporting affidavit because in fact the original was served on the defendant's solicitors. After hearing argument on this matter I determined the plaintiff's application was properly on foot. I indicated that I would publish reasons for that decision. These are those reasons. Before outlining those reasons, I should say in fairness to the defendant, counsel accepted what had happened was unfortunate and was an error made by the court staff. It was accepted the plaintiff was in no way at fault. Counsel was at pains to point out and I accept, he was not taking a pedantic point. The fact is s 459G mandates a regime and it was his submission that the regime had not been followed therefore what was at issue was the jurisdiction of the court to deal with the plaintiff's application. That point was well made.
10 The plaintiff did not dispute the defendant's submission that an affidavit supporting the application has to be a valid affidavit and a requirement of a valid affidavit is to be determined according to the laws of Western Australia. Section 9 of the Oaths, Affidavits and Statutory Declarations Act 2005 (WA) and O 37 r 2 of the Rules of the Supreme Court 1971 (WA) both set out the required form of an affidavit. In reality the defendant's complaint is not that the form of the affidavit does not comply with s 9 or O 37 r 2, rather the true complaint is that a copy of the affidavit being only a 'copy' cannot be 'an affidavit supporting the application' as required by s 459G(3). In par 5 of his written submissions, counsel for the defendant put the position as follows:
The photocopy is not 'an affidavit' within the meaning of sec 459G(3)(a) of the Act because:
5.1 it does not meet the requirement of s 9 of the Oaths, Affidavits and Statutory Declarations Act 2005 (WA) in that:
5.1.1 the person making the affidavit and the authorised witness thereto must 'sign or personal mark' the document (sec 9(3));
5.1.2 the Act does not permit a signature or personal mark to be made using a stamp (sec 15) and by analogy, a photocopy would similarly be impermissible; and
5.2 by distributing the affidavit from a copy thereof, sec 459G(3) of the Act requires the original affidavit to be filed.
11 Counsel for the plaintiff countered this argument in two ways. First, counsel pointed out the Oaths, Affidavits and Statutory Declarations Act does not allow the use of a stamp because that is not a 'signature or personal mark' of the person swearing the affidavit or the witness. Similarly if a photocopy of the signature was placed on the original document then that is not permissible. However that was not what happened in this case. In this case it is not disputed that the plaintiff and his witness did sign an original affidavit therefore the affidavit itself does comply with the Act. Second, it was submitted because s 459G(3)(a) refers to 'a copy' there must be a distinction between an affidavit and its copy, therefore the 'affidavit' in s 459G(3) means the original affidavit. Counsel pointed out the entirety of the section reads 'an affidavit supporting the application is filed with the court'. The operative word is 'filed'. So long as the document filed is an affidavit which satisfies the required format of an affidavit and it is 'filed' with the court then the section is satisfied.
12 Counsel then referred to O 1 r 4 which defines 'to file' to mean to file in the central office and 'file', 'filed' and 'filing' have corresponding meaning. The plain meaning seems to be 'filed' means the document is accepted by the central office for filing.
13 In support of this proposition counsel referred to the decision of O'Loughlin J in Australian Electoral Commission v Lalara (1994) 53 FCR 156 where his Honour adopted with approval what was said by Stout CJ in the New Zealand decision in Re Commercial Union Assurance Company (Limited) (1899) 18 NZLR 585 [588]. His Honour said:
What is the meaning of the word 'filed'? Filing, it has been said, is the means adopted of keeping Court documents. The method of filing, or of putting the documents on a file of thread, wire, or string, has, in all Courts, ... been discontinued, but the word has been kept. In its primitive meaning 'filing' means putting the documents on a file; but now documents are kept together by other methods. 'Filing' now really means depositing in a Court office.
14 Counsel referred to two other decisions in support of his position. They were Purden Pty Ltd v Registrar of Bankruptcy (1982) 43 ALR 512 and Sofia v Pattison (Unreported, FCA, 20 October 1997) which support the plaintiff's position. I need not go through these authorities in detail. It is sufficient if I say I am satisfied the original affidavit was 'filed'. It may be that the clerk, when he handed back the original of the affidavit to Mr Green, effectively 'unfiled' the document. Whether that is so or not is not to the point. The requirement of the section is that the affidavit be filed and in my view that was done.
15 Turning then to the second limb of the defendant's argument. What was really submitted was that because the original affidavit was served and not 'a copy' there had been no compliance with the section. Counsel for the plaintiff submitted this was effectively the argument advanced in Emhill Pty Ltd v Bonsoc Pty Ltd (2005) 55 ACSR 379. Emhill concerned the construction of s 109X(1)(b) of the Act which provided that:
For the purposes of any law a document may be served on a company by:
(a) ...
(b) delivering a copy of the document personally to a director of the company who resides in Australia or in an external territory ...
16 Emhill contended that the use of the word 'copy' in s 109X(1)(b) has the inescapable consequence that service of an original does not comply with the provision. Since a copy is made of or from an original it must follow (so it was argued) that the original cannot be a 'copy' for this purpose.
17 Maxwell P (with whom Callaway and Ashley JJA agreed) said:
Emhill's contention is simple. It is that the use of the word 'copy' in s 109X(1)(b) has the inescapable consequence that service of an original does not comply with the provision. Since a copy is made of or from an original, it must follow - so Emhill argues - that the original cannot be a 'copy' for this purpose.
If this construction is right, it means that, although the statutory demand itself has been served on the company, there has nevertheless not been good service - because only service of a copy would suffice. Counsel for Emhill frankly, and quite properly, conceded that such a result would be universally regarded as absurd. Counsel further conceded, properly, that it was not possible to discern any reason why parliament might have sought to distinguish, in this way, between an original and a copy of a statutory demand. I should point out that, having made these proper concessions, counsel for Emhill advanced every argument which could responsibly have been advanced on behalf of his client.
Where the adoption of a particular construction of a statutory provision would produce a manifestly absurd or inexplicable result, this will almost always indicate that the putative construction does not accord with the legislative purpose. As the High Court said in CIC Insurance Ltd v Bankstown Football Club Ltd [12] - [14].
- The court further held:
As Callaway JA pointed in argument, however, it does not follow that service of an original is therefore to be regarded as non-compliance with para (b). If it is right to regard service of the original as the highest and best form of service, and service of a copy as in that sense only second-best, then it cannot be supposed that a creditor who does more than the statute requires - by serving an original rather than a mere photocopy - fails to comply. On the contrary, in my view, where doing the lesser would suffice, doing the greater must also suffice.
Nor can there be any legitimate complaint that, by serving the original, the creditor has fallen short of 'strict compliance', as Emhill contended. The doctrine of strict compliance means that nothing less than that which the statute requires will suffice. Here, the creditor has done more than was required.
So to construe the provision will be in accordance with what appears to be the clear intent of s 109X - to facilitate service on companies. This construction is, moreover, consonant with the statement in the explanatory memorandum for the Bill which introduced Div 3 of Pt 5.4 of the Act, that the provisions were intended to ensure that disputes involving statutory demands would be resolved 'on the basis of the commercial justice of the matter, rather than on the basis of technical deficiencies' [18] - [20].
19 The defendant's allegation that a copy of the application has not been served stems from the fact that the copy served did not contain the court seal or the Registrar's signature therefore it was not a 'copy' of the originating process that the central office gave to Mr Green. As stated earlier, an additional copy of the originating process was prepared at the plaintiff's solicitors office. After filing, Mr Green wrote in the action number and the hearing date on the copy of the originating process which was served. But, the copy that was served did not contain the court seal or the Registrar's signature.
20 In Chelring Pty Ltd v Coombs [2000] WASC 60 I was satisfied an application which did not have the action number, did not have the date and time of the hearing and did not bear the seal of the court had not been served in accordance with the requirements of the section. I said:
Not without some reluctance, I have concluded that I should follow the Benonyx decision. What s 459G(3)(b) requires is a 'copy' of the application. The section does not say that what must be served is an 'exact copy'. It may then be the case that if the copy served does not contain the seal of the Supreme Court or it does not contain the action number, such omissions may be excused. But a copy of the application must, I think, by implication, 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 vital 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. In this case I am not satisfied that a copy of the application was served within the 21 days permitted by s 459G(3) and I am not therefore satisfied that an application is properly on foot [9].
21 In Craneford Nominees Pty Ltd v VGC Co-Operative Ltd (2012) 262 FLR 283 Stanley J undertook an exhaustive review of the relevant authorities. His Honour concluded:
An analysis of the authorities demonstrates that a document will satisfy the definition of a 'copy of the application' where:
(1) the copy document reflects the form of the originating process accepted by the court within the 21 day period;
(2) the copy document evidences the fact of the court’s acceptance, and hence, the fact that proceedings have been commenced, by some mark, whether it is the seal of the court, the Registrar’s signature, or some other authenticating mark such as the court stamp or action number; and
(3) the copy document records the important fact of the return date of the application [21].
22 In this case the originating process did not have the Registrar's signature or the court seal but it was in the form of the originating process filed at the central office. It contained the date the originating process was filed and the action number and it contained the return date of the application. In my view it therefore satisfied the requirements of the section and was 'a copy' of the application.
23 In conclusion, it is perhaps worth pausing to consider what would be achieved by accepting the defendant's argument in this case. It would be a triumph of form over substance. As counsel for the defendant candidly admitted there was nothing in the documents which was served on the defendant's solicitors that in any way prejudice their position. There was an unfortunate error on the part of a clerk in the central office - an error of the sort which is perhaps inevitable given the Dickensian filing system which plagues this court. But to allow that to determine the outcome of an application which clearly had merit would in my view be a travesty of justice.
24 For these reasons I determined what was a preliminary issue in favour of the plaintiff. The matter was adjourned to allow the parties to consider their position. I will hear the parties as to costs.
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