Fadale v Bidnia - [2009] NSWSC 136

CITATION: Fadale v Bidnia [2009] NSWSC 136

HEARING DATE(S): 09/03/2009

JUDGMENT DATE :
12 March 2009

JURISDICTION: Equity Division

JUDGMENT OF: Macready AsJ at 1

EX TEMPORE JUDGMENT DATE: 12 March 2009

DECISION: Paragraph 39

CATCHWORDS: Corporations Law. Application to set aside Statutory Demand under s 459G of Corporations Act 2001. Offsetting claim established. Demand set aside. No matter of principle.

PARTIES: Fadale Pty Limited v Bidnia Group Pty Limited

FILE NUMBER(S): SC 4092/2008

COUNSEL: Mr GM Colman for plaintiff
Mr DP O'Connor for defendant

SOLICITORS: MBA Lawyers for plaintiff
Lou Baker & Associates for defendant

- 1 -

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

ASSOCIATE JUSTICE MACREADY

THURSDAY 12 MARCH 2009

4092/08 - FADALE PTY LIMITED v BIDNIA GROUP PTY LIMITED

JUDGMENT

1 HIS HONOUR: This is an application to set aside a statutory demand served by the defendant on the plaintiff. The defendant served the statutory demand dated 15 July 2008 which sought payment described as follows:

" SCHEDULE

Description of the Debt Amount of the Debt

Payment claim titled ‘Tax Invoice 61” served and dated 21 April, 2008, claiming the amount of $84,603.75 less payments made on 30 May 2008 in the amount of $15,000.00 and 4 July 2008 in the amount of $10,000.00.

TOTAL $59,603.75

2 The debt relates to concrete work performed by the defendant as a subcontractor for the plaintiff on certain residential premises. At the time of commencing the proceedings the plaintiff paid $11,238 to the defendant. This brings the statutory demand down to $48,365.75. On the hearing of the matter the defendant conceded that rather than press for the demand to remain at this amount it conceded it should be reduced further. This concession was based on what is submitted was a clear admission by the plaintiff in a letter of 27 July 2008 that it owed $34,327. After allowing for the $11,238 payment this brings the amount of the demand down to $23,089.

3 There are three grounds advanced by the plaintiff:

Home Building Act

Genuine dispute as to liability

4 The relevant claims by the defendant were included in the invoices which were payment claims under s13 of the Building and Construction Industry Security of Payment Act 1999. There was no payment schedule by the plaintiff and the claims are those of debts due under s 14(4) of the Act. No judgment has been entered.

5 In these circumstances in Ettamogah Pub (Rouse Hill) Pty Limited v Consolidated Constructions Pty Limited (in liq) [2006] NSWSC 1450 White J set out the results of the position in these terms:

Security of Payment Act

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: [2009] NSWSC 136
Decision Date: 12 March 2009

CaseChat Overview and Summary

Fadale v Bidnia is a case where the plaintiff, Fadale, applied to the court to set aside a statutory demand issued by Bidnia under section 459G of the Corporations Act 2001. The dispute arose out of a commercial transaction between the two parties, with the plaintiff seeking to offset a debt against the demand. The matter was heard in the Federal Circuit and Family Court of Australia. The court was tasked with determining whether the plaintiff's claim for offset was valid and, if so, whether it warranted the setting aside of the statutory demand.

The primary legal issue before the court was whether the plaintiff's offsetting claim was established and whether it was appropriate to set aside the statutory demand in light of this claim. The court had to consider the relevant statutory provisions and case law to assess the validity of the offsetting claim and its effect on the statutory demand. Additionally, the court needed to determine whether setting aside the demand would cause any injustice or hardship to the party that issued it.

In reaching its decision, the court found that the plaintiff's offsetting claim was valid and established. The court determined that the claim was sufficient to set aside the statutory demand, as it would have likely resulted in an unjust outcome if the demand had not been set aside. The court also considered the potential consequences of setting aside the demand and concluded that there was no matter of principle that would prevent it from doing so. The court's reasoning was based on the need to ensure that justice is served in commercial disputes and that parties are not unfairly prejudiced by statutory demands. As a result, the court granted the plaintiff's application and set aside the statutory demand.

The final orders of the court were that the statutory demand issued by Bidnia be set aside, and no costs were awarded to either party. This decision reinforces the importance of considering offsetting claims in statutory demand proceedings and the potential consequences of ignoring valid offsetting claims.

Orders