Golf Links Estate v L.J. Williams

[2001] NSWSC 603

CITATION:	Golf Links Estate v L.J. Williams [2001] NSWSC 603
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	SC 4632 of 2000
HEARING DATE(S):	6 July 2001
JUDGMENT DATE:	6 July 2001
PARTIES :	GOLF LINKS ESTATE BLACKHEATH PTY LIMITED v LJ WILLIAMS EARTHMOVING PTY LIMITED
JUDGMENT OF:	Master Macready at 1

COUNSEL :	J.T. Johnson for defendant
SOLICITORS:	Mr M. Foley for plaintiff of Foleys Solicitors. Macedone, Christie Willis for defendant
CATCHWORDS:	Corporations Law. Application to set aside statutory demand. Demand set aside. No matter of principle.
DECISION:	Paragraph 17

1 MASTER: This is an application to set aside a demand under s 459G of the Corporations Law. Demand was served by the defendant on the plaintiff in respect of an amount of $36,843. The description of the debt in the demand is as follows:

"Judgement debt obtained in the Local Court at Sutherland in proceedings 1661 of 1991 against Lee Bagshaw, the liability for such debt having been assigned to the Debtor by operation of Section 8 of the Contractors Debts Act 1997 by reason of the service of a Debt Certificate and Notice of Claim on the Debtor on or about 23 August 2000."

2 The evidence in this matter shows that there was an order in the Fair Trading Tribunal on 14 October 1999. The parties in those proceedings were described as L J Williams Earthmoving Pty Limited, the plaintiff or applicant, which is of course the defendant in those proceedings. The defendant or respondent was a person called Lee Bagshaw. An order was made that Lee Bagshaw pay $36,760 to L J Williams Earthmoving Pty Limited. The evidence shows on 8 November 1999 that order was registered with the Local Court at Sutherland. It therefore became an order of the Local Court pursuant to s 47 of the Fair Trading Tribunal Act 1998.

3 There was a motion taken out in those proceedings on 2 August 2000 by the defendant L J Williams Earthmoving Pty Ltd. That motion was taken out for a certificate under s 7 of the Contractors Debts Act 1997. That motion was not served on the plaintiff nor was it served on Mr Bagshaw as he has subsequently been identified. As a result of that motion a certificate was issued pursuant to the section.

4 S 7.(1) provides that when judgment is given or entered up in the proceedings relating to the recovery of money owed to a person for work carried out or materials supplied, the Court may by order made on the application of the person in whose favour the judgment is given, issue a certificate (a debt certificate) in respect of the debt under this section. That certificate was served on the plaintiff on 23 August 2000. The effect of that service is provided for in s 8 of the Contractors Debts Act 1997. That section, as far as relevance, is as follows:

" 8 Notice of claim operates as assignment of debt

(1) Service of a notice of claim on the principal operates to assign to the unpaid person the obligation of the principal to pay the money owed under the contract to the defaulting contractor.

(2) The assignment is limited to the amount of the unpaid person's certified debt."

5   Accordingly the effect of service was to assign the debt that was due to Lee Bagshaw to the defendant. In other words the debt is now due to the defendant rather than the person Lee Bagshaw.

6   There have also been other proceedings in which the parties are concerned, 2204/00, which were proceedings in which William L Backhouse Pty Limited proposed to wind up the plaintiff in the present proceedings. There was an application by the defendant in the present proceedings as supporting creditor in those proceedings. That application was compromised and the consent orders were as follows:

“1. The defendant will pay to the supporting creditor, L J Williams Earthmoving Pty Limited the sum of $36,843.00 of the first drawdown of loan funds expected to be obtained on or before 31 August 2000.

2. The summons is dismissed.

3. There be no order as to costs.”

7   It can be seen the summons was dismissed.

8 There are a number of points raised by the plaintiff as to why there is a genuine dispute. The first point is that Mr Bagshaw's name in the Fair Trading Act proceedings is shown as Lee Bagshaw, whereas there is evidence given by Mr Leith Gordon Bagshaw in these proceedings that he has never been known as Lee. Secondly, Mr Bagshaw gave evidence and says he was bankrupt in 1993 and has not been discharged. Thirdly, it is said there is no service of the motion for the certificate for the obtaining of the certificate under s 7. Fourthly, there is no service of Fair Trading Act papers on the Mr Bagshaw, who gave evidence. Fifthly, the matter is covered by the short minutes and the condition precedent to payment has not been satisfied.

9   I turn and deal with the first point as to the identity of Mr Bagshaw. The evidence before me which concerned the relevant supply of the goods and services included an order signed by Mr Leith Bagshaw, who gave evidence, addressed from L J Williams Earthmoving Pty Limited No 1010 and it was an order to commence work. The customer was there shown as Glen Lee Civil Eng. Licence No 31500. Mr Leith Bagshaw said that he was the person who received or was involved in these supplies. Clearly it would seem to me that we are not here dealing with a question of substance where there might have been some mistaken identity. The relevant works in question, including the connection to the plaintiff in the present proceedings, is established.

10   A difficulty with a name is always curable in proceedings, for example even amendments to names where there has been a misnomer, does not attract the rule in Wilson v Neal and if there was some mistake it could no doubt be corrected if necessary. However, what I have to look at is the possibility of a genuine dispute and I am satisfied that there is no question of misnomer or other mistaken identity. We are not dealing with whether the relevant work was performed but a problem of someone's christian name.

11   As far as points 2 and 4 are concerned, namely that Mr Bagshaw was a bankrupt, and also no service of the Fair Trading papers on Mr Lee Bagshaw, there is a problem legally with that argument in this area. The evidence about non-service was given by Mr Bagshaw in the box. However, there has been no application, notwithstanding that these proceedings have been on foot and have had preliminary hearings on other points some months ago, to set aside the proceedings.

12   The importance of this arises from the effect that a judgment has in a court such as the Local Court. In Barclays Australia Finance Pty Limited 21 ACSR 235 at 238, the Chief Judge in Equity had the following to say:

"The assertion that there is a genuine dispute about the existence of the debt is in turn based on two grounds. The first relies on the existence of the undetermined appeal, in which orders are sought by Dan (inter alia) that the proceedings brought by Gaffikin Marine be dismissed and that Gaffikin Marine pay the costs of those proceedings. If the appeal succeeds, it is possible that the costs orders of 16 July 1995 (including the order against Barclays, although it is not an appellant) may be set aside. The answer to this submission is that the possibility that a presently existing and enforceable debt may be set aside in the future pursuant to a subsisting appeal does not give rise to a genuine dispute about the existence of the debt within the meaning of s 459H; see eg Hoare Bros Pty Ltd v DCT (1995) 16 ACSR 213; 13 ACLC 358; Wilden Pty Ltd v Greenco Pty Ltd (1995) 13 ACLC 1039. The position would of course be different if there were a stay of proceedings under, or stay of execution of, the costs order against Barclays, but there is not, and in the absence of any such stay and notwithstanding the pendency of the appeal, the costs orders of 16 July 1995 against Barclays (together with the judgment of 165 May 1996), unless and until set aside on appeal, operate as res judicata determining the matter of Barclays' costs liability to Gaffikin Marine; see Spencer-Bower & Turner Res Judicata 2nd ed p 144; Lahoud v B & M Quality Constructions (22 July 1994, SC(NSW) McLelland CJ in Eq, unreported).

13   In the present case there has been no stay in respect of either the Local Court proceedings or in the Fair Trading Tribunal. Similarly, this will also be an answer to the question of Mr Bagshaw saying that he has been bankrupt. The evidence is simply, just that he went bankrupt and he has not been discharged. Without going into the timing of it, it would seem that that also would be a matter which would be a matter for defence and which would lead, if anything, to the setting aside of the proceedings in due course. But the point of the matter is that until there is either a stay or there is a setting aside of the relevant orders, the judgment is conclusive.

14   There was a point taken on the failure to serve the motion. Firstly, there is no reason to serve it on Mr Bagshaw as it does not concern him. The matter is between the applicant, the third party, and the plaintiff. So far as service on the plaintiff is concerned, I would have thought it may be regarded as an administrative matter and even if it should have been regarded as appropriate to give notice to the plaintiff against whom the certificate was to issue, the defect is also covered by the conclusiveness of what followed. No doubt there should have been some application to set aside the granting of the certificate if it was going to be seriously contended by the plaintiff to the Local Court that there had been a misnomer. In the circumstances of the factual surroundings of this case it seems unlikely that such a case would have succeeded.

15 That leaves the remaining point which is the question of the short minutes. The defendant makes it clear that it claims it is a creditor on two bases. One of them is the one I have already been articulating, which is the claim pursuant to the assignment under the Contractors Debts Act, and the other is a separate agreement which apparently is for some consideration in some other piece of litigation which was to lead to some payment.

16   In my view, given that the basis of the claim is as expressed in the demand, the matter can really be looked at from the perspective of the basic claim. All that seems to have been obtained in respect of the short minutes is that the applicant there consented to the summons being dismissed which means withdrawing his claim in return for some promise. It does not seem to me that on the face of it involves a foregoing of his claim pursuant to the Contractors Debt Act.

17   Accordingly I dismiss the summons and order the plaintiff to pay the defendant's costs.

18 There is an application to shorten the time which runs under s459F(2) of the Corporations Law. It is suggested that because the matters have been run together and were set down to be heard together, that an order abridging the time ought to be made. Having regard to the time of day I think it is inappropriate and also having regard to the fact that there is no other pressing reason advanced why the winding-up hearing should not take place after the seven days expired.

19   I think it would be preferable in this matter to stand it over for a short time before me so I can deal with the matter.

20   I will direct that notice of any other ground in opposition in matter 1463/01 be given prior to 13 July and any other evidence which either party wishes to rely on be filed and served on or before 13 July 2001.

oOo

Last Modified: 07/23/2001