H'var Steel Services Pty Ltd v Matthew Craig Pty Ltd t/as M 'N' M Rigging Services
[2013] WASC 106
•28 MARCH 2013
H'VAR STEEL SERVICES PTY LTD -v- MATTHEW CRAIG PTY LTD t/as M 'N' M RIGGING SERVICES [2013] WASC 106
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2013] WASC 106 | |
| Case No: | COR:8/2013 | 21 MARCH 2013 | |
| Coram: | MASTER SANDERSON | 28/03/13 | |
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Demand set aside | ||
| B | |||
| PDF Version |
| Parties: | H'VAR STEEL SERVICES PTY LTD (ACN 089 442 599) MATTHEW CRAIG PTY LTD t/as M 'N' M RIGGING SERVICES (ACN 245 315 751) |
Catchwords: | Corporations Act 2001 (Cth) Application to set aside statutory demand Offsetting claim Turns on own facts |
Legislation: | Nil |
Case References: | Broke Hills Estate Pty Ltd v Oakvale Wines Pty Ltd (2005) 23 ACLC 1266 Calquid Pty Ltd v A & DR Illes Pty Ltd (2000) 34 ACSR 523 Graywinter Properties Pty Ltd v Gas & Fuel Corp Superannuation Fund (1996) 70 FCR 452 Sacon Constructions Pty Ltd v Concrite Quarries Pty Ltd (1997) 15 ACLC 1303 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
MATTHEW CRAIG PTY LTD t/as M 'N' M RIGGING SERVICES (ACN 245 315 751)
Defendant
Catchwords:
Corporations Act 2001 (Cth) - Application to set aside statutory demand - Offsetting claim - Turns on own facts
Legislation:
Nil
Result:
Demand set aside
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr J D Maclaurin & Mr A K Searle
Defendant : Mr J F Park
Solicitors:
Plaintiff : Doyles Construction Lawyers
Defendant : Park Linfoot Legal Solutions
Case(s) referred to in judgment(s):
Broke Hills Estate Pty Ltd v Oakvale Wines Pty Ltd (2005) 23 ACLC 1266
Calquid Pty Ltd v A & DR Illes Pty Ltd (2000) 34 ACSR 523
Graywinter Properties Pty Ltd v Gas & Fuel Corp Superannuation Fund (1996) 70 FCR 452
Sacon Constructions Pty Ltd v Concrite Quarries Pty Ltd (1997) 15 ACLC 1303
(Page 3)
1 MASTER SANDERSON: This is the plaintiff's application to set aside a statutory demand. The application is supported by an affidavit of Ante Jamie Jerkovich sworn 15 January 2013. Mr Jerkovich is a director of the plaintiff. Appearing as annexure E to that affidavit is a copy of the demand.
2 In the schedule to the demand under the subheading 'Description of Debt' there appears the following:
Monies due and owing for rigging services provided to the company for the erection of steel between 14 April 2012 and 10 June 2012 respectively and invoices rendered thereto.
3 There then follows a list of 28 invoices and an acknowledgement of payment of a specified sum. The amount of the demand is $97,388.50.
4 The operative part of Mr Jerkovich's affidavit is brief. It reads as follows:
2. On or about 2006 Matthew Craig Pty Ltd T/A M 'N' M Rigging Services ['the Defendant'] was contracted by the Plaintiff to provide rigging services on a job by job basis.
3. During the period of 14 April 2012 to 10 June 2012 ['the period'] the Defendant issued invoices to the Plaintiff for works purported to be completed. Annexed hereto and marked 'A' is a true copy of a Schedule setting out the dates and amounts of invoices rendered.
4. On or about 31 October 2012 the Plaintiff imposed a contra charge. Annexed hereto and marked 'B' is a true copy of that correspondence imposing the contra charge.
5. Prior to the period and during the period, the Defendant undertook to complete an erection of a Tower Crane ['the Crane Works'] for the Plaintiff.
6. The Defendant did not complete the crane works satisfactorily which required rectification works and caused delay to completing those works.
7. The Plaintiff undertook to complete the rectification works at its' own cost.
8. The Plaintiff is subject to backcharges being imposed by a third party by reason of the unsatisfactory crane works, which are to be finalised in March/ April 2013 but are estimated to be in excess of $100,000 and are attributable to the Defendant. Annexed hereto and marked 'C' is a true copy of correspondence from the third party advising of the estimation of backcharges.
(Page 4)
- 9. On or about 28 November 2012 I notified the Defendant of the backcharges which will be imposed and advised that the Plaintiff would be seeking to recover these from it. Annexed hereto and marked 'D' is a true copy of that correspondence.
5 Of particular importance is annexure C which is referred to in par 8 of Mr Jerkovich's affidavit. That is an email from one Michael Abrusci to Mr Jerkovich sent on 15 May 2012. It reads as follows:
Anthony,
We are in receipt of your Tax Invoice # 2758P1 in the amount of $15,000.00 plus GST for works relating to the tower crane on the above project.
We advise that the delay's caused by you (which have all been previously documented & advised to you) currently stand in excess of $100,000.00 & rising on a daily basis due to your inactions in rectifying your tower crane which is still not operating to it's designed capacity.
We advise that your invoice will not be paid & will be offset against the daily damages as stated in your contract.
Once the full extent of your delays to the project is determined, you will be issued with a statement of account in accordance with the contract which identifies the full extent of costs which will be levied against your account.
Regards,
6 While Mr Jerkovich's affidavit is brief to the point of being cryptic it is reasonably clear what is alleged. Since 2006 the defendant has undertaken rigging work for the plaintiff. In 2012 the plaintiff had a contract with a firm known as JAMAC Construction Group. It was required to erect a crane. It engaged the defendant to do the rigging. The rigging was not properly done and JAMAC made a claim against the plaintiff. Although not precisely quantified the claim was at least $100,000 and more. The plaintiff says the faulty rigging was the fault of the defendant. It therefore says it has an off-setting claim equal to or greater than the amount of the statutory demand and the demand ought be set aside.
7 It was the defendant's position the plaintiff's affidavit was wholly inadequate. Counsel submitted it did not set out the material facts which would allow an assessment of the contractual arrangement between the plaintiff and the defendant or the contractual relation between the plaintiff and JAMAC. Further it did not set out the facts which gave rise to the claim against the plaintiff by JAMAC and did not detail how the
(Page 5)
- defendant might be responsible for any losses JAMAC incurred. In other words the first line of defence was to say the application was incompetent because it was not supported by an adequate affidavit.
8 There is no doubt there is a jurisdictional requirement there be a valid affidavit in support of the application. In Calquid Pty Ltd v A & DR Illes Pty Ltd (2000) 34 ACSR 523 Santow J put the position this way:
Furthermore, there is the jurisdictional matter that the affidavit must be a sufficient explanation of the grounds for concluding that there is a genuine dispute. An affidavit that is fundamentally insufficient cannot be supplemented at a later date, though supplementation to a lesser degree is otherwise possible: ... . Thus it must at least contain a statement of the material facts relied upon and if so drafted measure up as if a pleading: ... [49] (531).
9 Furthermore it is necessary that the affidavit must provide sufficient material indicating the nature of the off-setting claim and the way in which it is calculated: see Broke Hills Estate Pty Ltd v Oakvale Wines Pty Ltd (2005) 23 ACLC 1266; Sacon Constructions Pty Ltd v Concrite Quarries Pty Ltd (1997) 15 ACLC 1303 (Emmett J).
10 In my view the plaintiff's affidavit in support of the application in all respects satisfies the jurisdictional requirements of s 459G(3)(a) of the Corporations Act 2001 (Cth). What emerges from the affidavit I have set out above. No fair reading of what Mr Jerkovich says could leave the reader in any doubt as to the basis upon which it is said there is an off-setting claim. The plaintiff also gives an indication of the quantum of the claim although it is not precisely quantified. But in the circumstances it could not be precisely quantified. What can be ascertained is the amount of the off-setting claim is greater than the amount of the statutory demand.
11 In further support of its position the plaintiff filed a second affidavit of Mr Jerkovich sworn 27 February 2013. Counsel for the defendant objected to large parts of this affidavit on various grounds. But the prime objection was the affidavit introduced new material and offended what is these days referred to as the 'Graywinter principle': see Graywinter Properties Pty Ltd v Gas & Fuel Corp Superannuation Fund (1996) 70 FCR 452. For reasons which follow I am not satisfied that submission is made out.
12 There is no doubt in his second affidavit Mr Jerkovich goes into considerably more detail about the circumstances in which the plaintiff
(Page 6)
- entered into its contract with the defendant and what allegedly went wrong. In par 5 of the affidavit he says the plaintiff contracted with JAMAC for the erection, hire and dismantling of a crane. He provides a copy of the subcontract. Importantly he says in April 2012 the plaintiff delivered the base of the crane to the site and installed it (par 7). In pars 8 - 11 he identifies the defendant and gives a brief outline of his past dealings with the firm. In pars 12 - 13 he refers to a meeting between himself and a Mr Matthew Craig of the defendant which sets out the conversation which led to the contractual relationship between the plaintiff and the defendant. It appears to have been a brief discussion. In the real commercial world that is the way things are so often done. It is the plaintiff's position that is the way it was done in this case.
13 Between pars 14 - 33 of the affidavit Mr Jerkovich sets out the fact the crane was erected by the defendant and the fact it was erected in an unsatisfactory fashion. There seems to be no doubt the crane was not properly erected. There also seems to be no doubt the problem was the base. There is a dispute between the parties as to who was responsible for any problems which arose.
14 In an attempt to solve the problems with the crane a firm of engineers were engaged. Appearing as annexure AJ-004 to Mr Jerkovich's second affidavit is an email from Mr Chris Cable of the engineers Robert Bird Group Pty Ltd to Mr Jerkovich. The email reads (in part) as follows:
This morning I also discussed the tensioning of the bolts into the concrete base with your rigger. He used a quarter turn with a wrench which doesn't achieve the required tension forces at lock-off as nominated on the drawings. I have been advised that a third of a turn is necessary to achieve the required stress, and hence these bolts should be retensioned. It would be safest to do this following removal of the crane.
I am concerned with the approach taken by your rigger. This is a high-risk operation and getting the base set-up correctly is critical to the safe and efficient performance of the carne [sic]. Taking risks, like erecting the crane without the holddown bolt arrangement being complete, is dangerous. I would recommend that further supervision of the site is required to prevent further issues like this arising.
15 Mr Jerkovich's affidavit also details attempts he has made to ascertain with more precision what claim may be made against the plaintiff by JAMAC. But JAMAC have been uncooperative. All they have said is they stand by their original claim and regard their entitlement to damages as ongoing.
(Page 7)
16 In my view Mr Jerkovich's second affidavit is entirely consistent with his first affidavit. It is more expansive but it does not raise a new issue or say anything which is materially different from what is contained in the first affidavit. It provides more detail, but it is permissible for a supplementary affidavit to do so. The basis upon which it is said there is an off-setting claim remains as it was in the first affidavit.
17 In opposition to the application the defendant filed an affidavit of Matthew Gibbings sworn 20 February 2013. This affidavit joins issue with many of the claims made by the plaintiff. But as both counsel agree it is not the function of the statutory demand procedure to resolve disputes of fact or to determine matters of liability. The sole question is whether or not the plaintiff is able to establish the plaintiff has an off-setting claim equal to or greater than the amount of the statutory demand. In this case I am so satisfied. I am satisfied the original affidavit of Mr Jerkovich establishes the jurisdictional basis for the application and I am satisfied the evidence found in Mr Jerkovich's two affidavits shows the plaintiff has an off-setting claim equal to or greater than the amount of the demand.
18 For these reasons I would set aside the statutory demand. I will hear the parties on the question of costs.
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