In the matter of Organic Paradise Pty Limited ACN 147 904 443
[2013] NSWSC 671
•23 May 2013
Supreme Court
New South Wales
Medium Neutral Citation: In the matter of Organic Paradise Pty Limited ACN 147 904 443 [2013] NSWSC 671 Hearing dates: 23 May 2013 Decision date: 23 May 2013 Before: Ball J Decision: See paragraphs 13 and 14 of this judgment.
Catchwords: CORPORATIONS - application to set aside a statutory demand under Corporations Act 2001 (Cth) s 459G - whether a genuine dispute as to the existence of the debt. Legislation Cited: Corporations Act 2001 (Cth) Cases Cited: Graywinter Properties v Gas & Fuel Corporation Superannuation Fund (1996) 70 FCR 452 Category: Principal judgment Parties: Organic Paradise Pty Limited ACN 147 904 443 (Plaintiff)
Just Organics (Aust) Pty Limited ACN 138 419 888 (Defendant)Representation: TJ Morahan (Plaintiff)
C Stomo (Defendant)
Lang Noonan Legal (Plaintiff)
File Number(s): 2012/357298 Publication restriction: Nil
EX TEMPORE Judgment
Before me is an application to set aside a statutory demand under s 459G of the Corporations Act 2001 (Cth) on the ground that there is a genuine dispute about the existence of the debt the subject of the demand. The demand is dated 29 October 2012. It claims a sum of $20,000 as "monies owing by the company to the creditor pursuant to an agreement made between the company and the creditor on the 8 October 2012".
Following the receipt of the statutory demand the solicitors for the plaintiff wrote to the defendant asking for details of the claimed debt. The defendant responded to that letter on 12 November 2012. In that response, which was written by Mr Pasquale Coppolaro, a director of the defendant, it says, in essence, that there was a meeting on 8 October 2012 at which Mr Brett Smith was acting as mediator. Also present were Mr Eric Jury, a director of both the plaintiff and the defendant, Mr Coppolaro, and Mr Peter Melov, a director of the plaintiff.
The third bullet point of the letter dated 12 November 2012 describes the circumstances in which the agreement was reached in these terms "Pete Melov made the offer to pay $20,000 by the end of the week, $80,000 by the end of December and a total of $300,000 as set out in the letter of acceptance signed by me". The reference to "me" is a reference to Mr Coppolaro. The letter goes on: "The letter of acceptance is the first payment of $26,500, however, Mr Melov's offer was $20,000 by the end of that week".
In an affidavit in support of the application to set aside the statutory demand, Mr Melov gives some background to the dispute that is said to have been settled at the meeting on 8 October 2012. As Mr Stomo, who appeared for the defendant, pointed out, the circumstances of that dispute are not really relevant to the question whether an agreement was reached on 8 October 2012. Mr Melov also says in his affidavit that the plaintiff was registered on 16 December 2010 and commenced trading in February 2011.
In addition, Mr Melov gives the following account of the meeting on 8 October 2012:
On 8 October, 2012, Brett Smith, Eric Jury and Pasquale Coppolaro entered my shop at 244 Oxford Street, Bondi Junction and demanded that I pay Pasquale Coppolaro $300,000.00. Any offer allegedly made on 8 October, 2012 could not be legally enforced as there was no consideration for same and it was made under duress. Any agreement allegedly made at that time is denied.
No other evidence is given concerning the meeting that occurred on 8 October 2012.
There is no dispute between the parties concerning the relevant legal principles. The affidavit in support of the application to set aside a statutory demand must provide sufficient material so that the court can be satisfied that there is a real and not spurious or hypothetical dispute concerning the existence of the debt. General assertions such as the assertion in paragraph 10 of Mr Melov's affidavit that the agreement was not made is not sufficient: Graywinter Properties v Gas & Fuel Corporation Superannuation Fund (1996) 70 FCR 452 at 459.
The real issue it seems to me in this case is whether Mr Melov's affidavit raises sufficient factual material for the court to form a view that there is a genuine dispute about whether the plaintiff was a party to the agreement said to have been reached on 8 October 2012.
There seemed to me to be a number of factual matters which are relevant to that question. One is that Mr Coppolaro says in his letter dated 12 November 2012 that "Pete Melov made the offer to pay $20,000 by the end of the week".
Another relevant matter is the fact that the dispute said to have been settled on 8 October 2012 appears to have been a dispute that arose in or about September 2010 between Mr Coppolaro and Mr Melov in relation to the trading activities of the defendant.
A third relevant matter is the fact that the plaintiff was not registered until 16 December 2010 which appears to be either after, on Mr Melov's evidence, or at least at the time the dispute arose which ultimately is said by the defendant to have lead to the settlement.
A fourth factual matter is that Mr Melov deposes in his affidavit to the fact that Mr Smith, Mr Jury and Mr Coppolaro entered the shop at 244 Oxford Street, Bondi Junction and demanded that "I" pay Mr Coppolaro $300,000.
Although in my view the evidence before the court is very unsatisfactory, the evidence I have referred to raises at least a genuine dispute about whether any agreement that was reached on 8 October 2012 was reached between the defendant and the plaintiff or the defendant and Mr Melov.
In those circumstances I think it is appropriate that the statutory demand be set aside. I make an order to that effect.
The plaintiff also sought an order for costs. In my opinion the affidavit in support of the application is poorly drawn. It gave the court no understanding of what happened to give rise to the dispute or what happened on 8 October 2012. It is only by piecing together facts from various parts of the affidavit that I have been satisfied that there is sufficient evidence to establish a genuine dispute. In those circumstances, the appropriate order is that each party pay its own costs.
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Decision last updated: 04 June 2013
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