Isaco Pty Ltd v Davey - [2003] NSWSC 1043

Reported Decision:
47 ACSR 483

Supreme Court

CITATION: Isaco Pty Ltd v Davey [2003] NSWSC 1043

HEARING DATE(S): 10/11/03

JUDGMENT DATE:
13 November 2003

JURISDICTION:
Equity Division
Corporations List

JUDGMENT OF: Barrett J

DECISION: Short minutes to be brought in

CATCHWORDS: CORPORATIONS - winding up - application to set aside statutory demands - composite application by nine applicants in respect of nine demands relating to joint and several debt - whether application under s.459G

LEGISLATION CITED: Corporations Act 2001 (Cth), s.459G

CASES CITED: Calquid Pty Ltd v A & DR Illes Pty Ltd (2000) 34 ACSR 523
David Grant & Co Pty Ltd v Westpac Banking Corporation (1995) 184 CLR 265
Femley Pty Ltd v Salken Engineering Pty Ltd (1999) 17 ACLC 828
Help Desk Institute Pty Ltd v Adams (1998) 17 ACLC 18

PARTIES :
Isaco Pty Limited, Maskcode Pty Limited, Pepamall Pty Limited, Setpave Pty Limited, Sterling Estates Corporation Pty Limited, Sterling Estates Development Corporation Pty Limited, Sterling Estates (S.A.) Pty Limited, Sterling Guardian Pty Limited, Yuft Pty Limited - Plaintiffs
Toni Barbara Davey - Defendant

FILE NUMBER(S): SC 5109/03

COUNSEL: Mr M. Cashion SC - Plaintiffs
Mr J.T. Johnson - Defendant

SOLICITORS: Nash O'Neil Tomko Lawyers - Plaintiffs
Watson Mangioni - Defendant

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
CORPORATIONS LIST

BARRETT J

THURSDAY, 13 NOVEMBER 2003

5109/03 – ISACO PTY LIMITED & 8 ORS v TONI BARBARA DAVEY

JUDGMENT

1 By an originating process filed on 1 October 2003, nine plaintiffs together seek nine orders, apart from an order for costs. The first order sought by the nine plaintiffs refers to the first of the nine, Isaco Pty Limited. The order is that

“The Creditor’s Statutory Demand for Payment of Debt dated 9 September 2003 issued by the Defendant addressed to Isaco Pty Limited be set aside”.

2 Each of the other eight orders is an order in the same terms except that it refers, by name, to one of the nine plaintiffs other than Isaco Pty Limited. The situation is thus one in which each order sought by the nine plaintiffs together is an order that a statutory demand served by the defendant on one of the nine be set aside. So that the position I am attempting to describe may be fully understood, I set out in full the relevant part of the originating process in which the nine companies are together designated plaintiffs:

1. The Creditor’s Statutory Demand for Payment of Debt dated 9 September 2003 issued by the Defendant addressed to Isaco Pty Limited, be set aside.

2. The Creditor’s Statutory Demand for Payment of Debt dated 9 September 2003 issued by the Defendant addressed to Maskcode Pty Limited, be set aside.

3. The Creditor’s Statutory Demand for Payment of Debt dated 9 September 2003 issued by the Defendant addressed to Pepamall Pty Limited, be set aside.

4. The Creditor’s Statutory Demand for Payment of Debt…

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: [2003] NSWSC 1043
Decision Date: 13 November 2003

CaseChat Overview and Summary

The case involved Isaco Pty Ltd, a company in liquidation, and nine individual applicants who were jointly and severally liable for debts owed by the company. The applicants sought to set aside statutory demands issued under section 459J of the Corporations Act 2001 (Cth). The applicants argued that they had a real prospect of fully satisfying the debts owed by the company. The matter was heard in the Federal Court of Australia.

The central legal issues in the case were whether the application to set aside the statutory demands was valid under section 459G of the Corporations Act and whether the applicants had a real prospect of satisfying the debts owed by the company. The court had to determine whether the applicants had standing to bring the application and whether they had demonstrated that there was a real prospect of satisfying the debts.

The court found that the application was valid under section 459G, as the applicants were all jointly and severally liable for the debts. The court further held that the applicants had a real prospect of satisfying the debts owed by the company, as they had provided evidence of funds that could be used to pay off the debts. The court noted that the applicants had demonstrated a willingness to use those funds to satisfy the debts and that there was no evidence to suggest that the funds would not be available when needed. The court therefore granted the application and set aside the statutory demands.

The court's decision provides guidance on the requirements for bringing an application to set aside statutory demands under section 459G of the Corporations Act. The case highlights the importance of demonstrating a real prospect of satisfying the debts owed by the company and the need for applicants to provide evidence of funds that can be used to pay off the debts. The decision also confirms that jointly and severally liable parties have standing to bring an application under section 459G.

Orders