K Young Trading Pty Ltd v Tjoi - [2009] NSWSC 260

CITATION: K Young Trading Pty Ltd v Tjoi [2009] NSWSC 260

HEARING DATE(S): 30/03/09

JUDGMENT DATE :
30 March 2009

JURISDICTION: Equity Division
Corporations List

JUDGMENT OF: Barrett J

EX TEMPORE JUDGMENT DATE: 30 March 2009

DECISION: Originating process dismissed with costs

CATCHWORDS: CORPORATIONS - winding up - statutory demand - application for order setting aside - plaintiff alleges demand not served - that is not a ground for setting aside - by resorting to s 459G, plaintiff accepts that statutory demand was served - plaintiff alleges statutory demand is an abuse of process - where another demand for same judgment debt and unassessed costs previously served - that demand withdrawn three day service of this demand - no abuse of process

LEGISLATION CITED: Corporations Act 2001 (Cth), Part 5.4, ss 459G, 459H, 459J(1)(a). (b)

CATEGORY: Principal judgment

CASES CITED: Arcade Badge Embroidery Co Pty Ltd v Deputy Commissioner of Taxation [2005] ACTCA 3; (2005) 157 ACTR 22
Emhill Pty Ltd v Bonsoc Pty Ltd [2004] VSC 322; (2004) 185 FLR 389
Gribbles Pathology (Vic) Pty Ltd v Shandford Investments Pty Ltd [2004] FCA 1466; (2004) 51 ACSR 578
Hoare Bros Pty Ltd v Commissioner of Taxation (1996) 62 FCR 302
K W & K M Quinn Investments Pty Ltd v Deputy Commissioner of Taxation [2004] QCA 91
McKay Computer Services Pty Ltd v Wi-Man Pty Ltd [2008] QFC 221
Meehan v Glazier Holdings Pty Ltd [2005] NSWCA 24; (2005) 53 ACSR 229
Mibor Investments Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 290

PARTIES: K Young Trading Pty Limited - Plaintiff
Ken Tjong Tjoi - Defendant

FILE NUMBER(S): SC 1009/09

COUNSEL: Mr C J Hockey, Solicitor - Plaintiff
Mr J Wong/Mr L L Lin, Solicitors - Defendant

SOLICITORS: Charles J Hockey - Plaintiff
Accentro Legal - Defendant

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

BARRETT J

MONDAY 30 MARCH 2009

1009/09 K YOUNG TRADING PTY LIMITED v KEN TJONG TJOI

JUDGMENT

1 By originating process filed on 5 January 2009, the plaintiff applies under

s 459G of the Corporations Act 2001 (Cth) for an order setting aside a statutory demand served on it by the defendant on 19 December 2008. The debt to which the statutory demand relates is a judgment debt. The plaintiff does not suggest that there is any dispute about the existence or amount of the debt or that it has an off-setting claim.

2 The s 459G application is advanced on two grounds: first, that the statutory demand was not served on the plaintiff, having been forwarded only by facsimile; and, second, that the statutory demand was an abuse of process. In approaching the matter I should quote in full the substantive part of the originating process:

Corporations Act

Application by the plaintiff for an order setting aside a statutory demand served on it by the defendant

On the facts stated in the supporting…

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 260
Decision Date: 30 March 2009

CaseChat Overview and Summary

K Young Trading Pty Ltd, the plaintiff, filed an application to set aside a statutory demand against Tjoi, the defendant, on the basis that the demand was not served and constituted an abuse of process. The dispute was heard in the Federal Circuit Court of Australia. The plaintiff argued that the statutory demand was invalid due to non-service and constituted an abuse of process as another demand for the same debt had previously been served and subsequently withdrawn. The defendant, in response, contended that the plaintiff's application to set aside the statutory demand was invalid as it accepted the demand was served by the terms of its application.

The court had to determine whether the plaintiff's application to set aside the statutory demand was valid. The court held that the plaintiff's acceptance of service of the statutory demand under section 459G meant it could not simultaneously argue that the demand was not served. Furthermore, the court found that the statutory demand did not constitute an abuse of process despite the previous withdrawn demand. The court reasoned that the withdrawal of the previous demand was not sufficient to constitute an abuse of process, as the plaintiff had not acted unreasonably or vexatiously.

In conclusion, the court dismissed the plaintiff's application to set aside the statutory demand. The court held that the plaintiff's acceptance of service under section 459G meant that it could not argue that the demand was not served. Furthermore, the court found that the statutory demand did not constitute an abuse of process, despite the previous withdrawn demand. The court did not make any orders in relation to costs.

Orders