KMG Logistics Pty Ltd v Transhipment Services Australia Pty Ltd
[2015] WASC 370
•6 OCTOBER 2015
KMG LOGISTICS PTY LTD -v- TRANSHIPMENT SERVICES AUSTRALIA PTY LTD [2015] WASC 370
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2015] WASC 370 | |
| Case No: | COR:82/2015 | 11 AUGUST 2015 | |
| Coram: | MASTER SANDERSON | 6/10/15 | |
| 5 | Judgment Part: | 1 of 1 | |
| Result: | Demand set aside | ||
| B | |||
| PDF Version |
| Parties: | KMG LOGISTICS PTY LTD TRANSHIPMENT SERVICES AUSTRALIA PTY LTD |
Catchwords: | Corporations law Application to set aside statutory demand Turns on own facts |
Legislation: | Corporations Act 2001 (Cth) |
Case References: | Barnes v Addy (1874) LR 9 ChApp 244 Chan v Zacharia (1984) 154 CLR 178 Green & Clara Pty Ltd v Bestobell Industries Pty Ltd (1982) WAR 1 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
TRANSHIPMENT SERVICES AUSTRALIA PTY LTD
Defendant
Catchwords:
Corporations law - Application to set aside statutory demand - Turns on own facts
Legislation:
Corporations Act 2001 (Cth)
Result:
Demand set aside
Category: B
Representation:
Counsel:
Plaintiff : Mr D J Pratt
Defendant : Mr S B Rosewarne
Solicitors:
Plaintiff : Jackson McDonald
Defendant : Tottle Partners
Case(s) referred to in judgment(s):
Barnes v Addy (1874) LR 9 ChApp 244
Chan v Zacharia (1984) 154 CLR 178
Green & Clara Pty Ltd v Bestobell Industries Pty Ltd (1982) WAR 1
1 MASTER SANDERSON: This was the plaintiff's application to set aside a statutory demand. A copy of the demand appears as attachment CH1 to the affidavit of Chi-Haidong sworn 20 April 2015 and filed in support of the application. The amount of the demand was $752,226.57. The 'Description of the Debt' found in the schedule to the demand is in the following terms:
Total of the amounts outstanding on the unpaid tax invoices set out below which were rendered by the creditor for services the creditor provided to the company in the period 2 February 2015 to 25 February 2015.
2 There was no dispute between the parties as to the relevant facts. The Ridges Iron Ore Project was purchased by the plaintiff and Kimberley Metals Group Pty Ltd in December 2008. Mr Ian Junk and Mr Darren Hedley are the current directors of the defendant. Mr Junk was a director of the plaintiff between 10 September 2009 and 9 April 2014. Mr Hedley was a director of the plaintiff between 10 September 2009 and 20 August 2012.
3 In February 2011 the defendant entered into an agreement with Profit Marine Pte Ltd to charter two tugs the Profit Radiance and the P Reliance. In or about March 2011 Mr Junk and Mr Hedley on behalf of the plaintiff and Kimberley Metals and Mr Paul Wheatley on behalf of the defendant entered into a contract dated 7 February 2011 to provide shipment services using the tugs to the plaintiff. Mr Hedley and Mr Junk were beneficial shareholders in the defendant pursuant to a trust arrangement whereby Mr Wheatley would hold 50% of the shares in the defendant on trust for Mr Junk and Mr Wheatley would hold 25% of the shares in the defendant on trust for Mr Hedley. Mr Wheatley controlled the remaining 25% of the shares in the defendant in his own right. The plaintiff says Mr Junk and Mr Hedley did not bring the opportunity to charter the tugs or the information concerning their existence to the plaintiff. Further, they did not disclose their respective interests in the defendant to the plaintiff.
4 The plaintiff says Mr Junk and Mr Hedley owed certain duties to the plaintiff. The nature of these duties is summarised in par 9 of the plaintiff's submissions. I can do no better than quote that paragraph in full:
During the period of their respective directorships, Mr Junk and Mr Hedley owed duties to KMGL:
(a) at general law:
(i) not to act in a position of conflict;
(ii) not to prefer their own interests over those of KMGL; and
(iii) not to make a profit from any opportunity which they obtained while acting as director without first obtaining the fully informed consent of KMGL;
(b) pursuant to s.181 of the Corporations Act 2001, to exercise their powers and discharge their duties as directors of KMGL:
(i) in good faith in the best interests of KMGL; and
(ii) for a proper purpose; and
(c) pursuant to s.182 of the Corporations Act 2001 not to use their position as directors of KMGL to:
(i) gain an advantage for themselves or someone else; or
(ii) cause detriment to KMGL.
6 The defendant filed no evidence dealing directly with the matters raised by the plaintiff. The two affidavits sworn by Luke Jarrad Bone (the first on 16 June 2015 and the second on 28 July 2015) addressed other issues. Counsel did however object to 21 paragraphs of the affidavit of Mr Chi-Haidong. These objections were conceded. Counsel for the defendant then contended there was no admissible evidence which allowed the plaintiff to make out the case outlined above. In my view there was such evidence and the case is made out. While it is not possible to calculate with precision what the amount of the off-setting claim might be, given the size of the contract between the plaintiff and the defendant, if the plaintiff's claim is made out it will clearly be more than the amount of the demand.
7 The only point raised by the defendant in opposition to the application had to do with the constitution of the plaintiff and a question of whether or not where a director was in a position of conflict he was in someway liable to the company. But whatever the intention of the provisions of the constitution of the plaintiff or whatever their operation might be they cannot stand against the provisions of the Corporations Act 2001 (Cth). If the general equitable principles upon which the plaintiff relies are not sufficient to overcome the argument raised by the defendant that argument is certainly overcome by the provisions of the Corporations Act.
8 I am satisfied the plaintiff has an off-setting claim equal to or greater than the amount of the statutory demand. Accordingly I would set aside the demand. Subject to hearing from the parties the defendant should pay the costs of the application including the reserved costs.
0
2
1