Lion Finance Pty Ltd v NASR

Lion Finance Pty Ltd (the applicant) sought to wind up NASR (the respondent) on the grounds of insolvency. The dispute centred on whether NASR was able to pay its debts as they fell due. The application was heard in the Supreme Court of New South Wales.

The primary legal issue before the Court was whether NASR was insolvent for the purposes of section 459E of the Corporations Act 2001 (Cth). This required the Court to determine if NASR had failed to pay a debt that had become due and payable, or if NASR was unable to pay its debts as they fell due.

Judge Altobelli found that the applicant had failed to establish that NASR was insolvent. The Court noted that while there was an outstanding debt, the applicant had not discharged its onus of proving that NASR was unable to pay its debts as they fell due. The Court considered the evidence presented by NASR regarding its financial position and concluded that it was not commercially unviable. Consequently, the application to wind up NASR was dismissed.