Macks v Valamios Produce - [2003] NSWSC 993

Reported Decision:
47 ACSR 583

Supreme Court

CITATION: Macks v Valamios Produce [2003] NSWSC 993

HEARING DATE(S): 27/10/03

JUDGMENT DATE:
31 October 2003

JURISDICTION:
Equity Division
Corporations List

JUDGMENT OF: Barrett J

DECISION: Interlocutory process dismissed with costs

CATCHWORDS: CORPORATIONS - winding up - company seeks injunction to restrain advertising of winding up application - dispute as to debt in unsatisfied statutory demand - no application to set aside statutory demand - alleged abuse of process - company insolvent - injunction not warranted

LEGISLATION CITED: Corporations Act 2001 (Cth), ss.459C, 459E, 459G, 459H, 459S

CASES CITED: Braams Group Pty Ltd v Miric (2002) 44 ACSR 124
David Grant & Co Pty Ltd v Westpac Banking Corporation (19950 184 CLR 265

PARTIES :
Peter Ivan Macks as Trustee for Efstratios Valamios and Constantina Valamios - Plaintiff
Valamios Produce Pty Limited - Defendant

FILE NUMBER(S): SC 5299/03

COUNSEL: Mr J T Johnson - Plaintiff
Mr R K Newton - Defendant

SOLICITORS: Sally Nash & Co - Plaintiff
Brown & Partners - Defendant

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

BARRETT J

FRIDAY, 31 OCTOBER 2003

5299/03 – PETER IVAN MACKS AS TRUSTEE FOR EFSTRATIOS VALAMIOS & ANOR v VALAMIOS PRODUCE PTY LIMITED

JUDGMENT

1 The plaintiff is the trustee under the Bankruptcy Act 1966 (Cth) of the estates of Efstratios Valamios and Constantina Valamios whom I shall call “the parents”. On or about 18 August 2003, the plaintiff served a statutory demand under s.459E of the Corporations Act 2001 (Cth) on the defendant, Valamios Produce Pty Limited, a company of which the shareholders and directors are George Valamiou and Chris Valamiou, sons of the parents. The statutory demand relates to an alleged debt of $3,208,536.40 said to be for money lent to the defendant by the parents in the period March to July 2003.

2 The evidence shows that, in the period referred to in the statutory demand, moneys accruing due to the parents in respect of their fruit and vegetable business carried on at the Flemington Markets was paid into the defendant’s bank account. One of two consequences appears to have followed: either the defendant held the moneys on trust for the parents or the defendant became indebted to the parents in an equivalent sum.

3 The defendant says – or, at least, one of the sons, Mr George Valamiou, gave evidence – that, at the parents’ request, the defendant has paid out sums the equivalent of those paid to it, so that any debt or liability to account owed to the parents has been satisfied. This, however, is not confirmed by any documentary evidence. To the extent that there are in evidence documents that purport to be listings of payments out by the defendant at the direction or for the benefit of the parents, those listings deal with sums which, in the aggregate, are some $200,000 short of the total paid to the defendant at the behest of the parents. In those circumstances, I proceed…

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 993
Decision Date: 31 October 2003

CaseChat Overview and Summary

The case involved a dispute between Macks and Valamios Produce, with Macks being the plaintiff and Valamios Produce being the defendant. The dispute centred on whether Valamios Produce had wrongfully advertised its winding up application. Macks sought an injunction to prevent Valamios Produce from advertising its winding up application, claiming that the application was an abuse of process and that the debt in the unsatisfied statutory demand was disputed. The matter was heard in the Federal Court of Australia.

The central legal issues that the court had to address were whether Valamios Produce had abused the court process by advertising its winding up application and whether the debt in the unsatisfied statutory demand was genuinely disputed. Additionally, the court had to consider whether an injunction was warranted given that Valamios Produce was insolvent.

In delivering the judgment, the court found that the advertisement of the winding up application was not an abuse of process. The court also determined that Macks had not made a sufficient case to show that the debt in the unsatisfied statutory demand was genuinely disputed, as there was no application to set aside the demand. Given that Valamios Produce was insolvent, the court concluded that an injunction was not warranted. The court emphasised the importance of following proper legal procedures and the need for insolvency processes to be respected. The court dismissed Macks' application for an injunction.

The court's final orders were that Macks' application for an injunction be dismissed, with costs awarded to Valamios Produce. The court's decision underscored the importance of adhering to legal processes and the protection of creditors' rights in insolvency proceedings.

Orders