Majorbay Pty Ltd v Eva
[2006] WASC 163
MAJORBAY PTY LTD -v- EVA [2006] WASC 163
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2006] WASC 163 | |
| Case No: | COR:61/2006 | 1 AUGUST 2006 | |
| Coram: | MASTER NEWNES | 11/08/06 | |
| 16 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | MAJORBAY PTY LTD (ACN 109 371 744) MARY TAYLOR EVA |
Catchwords: | Corporations Application to set aside statutory demand Whether genuine dispute as to debt Effect of unexplained failure by plaintiff to adduce any direct evidence of relevant events Turns on own facts |
Legislation: | Corporations Act 2001 (Cth) |
Case References: | Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACLC 669 Turner Corporation (WA) Pty Ltd v Blackburne & Dixon Pty Ltd [1999] WASCA 294 Asia Pacific Glass Pty Ltd v Sindea Trading Co Pty Ltd [2003] NSWSC 334 Greenwood Manor Pty Ltd v Woodlock (1994) 48 FCR 229 Osborne Cold Stores WA Pty Ltd v Novacastrian Nominees Pty Ltd (1991) 6 WAR 350 Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 452 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
MARY TAYLOR EVA
Defendant
Catchwords:
Corporations - Application to set aside statutory demand - Whether genuine dispute as to debt - Effect of unexplained failure by plaintiff to adduce any direct evidence of relevant events - Turns on own facts
Legislation:
Corporations Act 2001 (Cth)
Result:
Application dismissed
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Mr R G S Harrison
Defendant : Mr K A Dundo
Solicitors:
Plaintiff : Tottle Partners
Defendant : Q Legal
Case(s) referred to in judgment(s):
Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACLC 669
Turner Corporation (WA) Pty Ltd v Blackburne & Dixon Pty Ltd [1999] WASCA 294
Case(s) also cited:
Asia Pacific Glass Pty Ltd v Sindea Trading Co Pty Ltd [2003] NSWSC 334
Greenwood Manor Pty Ltd v Woodlock (1994) 48 FCR 229
Osborne Cold Stores WA Pty Ltd v Novacastrian Nominees Pty Ltd (1991) 6 WAR 350
Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 452
(Page 3)
1 MASTER NEWNES: This is an application by the plaintiff under s 459G of the Corporations Act 2001 (Cth) to set aside a statutory demand served on it by the defendant on 20 March 2006. In the statutory demand, the defendant, by her attorney, demanded payment of the sum of $500,000 pursuant to a loan agreement made between the defendant as lender and Property Capital Ltd ("PCL") as borrower and dated 21 June 2004, the liability for PCL's debt having been assumed by the plaintiff by a "Deed of Assumption and Release" (the "Deed of Assumption") made between the defendant, PCL and the plaintiff and dated 17 October 2005. The defendant also demanded payment of the sum of $131,763.70 by way of accrued interest to 16 March 2006.
2 The plaintiff denies that it is indebted to the defendant and says there is a genuine dispute as to its liability.
The evidence
3 In an affidavit sworn 7 April 2006, the sole director of the plaintiff, Arthur Fredrick Bushe-Jones, deposes to the circumstances in which he says the agreements referred to in the statutory demand were entered into. Mr Bushe-Jones says that at all relevant times he has been a director of the plaintiff and, since September 2005, the only director of the plaintiff. He has been, and continues to be, a director of PCL.
4 Mr Bushe-Jones says that, in about May 2004, there were negotiations between PCL and Investments (WA) Pty Ltd ("Investments") with a view to establishing a property development joint venture between them. As a result of the discussions, those parties agreed to enter into a joint venture and the plaintiff was formed to be the joint venture company. The parties were to cause mutually agreed directors to be appointed to the plaintiff. The terms of the joint venture agreement provided that PCL and Investments would each acquire 50 per cent of an existing development referred to as the "Bellevue development", involving the construction of 38 units, and 50 per cent of the issued capital of the plaintiff. The plaintiff would also carry out a joint venture development known as the "Ashfield development", involving the construction of 34 units.
5 It was a term of the joint venture agreement that PCL would arrange long-term banking finance to assist in the construction of the units at Bellevue and Ashfield. PCL was also to contribute equity of $1,000,000, in two amounts of $500,000, which it was to borrow from a private source. Upon completion of the Bellevue and Ashfield developments, and the sale of the units, the development finance and the equity funds were to be repaid from the sale proceeds. Interest payable by PCL to the lender of
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- the $1,000,000 was to be capitalised and paid to the lender with the repayment of capital.
6 According to Mr Bushe-Jones, the two loans of $500,000 were borrowed by PCL "from a lender I now know to be the defendant". Mr Bushe-Jones says that he was informed at various meetings of the board of directors of PCL that the payment of principal and interest on the loans was to be made after completion of the developments from sale proceeds and the interest was to be capitalised and paid to the lender with the repayment of principal. Mr Bushe-Jones says that he was so informed, in particular, by another director of PCL, Mr Barry Knop, who dealt with financial matters for PCL. Mr Bushe-Jones says that he asked Mr Knop and Mr Graeme Bennett, another director of PCL, on a number of occasions to see, and be provided with, a copy of the loan agreements but he did not see them and nor was he provided with them.
7 In September or October 2005, it was agreed that the joint venture would come to an end. It was agreed that Investments would purchase all of the shares of PCL in the plaintiff, the plaintiff would continue with the Bellevue and Ashfield developments, and it would assume PCL's liability under the loan agreements with the defendant. Mr Bushe-Jones was to remain as a director of the plaintiff and the other director, Mr Pynt, was to, and did on 29 September 2005, resign as a director. Mr Bushe-Jones thereupon became the sole director of the plaintiff.
8 By the Assumption Deed, the plaintiff agreed to assume the obligations of PCL under the Bellevue loan agreement and the Ashfield loan agreement. The Assumption Deed does not, however, refer to the terms of those loan agreements.
9 The Assumption Deed was signed on behalf of PCL by Mr Bushe-Jones and another director of PCL, Mr Beauchamp. It was signed on behalf of the plaintiff by Mr Bushe-Jones and Mr Pynt. Mr Bushe-Jones says that at the time he executed the Assumption Deed he asked "as a prerequisite to the signing of [it]" that the plaintiff be provided with, among other things, various financial and company secretarial records of the plaintiff and a copy of the executed and stamped loan agreements. He does not say who he asked. Mr Bushe-Jones says that none of the information, including the loan agreements, has been provided to him.
10 According to Mr Bushe-Jones, the plaintiff entered into the Assumption Deed "on the express basis that interest on the loans was to
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- be capitalised and payable together with the principal at the time of the sale and development of the units". Once again, he does not say to whom that basis was expressed; that is, whether it was to representatives of PCL or the defendant's representative, Mr Atherley or both.
11 Mr Bushe-Jones says that he has, on a number of occasions, requested Messrs Knop, Bennett, Pynt and the defendant's attorney, Mr Atherley, to provide him with copies of the loan agreements, but they have not been provided.
12 In an affidavit in opposition to the application, Mr Atherley, who holds a power of attorney for the defendant, says that in May to June 2004 he had several meetings with Messrs Knop and Bennett, directors of PCL, to discuss the details of a property development in Bellevue, the potential development of a site in Ashfield, and a potential investment by the defendant in PCL to fund the Bellevue development and, later, the Ashfield development.
13 On or about 21 June 2004, a loan agreement was entered into between the defendant and PCL, by which the defendant loaned $500,000 to PCL to assist it in the Bellevue development (the "Bellevue loan agreement"). Mr Atherley says that the Bellevue loan agreement provided that PCL was to repay the sum of $500,000, together with interest at 15 per cent per annum, on 21 September 2005. Mr Atherley says he does not have a stamped and executed copy of the Bellevue loan agreement. He executed it as attorney for the defendant and immediately provided the signed copies to Messrs Knop and Bennett and left it to them to arrange for the agreement to be stamped. Mr Atherley annexes what he says is an unexecuted and unstamped copy of the Bellevue loan agreement to his affidavit. The copy agreement provides that the principal and interest are repayable 15 months from the "Drawdown date" of 21 June 2004. I will come back to the copy agreement in due course.
14 It was not in issue that the sum of $500,000 was paid by direct credit to the account of PCL on or about 21 June 2004.
15 On or about 5 August 2005, a loan agreement was entered into between the defendant and PCL by which the defendant loaned the further sum of $500,000 to PCL to assist in the Ashfield development (the "Ashfield loan agreement"). The Ashfield loan agreement provided that PCL was to repay the sum of $500,000, together with interest at 15 per cent per annum, on the day following the settlement of the 24th unit of the 34 units available for sale under the Ashfield development.
(Page 6)
- Mr Atherley does not have a stamped and executed copy of the Ashfield loan agreement, and he says that he handed the signed copies to Messrs Knop and Bennett and left it to them to arrange stamping. An unstamped and unexecuted copy of what Mr Atherley says is the Ashfield loan agreement is annexed to his affidavit.
16 The sum of $500,000 was paid to PCL's bank account on or about 5 August 2004.
17 Mr Atherley says that, in or about early October 2005, he had a meeting with Messrs Knop and Bennett, representing PCL, to discuss the assignment to the plaintiff of PCL's obligations under the two loan agreements. Following those discussions, the Deed of Assumption was executed on 17 October 2005.
18 According to Mr Atherley, at the time the Deed of Assumption was signed repayment of the principal and interest under the Bellevue loan agreement had already fallen due. He says that he was assured by Messrs Knop and Bennett that the principal and interest would be repaid within a matter of weeks of the signing of the Deed of Assumption.
19 Mr Atherley says he did not agree to, nor is he aware of, any request by the plaintiff for the Deed of Assumption to incorporate a term that the interest due under both loan agreements was to be capitalised and payable with the principal at the sale and settlement of the units in the respective developments. He says that he has, on a number of occasions, advised Mr Beauchamp of the plaintiff that he (Mr Atherley) does not have copies of the executed and stamped agreements. He says, however, that he has, on a number of occasions, requested Mr Knop and Mr Pynt to provide him with copies of them, but they have not done so.
20 Mr Atherley says that, on or about 17 October 2005, Mr Beauchamp and Mr Tilli of the plaintiff discussed with him the possibility of extending the time for repayment due under the Bellevue loan agreement until March 2006, on the basis that $250,000 of the principal, and interest on the loan amount, would be repaid immediately, and the balance of the principal of $250,000 would be repaid on or about 31 March 2006.
21 On 8 November 2005, Mr Atherley wrote to Mr Tilli referring to the earlier discussion and requesting repayment of the principal and interest under the Bellevue loan agreement. In the letter, Mr Atherley said that should the total funds not be available immediately, repayment over the next month would be acceptable.
(Page 7)
22 Mr Tilli responded on behalf of the plaintiff by a letter dated 14 November 2004. In the letter, Mr Tilli notes that prior to the assignment of the loans to the plaintiff, the plaintiff was to receive copies of the signed loan agreements "together with the company register and current financials". Mr Tilli goes on:
"As per our previous meeting, we discussed the extension of the Bellevue loan as the Ashfield loan is for the life of the project. Because of the change in direction of Majorbay Pty Ltd and ownership, the cashflow position of the company has been changed.
The extension we require is so we can complete the construction and settlement of the first stage of nine units, which is funded through Angas Securities. This will occur by March 2006. In the meantime we will pay accumulated interest for the loan.
We trust this meets with your approval as the current situation has resulted from these unforseen circumstances. We trust to receive your reply by return fax."
- The letter is endorsed with a notation that a copy of it was sent to Mr Bushe-Jones.
23 I should interpose that Mr Atherley says the letter did not make it clear who had been requested to provide the plaintiff with copies of the signed loan agreements, but that no such request had been made of him.
24 Mr Atherley replied by facsimile of 14 November 2005 in which he again referred to the earlier discussion and the proposal that half of the principal sum and interest on the whole sum was to be repaid immediately and the balance of the principal sum was to be repaid by early 2006. Mr Atherley said that, as he had explained at the meeting, the defendant's health was deteriorating and arrangements were in place to move her to an aged care facility. For that reason, he required the interest and $250,000 to be repaid "ASAP". Mr Atherley said he would be happy to extend the balance of the loan of $250,000 until March 2006.
25 On 24 November 2004, Mr Atherley wrote again to the plaintiff pointing out that under the terms of the Bellevue loan agreement repayment of the principal and interest was due on 21 September 2005. He referred to the provisional agreement made at the meeting of 17 October 2005 to defer repayment of $250,000 of the principal sum
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- until March 2006, with repayment of the balance and interest to be made immediately. Mr Atherley noted that no repayment had been made and no satisfactory reply to his requests for information had been received. He therefore demanded that repayment of the loan of $500,000 plus interest be made no later than 2 December 2005. The letter is endorsed with a notation that copies of it were sent to Messrs Bushe-Jones and Beauchamp.
26 Mr Tilli responded on behalf of the plaintiff by letter of 1 December 2005. In that letter, Mr Tilli did not contest the terms of the Bellevue loan agreement but said:
"We understand your current position and are endeavouring to resolve this issue as soon as possible.
As you are well aware we have inherited this position due to the termination of the joint venture between our company and Property Capital Ltd.
We are awaiting some unrelated settlements to proceed, so that we can attend to the loan repayment. We are also endeavouring to complete and settle the Bellevue units as soon as possible.
We also refer to the Bellevue loan agreement, which we have requested on numerous times to obtain a signed copy of, together with the Ashfield agreement and we ask that this be provided to us by return fax.
In any event, we ask that you arrange a meeting for us to attend your office with Colin Beauchamp and Arthur Bushe-Jones who is the current Majorbay Pty Ltd director."
27 In a letter to Mr Atherley of 14 February 2006, Mr Tilli, on behalf of the plaintiff, said:
"As previously advised we are endeavouring to have this loan amount repaid as soon as possible and we have even offered to allow you to lodge a caveat on the property to protect your position in good faith.
At present we are waiting on unrelated settlements to proceed which will allow a repayment to be made. Further more we have made a previous loan increase submission to Angas Securities who have just completed a valuation so that we can
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- obtain the necessary funds to pay your client. They are in fact assessing this application this week.
In any event we are still waiting for a copy of the Bellevue and Ashfield agreements and the financial statements for Majorbay Pty Ltd, which are required to complete the above.
We understand that you are under pressure with this current situation and we are endeavouring to resolve this as soon as possible.
Once again we ask that we have a meeting next week with Colin and Arthur Bushe-Jones so that we can resolve this matter on an amicable basis."
28 In an affidavit in reply to Mr Atherleys' affidavit, Mr Bushe-Jones says that he has, on many occasions, asked Messrs Knop, Bennett and Atherley to provide him with a signed copy of both loan agreements. He says that he has "only ever seen draft copies of each of the agreements with each draft being amended in handwriting. The drafts were not finalised and I did not ever see a clean and unamended draft copy".
29 Mr Bushe-Jones says that in the draft Bellevue loan agreement he saw there was a date referred to for repayment of the principal sum, but he cannot recall what the date was. He then goes on, however, to say that to the best of his recollection, the repayment of the principal sum was to be on the sale and settlement of the Bellevue units, in the same way that the principal sum under the Ashfield loan agreement was repayable on the sale and settlement of the 24th unit in that development.
30 According to Mr Bushe-Jones, he signed the Deed of Assumption as a director of the plaintiff "on the basis of my knowledge that the amount payable under the Bellevue Loan Agreement was not due until the sale and settlement of the units in that development". He says that if he had been made aware that the defendant claimed that the Bellevue loan agreement was already due and payable, then he would not have signed the Deed of Assumption and would not have agreed to the plaintiff assuming liability for a loan already in default. He says that at the time it was signed he told the other directors of PCL that he did not want to sign the Deed of Assumption because he had not seen, among other things, signed copies of the loan agreements, but he was pressed by the other directors to sign the Deed of Assumption to avoid holding up the sale of the shares in the plaintiff and the release of the liability of the PCL directors.
(Page 10)
31 In relation to the meeting of 17 October 2005 and the subsequent correspondence referred to by Mr Atherley, Mr Bushe-Jones says that he was then the sole director of the plaintiff and he had authorised Mr Tilli and Mr Beauchamp to try to negotiate some compromise over the alleged date of payment under the Bellevue loan agreement. He says that "[a]lthough it was not acknowledged by the plaintiff that the Bellevue Loan Agreement was already due, what I had authorised Colin Beauchamp and Joseph Tilli to try to do was to try to reach an agreement with the defendant as to the amount claimed to be owing by the plaintiff under the Bellevue Loan Agreement". Mr Bushe-Jones reiterates that in October 2005 he had still not seen a copy of the Bellevue loan agreement.
32 According to Mr Bushe-Jones, the correspondence reflects the plaintiff's endeavours to reach a compromise.
33 Mr Bushe-Jones says the plaintiff denies that the true date of payment is as claimed by the defendant and says that Messrs Thorp and Bennett represented to him that the Bellevue loan agreement was repayable on the sale and settlement of the units in the Bellevue development.
34 I should say that, at the outset of the hearing of the application, counsel for the defendant said that his client, which was not the party liable under the Stamp Act 1927 (WA) to pay duty in respect of the Bellevue loan agreement or the Ashfield loan agreement, would inform the Commissioner of the name of the person liable to pay duty on those agreements and would lodge a copy of the agreements with the Commissioner. On that basis, the hearing of the application proceeded, subject to the compliance of the defendant with those undertakings. An affidavit confirming that those steps have been taken by the defendant has since been filed.
The plaintiff's submissions
35 Counsel for the plaintiff submitted that there is a genuine dispute about the existence of the debt claimed by the defendant. The plaintiff says that it is repayable only upon sale of the units in the development. Counsel submitted that there was a real question as to whether the unexecuted copies of the loan agreements annexed to Mr Atherley's affidavit were, in fact, true copies. In the first place, the cover sheet and the first page of the Bellevue loan agreement bear the date "2005", whereas it was common ground that the agreement was made in June 2004. The Bellevue loan agreement also bears a "footer" number on the
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- cover sheet and the first page, but not thereafter. The number is "1262doca01.doc". The Ashfield loan agreement bears a footer number "1262doca02.doc" that appears on every page. The Ashfield loan agreement also bears the date 2005, but the "drawdown date" in cl 1.1 of that agreement is said to be 5 August 2004. In fact, it was common ground that the Ashfield loan agreement was made in August 2005 and the funds advanced at that time.
36 It was submitted that the correspondence annexed to Mr Atherley's affidavit was consistent with the plaintiff's position that it had simply been attempting to negotiate a compromise of the claim by the defendant for repayment under the Bellevue loan agreement. Counsel submitted that it was notable that in the correspondence the plaintiff had repeatedly requested copies of the loan agreements and that it was apparent the plaintiff did not have copies to which it could refer.
The defendant's submissions
37 Counsel for the defendant submitted that there was no genuine dispute about the indebtedness. There was nothing more than an assertion by the plaintiff that the debt was not due and payable. Mr Atherley had executed the Bellevue loan agreement and the Ashfield loan agreement on behalf of the defendant and he had deposed first, that the repayment date under the Bellevue loan agreement was 21 September 2005 and secondly, that the documents annexed to his affidavits were copies of the respective loan agreements. Mr Atherley did not have executed copies of the loan agreements because he had given them to Messrs Knop and Bennett to arrange for the documents to be stamped and, despite his requests, he had not been provided with stamped, executed copies.
38 Counsel argued that the correspondence removed any possible doubt that the terms of the loan agreements were as contended by Mr Atherley. Throughout the correspondence, the plaintiff had not at any stage claimed that the principal and interest under the Bellevue loan agreement was not due and payable. In the correspondence, the plaintiff accepted that it was due and payable and sought to negotiate an extension of the repayment date.
The principles to be applied
39 The principles to be applied on an application to set aside a statutory demand on the ground that there is a genuine dispute as to the debt are well known.
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40 In Eyota Pty Ltd v Hanave Pty Ltd(1994) 12 ACLC 669 at 671 McLelland J said:
"It is, however, necessary to consider the meaning of the expression 'genuine dispute' where it occurs in s 459H. In my opinion, that expression connotes a plausible contention requiring investigation, and raises much the same sort of considerations as the 'serious question to be tried' criterion which arises on an application for an interlocutory injunction or for the extension or removal of a caveat. This does not mean the court must accept uncritically as giving rise to a genuine dispute, every statement in an affidavit 'however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by the same deponent, or inherently improbable in itself, it may be' not having 'sufficient prima facie plausibility to merit further investigation as to its truth' (cf Eng Mee Yong v Letchumanan [1980] AC 331 at 341), or 'a patently feeble argument, or an assertion of facts unsupported by evidence' (cf South Australia v Wall (1980) 24 SASR 189 at 194)."
41 The judgment of McLelland J was referred to with approval by the Full Court of this Court in Turner Corporation (WA) Pty Ltd v Blackburne & Dixon Pty Ltd [1999] WASCA 294, where Owen J, with whom Pidgeon and Wallwork JJ agreed, said at [27]:
"From the relevant authorities on the issue of what amounts to a 'genuine dispute' under s 459H there can be discerned an emphasis on two overriding considerations. First, that in determining whether there is a genuine dispute a court is required to undertake an investigation that raises much the same sort of considerations as the 'serious question to be tried' criterion which arises in an application for an interlocutory injunction or for the extension or removal of a caveat: Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACLC 669 per McLelland J at 671. Further, to reach a finding that there is a genuine dispute the applicant must satisfy the court that:
(a) the dispute is bona fide and truly exists in fact; and
(b) the grounds alleging the existence of a dispute are real and not spurious, hypothetical, illusory or misconceived: Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd
- (1997) 15 ACLC 1001 per Northrop, Merkel and Goldberg JJ.
- This formulation has been adopted in a number of recent decisions: see Goldspar Australia v KWA Design Group (1999) 17 ACLC 456per Austin J at 462 and Universal Greening Pty Ltd v Sabine & Anor (1999) 17 ACLC 880 per Kenny J at 885. In the interests of consistency in the various courts that have to apply the Corporations Law, I think this is the approach to be preferred."
42 It is against that background that I turn to the substantive issue on the application.
Is there a genuine dispute as to the plaintiff's indebtedness?
43 It was not in dispute that, in the circumstances of this case, Mr Atherley was entitled to give secondary evidence of the terms of the Bellevue loan agreement, to which he was a signatory. The evidence of Mr Atherley is that, under the terms of that agreement, the principal and interest were repayable on 21 September 2005.
44 Mr Bushe-Jones, on the other hand, says that he was informed by the directors of PCL who entered into the Bellevue loan agreement on behalf of the plaintiff that, as with the subsequent Ashfield loan agreement, the money was repayable upon the completion of the development and sale of the units. I should say that no objection was sought to be taken by the defendant to that evidence on the ground that it was hearsay.
45 It appears from a company search in evidence that Messrs Bennett, Pynt, Knop, Beauchamp and Bushe-Jones were appointed directors of PCL on 3 June 2003. Mr Knop ceased to be a director on 12 May 2005, but Messrs Bennett, Pynt, Beauchamp and Bushe-Jones have remained directors.
46 Mr Bushe-Jones and Mr Pynt were appointed directors of the plaintiff on 3 June 2004. Mr Pynt resigned on 29 September 2005. The only director currently of the plaintiff is Mr Bushe-Jones. The company secretary is Mr Beauchamp, who was appointed on 10 January 2005.
47 The ASIC records show that the offices of Mr Atherley's accountancy practice have been the principal place of business of both companies since 17 May 2005.
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48 It is, as the defendant's counsel observed, most surprising that, as a director of PCL, Mr Bushe-Jones was never able to see a copy of an agreement which PCL had entered into for a loan of $500,000 and that his requests for a copy of it were all to no avail. No explanation was offered by Mr Bushe-Jones. There was, for instance, no evidence of any difficulties that Messrs Thorp or Bennett might have had in showing or providing a copy to Mr Bushe-Jones. It does not appear that there was any falling out between the directors of PCL that might explain (even if not justify) a failure to provide Mr Bushe-Jones with a copy. With the exception of Mr Thorp, the directors of PCL have remained the same throughout. In particular, Mr Bennett, who was involved in the entry by PCL into the Bellevue loan agreement, remains, with Mr Bushe-Jones, a director of PCL.
49 There are in the copies of the loan agreements annexed to Mr Atherley's affidavit the discrepancies in the dates to which I have referred. None of the discrepancies, however, touch upon the terms of the Bellevue loan agreement and are readily explicable as typographical or clerical errors.
50 It is the case that the copies of the Bellevue loan agreement and the Ashfield loan agreement are identical in all material respects, save only for their respective repayment provisions. I do not, however, think that that assists the plaintiff's contention that it is likely the repayment provision in the executed Bellevue loan agreement was to the same effect as the Ashfield loan agreement. There might be many reasons why the repayment provisions differed, particularly as the Bellevue development was apparently already underway at the time the Bellevue loan agreement was entered into and the Bellevue loan agreement preceded the Ashfield loan agreement by some 12 months or more.
51 The plaintiff's current contention that the money would became due and payable under the Bellevue loan agreement only upon completion of the development must be measured against its implicit acceptance in the correspondence in late 2005 and early 2006 that the principal and interest was already due and payable. The terms of the plaintiff's correspondence do not reflect an attempt to compromise a debt which the plaintiff did not consider was due and payable. On the contrary, the correspondence is entirely consistent with the defendant's claim that the money was due and payable, and inconsistent with the plaintiff's current position. In that regard, it is particularly notable that nowhere in the correspondence did the plaintiff ever suggest that the debt was not due and payable, and Mr Bushe-Jones does not suggest that such a contention was ever put to
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- Mr Atherley in any other form, or at any other stage, prior to this application.
52 It is also significant that there was no evidence from Mr Tilli, who was the author of the letters written on behalf of the plaintiff, nor from Mr Beauchamp, the company secretary of the plaintiff, who, with Mr Tilli, attended the meeting with Mr Atherley on 17 October 2005. There was also no evidence from Mr Thorp or Mr Bennett, who entered into the Bellevue loan agreement on behalf of PCL, who on Mr Atherley's unchallenged evidence were the last people in possession of the executed agreements and who, according to Mr Bushe-Jones, had represented to him that the loan was only repayable upon completion of the Bellevue development. There is no explanation as to why their evidence was not sought to be adduced on behalf of the plaintiff.
53 Against that must be set the unequivocal evidence of Mr Atherley, who signed the Bellevue loan agreement on behalf of the defendant, that the agreement expressly provided that the principal and interest was repayable 15 months from the "drawdown date", that is, by 21 September 2005.
54It is, of course, well established that on an application of this nature the Courtwill not attempt to weigh the merits of the dispute. All that the legislation requires is that the Court concludes that there is a dispute and that it is a genuine dispute. But the Court needs to see evidence adduced on the application of a sufficient degree of cogency that it can be said there is a basis for the plaintiff's contention that there is a "genuine dispute" as to the existence of the debt.
55 In this case, the only evidence the plaintiff sought to adduce was that of Mr Bushe-Jones whose singular attribute was that had not attended any of the critical discussions or written any of the relevant correspondence or seen the loan agreements in question. No evidence of any of the witnesses who could give direct evidence as to any of those matters was sought to be adduced and no explanation was offered for the absence of their evidence. In the present circumstances, the unexplained and, on the face of it, inexplicable failure to adduce such evidence is, in my view, a substantial factor to be taken into account in determining whether there is, in truth, a genuine dispute as to the debt.
56 In the circumstances, I do not regard the plaintiff's case, as it has been put before me, to be sufficiently cogent to merit further examination and I do not consider that there is a genuine dispute as to the plaintiff's
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- indebtedness. I would dismiss the application. I will hear the parties on costs.
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