Maroon Gold Pty Ltd v Access World (Australia) Pty Ltd - [2020] WASC 140

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   MAROON GOLD PTY LTD -v- ACCESS WORLD (AUSTRALIA) PTY LTD [2020] WASC 140
CORAM:   MASTER SANDERSON
HEARD:   ON THE PAPERS
DELIVERED          :   6 MAY 2020
PUBLISHED           :   6 MAY 2020
FILE NO/S:   COR 259 of 2019
BETWEEN:   MAROON GOLD PTY LTD
Plaintiff

AND

ACCESS WORLD (AUSTRALIA) PTY LTD
Defendant

Catchwords:

Corporation law - Application to set aside statutory demand - Turns on own facts

Legislation:

Nil

Result:

Plaintiff's application dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	No appearance
Defendant	:	No appearance

Solicitors:

Plaintiff	:	Justice Legal Pty Ltd
Defendant	:	Murfett Legal

Case(s) referred to in decision(s):

Nil

MASTER SANDERSON:

This is the plaintiff's application to set aside a statutory demand. The application is supported by an affidavit of Ashley Jon Pattison sworn 23 December 2019. Appearing as attachment AP2 to Mr Pattison's affidavit is a copy of the statutory demand. The amount of the demand is $1,318,799.95. Appearing under the heading 'Description of debt' in the schedule to the demand five invoices are listed. The first is dated 20 August 2019 and the last 8 October 2019. They are for varying amounts. They total $1,723,851.49. The schedule shows the plaintiff has paid an amount of $405,051.54 leaving the balance claimed in the statutory demand.
The plaintiff is a private Australian company which operates the Black Jack Gold tenement plant near Charters Towers in North Queensland.[1] Mr Pattison says in his affidavit that on or about 12 April 2019 the plaintiff entered into an agreement with the defendant for the provision of haulage services at the Agate Creek Georgetown ROM and Black Jack Gold Treatment sites.[2] That agreement was in writing and appears as attachment AP5 to Mr Pattison's affidavit. I will return to that agreement later in these reasons. For present purposes it is sufficient to say that Mr Pattison acknowledges that the five invoices were rendered by the plaintiff to the defendant. There is no suggestion the invoices were not consistent with the contract and did not represent the amount owing by the plaintiff to the defendant.
[1] Affidavit of Ashley Jon Pattison sworn 23 December 2019 [5].
[2] Affidavit of Ashley Jon Pattison sworn 23 December 2019 [8].
It is Mr Pattison's evidence that on or about 18 October 2019 Mr Pattison met with Mr Tim Knox a director of the defendant. The subject of the discussion was the outstanding invoices.[3] Although Mr Pattison does not directly say as much, it is clear that as at the date of the meeting the plaintiff was not in a position to pay the invoices and meet its obligations under its contract with the defendant.
[3] Affidavit of Ashley Jon Pattison sworn 23 December 2019 [12].
It is Mr Pattison's evidence that during the course of the meeting Mr Knox said words to the following effect:
If Maroon Gold and Access World enter into a Memorandum of Understanding for haulage works for the Far Fanning Project, I can obtain internal funding to give Access World some cash flow relief and hold off on enforcing the debt.[4]
[4] Affidavit of Ashley Jon Pattison sworn 23 December 2019 [15].
As I understand the plaintiff's position, it alleges that the defendant, through Mr Knox, agreed to forebear recovery of the outstanding debt if the plaintiff entered into an agreement with the defendant for haulage services on the Far Fanning Project. No timeframe for forbearance was discussed nor was there any agreement as to upon what terms and conditions the parties would enter into a haulage agreement for the Far Fanning Project. But it is the plaintiff's position that through Mr Knox an offer was made.
According to Mr Pattison there was then some discussion about a capital raising being undertaken by Maroon Gold. There was also some discussion about the possible takeover of the plaintiff by European interests. The meeting concluded with Mr Knox indicating that he would draft a memorandum of understanding which presumably would include terms which covered the deferral of payment of the outstanding invoices.[5]
[5] Affidavit of Ashley Jon Pattison sworn 23 December 2019 [16].
An initial draft of the Memorandum of Understanding was forwarded to Mr Pattison on 21 October 2019. After some email correspondence the Memorandum of Understanding was signed on 24 October 2019.[6] It appears as attachment AP11 to Mr Pattison's affidavit. There is no reference in that Memorandum of Understanding to a moratorium on enforcement of the amount owing pursuant to the outstanding invoices.
[6] Affidavit of Ashley Jon Pattison sworn 23 December 2019; Annexure AP-9.
It would seem that during November of 2019, the plaintiff took steps to raise capital.[7] To some extent the defendant appears to have assisted in those efforts. But, there is nothing in Mr Pattison's evidence which adds anything to the alleged agreement which he says was reached between the plaintiff and the defendant. So the plaintiff's position really amounts to this. It owed the defendant over $1.3 million and there was no dispute about that debt. Discussions took place between the plaintiff and the defendant and as a consequence of those discussions the defendant agreed to defer payment of the outstanding invoices if the plaintiff and the defendant entered into a Memorandum of Understanding with respect to the Far Fanning Project. The parties do not appear to have set any timeframe – that is to say, they did not agree how long the defendant would hold off enforcing the outstanding debt. The Memorandum of Understanding made no reference to the payment deferral. The plaintiff says as at 6 December 2019 the date of the issue of the statutory demand the defendant was not entitled to payment of the outstanding invoices.
[7] Affidavit of Ashley Jon Pattison sworn 23 December 2019 [24].
In opposition to the plaintiff's application, the defendant relied upon an affidavit of Timothy David Knox sworn 31 January 2020. Mr Knox maintains there was no agreement between the plaintiff and the defendant as alleged by Mr Pattison.[8] Further, he gives evidence of three payment arrangements he says were agreed between the plaintiff and the defendant.[9] Although the affidavit is not entirely clear, as I understand it, Mr Pattison denies any payment arrangements were agreed. He maintains an agreement was reached with Mr Knox as to the deferral of payment of the invoices upon the signing of the Memorandum of Understanding.
[8] Affidavit of Timothy David Knox sworn 31 January 2020 [7].
[9] Affidavit of Timothy David Knox sworn 31 January 2020 [18.2].
In determining whether a statutory demand ought be set aside the version of facts most favourable to the plaintiff should be adopted. So, while I would accept, based upon Mr Knox's affidavit there is a dispute as to what actually occurred at the meeting of 17 October 2019, I will proceed on the basis the version of events put forward by Mr Pattison is what actually occurred. In doing so I am not making any determination on the evidence or making any comment, either directly or inferentially, as to the veracity of the evidence of the parties. The assumptions I am making are solely for the purpose of disposing of this application.
The difficulties with the plaintiff's version of events are obvious. First, there is no suggestion that any timeframe for the deferral of payment was agreed. Presumably the plaintiff would say there was an implied term a deferral would be for as long as it took the plaintiff to raise sufficient capital to allow it to discharge its obligations to the defendant. But, a reading of Mr Pattison's affidavit does not indicate that at any stage the plaintiff had a strategy to raise sufficient capital to make payment of its debt to the defendant. It only appears to have anticipated partial payment by a capital raising. Sale of the plaintiff to European interests appears to have been a realistic prospect. But it is not clear how that sale would have fed into the payment of the debt owing by the plaintiff to the defendant.
The second difficulty is this. After the alleged agreement was reached, the plaintiff made part payment to the defendant for the outstanding invoices. That is entirely inconsistent with the alleged agreement. Mr Pattison does not offer any credible explanation as to why that payment was made. It certainly does not suggest there was a binding agreement and that by demanding payment the defendant was breaching that agreement.
Perhaps most importantly there is cause for 4(e) of the Agate Creek Contract. That requires any variation of the agreement to be in writing.[10] It is not suggested by the plaintiff that any payment deferral agreement was in fact reduced to writing. It is arguable that had the parties agreed no written variation would have been required any deferral agreement may have been enforceable. It may also be that the parties overlooked the requirement for writing when they entered into negotiations on 17 October 2019. But the fact remains the contract between the parties required variations to be in writing and the variation to the Agate Creek Contract embodying a deferral of payments was not in writing.
[10] Affidavit of Ashley Jon Pattison sworn 23 December 2019; Annexure AP-5.
There was no dispute between the parties as to the principles to be applied in a case such as this. It was the plaintiff's position there was a genuine dispute that required further investigation. I am not satisfied there is a genuine dispute. Nor am I satisfied there is some other reason why the demand ought be set aside. On that basis, the plaintiff's application is dismissed. The plaintiff ought pay the defendant's costs of the application including the reserved costs.
Accordingly, I make the following orders:
(1)The plaintiff's application to set aside statutory demand be dismissed.
(2)The plaintiff pay the defendant's costs of the application, including reserved costs, to be taxed if not agreed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
IW
Associate to Master Sanderson
6 MAY 2020