Mills Oakley v Asset HQ Australia Pty Ltd
[2019] VSC 98
•27 February 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST
S ECI 2018 02858
IN THE MATTER OF: ASSET HQ AUSTRALIA PTY LTD (ACN 164 233 818)
| MILLS OAKLEY (A PARTNERSHIP) | Plaintiff |
| v | |
| ASSET HQ AUSTRALIA PTY LTD (ACN 164 233 818) | Defendant |
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JUDICIAL REGISTRAR: | Matthews JR |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 13 February 2019 |
DATE OF RULING: | 27 February 2019 |
CASE MAY BE CITED AS: | Mills Oakley v Asset HQ Australia Pty Ltd |
MEDIUM NEUTRAL CITATION: | [2019] VSC 98 |
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CORPORATIONS – Application for winding up in insolvency pursuant to s 459P of the Corporations Act 2001 (Cth) – Whether statutory demand served at registered office – Applicability of presumption of service by post to the registered office – s 109X, Corporations Act (2001) Cth; ss 28A and 29 Acts Interpretation Act 1901 (Cth); s 160 Evidence Act 2008 (Vic) considered – Presumption of service by post to the registered office not established – Deputy Commissioner of Taxation v ABW Design and Construction Pty Ltd (2012) 291 ALR 127; Chen v The College of Building Ltd [2015] ACTSC 19 applied.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | M. Lapirow | Davies Moloney |
| For the Defendant | B Slocum | Gavin Parsons & Associates |
JUDICIAL REGISTRAR:
Introduction
This proceeding is a winding up application brought by the plaintiff against the defendant, pursuant to s 459P of the Corporations Act 2001 (Cth) (‘Act’). The plaintiff relies on a failure by the defendant to comply with a statutory demand dated 8 November 2018 (‘Statutory Demand’) allegedly served by post on the defendant sent on 8 November 2018. The Statutory Demand is in respect of a debt of $158,905.67, pursuant to a judgment given on 3 October 2018 by the District Court of New South Wales at Sydney.
Pursuant to s 459C(2)(a) of the Act, a company is presumed to be insolvent if it has failed to comply with a statutory demand within the meaning set out in s 459F of the Act. Relevantly, that section provides that the period for compliance with a statutory demand is 21 days after the demand is served.
In this proceeding, the plaintiff relies on this statutory presumption of insolvency. For that presumption to apply, there must have been a failure to comply with the Statutory Demand. For there to be such a failure, the Statutory Demand must have been served on the defendant.
The defendant disputes service of the Statutory Demand: it says that the Statutory Demand was not served upon it. It is common ground that the registered office of the defendant, as shown in the records maintained by the Australian Securities and Investments Commission, was at all material times ‘DBW (NSW) Pty Limited, Level 6, 1 Pacific Highway, North Sydney, NSW, 2060’ (‘Registered Office’). This decision concerns the question of whether the Statutory Demand was served on the defendant by being posted to the Registered Office.
The proceeding was listed for hearing on 6 February 2019. At that time, the parties agreed that this question of service of the Statutory Demand should be dealt with first, before the balance of the proceeding, and the hearing was adjourned to 13 February 2019 to allow for further affidavits to be filed and for a hearing in relation to this question.
Evidence
Plaintiff’s evidence
In relation to service of the Statutory Demand, the plaintiff relies on the affidavits of:
(a) Margaret Catherine Crilly, sworn 13 November 2018 (‘First Crilly Affidavit’). Ms Crilly is a law clerk employed by Davies Moloney, the plaintiff’s solicitors;
(b) Ms Crilly, sworn 11 February 2019 (‘Second Crilly Affidavit’); and
(c) Colman Francis Moloney, sworn 11 February 2019 (‘Moloney Affidavit’). Mr Moloney is a principal of Davies Moloney and is the solicitor acting for the plaintiff.
Ms Crilly deposes that she served the Statutory Demand by priority pre-paid post, by placing it in an envelope “addressed to the [defendant] at its registered office, DBW (NSW) Pty Limited, Level 6, 1 Pacific Way, North Sydney, NSW, 2060”[1] (‘Pacific Way Address’). She posted this envelope (‘Envelope’) by placing it in the post box at the corner of William and Little Lonsdale Streets, Melbourne, at 5.50pm on 8 November 2018.[2] Ms Crilly has exhibited a copy of the Envelope, which she addressed, which shows the address to be as described, that is, the Pacific Way Address.[3] The Statutory Demand which Ms Crilly posted was also addressed to the defendant at the Pacific Way Address.[4] In her second affidavit, Ms Crilly states that when addressing the Envelope and the Statutory Demand, she inadvertently wrote/typed it as “Pacific Way” rather than “Pacific Highway”.[5]
[1]First Crilly Affidavit, [2].
[2]First Crilly Affidavit, [2].
[3]Second Crilly Affidavit, Annexure A.
[4]First Crilly Affidavit, Annexure A.
[5]Emphasis added.
Ms Crilly also deposes to the system within Davies Moloney’s office for dealing with postal items which are returned to Davies Moloney, such as items marked “return to sender” or “unknown at this address”. She states that the procedure for a returned postal item is to open it, staple the envelope to the contents, place it on the relevant file and then provide the file to the person responsible. Ms Crilly states that the Statutory Demand has not been returned to Davies Moloney by Australia Post as shown on the return address.
Ms Crilly also served the originating process, inter alia, on the defendant by posting it in an envelope addressed to the defendant at the Registered Office on 18 December 2018.[6]
[6]Moloney Affidavit, [7]; Exhibit CFM-2 to the Moloney Affidavit. See also the affidavit of service of Ms Crilly, sworn 19 December 2018, in which she deposes to service of copies of the originating process, a SEPA notice, the ASIC search of the defendant, the affidavit in support of the originating process sworn by Robert Semmens on 14 December 2018, and the liquidator’s consent.
Mr Moloney’s evidence as to the practice within Davies Moloney for returned mail is to the same effect as Ms Crilly.[7] He also states that the Statutory Demand has not been returned to Davies Moloney by Australia Post.[8]
[7]Moloney Affidavit, [13]-[16].
[8]Moloney Affidavit, [16].
Mr Moloney states that he conducted an internet search,[9] which showed that there is only one street with the name of “Pacific’’ in postcode 2060. That is “Pacific Highway”.[10]
[9]Using the internet address:
[10]Moloney Affidavit, [8]; Exhibit CFM-3 to the Moloney Affidavit.
Mr Moloney conducted an internet search on Google maps street view, to obtain an image of the building at the Registered Office. He says that the image shows a ‘fairly modern multistory [sic] office block, which is topped by a large rooftop mounted sign reading “Konica Minolta”’.[11]
[11]Moloney Affidavit, [9].
Mr Moloney conducted a search to determine the closest Australia Post branch to the Registered Office, which he found was at 92 Pacific Highway North Sydney. He attempted to contact that post office but could not locate a telephone number.[12] Instead, Mr Moloney telephoned a general customer service number for Australia Post on 6 February 2019 at 2.45pm and spoke with an Australia Post employee who gave his name as Julio. Julio said he was located in Brisbane and he then told Mr Moloney that:[13]
[12]Moloney Affidavit, [10]-[11].
[13]Moloney Affidavit, [12].
(a) There was no point contacting the local post office, as all post deliveries are organised through a mail distribution centre;
(b) Each mail distribution centre has responsibility for particular post codes;
(c) The mail distribution centre allocates postal items to particular postal workers who undertake delivery in that area. Mr Moloney says that he understood from this description that each postal worker has a route and they undertake deliveries on that route;
(d) Postal workers know their areas, would be aware of the streets in their areas, and would be aware of the buildings and the businesses, especially those which they would visit or deliver to frequently;
(e) Upon Mr Moloney advising Julio of the Pacific Way Address, Julio told him that he checked the streets and there was no “Pacific Way” in that area, however anyone familiar with the area would know it meant “Pacific Highway”;
(f) Julio expected that ‘if a pre-paid postal item could not be delivered that the postal worker would endorse the item “return to sender” if there was a return address provided and that a postal return item would be delivered in the ordinary course of post.’
Defendant’s evidence
In relation to service of the Statutory Demand, the defendant relies on the affidavits of:
(a) Craig Adams, affirmed 11 February 2019 (‘Adams Affidavit’). Mr Adams deposes that he is the director of the defendant;
(b) Matthew Duggan, affirmed 12 February 2019 (‘Duggan Affidavit’). Mr Duggan is the sole director of DBW (NSW) Pty Limited (‘DBW’), an accounting practice situated at Level 6, 1 Pacific Highway, North Sydney NSW 2060, that is, the Registered Office.
Mr Adams deposes that to the best of his knowledge, the Statutory Demand was not received by the defendant at the Registered Office. He also says that it was not received by him in his capacity as a director of the defendant at any time before around 24 January 2019.[14]
[14]Adams Affidavit, [2]. See also an earlier affidavit affirmed by Mr Adams on 31 January 2019, [9].
Mr Duggan deposes that historically, the defendant engaged DBW to provide it with accounting, taxation and Xero subscription services (‘Core Services’), but ceased providing these services to the defendant in or around June 2018. At that time, he and his former business partner dissolved their business partnership, which dissolution involved DBW treating certain clients as “archived clients” who were to be transferred to the former partner’s new accounting practice. After DBW’s retainer with the defendant for Core Services was terminated in around June 2018, the defendant has been an archived client and DBW has continued to perform registered office services for the defendant pending its official transfer to the new accounting practice.[15]
[15]Duggan Affidavit, [3].
Mr Duggan deposes that DBW is not based at the Pacific Way Address, and that he does not know whether it is a valid address in North Sydney. He says that he did not personally receive the Statutory Demand at the Registered Office by way of post on or after 8 November 2018, or at all.[16] He says that he first saw it when he received a copy of it from the defendant’s solicitor on about 11 February 2019.[17]
[16]Duggan Affidavit, [6].
[17]Duggan Affidavit, [7].
Mr Duggan also says that he knows a statutory demand is an important document that must be attended to urgently by its recipient, and that had he received the Statutory Demand or had notice of it being sent to the Registered Office, he would have informed the defendant by sending it to its director, Craig Adams.[18]
[18]Duggan Affidavit, [8].
Mr Duggan states that he does not believe that the Statutory Demand was received at the Registered Office.[19] He describes, in some detail, the system in place for mail received at DBW. In summary:[20]
[19]Duggan Affidavit, [6].
[20]Duggan Affidavit, [10], [12]-[13].
(a) Mail is received at DBW by two means: either by a staff member attending DBW’s PO box daily to collect mail sent to that PO box; or by delivery from the Australia Post contractor who delivers mail addressed to DBW’s street address, which are either received by the receptionist or by being left at the reception desk if it is unattended;
(b) Mail is sorted daily by the person assigned reception and mail sorting duties;
(c) If mail is received addressed to a client, the DBW receptionist searches DBW’s customer management software system (‘CMS’), to ascertain whether the client is “active” or “archived”. The CMS retains contact information for archived clients and the mail would be forwarded to that person, and an outgoing mail log would be recorded in the CMS. The mail for archived clients would not be opened before being sent on to the contact person; and
(d) DBW does not retain an incoming mail log.
Elena Mendez was the DBW employee who was responsible for reception and mail sorting duties in November 2018, and Leila Rossi performed that role in December 2018. Mr Duggan deposes that they are both aware of the mail system as described, he has personally communicated the system to all DBW staff, and he has personally observed Ms Mendez and Ms Rossi implementing the system. He asked them whether they would have complied with the system upon the receipt of any mail addressed to the defendant in November or December 2018, and they told him they would have done so.[21]
[21]Duggan Affidavit, [11].
A search of the CMS in November or December 2018 would have produced a result that the defendant was an archived client. The CMS record for the defendant lists Mr Adams as the contact person for the defendant, providing a street address, an email address and a mobile telephone number.[22]
[22]Duggan Affidavit, [12].
Mr Duggan says that any mail received by DBW addressed to the defendant would have been sent to Mr Adams at the address recorded on the CMS and logged in the outgoing mail log. Mr Duggan states that he has reviewed the outgoing mail log on the CMS for the defendant for November and December 2018 and there are no records of outgoing mail shown in that log.[23]
[23]Duggan Affidavit, [14]-[15].
Relevant law and applicable principles
Section 109X(1) of the Act (‘Section 109X’) relevantly provides:
For the purposes of any law, a document may be served on a company by:
(a) leaving it at, or posting it to, the company’s registered office;
…
Section 28A(1) of the Acts Interpretation Act 1901 (Cth) (‘Section 28A’) relevantly provides:
For the purposes of any Act that requires or permits a document to be served on a person, whether the expression “serve”, “give” or “send” or any other expression is used, then the document may be served:
…
(b)on a body corporate – by leaving it at, or sending it by pre-paid post to, the head office, a registered office or a principal office of the body corporate.
Section 29 of the Acts Interpretation Act 1901 (Cth) (‘Section 29’) relevantly provides:
(1)Where an Act authorises or requires any document to be served by post, whether the expression “serve” or the expression “give” or “send” or any other expression is used, then the service shall be deemed to be effected by properly addressing, prepaying and posting the document as a letter and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post.
(2)This section does not affect the operation of section 160 of the Evidence Act 1995.
Section 160(1) of the Evidence Act 2008 (Vic) (‘Section 160’), which is the relevant Evidence Act in respect of this proceeding, relevantly provides:
It is presumed (unless evidence sufficient to raise doubt about the presumption is adduced) that a postal article sent by prepaid post addressed to a person at a specified address in Australia or in an external Territory was received at that address on the fourth working day after having been posted.
The author of Statutory Demands and Winding Up in Insolvency[24] summarises the applicable law in this regard as follows:
[24]Farid Assaf, Statutory Demands and Winding Up in Insolvency (Second Edition, 2012, Lexis Nexus Butterworths Australia) (‘Assaf Text’), [3.53 (including citations)].
Service of a statutory demand can be effected by posting a statutory demand to the company’s registered office.[25] In order to establish that a document, including a statutory demand, has been served on a company by ‘posting it to the company’s registered office’ under s 109X the following elements must be proved:[26]
[25]s 109X(1)(a) of the Act.
[26]Pearlburst Pty Ltd v Summers Resort Group Pty Ltd [2007] NSWSC 1126 at [22]-[23] per Barrett J citing Debelle J in Dwyer v Canon Australia Pty Ltd [2007] SASC 100 and Brereton J in Northumbrian Ice Cream Co Ltd v Breakaway Vending Pty Ltd [2006] NSWSC 1216. See also Brown v Bluestone Property Services Pty Ltd [2010] NSWSC 869 per Barrett J.
·that the envelope was properly addressed;
·that the envelope contained the relevant document to be served;
·that the envelope was prepaid;
·that the document was placed in the post and posted as a letter; and
·that the envelope was sent to the registered office of the company.
Service by post will not be established unless each of those facts has been proved[27] although in some cases appropriate inferences may be drawn by the court.[28]
[27]See, for example, Grant Thornton Pty Ltd v Green Global Technologies Ltd [2009] QSC 262 per Daubney J.
[28]Deputy Commissioner of Taxation v Clear Blue Developments Pty Ltd [2010] FCA 1223.
In effect, the combined operation of Section 109X, Section 28A and Section 29 creates a presumption that if a document is posted to the registered office of a company, it is deemed to have been served on the company unless the contrary is proved. Section 29 deems service to have been effected at the time the letter would be delivered in the ordinary course of post, unless the contrary is proved. Section 160 creates a presumption that a prepaid postal article is received at the relevant address on the fourth working day after being posted unless evidence sufficient to raise doubt is adduced.
The question in this case is a narrow one: in circumstances where the Statutory Demand was posted in the Envelope addressed to the Pacific Way Address, can the plaintiff rely on the presumption that the Statutory Demand was delivered to the Registered Office? The only real issue in contention is whether the use of “Way” rather than “Highway” in the address on the Envelope means that the presumption does not operate. The plaintiff relies on the statutory presumptions in respect of service by post: the plaintiff does not rely on some other form of service.
Submissions
Plaintiff’s submissions
The plaintiff submitted that the essential question was whether “Pacific Way” was an incorrect address when it should have been “Pacific Highway”. The plaintiff submitted that it was an immaterial difference and not one which meant that the Envelope was incorrectly addressed.
The plaintiff also submitted that the Court should infer that an envelope addressed to the Pacific Way Address would have been delivered to the Registered Office.
The plaintiff said that there is no significant difference between “Way” and “Highway” and that it was not the law that misspelling the address would invalidate it. No authority was provided to me supporting this proposition. I was taken to authorities[29] which dealt with the question of whether any prejudice flowed from a document not being delivered to a registered office when that is what was required, such that if there was no prejudice then it was not fatal (it being seen as a mere irregularity rather than a nullity). These instances were not in relation to service of statutory demands or by reference to the statutory regime in place in Australia. These cases were of no real utility to me in deciding the question.
[29]Vignes v Stephen Smith & Co Ltd (1909) 53 SJ 716 and other English cases referred to in Rochester Communications Group Pty Ltd v Lader Pty Ltd (1997) 143 ALR 648, 662-664.
Rather, the plaintiff’s submission that there was no significant difference between “Way” and “Highway” rested more on certain factual matters which it relied on. As there was no “Pacific Way” within postcode 2060, the plaintiff says, relying on the conversation Mr Moloney had with Julio of Australia Post,[30] the Envelope would have been delivered to “Pacific Highway”. If there was evidence to demonstrate that there was a “Pacific Way” in postcode 2060, then the Court would be faced with the prospect of there being a real prejudice, but here if there was an error in the address it was not one which could cause prejudice for service of a statutory demand by post.
[30]See paragraph 13(e) above.
The plaintiff submits that it does not have to prove that the document was received. It is required to show that it posted it and that it would have been delivered in the ordinary course of post.
It says that it is entitled to rely on the statutory presumption of service by post, because there is no material difference between “Way” and Highway” in this context and there is no evidence to dispute Mr Moloney’s evidence. It says there is no credible evidence to show that the address used on the Envelope is not effective.
The plaintiff also contends that Mr Duggan’s evidence does not establish non-delivery of the Statutory Demand.
Counsel for the plaintiff contended that aspects of the Duggan Affidavit were unreliable and therefore ought not be accepted: Mr Duggan stating that DBW was not at the Pacific Way Address is to be treated as an assertion that there may be a “Pacific Way” in postcode 2060 and his statement that he does not know whether it is a valid address in North Sydney is intended to be supportive of the defendant’s position. This, along with him not explaining the circumstances in which the partnership was dissolved or why the defendant had not yet been transferred as a client to the former partner, meant that Mr Duggan had entered into the arena in the dispute between plaintiff and defendant. In my view, there is nothing at all in the material to support these submissions and I reject them. There is no basis for such conclusions to be drawn.
The plaintiff also says that as the Duggan Affidavit does not mention service of the originating process on the defendant by post sent to the Registered Office,[31] or that this was sent on to the defendant, Mr Duggan’s assertions about what he would have done had the Statutory Demand been delivered carry little weight.
[31]The originating process was sent by post on 18 December 2018, in an envelope correctly addressed to the Registered Office: see paragraph 9 above.
Further, the plaintiff submits that there is no corroboration from the two employees named by Mr Duggan as being responsible for reception and mail sorting, and so Mr Duggan’s evidence as to this should also carry little weight.
The plaintiff says that the Duggan Affidavit is not a rebuttal of the presumption of delivery of the Statutory Demand to the Registered Office, as all that can be established is that DBW’s outgoing mail log may not be accurate. It is said that no one can say it was not received at the Registered Office.
The plaintiff submits that other aspects of the Duggan Affidavit support its position: for example, there is a consistent method for delivery of mail addressed to DBW’s street address to be delivered to its reception by an Australia Post contractor.
Finally, the plaintiff says that the Envelope not being returned to sender to Davies Moloney supports the inference that the Envelope was delivered to the Registered Office.
Defendant’s submissions
The defendant’s primary submission was that the plaintiff has failed to comply with one of the necessary elements of Section 109X and Section 28A, such that it cannot take advantage of the deemed service occasioned by those provisions. This was the failure to post the Statutory Demand to the defendant “at the registered office”. The Pacific Way Address was not the Registered Office.
In support of this submission, counsel for the defendant referred to a number of authorities which considered the meaning of “the company’s registered office” and which established that strict compliance was required.
In Deputy Commissioner of Taxation v ABW Design and Construction Pty Ltd,[32] Logan J re-stated that the presumptions in Section 109X and Section 28A are engaged only if there is compliance with the elements set out in those sections,[33] which in this case is that the document be posted to the company’s registered office. The term “registered office” is the address registered by a company for the purposes of s 142 of the Act.[34]
[32](2012) 291 ALR 127 (‘ABW’).
[33]ABW, 133, referring to the same cases as cited in footnote 26 above.
[34]ABW, 133.
In ABW, the postcode of the suburb where the company’s registered office was located formed part of the address for the registered office, as that is how is was recorded on the ASIC register. In that case, there was evidence that the envelope was addressed to ABW’s registered office but there was a “private and confidential” stamp which obscured the postcode. As the postcode had been obscured, it was held that the statutory demand had not been sent by post to ABW’s registered office. This meant that Section 28A and Section 109X had not been complied with.[35] In ABW, no manner of service other than by post to the registered office was carried out, and the non-compliance with Section 28A and Section 109X in those circumstances was sufficient for Logan J to take the view that the application to wind up ABW must be dismissed.[36]
[35]ABW, 134.
[36]ABW, 134-135.
Counsel also referred to Chen v The College of Building Ltd,[37] where there were errors in the way in which the envelope containing a statutory demand was addressed. In that case, the registered office of the company was shown as “Australaian [sic] Institute of Building, Ground Floor, 217 Northbourne Avenue Turner ACT 2612”. The statutory demand was sent to “The Board of Directors, College of Building, 217, Northbourne Avenue Turner ACT 2612”. In that instance, in addition to the company being referred to as “College of Building” whereas the correct name was “The College of Building Ltd”, the error in the address was the omission of “Australian [or Australaian] Institute of Building, Ground Floor” before “217 Northbourne Avenue, Turner ACT 2612”. In that case, the Court was satisfied that the omission of “Australian [or Australaian] Institute of Building, Ground Floor” was sufficient to find that the envelope was not posted to the company at its registered office for the purpose of Section 109X and that it was not ‘properly addressed’ for the purposes of Section 29.[38]
[37][2015] ACTSC 19 (‘Chen’).
[38]Chen, [51].
Further, as the Envelope was not “properly addressed”, the presumption (unless the contrary is proved) that service is effected at the time at which the Envelope would be delivered in the ordinary course of post, as required by Section 29, cannot be relied upon. Here, the defendant relies on the proposition that if the time of service cannot be presumed or proven, then service is not deemed to have occurred as it cannot be established (in the absence of other evidence) when the failure to comply with the Statutory Demand occurred.[39]
[39]Fancourt v Mercantile Credits Limited, (1983) 154 CLR 87, 96-7 (‘Fancourt’).
The defendant disagreed with the plaintiff’s submission that the presumption should arise because there was no practical difference between “Way” and “Highway”, in particular pointing out that the cases do not put it this way. Rather, the cases establish that the envelope has to be addressed to the registered office as stated in the ASIC records, which here it was not.
Counsel for the defendant also referred to Panimo Nominees Pty Ltd v Vasiliki Lobsters Melbourne Pty Ltd,[40] which concerned an application to wind up the defendant company where service of the statutory demand was disputed. In that case, Gardiner AsJ stated that ‘while it bears the onus of proving non delivery, the defendant is not required to prove a negative’.[41] In Vasiliki Lobsters, the statutory demand was addressed to the correct address, and so the defendant in that case was attempting to displace the presumption of service by post. Evidence was led from the defendant’s accountant, whose office was the registered office for the defendant, that the statutory demand was not received. There was evidence of the mail system in operation at the accountant’s office. In that case, Gardiner AsJ accepted that the defendant’s evidence established non-delivery. The plaintiff also relied on Vasiliki Lobsters, contending that the evidence which was required there to establish non-delivery was of greater quality than that offered in this case. However, that is not to the point: in Vasiliki Lobsters, absent evidence to the contrary, the plaintiff would have been able to rely on the statutory presumptions as to service by post.
[40][2011] VSC 321 (‘Vasiliki Lobsters’).
[41]Vasiliki Lobsters, [19].
In Deputy Commissioner of Taxation v Manta’s On the Beach Pty Ltd,[42] the statutory demand was correctly addressed to the defendant’s registered office, which was also the residence of the director of the defendant. As in Vasiliki Lobsters, the defendant was attempting to displace the presumption. In Manta’s, after considering the evidence as to the director’s practice regarding mail addressed to the defendant, Logan J held that it was sufficient to establish non-delivery of the statutory demand.[43] Counsel for the defendant pointed out that the system relied upon by the director in Manta’s for dealing with mail was far inferior to that of DBW, a proposition which I accept, and yet it was sufficient to establish non-delivery. In that case, as with this one, there was evidence that the statutory demand had not been “returned to sender”, a factor which Logan J stated must be taken into account.[44]
[42][2012] FCA 417 (‘Manta’s’).
[43]Manta’s, [7]-[13].
[44]Manta’s, [9].
The defendant also submitted that in this case, even though it was not required to prove a negative, the evidence established that the Statutory Demand had not been delivered to the Registered Office. If it had been delivered, DBW’s system was such that it would have been recorded in the outgoing mail log, and it was not.
Counsel for the defendant submitted that as this hearing was to deal solely with the question of service of the Statutory Demand, nothing should be implied from the Duggan Affidavit being silent as to service of the originating process.
Consideration
I accept the defendant’s submissions in this case. In my view, the plaintiff is not entitled to rely on the deemed service provisions in Section 29, as the Statutory Demand was not delivered to the Registered Office in conformity with Section 109X and Section 28A. These presumptions are the only method of service relied upon by the plaintiff, and it is not able to do so because the Envelope was not properly addressed. This requirement has been clearly established in a number of cases, as summarised in the Assaf Text and as referred to in ABW and Chen.
As set out in ABW and Chen, strict compliance with the document being addressed to the registered office as recorded in the ASIC register is required, and here there was not such compliance. The plaintiff’s repeated submission that there was no ‘material difference’ or ‘practical difference’ between “Way” and “Highway” in this case was not to the point: “Way” was not the Registered Office and that is the end of it.
Even if that was not the case, I am still not satisfied that the plaintiff is entitled to rely on the presumptions or that the plaintiff has established service of the Statutory Demand. While I have no reason to doubt Mr Moloney’s evidence, I do not regard the lack of a “Pacific Way” in postcode 2060, the statements made by Julio of Australia Post, or the fact that the Envelope was not “returned to sender” as justifying me in the circumstances of this case drawing the inference which the plaintiff would have me draw that a letter addressed to the Pacific Way Address would have been, and was, delivered to the Registered Office.
Further, Mr Duggan’s evidence is, in the circumstances of this case, sufficient to satisfy me that the Statutory Demand was not delivered to the Registered Office. He has made relevant enquiries of his staff and his systems, and he has adequately explained what would have happened within his office had delivery occurred. Had I been prepared to draw the inference urged upon me by the plaintiff, I would not have done so in light of the Duggan Affidavit. I should note for completeness that Mr Duggan’s evidence as to his understanding of the importance of dealing with a statutory demand promptly and what he would have done with a statutory demand delivered to DBW’s office[45] is irrelevant, given his evidence that mail addressed to an archived client would have been sent on to its contact person without being opened,[46] since the defendant is an archived client and the Envelope (had it been delivered) would not have been opened.
[45]See paragraph 18 above.
[46]See paragraph 19(c) above.
I do not regard Mr Adams’ evidence, summarised in paragraph 15 above, as assisting the defendant, as this goes, at best, to non-receipt by a person rather than non-delivery to a place.[47]
[47]Fancourt, 97.
Conclusion
It follows that the plaintiff is unable to establish service of the Statutory Demand, such that the presumption of insolvency under s 459C(2)(a) of the Act arising from a failure to comply with the Statutory Demand within the requisite timeframe also does not arise.
I will hear from the parties as to the disposition of the proceeding and as to costs.
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