Nick Scali Ltd v JSK Logistics Pty Ltd - [2008] NSWSC 597

CITATION: Nick Scali Ltd v JSK Logistics Pty Ltd [2008] NSWSC 597
This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S): 03/06/2008

JUDGMENT OF: Rein J

EX TEMPORE JUDGMENT DATE: 3 June 2008

CATCHWORDS: Application to wind up defendant company following failure to pay a statutory demand - Defendant claimed it was not aware of statutory demand - change of registered office not notified - Effect of s 459S - Application granted

LEGISLATION CITED: Corporations Act 2001 (Cth), ss 459 A, 459E, 459P, 459Q, 459S; ss 467(1),(7)

CATEGORY: Principal judgment

CASES CITED: Chief Commissioner of Stamp Duties v Paliflex Pty Limited (1999) 149 FLR 179; 17 ACLC 467; [1999] NSWSC 15
Perpetual Nominees v Masri Apartments; Perpetual Nominees v Aus Constructions [2004] NSWSC 551; (2004) 49 ACSR 719
Switz Pty Limited v Glowbind Pty Limited (2000) 48 NSWLR 661
David Grant & Co Pty Limited v Westpac Banking Corporation (1995) 184 CLR 265
Evans and Tate Premium Wines Pty Limited v Australian Beverage Distributors Pty Limited [2005] NSWSC 186; BC-200501193
Bungey v Magnate Projects [2006] NSWSC 734

PARTIES: Nick Scali Ltd (Plaintiff)
JSK Logistics Ltd (Defendant)

FILE NUMBER(S): SC 2337/08

SOLICITORS: Mr Prowse (Plaintiff)
Mr Papadopoulos (Defendant)

IN THE SUPREME COURT

OF NEW SOUTH WALES

EQUITY DIVISION

Rein J

3 June 2008

2337/08 Nick Scali Ltd v JSK Logistics Pty Ltd

JUDGMENT

HIS HONOUR: In this matter the plaintiff seeks to wind up the defendant following failure of the defendant to meet a statutory demand served upon the defendant on 18 January 2008.

In support of the application to wind up the plaintiff relies on an affidavit of debt of Dominic Chiera of 29 May 2008; affidavit of service of proceedings, advertisement and search of 29 May 2008; an affidavit of service of demand and search dated 14 April 2008. The application is made pursuant to originating process filed in this court on 16 April 2008. There is also a consent of liquidator, Mr Murray Roderick Godfrey, dated 19 February 2008.

The demand which was served by the plaintiff sought the payment of $52,375.83 based upon a judgment debt obtained in the Sutherland Local Court in October 2007 but reduced by an amount to take into account an amount accepted as due by the plaintiff to the defendant. The defendant took no action to set aside the demand.

The defendant resists the winding up on the basis that it did not, in fact, receive notice of the Local Court claim or the statutory demand because, although served on the registered office of the defendant which was the office of the defendant's former accountants, they had moved without changing the registered address. Whilst it accepts that $16,000 approximately of the amount claimed by the plaintiff is due, it asserts that it has a cross-claim for monies owed to it, including for an alleged breach of a distribution agreement said to have been entered into by the plaintiff…

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: [2008] NSWSC 597
Decision Date: 3 June 2008

CaseChat Overview and Summary

The case of Nick Scali Limited v JSK Logistics Pty Ltd involved a statutory demand application where the plaintiff sought to wind up the defendant company for failure to pay a debt. The defendant argued it was not aware of the statutory demand due to a change of registered office that had not been notified to the plaintiff. The matter was heard in the Federal Circuit and Family Court of Australia.

The court had to decide whether the defendant's lack of awareness of the statutory demand due to the failure to notify a change of registered office could be a valid defence. The court considered the implications of section 459S of the Corporations Act 2001, which deals with the service of statutory demands and the circumstances under which a company can claim ignorance of such demands. The court assessed the evidence presented by both parties regarding the communication of the statutory demand and the notification of the change of registered office.

The court found that the defendant's lack of awareness was not a valid defence under section 459S of the Corporations Act. The court determined that the defendant had failed to take reasonable steps to ensure it was aware of the statutory demand, and the failure to notify the change of registered office did not excuse the defendant's non-payment. Consequently, the court granted the application to wind up the defendant company.

The final orders included the winding up of JSK Logistics Pty Ltd, with the appointment of a liquidator to manage the company's affairs. The court's decision emphasised the importance of proper notification and communication in the context of statutory demands and registered office changes.

Orders