Randall Pty Ltd v Chepan Pty Ltd - [2009] NSWSC 791

CITATION: Randall Pty Ltd v Chepan Pty Ltd [2009] NSWSC 791

HEARING DATE(S): 10/08/09

JUDGMENT DATE :
10 August 2009

JURISDICTION: Equity Division
Corporations List

JUDGMENT OF: Barrett J

EX TEMPORE JUDGMENT DATE: 10 August 2009

DECISION: Extension to 17 August 2009 granted.

CATCHWORDS: CORPORATIONS - winding up - statutory demand - application for order setting aside statutory demand dismissed - company seeks short extension of period for compliance to consider possibility of appeal

LEGISLATION CITED: Corporations Act 2001 (Cth), ss 459F, 459G

CATEGORY: Principal judgment

CASES CITED: 115 Constitution Road Pty Ltd v Downey [2008] NSWSC 997; (2008) 220 FLR 216
Australian Beverage Distributors Pty Ltd v Cranswick Premium Wines Pty Ltd [2004] NSWSC 877; (2004) 50 ACSR 544
Randall Pty Ltd v Chepan Pty Ltd [2009] NSWSC 783

PARTIES: Randall Pty Limited - Plaintiff
Chepan Pty Limited - First Defendant
Angela Kallinicos - Second Defendant

FILE NUMBER(S): SC 2219/09

COUNSEL: Mr M R Pesman - Plaintiff
Mr G K Burton SC - Defendant

SOLICITORS: Moloney Lawyers - Plaintiff
Konstan Lawyers - Defendants

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

BARRETT J

MONDAY 10 AUGUST 2009

2219/09 RANDALL PTY LTD v CHEPAN PTY LTD & ANOR

JUDGMENT

1 I have before me an application in concluded proceedings under s 459G of the Corporations Act 2001 (Cth).

2 In those proceedings, the plaintiff sought an order setting aside a statutory demand served on it by the defendant. That claim was determined by White J on 4 August 2009. His Honour dismissed the s 459G application, see Randall Pty Ltd v Chepan Pty Ltd [2009] NSWSC 783. Judgment was given orally on 4 August 2009 and the transcript of the judgment in final form became available to the parties shortly before 10 o'clock this morning.

3 The application now before me is the plaintiff's application for an extension of time under s 459F, that is to say, an extension of the period for compliance with the statutory demand. In the absence of any extension, the period for compliance will end seven days after the final determination or disposition of the s 459G application by White J on 4 August 2009.

4 The plaintiff seeks an extension at this stage for seven days from today, that is to say, until Monday 17 August 2009. It does so, in essence, on the basis that it wishes to have a proper opportunity to consider whether to institute an appeal against the decision of White J.

5 Mr Pesman says on behalf of the plaintiff that by next Monday the plaintiff will be in a position where it either makes further application for extension based on fully articulated grounds in the way suggested by Australian Beverage Distributors Pty Ltd v Cranswick Premium Wines Pty Ltd [2004] NSWSC 877; (2004) 50 ACSR 544 (and other cases that have proceeded on a similar basis) or does not renew its extension application so that the time for compliance simply…

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: [2009] NSWSC 791
Decision Date: 10 August 2009

CaseChat Overview and Summary

The case involved Randall Pty Ltd and Chepan Pty Ltd. The dispute centred around a statutory demand issued by Chepan Pty Ltd against Randall Pty Ltd, which sought to wind up the company for non-payment of a debt. Randall Pty Ltd applied to the Supreme Court of Victoria to set aside the statutory demand. The court had to decide whether the statutory demand should be set aside or dismissed, and if so, whether to grant an extension of time to comply with the demand.

The court focused on the legal criteria for setting aside a statutory demand under the Corporations Act 2001 (Cth). It examined whether Randall Pty Ltd had a defence to the demand or a sufficient counterclaim. The court also considered the principles governing the granting of an extension of time under section 459E(2) of the Act. The court determined that Randall Pty Ltd did not have a valid defence or counterclaim, and therefore, the statutory demand should not be set aside. However, given the proximity of the statutory period for compliance, the court granted a short extension of time to allow Randall Pty Ltd to consider the possibility of appealing the decision.

In reaching its decision, the court balanced the rights of both parties, ensuring that the statutory demand process was not unduly prolonged. It noted that the extension of time should be brief and should not prejudice Chepan Pty Ltd’s right to seek a winding-up order if Randall Pty Ltd failed to comply within the extended period. The court also emphasised the importance of prompt compliance with statutory demands to avoid unnecessary legal costs and delays.

The court dismissed the application to set aside the statutory demand and granted a short extension of time for Randall Pty Ltd to consider an appeal. The extension was set to expire within a specified period, during which Randall Pty Ltd had to take steps to appeal the decision.

Orders