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Re AMP Life Ltd

Re AMP Life Ltd

Case [2018] NSWSC 855 8 June 2018

Statutory Demand

Statutory Construction

Substantial Injustice

Corporate Law & Governance

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: In the matter of AMP Life Limited [2018] NSWSC 855
Hearing dates: 4 June 2018
Decision date: 08 June 2018
Before: Gleeson JA
Decision:
(1) The statutory demand dated 19 March 2018 and served on the plaintiff by the defendant be set aside.
(2) The defendant pay the plaintiff’s costs of the proceedings.
Catchwords: CORPORATIONS – CORPORATIONS – statutory demand – application for declaration that statutory demand is a nullity – whether non-compliance with prescribed Form 509H renders demand invalid – where demand served in New South Wales – where no address for service in New South Wales given in the demand
CORPORATIONS – statutory demand – application to set aside statutory demand – whether fundamental defects in demand cause substantial injustice to the company – Corporations Act 2001 (Cth), s 459J(1)(a) - whether creditor failed to identify the source or basis of the debt – whether amount of the debt is grossly overstated – whether the alleged gross overstatement constitutes “some other reason” to set aside the demand – Corporations Act 2001 (Cth), s 459J(1)(b) - whether genuine dispute about the existence of the debt - Corporations Act 2001 (Cth), s 459H(1)(a)
Legislation Cited: Corporations Act 2001 (Cth), ss 9, 459E, 459G, 459H, 459J, Pt 5.4
Corporations Regulations 2001 (Cth), Sch 2
Service and Execution of Process Act 1992 (Cth), ss 15, 16
Service and Execution of Process Act Regulations 1993 (Cth)
Commonwealth Constitution, s 51(xxiv)
Uniform Civil Procedure Rules 2005 (NSW), r 42.1
Cases Cited: Business to All Australia Pty Ltd v North East Developments Pty Ltd (recs and mgrs apptd) [2011] NSWSC 668
Creata (Aust) Pty Ltd v Faull [2017] NSWCA 300
Crema (Vic) Pty Ltd v Land Mark Property Developments (Vic) Pty Ltd [2006] VSC 338; (2006) 58 ACSR 631
Edwards v Hunter Valley Co-op Dairy Co Ltd (1992) 7 ANZ Ins Cas 61-113
Equuscorp Pty Ltd (formerly Equus Financial Services Ltd) v Perpetual Trustees WA Ltd (1997) 80 FCR 296; (1997) ACSR 675
Everkind Pty Ltd v Hazenforn Pty Ltd [2010] NSWSC 1031
Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785
First State Computing Pty Ltd v Kyling (1995) 13 ACLC 939
Hannover Life Re of Australasia Ltd v Sayseng [2005] NSWCA 214; (2005) 13 ANZ Ins Cas 90-123
Kay Investment Holdings Pty Ltd v North East Developments Pty Ltd (in liq) [2011] NSWSC 1121; (2011) 85 ACSR 610
LSI Australia Pty Ltd v LSI Holdings Ltd [2007] NSWSC 1406; (2007) 25 ACLC 1602
Panel Tech Industries (Aust) Pty Ltd v Australian Skyreach Equipment Pty Ltd (No 2) [2003] NSWSC 896
PrimeSpace Property Investment Ltd v Vienne Pty Ltd [2015] FCA 326
Re Glenevan Pty Ltd [2015] NSWSC 201
Re International Materials & Technologies Pty Ltd (2013) 282 FLR 362; [2013] NSWSC 782
Re Leasing Holdings Pty Ltd (formerly Charlie Lovett Pty Ltd) [2015] NSWSC 771
Re Morris Catering (Aust) Pty Ltd (1993) 11 ACSR 601

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.

Continue reading Re AMP Life Ltd

Details

AGLC: Re AMP Life Ltd [2018] NSWSC 855
Case: [2018] NSWSC 855
Decision Date: 08 June 2018

CaseChat Overview and Summary

The case of Re AMP Life Ltd involved a dispute where the creditor sought a declaration that a statutory demand served on the debtor was null and void, or alternatively, an order to set it aside. The dispute was heard in the Federal Court of Australia. The debtor, AMP Life Ltd, contested the validity of the statutory demand on multiple grounds, including non-compliance with the prescribed form, lack of identification of the debt source, and gross overstatement of the debt amount.

The court had to determine whether the statutory demand was invalid due to non-compliance with the prescribed Form 509H, specifically whether the absence of an address for service in New South Wales rendered the demand invalid. The court also had to decide whether the fundamental defects in the demand caused substantial injustice to the company, as per section 459J(1)(a) of the Corporations Act 2001 (Cth). Furthermore, the court needed to examine whether the creditor's failure to identify the source or basis of the debt, and the alleged gross overstatement, constituted sufficient grounds to set aside the demand under section 459J(1)(b) of the Act. Additionally, the court needed to consider if there was a genuine dispute about the existence of the debt, as per section 459H(1)(a).

In its reasoning, the court noted that non-compliance with the prescribed form did not automatically render the demand invalid, provided the defect did not cause substantial injustice. The court held that the failure to include an address for service in New South Wales was not a fatal defect in this instance, as the debtor had not suffered any substantial injustice. The court also found that the creditor's failure to identify the source or basis of the debt, and the gross overstatement, were significant defects that caused substantial injustice. The court concluded that the demand should be set aside because of these fundamental defects and the genuine dispute about the existence of the debt.

The court ordered that the statutory demand be set aside and that the creditor pay the costs of the proceeding.

Orders