Re AOA Pty Ltd - [2022] VSC 690

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST

S ECI 2022 01357

IN THE MATTER of AOA PTY LTD (ACN 161 183 562)

BETWEEN:

AOA PTY LTD (ACN 161 183 562)	Plaintiff
v
WANG LAWYERS PTY LTD trading as HERALD LEGAL (ACN 166 464 642)	Defendant

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JUDGE:	Gardiner AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	13 October 2022
DATE OF RULING:	13 October 2022 (revised 16 November 2022)
CASE MAY BE CITED AS:	Re AOA Pty Ltd
MEDIUM NEUTRAL CITATION:	[2022] VSC 690

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CORPORATIONS – Application to set aside a statutory demand pursuant to s 459G of the Corporations Act 2001 (Cth) – Solicitors for the plaintiff withdrew prior to hearing – Rule 1.16 of Supreme Court (General Civil Procedure) Rules 2015 (Vic) (‘the Rules’) – Worldwide Enterprises Pty Ltd v Silberman [2009] VSC 165 applied – Director not permitted to advocate on corporate plaintiff’s behalf – Defendant the former solicitor for the plaintiff in proceedings in the County Court of Victoria – Dispute arose in respect of fees payable by a plaintiff to the defendant for acting in that proceeding – Defendant applied for costs determination under s 188 of the Legal Profession Uniform Law 2014 (NSW) in which grievances of plaintiff were considered by costs assessor and reduction made to the bill of costs – Defendant registered the determination in respect of costs assessment pursuant to s 70 of the Legal Profession Uniform Law Application 2014 (NSW) in Local Court of New South Wales – Plaintiff alleges genuine dispute and offsetting claim – Finding that contention as to genuine dispute not available by reason that defendant’s claim is based on judgment debt – No offsetting claim raised in plaintiff’s affidavit material – Contention that demand should be set aside for ‘some other reason’ under s 459J dismissed – Application dismissed with costs fixed by the court – Defendant as solicitor not entitled to charge legal costs for acting on its own behalf Legal Profession Uniform Law – Bell Lawyers Pty Ltd v Pentelow (2019) 269 CLR 333 applied – Court fixes defendant’s costs for counsel.

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APPEARANCES:	Counsel	Solicitors
The Plaintiff in person
For the Defendant	Mr J Leung	Wang Lawyers Pty Ltd

HIS HONOUR:

The plaintiff, AOA Pty Ltd (‘AOA’), makes an application by originating process filed on 20 April 2022 to set aside a statutory demand served on it by the defendant (‘the Demand’), Wang Lawyers Pty Ltd, trading as Herald Legal (‘Herald Legal’), dated 28 March 2022 and served on AOA on 29 March 2022.

The originating process also seeks an order in the alternative that the Demand be set aside under s 459J of the Corporations Act 2001 (Cth) (‘the Act’). AOA further claims in the alternative that the Demand be varied pursuant to s 459H(1)(a) of the Act.

AOA’s application is supported by an affidavit of its sole director, Andy Wang, filed 20 April 2022 and its former solicitor, Newton Yue Han, filed 26 May…

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 AOA Pty Ltd

Details

AGLC: Re AOA Pty Ltd [2022] VSC 690
Case: [2022] VSC 690
Decision Date: 13 October 2022 (revised 16 November 2022)

CaseChat Overview and Summary

The case of Re AOA Pty Ltd involved an application to set aside a statutory demand under section 459G of the Corporations Act 2001 (Cth). The plaintiff, AOA Pty Ltd, had initially engaged the defendant, a solicitor, to represent them in a County Court proceeding. The dispute arose over fees that the plaintiff owed to the defendant for the services rendered. Following a costs determination under section 188 of the Legal Profession Uniform Law 2014 (NSW), the defendant registered the assessment of costs in the Local Court of New South Wales. AOA Pty Ltd, through its solicitors, sought to have the statutory demand set aside, arguing both that there was a genuine dispute over the fees and that there was an offsetting claim. The defendant, who had withdrawn as the plaintiff's solicitor before the hearing, contested the application.

The primary legal issues before the court were whether the statutory demand could be set aside due to a genuine dispute or an offsetting claim, and if the defendant was entitled to recover legal costs for acting on its own behalf. The court found that the contention of a genuine dispute was not tenable because the defendant's claim was based on a judgment debt, and therefore not subject to the dispute provision. Additionally, the court held that the plaintiff's affidavit did not raise a valid offsetting claim, and dismissed the application to set aside the statutory demand for 'some other reason' under section 459J of the Corporations Act. The court also addressed the issue of the defendant's right to recover legal costs, applying the principles from Bell Lawyers Pty Ltd v Pentelow, and concluded that the defendant was not entitled to charge legal costs for acting on its own behalf.

Consequently, the application was dismissed with costs, which the court fixed at an amount determined to be reasonable. The court also awarded the defendant's costs for counsel. This decision underscores the importance of the distinction between a genuine dispute and a judgment debt, and the limitations on a former solicitor's right to recover costs when acting on their own behalf.

Orders