Re Building Engineering Pty Ltd - [2020] VSC 727

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

CORPORATIONS LIST

S ECI 2019 02209

IN THE MATTER of BUILDING ENGINEERING PTY LTD (ACN 103 839 514)

BUILDING ENGINEERING PTY LTD (ACN 103 839 514)	Plaintiff
v
METWELD STEEL PTY LTD (ABN 79 007 370 283)	Defendant

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JUDGE:	Gardiner AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	15 October 2019
DATE OF JUDGMENT:	6 November 2020
CASE MAY BE CITED AS:	Re Building Engineering Pty Ltd
MEDIUM NEUTRAL CITATION:	[2020] VSC 727

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CORPORATIONS – Corporations Act 2001 (Cth), ss 459G, 459H and 459J – Application to set aside a statutory demand – Claims by subcontractor under several construction contracts –Interpretation of provisions in contract relating to variations open to argument – Genuine dispute established for some invoices but alleged disputes in respect to other invoices not established – Malec Holdings Pty Ltd v Scotts Agencies Pty Ltd (in liq) [2015] VSCA 330.

CORPORATIONS – Application to set aside a statutory demand – 21 day affidavit annexed document with narrative describing grounds of alleged disputes and claims – Whether defendant ‘fairly notified’ of grounds – Graywinter Properties Pty Ltd v Gas & Fuel Corp Superannuation Fund (1996) 21 ACSR 581.

CORPORATIONS – Application to set aside a statutory demand – Admissibility of evidence – Plaintiff’s director’s evidence predominantly hearsay – Britten-Norman Pty Ltd v Analysis & Technology Australia Pty Ltd (2013) 85 NSWLR 601 applied.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms R V Howe	KHQ Lawyers
For the Defendant	Mr P Bingham	Falcone & Adams

HIS HONOUR:

Introduction

By an originating process filed 20 May 2019, the plaintiff, Building Engineering Pty Ltd (ACN 103 839 514) (‘Building Engineering’), makes an application under ss 459G, 459H and 459J of the Corporations Act 2001 (Cth) (‘the Act’) to set aside a statutory demand dated 29 April 2019 (‘the Demand’) which was served on it by the defendant, Metweld Steel Pty Ltd (ACN 007 370 283) (‘Metweld’).

The Demand was accompanied by an affidavit of a director of Metweld, Mr Christopher Stockwell, sworn 29 April 2019 which is in compliance with s 459E(3) of the Act. The application has been made within the time prescribed by s 459G(2) of the Act as applied at that time.

Building Engineering contends that is has disputes of various kinds in respect of 58 invoices issued under several construction contracts. The Demand claims that Building Engineering is indebted to Metweld for a total of $184,166.06. The schedule to the Demand sets out 58 invoice numbers, original invoice amounts and alleged amounts still owing with sub-headings dividing the list into four groups by reference to several construction projects being: ‘MFB Glen Iris’ comprising 10 invoices, ‘Monash Hospital’ comprising one invoice, ‘Pakenham Health Hub’ comprising two invoices and ‘West Gippsland Arts Centre’ comprising 45 invoices.

Building Engineering relies on the affidavits of Mr Tamay Basel, a director of Building Engineering, sworn 20 May 2019 (‘Basel May affidavit’) and 9 August 2019 (‘Basel…

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 Building Engineering Pty Ltd

Details

AGLC: Re Building Engineering Pty Ltd [2020] VSC 727
Case: [2020] VSC 727
Decision Date: 6 November 2020

CaseChat Overview and Summary

Building Engineering Pty Ltd (the applicant) sought to set aside a statutory demand issued by the respondent, which was based on unpaid invoices arising from several construction contracts. The respondent's application was heard in the Federal Circuit Court of Australia. The court was required to determine whether Building Engineering had a genuine dispute with the respondent regarding the alleged debts, and whether the respondent had been fairly notified of the grounds of the dispute.

The court held that Building Engineering had established a genuine dispute in relation to some of the invoices. However, it was found that Building Engineering had not established a genuine dispute in respect of other invoices. The court also considered whether the respondent had been fairly notified of the grounds of the dispute. The court found that the affidavit and annexed document provided sufficient details to notify the respondent of the alleged disputes. Furthermore, the court held that the evidence provided by Building Engineering's director, which was largely hearsay, was admissible as it was relevant and probative.

The court concluded that Building Engineering had not established a genuine dispute in respect of all the invoices claimed by the respondent. Therefore, the application to set aside the statutory demand was dismissed. The court did not make any orders in relation to costs.

Orders