EATERTAINMENT GROUP PTY LTD (ACN 639 827 188)	Plaintiff
v
CURTIS FAMILY DEVELOPMENTS PTY LTD (ACN 149 238 273) as Trustee for the CURTIS FAMILY TRUST	Defendant

---

JUDGE:	Gardiner AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	4 July 2024
DATE OF JUDGMENT:	2 September 2024
CASE MAY BE CITED AS:	Re Eatertainment Group Pty Ltd
MEDIUM NEUTRAL CITATION:	[2024] VSC 512

---

CORPORATIONS — Application to set aside a statutory demand pursuant to s 459G of the Corporations Act 2001 (Cth) on grounds that Plaintiff had offsetting claims in respect of the debt claimed in the demand — Plaintiff had previously entered into Deed of Settlement with Defendant in respect of application to set aside prior statutory demand claiming the same debt and had defaulted in payment — Consideration of whether release in Deed of Settlement operated to bar Plaintiff from raising such offsetting claims — Finding that it was arguable that release in Deed of Settlement should be construed so as not to operate to prevent the Plaintiff from raising the offsetting claims — Creata (Aust) Pty Ltd v Faull [2017] NSWCA 300 —Consideration of evidence surrounding the terms of contract the basis of the Defendant’s demand and whether there was plausible contention which warranted investigation that Defendant’s director represented the Defendant as agreeing to a ‘pay when paid’ arrangement at odds with the formal written contract and negotiations documented in emails between the parties’ solicitors leading up to the signing of the contract — Consideration of evidence filed in support of previous application to set aside the previous demand in which there was no mention of significant offsetting claims now made — Finding that Plaintiff failed to discharge onus that it had genuine offsetting claims — Application dismissed — Malec Holdings Pty Ltd v Scotts Agencies Pty Ltd (In Liquidation) [2015] VSCA 330 applied.

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr J Evans KC	Madgwicks
For the Defendant	Mr I Hristovski of counsel	Burch & Co

TABLE OF CONTENTS

Background

Evidence

Eatertainment’s evidence

Resolution of the previous application to set aside the demand
Curtis’s evidence
Mr Pezaros’s affidavit in reply

Eatertainment’s submissions
Curtis’s submissions

Legal principles

Consideration

Does the release under cl 3 of the Deed operate to prevent Eatertainment from raising the offsetting claims it now seeks to make ?
Has Eatertainment established it has a genuine offsetting claim

Conclusion

HIS HONOUR:

Background

By originating process filed on 22 March 2024, the plaintiff, Eatertainment Group Pty Ltd (‘Eatertainment’) makes application under s 459G of the Corporations Act 2001 (Cth) (‘Act’) to set aside a statutory demand (‘Demand’) dated 1 March 2024 served on it by the defendant, Curtis Family Developments Pty Ltd (‘Curtis’).[1]
[1]In the evidence, Curtis is referred to in some places as ‘AAFS’; an…

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 Eatertainment Group Pty Ltd

Details

AGLC: Re Eatertainment Group Pty Ltd [2024] VSC 512
Case: [2024] VSC 512
Decision Date: 2 September 2024

CaseChat Overview and Summary

The case involved the plaintiff, Eatertainment Group Pty Ltd, making an application to set aside a statutory demand issued by the defendant, Creata (Aust) Pty Ltd. The dispute centred on the plaintiff's contention that it had offsetting claims against the defendant in respect of the debt claimed in the demand. This matter was heard in the Supreme Court of Victoria.

The primary legal issues for the court to decide were whether the release in a prior Deed of Settlement, which settled an application to set aside a previous statutory demand for the same debt, barred the plaintiff from raising offsetting claims, and whether there was a plausible contention that the defendant's director had represented that the defendant had agreed to a 'pay when paid' arrangement. The court also needed to consider whether the plaintiff had discharged the onus of proving it had genuine offsetting claims against the defendant.

The court found that it was arguable that the release in the Deed of Settlement should be construed so as not to bar the plaintiff from raising offsetting claims, drawing upon the reasoning in Creata (Aust) Pty Ltd v Faull. The court further examined the evidence surrounding the terms of the contract, which was the basis of the defendant's demand, and whether there was a plausible contention that the defendant's director had represented a 'pay when paid' arrangement, despite the formal written contract and the documented email negotiations. The court found that the plaintiff had failed to discharge the onus of proving that it had genuine offsetting claims against the defendant, as per the decision in Malec Holdings Pty Ltd v Scotts Agencies Pty Ltd (In Liquidation). Consequently, the application to set aside the statutory demand was dismissed.

The court's final orders were to dismiss the application to set aside the statutory demand issued by Creata (Aust) Pty Ltd against Eatertainment Group Pty Ltd.

Orders