Re JJ Armstrong (Vic) Pty Ltd
[2022] VSC 476
•19 August 2022 (revised 29 August 2022)
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
CORPORATIONS LIST
S ECI 2022 01894
IN THE MATTER of JJ ARMSTRONG (VIC) PTY LTD (ACN 613 338 686)
BETWEEN:
| JJ ARMSTRONG (VIC) PTY LTD (ACN 613 338 686) | Plaintiff |
| v | |
| PROMURUS PTY LTD (ACN 630 093 686) | Defendant |
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JUDGE: | Gardiner AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 26 July 2022 |
DATE OF JUDGMENT: | 19 August 2022 (revised 29 August 2022) |
CASE MAY BE CITED AS: | Re JJ Armstrong (Vic) Pty Ltd |
MEDIUM NEUTRAL CITATION: | [2022] VSC 476 |
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CORPORATIONS – Application to set aside statutory demand under s 459G of the Corporations Act 2001 (Cth) – Preliminary issue as to whether the application was made within the 21 day time period prescribed by s 459G(2) – Conflicting evidence as to when the statutory demand was served at the registered office – Derma Pharmaceuticals Pty Ltd v HSBC Bank Australia Ltd (2005) 188 FLR 373 applied – Onus on plaintiff to establish matters required to be proven to demonstrate that Court had jurisdiction to hear application – Finding that plaintiff discharged onus and application made in time prescribed by s 459G(2).
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr M Tennant | Rigby Cooke |
| For the Defendant | Mr S Wilmoth | Neill Ogge Lawyers |
TABLE OF CONTENTS
JJA’s evidence as to service.............................................................................................................. 2
First affidavit of Benjamin Newbold affirmed 24 May 2022................................................... 2
Affidavit of Sharon Weiland sworn 30 June 2022.................................................................... 2
First affidavit of Claudia Finta sworn 30 June 2022................................................................. 3
Second affidavit of Claudia Finta sworn 13 July 2022............................................................. 3
Affidavit of Christina Stajcer sworn 30 June 2022.................................................................... 4
Affidavit of Michael Catanzariti affirmed 15 July 2022........................................................... 5
Promurus’ evidence as to service.................................................................................................... 6
First affidavit of Troy Holmes sworn 10 June 2022.................................................................. 6
Mr Newbold’s response to Mr Holmes’ affidavit of 10 June 2022......................................... 7
Second affidavit of Troy Holmes sworn 14 July 2022.............................................................. 7
The cross-examination of Mr Holmes............................................................................................ 8
JJA’s submissions............................................................................................................................. 13
Promurus’ submissions................................................................................................................... 14
Consideration.................................................................................................................................... 15
HIS HONOUR:
The plaintiff, JJ Armstrong (Vic) Pty Ltd (‘JJA’), makes application by an originating process filed 24 May 2022 to set aside a statutory demand dated 22 April 2022, which was served on it by the defendant, Promurus Pty Ltd (‘Promurus’).
A preliminary question arises concerning the date of service of the statutory demand. This is of significance as it will determine whether JJA has made an application under s 459G of the Corporations Act2001 (Cth) (‘Act’) within time.
In an affidavit of Christina Stajcer, sworn 10 June 2022, Ms Stajcer deposes that she served the originating process in this proceeding and the supporting affidavit of Benjamin Armstrong Newbold, affirmed 24 May 2022, at approximately 5:00pm on 24 May 2022 by sending it to the email address nominated by Promurus. Shortly afterwards, she received a notification that the email had been successfully delivered to Promurus.
JJA contends that the statutory demand was served at its registered office on 5 May 2022 and as the application and supporting affidavit were filed and served within the statutory period, which expired on 26 May 2022, it complied with the requirements of s 459G(2) and the Court therefore has jurisdiction to consider the application.
Promurus contends that the demand was served by a process server, Troy Holmes, on 22 April 2022 at “about 5:00pm” by hand delivering it to the mailbox slot at JJA’s registered office, with the result that the 21‑day statutory period within which JJA had to make an application expired at midnight on 13 May 2022. Promurus therefore contends that the application by JJA has been made out of time and should be dismissed.
In order for JJA to establish the existence of the Court’s jurisdiction under s 459G, JJA accepts that it has the burden of proving all necessary matters, including service.[1]
[1]See Derma Pharmaceuticals Pty Ltd v HSBC Bank Australia Ltd (2005) 188 FLR 373.
JJA’s evidence as to service
JJA relies on several affidavits on the issue of service.
First affidavit of Benjamin Newbold affirmed 24 May 2022
Benjamin Newbold is a director of JJA. In his affidavit of 24 May 2022, he states that he first became aware of the statutory demand on 9 April 2022, when he checked his emails and noticed that he had received an email from JJA’s accountants, Ascot Partners, enclosing a copy of the demand with the accompanying affidavit.
Affidavit of Sharon Weiland sworn 30 June 2022
Ms Weiland deposes that she is the business services client manager of Ascot Partners and has worked in that position for about 20 years. Ascot Partners are the accountants for JJA and their business address, 227 Abbotsford Street, North Melbourne, is noted on the Australian Securities and Investments Commission’s register as the location of JJA’s registered office.
Ascot Partners occupies the entire office building located at Abbotsford Street. Access to the building is by a front door next to which is a fixed panel with a mail slot in it. Both the door and the mail slot are in an alcove that is set back approximately a meter from the footpath. When Ascot Partners’ offices are closed, the alcove area is sealed off from the street by two large metal gates that are closed and locked with a padlock. When the gates are locked, the front door and the mail slot cannot be reached from the street because of their distance from the gate. Ms Weiland’s affidavit exhibits photographs of Ascot Partners’ office building that reflect this.
Ms Weiland states that she is often the last person to leave the office and is responsible for securing the premises when she leaves. She describes the process as follows:
(a) she sets the alarm by entering her personal code, which is unique to her and no‑one else has access to;
(b) she closes and locks the door to the office, steps into the alcove and swings out the two metal gates in line with the footpath; and
(c) she then closes both sides of the gates and locks them with a padlock.
Ms Weiland states that in the last 11 years that Ascot Partners have occupied the premises, she has never left the gates unlocked when she has been the last person to leave. She exhibits an extract of the security system logs for the alarm, which records that on 23 April 2022, the alarm was armed at 4:50pm using her personal code. She was able to say that she armed the alarm as she is the “User 6” identified in the log. She knows that on 23 April 2022, by having armed the alarm, no-one else remained at the office and she was the last one to leave. She states, therefore, that she would have gone through the process of locking the front door and gates as she has done for the last 11 years.
First affidavit of Claudia Finta sworn 30 June 2022
Ms Finta is a receptionist and administrative assistant employed by Ascot Partners. Ms Finta states that it is part of her responsibilities to check and clear the letterbox next to the front door of the office building occupied by Ascot Partners. Australia Post typically delivers mail at about lunchtime each day. In the afternoon of each weekday, she checks the letterbox to see if there are any articles there. She carries out the same task when she arrives in the office in the morning and leaves in the afternoon.
Ms Finta states that she opens all mail that she collects in the mailbox unless the mail is addressed to a specific accountant that works in the office, in which case she puts it on his or her desk. She looks to see which client of the firm the mail is addressed to, then scans the item into Ascot Partners’ system, files it, and gives the physical copy of the item to the accountant who manages that client.
Ms Finta states that on 5 May 2022, she collected the mail in the way she has described. In the mail was a statutory demand addressed to JJA and dated 22 April 2022. She scanned a copy of the statutory demand into the system maintained by Ascot Partners on the same date. She exhibits a screenshot of Ascot Partners’ record of the scanning of the letter into the system that confirms this.
Second affidavit of Claudia Finta sworn 13 July 2022
In a subsequent affidavit of 13 July 2022, Ms Finta states that during the period of 26 April 2022 to 4 May 2022, she attended work on ordinary business days and carried out her normal duties, including the collection of mail in accordance with the process she had outlined in her earlier affidavit. She states that while carrying out her normal duties during the period 26 April 2022 to 4 May 2022, there was no statutory demand addressed to JJA in the Ascot Partners mailbox. She confirms that it was not until 5 May 2022 that she found it in the mailbox.
Affidavit of Christina Stajcer sworn 30 June 2022
Ms Stajcer states that on 10 June 2022, Mr Holmes’ affidavit of the same date was served on her firm. That affidavit exhibited a copy of an email purportedly originating from Down Under Investigations Pty Ltd (“Down Under Investigations”) which made reference to an ‘attached statutory demand served on your registered office a week ago’. She requested the solicitors for Promurus to provide a copy of the 29 April 2022 email in its native format, but no response was received. She again wrote to them the following day repeating this request, but no response was received.
On 20 June 2022, a subpoena was filed on behalf of JJA, requiring Mr Holmes to produce the 29 April 2022 email in its native format. In the course of serving this document, it came to Ms Stajcer’s attention that the 29 April 2022 email referred to two different email addresses for Mr Holmes’ employer, Down Under Investigations, one ending “.com.au” the other “.com”.
On 21 June 2022, Ms Stajcer attempted to send correspondence to both email addresses. She states that her firm has access to a software program that records the delivery status of emails sent. This software confirmed that the email to the “.com.au” email address, which was the email address that the 29 April 2022 email was alleged to have been sent from, could not be delivered, presumably because the address does not exist. The software confirmed that the email to the “.com” email address was successfully delivered.
On 22 June 2022, Ms Stajcer filed and served a notice to produce on the solicitors for Promurus for the email in its native format, but no response was received.
Affidavit of Michael Catanzariti affirmed 15 July 2022
Mr Catanzariti is a director and accountant at Ascot Partners and he confirms that Ascot Partners occupies the entire office building at 227 Abbotsford Street, North Melbourne. When the offices are closed, the entrance to the building, access to the mail slot, and the front alcove area from the street are sealed off by two large metal gates that are closed and locked with a padlock. Mr Catanzariti states that all employees know that the process to be followed by the last person leaving the office is to activate the alarm, lock the front door, shut the two front metal gates, and then lock the gates with a padlock.
Mr Catanzariti states that on 22 April 2022, the day that Mr Holmes was alleged to have served the demand, he attended the office after hours to collect some personal belongings. He recalls that when he arrived at the office, the front gate was closed and padlocked, preventing access to the front door and mail slot. He unlocked the padlock, unlocked the front door, and disarmed the alarm before entering the building.
Mr Catanzariti has exhibited a copy of the security system log for the alarm, which records that he deactivated the alarm using his personal code at 7:21pm on 22 April 2022. He is able to say that he deactivated the alarm because he is “User 4” appearing on the log, which is a personal code unique to him.
Mr Catanzariti says that when he finished at the office, he activated the alarm at 7:23pm and followed the process of locking the front door and gate, including securing the gate with the padlock. He exhibits a copy of the security log that confirms those matters.
None of the deponents to the affidavits relied by JJA were cross‑examined on their affidavits.
Promurus’ evidence as to service
First affidavit of Troy Holmes sworn 10 June 2022
Mr Holmes is an employee of Downunder Investigations. In his affidavit of 10 June 2022, he states that on 22 April 2022, at about 5:00pm, he served the statutory demand on JJA by delivering it to its registered office at 227 Abbotsford Street, North Melbourne. He describes the premises as a two-storey building with the names “AP” and “Ascot Partners” appearing high up on the outside wall and glass entrance door. Mr Holmes states that the glass entrance door is on the right-hand side of the building and adjacent to that, on the right, is a keypad and mail slot. He states that he placed the demand in the mail slot to the right of the glass entrance door. He states that it appeared that the entire building was occupied solely by Ascot Partners as no other names appeared on the building.
Mr Holmes states that on Thursday 28 April 2022, at about 12:00pm, he telephoned JJA on a number that he identifies and spoke to Mr Newbold. He states that he requested Mr Newbold to provide his email address so he could email a copy of the statutory demand to him. After a mildly acrimonious exchange, Mr Newbold provided his email address. Mr Holmes states that on the following day, 29 April 2022, at 1:14pm, he emailed Mr Newbold at that email address. That email was purportedly transmitted from the “.com.au” address referred to by Ms Stajcer but the footer to the email notes Downunder Investigations’ email address ending in “.com”. It states:
From: [Down Under Investigations’ email address ending in “.com.au”]
Subject: Promurus Pty Ltd v JJ Armstrong (Vic) Pty Ltd – Service of Statutory Demand
Date: 29 April 2022 at 1:14:23 pm AEST
To: [Mr Armstrong’s email address at JJA]
Good afternoon Ben,
Please find attached Statutory Demand, served on your registered office a week ago.
Kindly contact this office to discuss and hopefully reach a resolution without the necessity of this matter going further.
Kind regards,
Troy HOLMES
Investigation/Debt Collection Manager
Down Under Investigations
P.O. Box [###] Elsternwick Vic 3185
P: [#### ### ###]
E: [Down Under Investigations’ email address ending in “.com”]
W: [Down Under Investigations’ webpage]
Mr Newbold’s response to Mr Holmes’ affidavit of 10 June 2022
In his affidavit of 30 June 2022, Mr Newbold responds to Mr Holmes’ affidavit of 10 June 2022 in respect of Mr Holmes’ evidence that he called Mr Newbold on his mobile telephone on 28 April 2022 at around 12:00pm and that on 29 April 2022 at 1:14pm, he sent an email to Mr Newbold from the email address ending in “.com.au”.
Mr Newbold recalls having spoken to Mr Holmes but he is unsure as to the exact date and time. The telephone call was brief. Mr Holmes identified himself, where he was from, and who he was representing. Mr Holmes asked for the email address of the accounts department for JJA. Mr Newbold instead provided his personal email address and the call ended. Mr Newbold states that Mr Holmes did not mention at any stage that he intended to send a statutory demand. The next occasion he heard from him was via email on 17 May 2022.
Mr Newbold states that he never received the email of 29 April 2022 referred to by Mr Holmes. When he reviewed Mr Newbold’s affidavit of 30 June 2022 ,he conducted a search of his inbox, entering the phrase “downunder”. Based on this search, the only mail in his inbox was an email from Down Under Investigations, with the address ending in “.com”, sent on 17 May 2022 at 11:15am. He never received any other emails from Mr Holmes or Down Under Investigations.
Second affidavit of Troy Holmes sworn 14 July 2022
Mr Holmes swore a further affidavit in which he responds to Ms Weiland’s affidavit, where she deposes that she would have gone through the process of locking the front door and gates. He states that when delivering the statutory demand to the mail slot, he was able to access the alcove where the mail slot is situated as the gates to the alcove were open. He says that after placing the statutory demand in the mail slot, he followed his usual practice. He returned to his car, drove a short distance, parked, and made a note. He states that he wrote a note that he placed on his file “227 - @ 1700 hours”. He stated that he uses “@” to mean “about”’. He states that some weeks later he referred to this note when preparing his affidavit of 10 June 2022, but did not retain it once his affidavit was electronically prepared.
Mr Holmes did not respond to Mr Newbold’s affidavit of 30 June 2022.
The cross-examination of Mr Holmes
Mr Holmes was required to attend for cross‑examination at the hearing on 26 July 2022 and was cross-examined by Mr Tennant, counsel for JJA.
Mr Holmes stated that he was employed by Down Under Investigations which carries on business as a debt collector. Down Under Investigations was engaged by Promurus to recover a debt that was alleged to be owing by JJA and in the course of this engagement, decided to serve a statutory demand on JJA. He was the employee most involved in the preparation of the demand.
Mr Holmes was cross-examined about the email to Mr Newbold on 29 April 2022, purportedly sent by him from the email address for Down Under Investigations, which ends in “.com”. Mr Holmes stated that he did not have a native version of that email in his possession. Mr Holmes accepted that Mr Newbold did not, in fact, receive an email from him on 29 April 2022, saying that after conducting some enquiries, he has subsequently realised that the email was not sent. He also accepted that this was not referred to in either of his affidavits. Mr Holmes acknowledged that the email address ending in “.com.au” does not exist. It was put to Mr Holmes that the email was a false document that had been created for the purpose of exhibition to an affidavit, which Mr Holmes denied.
Mr Tennant enquired as to the whereabouts of a native version of that email, but Mr Holmes said Down Under Investigations did not have access to it. He agreed that the email of 29 April was printed out so it could be exhibited to his affidavit.
Mr Tennant contended that “draft emails” (i.e. emails that are not actually sent) do not contain a date and time. The date and time only appear once they are sent. He also contended that the sender address is automatically prepopulated when the email is composed and sent from an email address; the author of the email does not manually key in the email address from which the email is sent.
Mr Holmes did not agree with the propositions that the date and time are only shown on emails when they have actually been sent and that if it was a draft email that had not been sent, it would not show a date and time.
Mr Holmes gave no explanation as to how an email that was sent from a non‑existent address (as was the case with the 29 April 2022 email) could bear a date and time of transmission when it was not actually sent.
Mr Holmes stated that he rarely performed process serving work, perhaps approximately once a month, although this varied from month to month. He understood that in the context of the service of a statutory demand, it is important to keep a record of when a statutory demand is served.
Mr Holmes was cross‑examined concerning the note he made relating to service, which stated “227 ‑ @ 1700 hours”. He stated that he did not “destroy” the note, but that he discarded it after he had obtained the information from the note and transferred it to the document that he prepared in respect of service. He stated that he discarded the note “on the day”, that is the same day that he purported to serve the demand (on 22 April 2022) or otherwise, on the next day, 23 April 2022. This testimony conflicts with Mr Holmes’ evidence in his affidavit of 14 July 2022, where Mr Holmes had stated “[s]ome weeks later I referred to this note when preparing my affidavit of 10 June 2022 but did not retain it once my affidavit was electronically prepared”. Mr Holmes accepted that his affidavit evidence is therefore incorrect in that respect and instead, should have referred to “days” not “weeks”.
Mr Holmes states that on 22 April 2022, he transferred the information from the note to a document, which he described as a “simple affidavit of service”. There was no reference to that document in Mr Holmes’ affidavit evidence and it was not available at the hearing of the application. Mr Holmes states that the simple affidavit of service was not relied upon as the solicitors for Promurus required a document in a more formal format. Mr Holmes states that the document would have been prepared either quite late in the afternoon of 22 April 2022, after he had served the demand, or the next day.
Mr Holmes was then questioned about his telephone call with Mr Newbold on 28 April 2022. As has been mentioned, Mr Holmes stated that he called Mr Newbold on that day, at about 12:00pm. Mr Holmes agreed that he made such call from the telephone number XXX XXX 660, that he stated he worked for Down Under Investigations on behalf of Promurus, and that he asked for Mr Newbold’s email address. It will be recalled that Mr Newbold deposes that at no stage did Mr Holmes mention he intended to email a copy of the statutory demand to him. In this regard, Mr Holmes stated that he did mention the statutory demand in the telephone call and that it would have been strange for Mr Newbold to have provided his email address to him upon a request to do so without providing a reason. He stated that Mr Newbold wanted to know what reason Mr Holmes had for requesting his email address, to which his response was that it was to provide him with documents that had been served on the registered office.
Mr Holmes accepts that he was served with a subpoena requesting him to produce documents in the proceeding including telephone records for the telephone number from which he telephoned Mr Newbold. Mr Holmes stated that he did not have those records in his possession and that he has requested his telephone service provider for them, but that Telstra was yet to provide them to him. He stated that the records of his telephone calls do not appear on his telephone account, nor are they available by accessing the Telstra website.
Mr Holmes stated that despite not being able to produce an exact record of the date of the conversation, he was able to recollect the date of the telephone call based on a note he took. That note is not in evidence.
Mr Tennant then put a number of matters to Mr Holmes concerning his prior history. Mr Wilmoth, counsel for Promurus, objected to that line of questioning on the basis that JJA had not provided a tendency notice pursuant to s 97(1)(a) of the Evidence Act 2008 (Vic) (‘Evidence Act’) and further, that the line of questioning should not be allowed given the effluxion of time since the offences.
I accept Mr Wilmoth’s submission that the circumstances required the service of a tendency notice under s 97 of the Evidence Act by reason that the clear purpose of Mr Holmes’ character being put in issue was to establish that he has or had a tendency to act in a particular way. I allowed the line of questioning to proceed. The convictions, the nature of which I will come to shortly, are, to my mind, highly relevant in the current context. Mr Holmes readily agreed to such matters when they were put to him by Mr Tennant. I regarded them to be of significant probative value in the context of consideration of the preliminary issue, in which the parties’ respective evidence cannot be satisfactorily reconciled. I will order that there be a dispensation from the requirement to serve a tendency notice pursuant to s 100 of the Evidence Act and I will not impose any conditions on the grant of that dispensation.
In answers to cross‑examination, Mr Holmes agreed that on 4 June 2004, he was convicted by a jury in the County Court of Victoria of three charges of making a false document contrary to s 82A of the Crimes Act 1958 (Vic) (‘Crimes Act’), perjury contrary to s 314 of the Crimes Act, and attempting to obtain financial advantage by deception pursuant to s 321N of the Crimes Act. He agreed that the charges related to an attempt by him to persuade officers of the City of Melbourne to waive a $50 penalty imposed with respect to a parking infringement notice and that the jury had accepted that Mr Holmes had presented to the City of Melbourne a statutory declaration containing a false statement. He also agreed that an appeal to the Court of Appeal was dismissed.
Mr Holmes agreed that he was a police officer in Victoria Police and was in that position in February 2002. Mr Tennant put to Mr Holmes that in a separate trial, he was convicted by a jury in the County Court of Victoria of knowingly and falsely swearing during a summary hearing in the Magistrates’ Court of Victoria that in February 2002, he witnessed an assault outside a nightclub in Melbourne. Mr Holmes agreed that an appeal to the Court of Appeal was dismissed.
Cross‑examination then moved to the occasion of the service of the demand and Mr Holmes agreed that his evidence was that the demand was served at “about 5:00 pm” on 22 April 2022. He was taken to the differences between the statutory demand exhibited to his affidavit and the document which was served on JJA, which was exhibited to Mr Newbold’s first affidavit. Mr Holmes was taken to those documents and the differences between them. The date on the document in the schedule to that served on JJA bears the date 20 April 2022, whereas the document exhibited to Mr Holmes’ affidavit is dated 22 April 2022.
Mr Holmes stated that he changed the dates. He prepared the document on 20 April 2022, however the director of Promurus was unable to sign the demand or get his affidavit sworn until 22 April 2022. He thought that he had changed both dates, but he clearly did not. He retyped the front page to say 22 April 2022 on the schedule and deleted the date of 20 April and put 22 April near Mr Kolyasa’s signatures.
It was put to Mr Holmes that the statutory demand that Mr Kolyasa was looking at when he signed it was dated 20 April 2022 and when Mr Kolyasa sent it back, it bore that date and Mr Holmes stated that the statutory demand was changed to 22 April 2022.
When asked when the change occurred, he stated that he did not recall who changed the date to 22 April 2022, but “it may have been [him]”. He does not recall whether it was after the affidavit had been sworn.
It was put to Mr Holmes that he did not serve the demand on 22 April 2022, to which Mr Holmes responded that he did. The evidence of Ms Finta was put to him, in particular her evidence that the demand was not found in the mailbox until 5 May 2022 despite her retrieving mail from the mailbox in all of the business days between 26 April 2022 and that day. It was put to him that if he had placed the statutory demand in the mail slot on 22 April 2022, Ms Finta would have found it there on 26 April 2022 when she returned to work. Mr Holmes responded that he could not speak as to when Ms Finta would have found it.
JJA’s submissions
Counsel for JJA, Mr Tennant, contended that there were six reasons why the Court should accept the evidence of JJA’s witnesses that the statutory demand was served on 5 May 2022, not on 22 April 2022.
First, the evidence of Ms Finta is that it was not until 5 May 2022, despite her attending work and checking the mailbox every business day from 26 April 2022 until 4 May 2022, that the demand was retrieved from Ascot Partners’ mailbox.
Second, the contemporaneous records maintained by Ascot Partners’ electronic system show that Ms Finta scanned the statutory demand into that system on 5 May 2022.
Third, Mr Holmes could not have placed the statutory demand in the mail slot at the North Melbourne property at 5:00pm on 22 April 2022 because Ms Weiland had already closed and padlocked the front gates at the property, preventing access to the mail slot.
Fourth, consistent with Ms Weiland’s evidence, when Mr Catanzariti attended the North Melbourne property on the evening of 22 April 2022, the front metal gates were closed and padlocked.
Fifth, the version of the statutory demand exhibited to the first Holmes affidavit and that was allegedly served on 22 April 2022 is different from the version served on JJA.
Sixth, Mr Holmes deposes in the first Holmes affidavit that he sent the 22 April 2022 email to Mr Newbold and exhibited a copy of the purported email to his affidavit. However, the 22 April 2022 email was allegedly sent from an email address that was unable to receive emails from Ms Stajcer, Mr Newbold did not receive the alleged 22 April 2022 email, and neither Mr Holmes nor Promurus’ solicitors produced a native version of the alleged 22 April 2022 email despite a copy being exhibited to the first Holmes affidavit. In cross‑examination, Mr Holmes stated that the email was printed out so that it could be exhibited to Mr Holmes’ affidavit.
JJA contends that the Court should accept that it has discharged the burden it bears to establish that statutory demand was served on 5 May 2022 and the originating process and supporting affidavit were served on Promurus on 24 May 2022, i.e. within 21 days of service of the statutory demand.
Promurus’ submissions
In its submissions, Mr Wilmoth, counsel for Promurus, made reference to Mr Newbold’s affidavit of 30 June 2022, where he makes reference that he “first became aware of the demand on 9 May” and voiced criticism that, even on JJA’s evidence, the demand was served at the registered office on 5 May 2022, but for a period of several days, there was no consideration of the demand and this was not explained.
As regards Ms Weiland’s affidavit, Mr Wilmoth notes that she does not depose to her actual memory of locking the gates at about 4:50pm on 22 April 2022, but describes, in paragraph 8, her “usual practice” and concludes she would have gone through the process of locking the gates after turning on the building security alarm at 4:50pm. If that be so, it follows that Mr Holmes could have put the demand in the mail slot before 4:50pm, consistently with his evidence that he did so at “about 5:00pm”. As such, he contended the demand may have been at its registered office, in the possession of its accountants for up to several days, that is, 5 May to 9 May 2022 before it was sent to JJA.
Mr Wilmoth contends that JJA has failed to explain the delay of a week in its accountants forwarding it the demand and the inference that should be drawn is that Ascot Partners “sat on” the demand, resulting in JJA’s failure to comply with the strict 21‑day time limit for its application to set aside the demand.
Consideration
It is obvious from the foregoing that the two accounts as to the date of service of the demand cannot be satisfactorily reconciled. As has been mentioned, JJA bears the onus of establishing that it has made application within the time prescribed by s 459G(2).
JJA’s detailed evidence directed to the practices adopted by its accountants, whose premises serve as JJA’s registered office, in regard to access, monitoring and clearance of the mailbox at their premises is comprehensive and plausible.
Ms Weiland’s evidence is that she locked the gates at 4:50pm on 22 May 2022 and supports this by her reference to the electronic alarm, which logs her departure from the premises. As she was the last person in attendance at the premises, it was her responsibility to lock the premises from the outside.
Ms Weiland’s evidence is corroborated by the evidence of Mr Catanzariti, who visited the premises later that day, found the gates locked, and was required to unlock the padlock to the gates to gain admittance to the premises.
In her evidence, Ms Finta, the receptionist and administrative assistant at Ascot Partners, outlines her responsibility for monitoring and retrieving mail left in the mailbox and the procedure adopted for dealing with mail placed into it. She states that she employs a procedure of scanning the item onto Ascot Partners’ system, electronically filing it, and taking the physical copy to the accountant who manages that account. Her evidence is that during the period of 26 April to 4 May 2022, she was in attendance at work and carried out her normal duties and states that she did not find the statutory demand addressed to JJA in the mailbox in that period. She states that she did find it on 5 May 2022 and that she scanned it on that day.
Ms Weiland, Ms Finta and Mr Catanzariti were not cross‑examined on their affidavits. In my view, there is no evidence to support the contention made by Mr Wilmoth that Ascot Partners have ‘sat on’ the demand after it was served at their office.
As to Promurus’ evidence, in his affidavit of 10 June 2002, sworn some seven weeks after he deposes that he served the demand, Mr Holmes deposes that he placed the demand in the letterbox at the premises “at about 5pm” on 22 May 2022 and his access was not impeded by the gates mentioned in the evidence. He states that he made a note recording this but that note was not available as it was not retained by him, being discarded on the day of service or very shortly afterwards. This is despite Mr Holmes’ acceptance of the proposition of the importance of recording the date, time, and place of service of a statutory demand. The affidavit of 10 June was therefore sworn without the assistance of the note. The note did not, in any event, on Mr Holmes’ evidence, record the day of service, stating only “227 - @ 1700 hours”. Mr Holmes’ evidence was that very soon after service on 22 April 2022, by reference to that note, he prepared an informal affidavit of service, which was never sworn, but that draft affidavit of service has not been put into evidence. I observe that this document, being prepared so soon after the occasion of alleged service, would have served as a contemporaneous record of the date and time of service.
The circumstances surrounding the email purportedly sent by Mr Holmes on 29 April 2022 are curious and unexplained. It seems that, by its reference to the ‘… statutory demand served on your registered office a week ago’, the purpose for which such document was put into evidence was to bolster the evidence of Promurus in respect of the date of service. It is not explained how, if it is accepted by Mr Holmes that such a document was unsuccessfully sent from a non-existent email address, it could nonetheless bear a date and time of transmission and subsequently be able to be printed off for the purpose of exhibition to the 10 June affidavit.
Mr Holmes’ evidence as to the alteration of the date in the schedule to the demand from 20 April 2022 to 22 April 2022 is confusing and unsatisfactory. What is clear from the evidence is that the demand which was actually served on JJA was dated 20 April 2022 whereas the affidavit of Mr Kolyasa which accompanied it post-dated the demand, being dated 22 April 2022. [2]
[2]The significance of this is considered in the decision of the Full Court of the Supreme Court of Western Australia in Wildtown Holdings v Rural Traders Co Limited (2002) 172 FLR 35 (‘Wildtown Holdings’). In Wildtown Holdings, the affidavit was sworn two days before the demand and was held not to satisfy the requirements of s 459E(3) of the Corporations Act 2001 (Cth). See other authorities referred to in Assaf‘s Winding Up in Insolvency, 3rd edition at para 8.58–8.62 and footnote 288, as well as the author’s observation at para 8.61 that on balance, the accompanying affidavit should be sworn on the same day as the statutory demand.
The offences to which Mr Holmes admits to being convicted of are serious and are, to my mind, despite the passage of time, relevant in the context of the controversy here. Putting it bluntly, on previous occasions, Mr Holmes has been prepared to put forward falsities on oath when he considered that it was to the advantage of his interests to do so.
I find that JJA has established, to my satisfaction, on the balance of probabilities, that the demand was served at the registered office on 5 May 2022 and that JJA therefore had until 26 May 2022 to make an application to set aside the demand under s 459G of the Act, which it has done.
In the circumstances, the preliminary issue is decided in favour of JJA.
I will make an order pursuant to s 100 of the Evidence Act that JJA be permitted to put the matters to Mr Holmes concerning his prior history, notwithstanding the failure by JJA to serve a tendency notice under s 97 of the Evidence Act and hear the parties as to appropriate orders for the further conduct of the matter. In particular, I will invite submissions in respect of the fact, as has been mentioned, that the affidavit accompanying the demand post-dates the demand.
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