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Re L H Holding Management Pty Ltd

Re L H Holding Management Pty Ltd

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT
CORPORATIONS LIST

S ECI 2024 01774

IN THE MATTER of L H HOLDING MANAGEMENT PTY LTD (ACN 118 908 660)

BETWEEN:

L H HOLDING MANAGEMENT PTY LTD (ACN 118 908 660)	Plaintiff
v
GEORGIA TSAHRELIAS	Defendant

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JUDGE:	Gardiner AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	22 November 2024
DATE OF JUDGMENT:	4 July 2025
CASE MAY BE CITED AS:	Re L H Holding Management Pty Ltd
MEDIUM NEUTRAL CITATION:	[2025] VSC 407

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CORPORATIONS – Application to set aside statutory demand pursuant to ss 459G, 459H and 459J of the Corporations Act 2001 (Cth) – Whether genuine dispute as to whether the debt was due and payable – Defect under s 459J(1)(a) of the Corporations Act 2001 (Cth) – ‘Some other reason’ under s 459J(1)(b) of the Corporations Act 2001 (Cth) – Debt the subject of the demand based on a compensation order made pursuant to s 85B of the Sentencing Act 1991 (Vic) – Plaintiff found guilty of workplace manslaughter pursuant to s 39G of the Occupational Health and Safety Act 2004 (Vic) – Stay of compensation order pending plaintiff’s appeals pursuant to s 311(2) of the Criminal Procedure Act 2009 (Vic) – Effect of stay under s 311(2) of the Criminal Procedure Act 2009 (Vic) – Whether stay of operation or stay of execution – Whether there was a genuine dispute that the debt claimed was not due and payable at the time of service of the demand by reason of the stay being a stay of operation – Whether demand should be set aside by reason of the existence of the stay pursuant to s 459J(1)(b) – Alleged defect in the demand under s 459J(1)(a) – Schedule to demand included the words ‘and penalty interest’ but no penalty interest was quantified as part of the debt claimed in the demand – Finding that there was a defect in demand but such defect did not cause substantial injustice – Finding that there was a genuine dispute as to the nature and effect of the stay imposed by s 311 of the Criminal Procedure Act which was not appropriate to be resolved in this application – Demand set aside.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M Tennant	Ward & Co. Legal Consultants Pty Ltd
For the Defendant	Mr P Duggan	Carbone Lawyers

TABLE OF CONTENTS

Introduction

This proceeding

The application to Croucher J for a direction that the s 311(2) stay be lifted

L H Holding’s submissions

Was the debt claimed ‘due and payable’ when the demand was served?
The claim for ‘penalty interest’ without specification of the amount claimed

Ms Tsahrelias’ submissions

No genuine dispute
No defect in the demand
‘Some other reason’

Legal principles

Consideration

Is it arguable that the debt claimed in the demand is not ‘due and payable’?
Is there a defect in the demand which causes substantial injustice?
The demand was not accompanied by a supporting affidavit

HIS HONOUR:

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.

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Details

Case: [2025] VSC 407
Decision Date: 4 July 2025

CaseChat Overview and Summary

The case of Re L H Holding Management Pty Ltd involved an application by L H Holding Management Pty Ltd to set aside a statutory demand served on them. The demand was issued by a creditor who claimed that L H Holding Management Pty Ltd owed them a debt. The dispute was heard in the Federal Circuit Court of Australia. The primary legal issue before the court was whether there was a genuine dispute about the debt being due and payable, which would allow the statutory demand to be set aside under the Corporations Act 2001. Additionally, the court had to consider whether there was a defect in the demand itself, and if there were any other reasons why the demand should be set aside.

The court examined the nature of the debt, which was based on a compensation order made pursuant to the Sentencing Act 1991. The compensation order followed a conviction under the Occupational Health and Safety Act 2004. The court also considered the effect of a stay of the compensation order, pending appeals, imposed under the Criminal Procedure Act 2009. The central question was whether this stay constituted a stay of operation or a stay of execution, and whether this affected the debt's due status at the time the demand was served. The court found that there was a genuine dispute regarding the nature and effect of the stay, which was not suitable to be resolved through the application to set aside the demand.

The court determined that the statutory demand had a defect in that it mentioned penalty interest in the schedule but did not quantify it in the demand itself. However, the court held that this defect did not cause substantial injustice. Ultimately, the court set aside the demand, finding that there was a genuine dispute about the nature and effect of the stay under the Criminal Procedure Act, and that this issue was inappropriate to resolve in this particular application. The court's decision was that the demand should be set aside due to the genuine dispute and the existence of the stay.

The final orders of the court were to set aside the statutory demand served on L H Holding Management Pty Ltd. This decision provided relief to L H Holding Management Pty Ltd from the immediate pressure to pay the debt claimed by the creditor.

Orders