Re Nature One Dairy (Australia) Pty Ltd - [2021] VSC 879

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

CORPORATIONS LIST

S ECI 2021 00894

IN THE MATTER of NATURE ONE DAIRY (AUSTRALIA) PTY LTD (ACN 633 981 665)

NATURE ONE DAIRY (AUSTRALIA) PTY LTD (ACN 633 981 665)	Plaintiff
v
BICHENO INVESTMENTS PTY LTD (ACN 122 192 134)	Defendant

- and -

S ECI 2021 00896

IN THE MATTER of NATURE ONE DAIRY PTY LTD (ACN 602 371 684)

NATURE ONE DAIRY PTY LTD (ACN 602 371 684)	Plaintiff
v
BICHENO INVESTMENTS PTY LTD (ACN 122 192 134)	Defendant

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JUDGE:	Efthim AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	13 July 2021
DATE OF JUDGMENT:	25 August 2021
CASE MAY BE CITED AS:	Re Nature One Dairy (Australia) Pty Ltd; Re Nature One Dairy Pty Ltd
MEDIUM NEUTRAL CITATION:	[2021] VSC 879

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CORPORATIONS – Application to set aside a statutory demand pursuant to s 459G of the Corporations Act 2001 (Cth) – Genuine dispute – Offsetting claim – Whether claim in separate proceeding constitutes offsetting claim for purpose of s 459H(1)(b) of the Corporations Act 2001 (Cth) – Offsetting claim cannot be quantified – Lack of mutuality – Whether debt due and payable – Abuse of process – s 459J of the Corporations Act 2001 (Cth) – Multiplicity of claims for single debt – Statutory demand issued for improper purpose.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr S B Rosewarne Mr N J Guenther	Nicholson Ryan Lawyers
For the Defendant	Mr C R Brown	Mills Oakley

HIS HONOUR:

The plaintiffs in these proceedings, Nature One Dairy (Australia) Pty Ltd and Nature One Dairy Pty Ltd, apply pursuant to s 459G of the Corporations Act 2001 (Cth) (‘the Act’) to set aside statutory demands dated 9 March 2021, which were served on them by the defendant, Bicheno Investments Pty Ltd, in each proceeding.

The demands claim that the plaintiffs are indebted to the defendant in the amount of $5,520,000. The debt is described in the schedules of each demand as:

…relating to the Redemption Amount calculated pursuant to the Converting note deed poll executed by Nature One Dairy (Australia) Pte Ltd Singapore Entity No. 201507161W in favour of the creditor and guaranteed by the debtor pursuant to the Guarantee Deed Poll executed by the debtor in favour of the creditor.

Affidavits

The plaintiffs rely on three affidavits of their CEO, Nick Dimopoulos, each affirmed on 26 March 2021, 14 May 2021 and on 29 June 2021, respectively, and an affidavit of Francesco Licciardello, director of Nature One Dairy Pty Ltd (‘NOD’), affirmed on 21 May 2021. The defendant relies on the affidavit of its former solicitor Benjamin Scott Swain, sworn on 15 June 2021.

Background

NOD operates, primarily through its Australian subsidiaries, as an Australian blend and pack manufacturer of powdered milk products, including infant formula, from its 100% owned processing facility located in Carrum Downs, Victoria. As well as developing its own range of powdered milk products, NOD also has blend and pack agreements…

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: [2021] VSC 879
Decision Date: 25 August 2021

CaseChat Overview and Summary

The case of Re Nature One Dairy (Australia) Pty Ltd involved a dispute between Nature One Dairy, the debtor, and various creditors, including the applicant. The primary issue before the court was whether the statutory demand issued against Nature One Dairy could be set aside under sections 459G and 459J of the Corporations Act 2001. The debtor argued that the statutory demand should be set aside due to the existence of a genuine dispute, an offsetting claim, and an abuse of process. The court was tasked with determining whether the offsetting claim constituted a genuine dispute and if the statutory demand was issued for an improper purpose.

The court examined the nature of the offsetting claim and whether it could be considered as an offsetting claim under section 459H(1)(b) of the Corporations Act. The debtor argued that the claim in a separate proceeding could be considered an offsetting claim. However, the court noted that the offsetting claim could not be quantified and lacked mutuality. Furthermore, the court considered whether the debt was due and payable and whether there was an abuse of process under section 459J of the Corporations Act. The debtor argued that the multiplicity of claims for the single debt and the issuing of the statutory demand for an improper purpose warranted setting aside the demand.

The court ultimately found that the statutory demand could not be set aside as the debtor had not demonstrated a genuine dispute or an offsetting claim. The court held that the offsetting claim was not quantifiable and lacked mutuality. Additionally, the court found that the statutory demand was not issued for an improper purpose, and there was no evidence of abuse of process. Consequently, the application to set aside the statutory demand was dismissed.

The court ordered that the application to set aside the statutory demand be dismissed, and costs were awarded to the respondent.

Orders