Re Resource Pty Ltd

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT
CORPORATIONS LIST

S ECI 2025 02674

IN THE MATTER of RESOURCE PTY LTD (ACN 615 144 066)

BETWEEN:

RESOURCE PTY LTD (ACN 615 144 066)	Plaintiff
v
GTV RECYCLING PTY LTD (ACN 664 244 928)	Defendant

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JUDGE:	Steffensen AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	9 July 2025
DATE OF RULING:	9 September 2025
CASE MAY BE CITED AS:	Re Resource Pty Ltd
MEDIUM NEUTRAL CITATION:	[2025] VSC 567

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CORPORATIONS – Statutory demand – Application to set aside under s 459H of Corporations Act 2001 (Cth) – Whether there is a genuine dispute as to whether the debt is due and payable – Where no dispute as to the quantum of the debt – Whether there is sufficient evidence as to an alleged oral agreement to defer payment – Whether Court may entertain alternative arguments by a defendant which assume that genuine dispute has been established – Whether it is appropriate to subpoena documents in support of an alternative argument – Corporations Act 2001 (Cth), ss 459H(1)(a), 459H(3).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	S. Clement	Frenkel Partners
For the Defendant	G. Lubofsky	Dark Legal

TABLE OF CONTENTS

A.. Introduction

B.. Background

C.. Applicable Principles

D.. Is there a genuine dispute as to whether payment is due?

D.1         Evidence relied upon by the plaintiff
D.2         Is there sufficient evidence of the Alleged Oral Agreement?
D.3         Is there a plausible contention that the Alleged Oral Agreement is supported by consideration?
D.4         Conclusion

E... The defendant’s alternative arguments

E.1 First alternative - What is the impact of the credit application?
E.2 Second alternative – Was the debt due because the Alleged Oral Agreement was discharged or frustrated?

F... Orders

HER HONOUR:

A Introduction

This application is to set aside a statutory demand pursuant to ss 459G, 459H or 459J of the Corporations Act 2001 (Cth).
Subject to a small offsetting claim which is accepted by the defendant, the plaintiff does not dispute the quantum of the debt. The plaintiff seeks that the demand be set aside because it genuinely disputes that the debt is due and payable. The plaintiff contends that the parties orally agreed on 9 and 10 September 2024 that the debt will only be payable upon the plaintiff receiving funds from its insurer and not otherwise (the ‘Alleged Oral Agreement’). In support of its application, the plaintiff relies on the affidavits of its director, Troy Rowe, filed on 14 May 2025 and 1 July 2025; and submissions filed on 1 July 2025.
The defendant primarily opposes the application on the following grounds. It denies the parties reached the Alleged Oral Agreement and disputes that there is sufficient evidence to found a plausible contention that any such agreement was reached. In the alternative, the defendant says that even if the parties reached the Alleged Oral Agreement, it was not binding because the parties had entered into a prior binding agreement on 7 September 2024 and the defendant did not receive any consideration in exchange for deferring payment under the Alleged Oral Agreement. The defendant relies on the affidavit of its employee and National Technical Business Development Manager, Michael Lunt, filed on 18 June 2025; the affidavit of its managing director, Gareth Robinson, filed on 18 June 2025; the affidavits of its solicitor, Alicia Dark, filed on 16 June 2025, 19 June 2025 and 20 June 2025; and submissions filed on 4 July 2025.
I set out relevant background and the principles to be applied by the Court below in Parts B and C respectively. The key question to be determined by the Court is whether the plaintiff has demonstrated there is a genuine dispute as to whether the parties reached the Alleged Oral Agreement. For the reasons set out in Part D below, I am satisfied that the plaintiff has established there is a genuine dispute.
In addition to its primary grounds of opposition, the defendant argued two additional alternative grounds. Counsel described these alternative ground to be relevant to ‘the alternative universe’ where, contrary to the defendant’s primary case, the Court accepts that there is a genuine dispute as to whether the parties entered into the Alleged Oral Agreement.[1]
[1]Transcript of Proceedings, In the Matter of Resource Pty Ltd (ACN 615 144 066) (Supreme Court of Victoria, S ECI 2025 02674, Steffensen AsJ, 9 July 2025) 66 (‘Transcript’).
For the reasons set out in Part E below, there are a number of difficulties with the defendant’s alternative claims and neither provides a basis for refusing the relief sought by the plaintiff.

B Background

I will now set out the background to this application. Save where I expressly indicate, these matters are not disputed.
A fire occurred at the plaintiff’s premises on 7 September 2024. The plaintiff engaged the defendant to provide fire clean-up services, which the defendant commenced providing that day.
On 9 and 10 September 2024, Mr Rowe of the plaintiff and Mr Lunt of the defendant exchanged text messages and telephone calls, during which the timing of the plaintiff’s payment for the defendant’s services was discussed. The plaintiff says that it was during these conversations that the parties reached the Alleged Oral Agreement. What was said during these conversations is a matter of dispute.
Further services were provided by the defendant to the plaintiff on 10, 11 and 13 September 2024.
On 24 September 2024, the defendant issued an invoice for its services in the amount of $81,208.49, which sets out a ‘due date’ of 24 October 2024 (the ‘Invoice’). However, the defendant does not contend that the debt was due and payable on 24 October 2024.
On 19 November 2024, the plaintiff executed a credit application form provided to it by the defendant. The credit application includes terms and conditions regarding the supply of goods and services by the defendant to the applicant on credit.
On 24 April 2025, the defendant issued a statutory demand in respect of monies due and owing for goods and services described in the Invoice.
Prior to issuing the statutory demand, the defendant sought payment of the debt from the plaintiff. The defendant issued overdue payment requests to the plaintiff by email on 28 October and 18 November 2024.[2] However, copies of these requests or any response from the plaintiff were not adduced.
[2]Affidavit of Gareth Robinson filed on 18 June 2025, [14] (‘Robinson Affidavit’).
It is apparent that a letter of demand was sent on 28 January 2025, however, the demand itself is not in evidence. Email correspondence passed between the parties on 28 January, 6 March, 20 March and 4 April 2025 in relation to the payment of the debt and the payment terms. On 24 April 2025, Mr Rowe and Mr Lunt exchanged text messages which address the payment terms of the debt.
The plaintiff relies upon this email and text correspondence to support the contention that the Alleged Oral Agreement was made. The defendant disputes that this material assists the plaintiff, and submits that the plaintiff’s contention rises no higher than mere assertion as to an agreement.

C Applicable Principles

Section 459E of the Corporations Act provides that statutory demands may be served on a company for a debt that is ‘due and payable’. This means that the debt is ascertainable, immediately payable and presently recoverable or enforceable by action.[3]
[3]Re Renu Waste Pty Ltd [2020] NSWSC 108, [22].
There is some contention as to whether an application to set aside a statutory demand on the basis that the debt is not due and payable should be made under s 459H(1)(a) (for a genuine dispute as to the existence of the debt), s 459J(1)(a) (as a defect that causes substantial injustice) or s 459J(1)(b) (for some other reason). In Re Renu Waste Pty Ltd, Rees J surveyed the authorities on this topic.[4] Her Honour concluded that when a company applies to set aside a statutory demand on the basis that there is a genuine dispute, not as to the existence or the amount of the debt, but whether it is due and payable, then the court may set it aside under any of ss 459H(1)(a), 459J(1)(a) or 459J(1)(b), ‘but whichever route is taken, the Court must be satisfied before doing so that there is a “plausible contention requiring investigation” that the debt is not presently due and payable’.[5] That is, whichever pathway is used, genuine dispute must be demonstrated.
[4]Ibid [25]–[32], cited with approval in Re Mearth Technology Pty Ltd [2024] NSWSC 656, [50].
[5]Ibid [32].
Even though the originating process refers to both ss 459H and 459J, the parties’ submissions focussed upon whether a genuine dispute had been established under s 459H(1)(a). Given the standard of proof is the same for both ss 459H and 459J, this is of no consequence.
The principles to be applied when considering whether there is a genuine dispute are set out by the Court of Appeal in Malec Holdings Pty Ltd v Scotts Agencies Pty Ltd (in liq).[6] These principles are not in dispute, and can be summarised briefly as follows:
[6][2015] VSCA 330, [47]–[51] (‘Malec’).
(a)The threshold for establishing a genuine dispute is low.[7]
(b)For the purposes of s 459H of the Act, a genuine dispute will exist about a specified debt if there is a ‘plausible contention requiring investigation’ that the company is not so presently indebted as alleged.[8]
(c)The dispute must be bona fide and truly exist in fact and have objective existence, factual particularity and prima facie plausibility.
(d)A dispute will not be genuine if it is fanciful, futile, or mere bluster or assertion. The grounds for alleging the existence of a dispute must be real and not spurious, hypothetical, illusory or misconceived. [9]
(e)It is not necessary for the court to engage in an in-depth examination or determination of the merits of the dispute, and it is not the court’s role to identify the likely result of the dispute.[10] Rather, the task of the court is analogous to a summary judgment application; that is, to decide whether there is a dispute ‘such as would warrant subsequent adjudication’.[11] If it sees any factor that, on rational grounds, indicates an arguable case on the part of the plaintiff, it must find that a genuine dispute exists, even where any case apparently available to be advanced against the plaintiff seems stronger.[12]
(f)Whilst an applicant is not required to formally or comprehensively evidence the basis of its dispute:
The court is not required to accept uncritically every statement in an affidavit however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by the same deponent, or inherently improbable in itself, it may be, as it may not have sufficient prima facie plausibility to merit further investigation as to its truth. The court is also not required to accept uncritically a patently feeble legal argument or an assertion of facts unsupported by evidence …[13]
(g)Except in extreme cases, the court should not embark upon an inquiry as to the credit of a deponent whose evidence is relied on by the applicant.[14]
[7]Ibid [47].
[8]Ibid [48].
[9]Ibid [49].
[10]Ibid [48]; see also Re Morris Catering (Australia) Pty Ltd (1993) 11 ACSR 601, 605.
[11]JJMMR Pty Ltd v LG International Corporation [2003] QCA 519, [4].
[12]Panel Tech Industries v Australian Skyreach (No 2) [2003] NSWSC 896, [18]; Malec (n 6) [48].
[13]Malec (n 6) [50].
[14]Ibid [50].
It is usually inappropriate for the court to attempt to decide competing contentions as to contractual interpretation, because if the disputed question of contractual interpretation is arguable, and not patently feeble or plainly without basis, there will be a genuine dispute.[15]

D Is there a genuine dispute as to whether payment is due?

[15]Grandview Ausbuilder Pty Ltd v Budget Demolitions Pty Ltd [2019] NSWCA 60, [90] (‘Grandview’).

D.1 Evidence relied upon by the plaintiff

The key issue to be determined on this application is whether the plaintiff has established that there is a plausible contention warranting further investigation that the parties reached the Alleged Oral Agreement.
Mr Rowe’s affidavit filed on 14 May 2025 says that the fire occurred on 8 September 2024, and that the plaintiff sought to engage the defendant to provide water clean-up services on 9 September 2024. The plaintiff now accepts that the evidence establishes that the fire occurred on 7 September 2024, that the defendant was engaged and commenced providing water clean-up services on the day of the fire, and that these services account for over half of the Invoice amount.
The text messages exchanged between Mr Rowe and Mr Lunt on 9 September 2025 evidence that the payment terms were discussed via text messages. In these text messages, Mr Rowe says:
Also, just a reminder this is an insurance job and the last payout took 5 months and your accounts team was chasing me for payment but I simply don’t have cash flow this time round so payment terms would need to be based on whenever the insurance pays out. Can you confirm that is all good please?[16]
[16]Text Message from Mr Rowe to Mr Lunt dated 9 September 2024 , Exhibit TR-1 to the Affidavit of Troy Rowe filed on 14 May 2025, 14 (‘First Rowe Affidavit’).
The text messages set out what Mr Rowe was seeking to negotiate, which is consistent with what he says was the ultimate agreement reached between the parties. The plaintiff submits, and I accept, that it is arguable that the reference in Mr Rowe’s text message to ‘a reminder this is an insurance job’ may evidence that the payment terms were discussed prior to Mr Rowe’s text message.
In his responding text message, Mr Lunt does not provide confirmation that the payment terms sought by Mr Rowe were ‘all good’. Rather, Mr Lunt states:
Re the insurance side of things, I’ll be letting our MD’s know that it could take at least a couple of months to get paid and I’ll also negotiate with TDG/30XY to see if they can give us some leniency on holding the debt for 60’ish days with that scenario in mind.
If it’s looking to be drawn out past that, it would be ideal if you could chip away at it to reduce what we’d be realistically holding, as we’re in a similar boat cashflow wise too.[17]
[17]Text Message from Mr Lunt to Mr Rowe dated 9 September 2024 , Exhibit TR-1 to the First Rowe Affidavit (n 16) 15–16.
The plaintiff accepts, as it should, that these text messages do not evidence an agreement between the parties that payment terms would be based upon whenever the plaintiff’s insurer pays out. However, these text messages do assist in providing context for the subsequent conversations between the parties. In fact, both parties rely upon the text messages as context for what they say was agreed between the parties.
The Invoice identifies that no services were provided by the defendant to the plaintiff on 8 or 9 September 2024.
Mr Rowe has gone on oath and explained the oral agreement that he says was reached between the parties. At paragraphs 14 to 15 of his first affidavit, Mr Rowe says:
Between 9 and 10 September 2024, I had further telephone calls with Mr Lunt regarding the Services and the payment arrangement. In those telephone discussions, Mr Lunt agreed that [the defendant’s] fees for completing the Services would be payable only upon [the plaintiff] receiving the anticipated insurance claim monies related to the September Fire, and not otherwise. That was the basis upon which Resource engaged GTV to perform the Services. To my knowledge, Mr Lunt has never reneged on that being what was agreed and, as set out below, he has reaffirmed that position since the Creditor’s Statutory Demand was improperly issued.
In reliance upon these communications and the representations by Mr Lunt, [the plaintiff] engaged [the defendant] to complete the Services.[18]
[18]First Rowe Affidavit (n 16) [14]–[15].
The Invoice shows that the balance of the services were provided on 10, 11 and 13 September 2024.
Mr Lunt of the defendant has sworn evidence which disputes the content of the conversations between him and Mr Rowe.[19] Mr Lunt disputes that he agreed that the services would be payable only upon the plaintiff receiving anticipated insurance claims monies, and not otherwise. Mr Lunt says that he would never have reached such an agreement because he was not authorised to do so and the defendant would never agree to those terms.
[19]Affidavit of Michael Lunt filed on 18 June 2025, [15]–[18] (‘Lunt Affidavit’).
Mr Lunt accepts that there were telephone conversations between him and Mr Rowe, but says that he understood an agreement was reached whereby: (a) the defendant would wait two months to get paid; and (b) if the plaintiff had not received its insurance payment within those two months, then the plaintiff would start paying instalments to the defendant to reduce the amount owing, with the balance to be paid when the plaintiff received the insurance payout.[20]
[20]Ibid [17].
The plaintiff submits that despite the dispute between the parties as to what was agreed orally, Mr Lunt’s evidence is consistent to some extent with the agreement which Mr Rowe says was reached. This is because even on Mr Lunt’s evidence as set out in paragraph 17 of his affidavit, the defendant agreed to wait until the plaintiff received its insurance payout.
The plaintiff also relies upon Mr Robinson’s evidence as being to some extent consistent with the plaintiff’s contention that there was an agreement that the debt was not due for payment until insurance monies were received. Mr Robinson says:
On 18 November 2024, I convened a meeting with Sam Webb, General Manager of [the defendant], and Mr Lunt, to discuss a number of matters, including the amount owed by [the plaintiff] which was nearing the date for payment, 23 November 2024, being 60 days from the date [the Invoice] was issued.
During the meeting, I advised Mr Lunt that:
a.he failed to adhere to [the defendant’s] operating procedures whereby any payment term in excess of 30 calendar days requires approval from the Directors of [the defendant]; and
b.if [the plaintiff] couldn’t pay within the 60 day payment terms, they would need to enter into [the defendant’s] commercial credit terms contained in [the defendant’s] Application for Commercial Credit for the outstanding debt.[21]
[21]Robinson Affidavit (n 2) [11]–[12].
Mr Robinson does not explain why it was necessary to discuss the plaintiff’s debt prior to it falling due for payment on 23 November 2024. The plaintiff submits that Mr Robinson’s evidence suggests that there had been some other communication with him which indicated that a payment arrangement other than 60-day payment terms had been agreed with the plaintiff.
The plaintiff submits that the court should have regard to post-contractual conduct of the parties as evidence which supports the formation of the Alleged Oral Agreement. I accept that post-contractual conduct is relevant to the question of whether there was a payment-terms agreement between the parties, but cannot be relied upon on the question of construction of the terms of the alleged contract. This is an exception to the usual position that the court will only look at the evidence of the parties at the time the contract was entered into.[22]
[22]Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154, [59] (Campbell JA, with whom Beazley JA agreed and Basten JA agreed with one qualification). See also Webster Investments Pty Ltd v Anderson and Webster Investments Pty Ltd v North Star Developments Pty Ltd [2016] VSC 620, [45].

The plaintiff submits that the following conduct is consistent with the plaintiff’s assertion that the Alleged Oral Agreement was formed.
First, the plaintiff refers to correspondence between the parties before the statutory demand was issued, in which the defendant does not cavil with the plaintiff’s assertion that payment would be due when the insurer pays the plaintiff.
In this regard, the plaintiff points to an email from Mr Rowe to the defendant dated 28 January 2025, which apparently responds to a letter of demand sent to the plaintiff that day. In response to the demand, Mr Rowe writes:
[T]he job was offered on the basis payment was whenever insurance paid out. Agreement is implied by the fact the job was accepted. We do not have any payment from insurance and we have no clarity on when that will occur. Our business is owed into the millions so it is very much front of mind for us to continue pushing the insurer.
So to be clear, no payment will occur until insurance monies are received and I can provide a guarantee that payment to Enovate will occur within 48hrs of those funds being received.
If this letter of demand is pushed, any legal costs we are required to incur in defending this letter of demand will be taken off the debt owing.[23]
[23]Email from Mr Rowe to Elena Gandini dated 28 January 2025, Exhibit GR-1 to the Robinson Affidavit (n 2) 10.
There is no evidence of a response to Mr Rowe’s email until 6 March 2025, where the defendant’s employee writes:
I wanted to follow up since our last discussion was over a month ago. Please let me know if there are any developments, as we have passed 5 months.[24]
[24]Email from Ms Gandini to Mr Rowe dated 6 March 2025, Exhibit GR-1 to the Robinson Affidavit (n 2) 10.
The plaintiff relies upon this email to evidence post-contractual conduct which is consistent with the existence of the Alleged Oral Agreement. This is because it does not cavil with Mr Rowe’s version of events. It also refers to a 5-month period for payment, which is the time that the plaintiff’s previous insurance claim took to be paid out, as referred to in the text message exchange between Mr Rowe and Mr Lunt on 9 September 2025.
The plaintiff also relies upon a further email from the defendant’s accounts team to Mr Rowe dated 20 March 2025, which is in response to the plaintiff’s invoice which is the subject of the offsetting claim. It states:
I just wanted to confirm that your invoice will be paid as soon as [the Invoice] for $ 81,208.49 is settled.
I also sent an email a few weeks ago regarding the insurance, but I haven’t received an update yet. Do you have any news on that? The initial estimate was 5 months, and we are now entering month 6. An update on the status would be greatly appreciated.[25]
[25]Email from Ms Gandini to Mr Rowe dated 20 March 2025, Exhibit GR-1 to the Robinson Affidavit (n 2) 13.
Mr Rowe replied on the same day, stating:
Not sure about the logic there. We made an agreement to pay [the Invoice] upon receipt of insurance monies. Our invoice was due prior to [the Invoice] even being issued and was not linked to any such agreement.
We are still working on the insurer but we have not had a response to our recent attempts to contact them. Their loss adjuster is also pushing but has not got a response for the last few weeks so we are not entirely sure what is going on.[26]
[26]Email from Mr Rowe to Ms Gandini dated 20 March 2025, Exhibit GR-1 to the Robinson Affidavit (n 2) 12.
The defendant responded to this email on 4 April 2025, stating:
I understand that, but as you can also consider, we still have a considerable amount outstanding that we had to make a supplier payment, regardless.
Could you please request the name of the insurer and the name of the loss adjusteris [sic]?[27]
[27]Email from Ms Gandini to Mr Rowe dated 4 April 2025, Exhibit GR-1 to the Robinson Affidavit (n 2) 12.
For the same reasons addressed in respect of the 6 March 2025 email, the plaintiff submits that this email exchange is consistent with the existence of an agreement that the defendant’s debt is only payable whenever the insurance pays out. In the email dated 4 April 2025, the defendant does not cavil with Mr Rowe’s assertion that the parties made an agreement to pay the defendant upon receipt of insurance monies. The response of ‘I understand that’ is arguably acceptance that there was an agreement as asserted by Mr Rowe.
The plaintiff also relies on the text message sent by Mr Lunt to Mr Rowe on 24 April 2025, following the issuance of the statutory demand, in which Mr Lunt said:
I have told them this the entire way along that we will get paid once your insurer pays you.
Obviously, no one expected it to drag on this long, including you & I[.][28]
[28]Text Message from Mr Rowe to Mr Lunt, Exhibit TR-1 to the First Rowe Affidavit (n 16) 31; First Rowe Affidavit (n 16) [24]–[25].
The plaintiff submits that this is post-contractual conduct consistent with the existence of the Alleged Oral Agreement.

D.2 Is there sufficient evidence of the Alleged Oral Agreement?

In my view, the plaintiff has established that it genuinely disputes that the debt owed to the defendant is due and payable. The plaintiff has adduced evidence from Mr Rowe as to when the Alleged Oral Agreement was reached and as to the nature of that agreement.
The defendant submits that Mr Rowe’s evidence of the Alleged Oral Agreement is conclusory, and is therefore inadmissible or ought to be given no weight. I accept that this aspect of Mr Rowe’s evidence is conclusory. At paragraph 14 of his first affidavit, Mr Rowe states that Mr Lunt agreed certain matters. He does so without giving his evidence of his recollection of the words exchanged between the two men, as would be the usual form of admissible evidence of a conversation. The consequence of this is that the Court is not in a position to assess whether the words exchanged give rise to an oral contract between the parties.
However, I do not accept that Mr Rowe’s evidence is inadmissible on this application. Evidence which would not would not be admissible at trial, on account of it being hearsay, opinion, or in the form of conclusions as to primary facts, may be admissible as evidence that there is a dispute as to the existence or amount of a debt and as to whether that dispute is genuine.[29] As the Court of Appeal emphasised in TR Administration Pty Ltd v Frank Marchetti & Sons Pty Ltd,[30] the primary task is to establish a genuine dispute, and to do so, the company is not required to formally or comprehensively evidence the basis of the alleged genuine dispute in a manner that would be necessary at trial. Something less is required. The company will be able to establish genuine dispute provided that the evidence establishes that the dispute has sufficient objective existence and factual particularity to distinguish it from mere assertion.[31]
[29]Tokich Holdings Pty Ltd v Sheraton Constructions (NSW) Pty Ltd (in liq) [2004] NSWSC 527, [21]–[22].
[30][2008] VSCA 70.
[31]Ibid [71] (Dodds-Streeton JA, Neave and Kellam JJA agreeing at [1]–[2]).
Mr Rowe’s evidence is arguably consistent with:
(a)the break in services provided by the defendant between 7 and 10 September 2024, which arguably reflects the evidence of Mr Rowe that the plaintiff engaged the defendant to complete the services in reliance upon the communications and representations from Mr Lunt on 9 and 10 September 2024;[32]
(b)the text messages exchanged on 9 September 2024, which identify that the payment terms were the subject of negotiation between the parties;
(c)Mr Lunt’s evidence that the balance of the debt would be due upon receipt of insurance funds;[33] and
(d)to a lesser extent, the evidence of Mr Robinson from which it might be inferred that he was informed that there was an agreement between the parties that the debt would not be due and payable 60 days from the date of the Invoice.[34]
[32]First Rowe Affidavit (n 16) [15].
[33]Lunt Affidavit (n 19) [17].
[34]Robinson Affidavit (n 2) [11]–[12].
The Alleged Oral Agreement is also consistent with the defendant’s post-contractual conduct to which I have referred. That is, the defendant’s emails dated 6 March, 20 March and 4 April 2025, and Mr Lunt’s text message dated 24 April 2025.
The defendant raises the following issues with the sufficiency of the plaintiff’s evidence of the Alleged Oral Agreement:
(a)Mr Rowe’s evidence is vague as to the date of the agreement and how it was reached.
(b)The Alleged Oral Agreement is inconsistent with the text messages exchanged between Mr Lunt and Mr Rowe on 9 September 2024.
(c)The Alleged Oral Agreement is beyond Mr Lunt’s authority, as he is only authorised to enter into 30-day payment terms with customers.
(d)The Alleged Oral Agreement is inconsistent with the fact that the majority of the defendant’s services had been provided before the agreement was reached.
The defendant submits that I should that accept Mr Lunt’s evidence regarding the agreement between the parties in the telephone conversations over that of Mr Rowe. The defendant says that this is the appropriate course as Mr Lunt’s evidence is presented in admissible form and is consistent with the 9 September 2024 text messages between the parties.
I will address each of these arguments in turn.
I do not accept the defendant’s argument that Mr Rowe’s evidence is vague as to the date on which the Alleged Oral Agreement arose or how it was reached. Mr Rowe articulates this clearly in paragraphs 14 and 15 of his first affidavit, where he provides evidence that the agreement was reached orally during telephone calls with Mr Lunt between 9 and 10 September.
The defendant submits that the Alleged Oral Agreement is not plausible because it is inconsistent with the text messages exchanged between Mr Lunt and Mr Rowe on 9 September 2024. The defendant points to the fact that Mr Lunt’s text messages refer to the defendant’s obligations to its contractors, which provide commercial context as to why the defendant would not accept Mr Rowe’s payment term proposal. I accept, as does the plaintiff, that the alleged agreement is inconsistent with Mr Lunt’s payment proposal as set out in the 9 September 2024 text messages.
However, the fact that there were earlier text messages does not demonstrate that it is not plausible that a subsequent agreement was reached orally in the manner contended by the plaintiff. It is plausible that after the exchange of text messages the parties would enter into an oral agreement whereby the defendant agreed to the payment terms proposed by the plaintiff.
The defendant submits that that the Alleged Oral Agreement is not plausible, as Mr Lunt was not authorised to enter into agreements with customers with payment terms longer than 30 days. The limits upon Mr Lunt’s authority are referred to in Mr Lunt’s evidence[35] and Mr Robinson’s evidence.[36] The plaintiff submits, and I agree, that it is irrelevant whether Mr Lunt had actual authority to enter into the Alleged Oral Agreement. It is certainly arguable from the evidence of the negotiations between Mr Rowe and Mr Lunt that Mr Lunt had at least ostensible authority to bind the defendant.
[35]Lunt Affidavit (n 19) [18]–[19] .
[36]Robinson Affidavit (n 2) [6]–[7].
The defendant submits that the Alleged Oral Agreement is implausible because over half the services by value had already been provided by the time it was reached. I disagree. Again, there is nothing implausible about agreeing the payment terms after services had been provided but before the defendant completed the job.
The plaintiff’s counsel submitted that I should view Mr Rowe’s evidence generously in light of the obvious mistake regarding the date of the fire, and that there may be an error in the other dates or recollections referred to in his evidence. I do not accept that this would be appropriate. This is because the date of the fire was confirmed in Mr Lunt’s affidavit, but Mr Rowe did not take the opportunity in his reply affidavit to clarify or explain any error in his first affidavit as to the date he says the oral agreement was reached. Further, Mr Lunt’s evidence corroborates the dates of the conversations between the parties.
At paragraph 15 of his first affidavit, Mr Rowe states that the plaintiff agreed to engage the defendant to complete the services in reliance upon his communications with Mr Lunt. This is consistent with the Alleged Oral Agreement being the basis upon which the plaintiff engaged the defendant to provide services on 10, 11 and 13 September 2025.
I am therefore not satisfied that the Alleged Oral Agreement is inconsistent with the fact that services had already been provided by the defendant by the time the plaintiff alleges the agreement was reached.
The defendant submitted that I should accept Mr Lunt’s evidence as to what was agreed by the parties in the telephone conversations on 9 and 10 September 2024. I accept that Mr Lunt’s evidence as to those conversations is broadly consistent with that which he proposed by text message on 9 September 2024. I also accept that Mr Lunt’s evidence is presented in a more conventional manner. This is because he identifies the words he says were spoken during the relevant conversations with Mr Rowe. However, Mr Lunt’s evidence is arguably inconsistent with the text message he sent to Mr Rowe on 24 April 2025, which broadly aligns with the existence of the Alleged Oral Agreement. Mr Lunt’s evidence as to the agreement reached between the parties is also inconsistent with the defendant’s evidence and submissions on this application, and the various alternative positions raised. The agreement Mr Lunt says was reached is inconsistent not only with the 7 September 2024 agreement alleged by the defendant, which is addressed in Part D.3 below, but also with Mr Robinson’s evidence that the Invoice was due for payment on 23 November 2024.[37]
[37]Robinson Affidavit (n 2) [11].
The fact that Mr Lunt contests the evidence does not of itself demonstrate that Mr Rowe’s contentions are implausible. The dispute between the parties as to what was agreed during these telephone discussions is precisely the kind of dispute that the Court will not determine on an application to set aside a statutory demand. If I were to proceed in the manner proposed by the defendant, I would be determining that Mr Lunt’s version of events is to be preferred over Mr Rowe’s, without the benefit of trial on this issue or cross-examination of either deponent. This is a course which the authorities warn against on an application to set aside a statutory demand.[38]

D.3 Is there a plausible contention that the Alleged Oral Agreement is supported by consideration?

[38]Malec (n 6) [47]–[50].

The defendant argues that the plaintiff’s evidence rises no higher than mere assertion because by the time the Alleged Oral Agreement is said to have been reached, the parties had already entered into a binding contract. The defendant says that the Alleged Oral Agreement therefore cannot be binding on the parties as no consideration passed to the defendant in connection with the promises exchanged.
In this regard, the defendant submits that:
(a)The parties entered into a binding contract on 7 September 2024, being the day that the plaintiff requested the defendant’s services, and the date on which the defendant provided the majority of the services.[39]
(b)This binding contract was in respect of all clean-up services, such that the defendant was contractually obliged to complete the works that it commenced on 7 September 2024.
(c)As a matter of law, it is an implied term of that contract that the payment for the services became immediately due, such that the defendant was entitled to be paid either as and when it carried out the work on 7 September 2024,[40] or when it had provided all the services on 13 September 2024.[41]
[39]Transcript (n 1) 37–38.
[40]Transcript (n 1) 52.
[41]Ibid 62.
The defendant submits that absent a valid variation of the 7 September 2024 contract, the 7 September 2024 contract properly is to be construed without regard to the subsequent conduct alleged by the plaintiff to give rise to the Alleged Oral Agreement.
The defendant submits that if any agreement was reached between Mr Rowe and Mr Lunt to defer payment, they were merely agreeing to do what they were bound to do by the prior enforceable contract.[42] The defendant says that this is because the terms of the 7 September contract included an agreement to complete the services at the plaintiff’s site and an implied term that the defendant was entitled to immediate payment. Thus, as at 7 September 2024, the defendant was contractually obliged to continue to provide the services to the plaintiff until the clean-up job was complete and the plaintiff was contractually obliged to make immediate payment for those services.[43] The defendant submits that there therefore could not be an effective variation at law by the subsequent oral conversations on 9 and 10 September 2024, as the parties are just agreeing to do what they are already obliged to do pursuant to the binding 7 September 2024 agreement, and no fresh consideration passed.
[42]White Pointer Investments Pty Ltd v Creative Academy Group Pty Ltd [2023] NSWSC 817, [236] (‘White Pointer’), quoting Larkin v Girvan (1940) 40 SR (NSW) 356, 368, and citing Searle v Commonwealth of Australia (2019) 100 NSWLR 55, [7].
[43]Transcript (n 1) 52, 55–56.
Furthermore, the defendant submits that in light of the 7 September contract, any discussions or conduct referring to the defendant accepting payment later than 7 September 2024 do not evidence a binding agreement to vary the 7 September contract. In this regard, the defendant relies upon authorities where the court has found that a creditor granting an indulgence in respect of payment was found not to have varied the agreement between the parties.[44]
[44]White Pointer (n 42) [232].
Each of these arguments hinge upon there being a valid, enforceable agreement between the parties dated 7 September 2024 with the terms as alleged by the defendant. If that were a matter which was beyond doubt, it might serve to demonstrate that the Alleged Oral Agreement does not have sufficient prima facie plausibility to merit further investigation as to its truth.
However, on the evidence before me, I am not satisfied that the defendant’s evidence of the 7 September 2024 agreement is so compelling as to demonstrate that the plaintiff’s contentions are not plausible and warrant investigation.
The evidence relied upon by the defendant to establish the 7 September 2024 agreement is the accepted fact that the defendant commenced the clean-up work on 7 September 2024 in response to the plaintiff’s request. Mr Lunt’s evidence of the engagement on 7 September 2024 by telephone call with Mr Rowe is addressed at paragraphs 10 and 11 of his affidavit. He says that he provided Mr Rowe with the defendant’s ‘litre per hour’ rates for the services.
Other than the evidence from Mr Lunt that he provided Mr Rowe with the defendants’ litre-per-hour rates for the service, there is no evidence that price was agreed by the parties on 7 September 2024. It is apparent from Mr Lunt’s text messages sent on 9 September 2024 that price was still being discussed between the parties two days later.
There is also no evidence that the parties discussed or agreed payment terms on 7 September 2024. Counsel for the defendant submitted that, given the contract between the parties was silent as to the time for payment, the law will imply a term that payment is due either immediately or upon conclusion of the work.[45] This would make the debt due on either 7 or 13 September 2024. However, he did not take the Court to any authority for that proposition, and submitted that such a term would arise because it would be necessary to give business efficacy to the agreement reached between the parties.[46] Counsel for the plaintiff was unable to identify authority which supported the defendant’s submission. The defendant also did not explain how the debt became immediately due for payment on 7 or 13 September 2024. On those dates, the defendant had yet to issue any invoice and the services under the agreement remained incomplete. There is no evidence that the plaintiff knew the quantum of the debt payable as at either date.
[45]Transcript (n 1) 52.
[46]Ibid 62, 95.

There is also no evidence which supports the defendant’s submission that it was contractually obliged to continue providing the services until the cleanup was complete.
The 7 September 2024 agreement alleged by the defendant also appears inconsistent with:
(a)Mr Lunt’s evidence as to the payment terms agreed between the parties on 9 and 10 September 2024, prior to further services being provided;[47] and
(b)Mr Robinson’s evidence that the date for payment of the Invoice was 23 November 2024, being 60 days from its date of issue.[48]
[47]Lunt Affidavit (n 19) [17].
[48]Robinson Affidavit (n 2) [11].
The defendant’s argument hinges upon the formation of an agreement on 7 September 2024 that included an implied term of immediate payment. Given the lack of evidence adduced on this application to support the 7 September 2024 agreement and the absence of binding authority that the law will imply a term of immediate payment on 7 September 2024, I am not satisfied that this argument demonstrates that the plaintiff’s dispute as to the payment terms is not plausible or genuine.
Further, and in any event, whatever agreement was reached between the parties on 7 September 2024, the evidence establishes a plausible contention that it was varied by the subsequent agreement as contended for by the plaintiff, with consideration passing by reference to the additional services provided by the defendant after 10 September 2024.

D.4 Conclusion

For these reasons, I am satisfied that the plaintiff has adduced sufficient evidence to establish the objective existence and factual particularity of its dispute as to the payment terms, and that this distinguishes it from mere assertion.
The defendant raises a number of arguments in support of its contention that the plaintiff’s asserted dispute is not plausible or genuine and ought to be rejected. However, as discussed above, none of the defendant’s arguments demonstrate that the plaintiff’s contentions are implausible or patently feeble, such that the dispute raised is not genuine. Rather, the defendant’s arguments reveal that there is a genuine dispute between the parties as to the terms of the contract between them.
It is plain that the dispute raised by the plaintiff has not been manufactured in response to the statutory demand. Rather, the plaintiff’s contention as to the agreement between the parties is referred to in multiple pieces of correspondence exchanged prior to the defendant serving the demand. This is shown in the emails from Mr Rowe to the defendant dated 28 January and 20 March 2025, and the correspondence he sent to Mr Lunt and the defendant’s lawyers immediately upon receipt of the statutory demand.
At a trial of the parties’ dispute on its merits, the plaintiff will need to prove that the Alleged Oral Agreement is in line with the objective theory of contract. I accept the defendant’s submission that at trial, the Court will need to undertake an analysis of the kind undertaken in Dig It Landscapes (in liq) v Bupa Aged Care Australia Pty Ltd (No 2).[49] That is, the Court will need to consider detailed evidence as to the words and conduct of the parties in their commercial context, in order to determine whether a binding agreement was reached in the manner that the plaintiff contends. The evidence on this application does not reach that far, nor is it necessary for it to do so. However, given the consistencies between the plaintiff’s case and the evidence analysed above, I am satisfied that there is sufficient evidence to establish a plausible contention that the parties entered into the Alleged Oral Agreement.
[49][2024] FCA 31, [138]–[179].

E The defendant’s alternative arguments

Th defendant raises two arguments expressly on the basis that they are only to be considered if the Court finds, as it has done, that there is a genuine dispute as to whether the parties reached the Alleged Oral Agreement.[50]
[50]Transcript (n 1) 66.
There are conceptual difficulties with running alternative arguments which accept that the plaintiff has established that there is a genuine dispute. Once the court is satisfied that there is a genuine dispute in the terms alleged by the plaintiff as to whether the debt is due and payable, that is the end of the matter. This is because the court has determined that the dispute warrants subsequent adjudication and the statutory demand will be set aside.
This is consistent with s 459H(3), which provides that where the ‘substantiated amount’ calculated in accordance with the formula set out in s 459H(2) is less than the statutory minimum ‘the Court must, by order, set aside the demand’. Where the court is satisfied that there is a genuine dispute as to the existence of the demanded debt, the substantiated amount will always be nil (or a negative amount, if an offsetting claim as been established), and thereby less than the statutory minimum. This is because s 459H(5)(a) defines the ‘admitted amount’ to be a nil amount where there is a genuine dispute as to the existence of the debt. Therefore, the ‘substantiated amount’ calculated in accordance with s 459H(2) (being the admitted total less the offsetting total) will also be a nil amount. Thus, where a genuine dispute has been established as to the existence of the demanded debt, the court has no discretion, and must order that the demand be set aside under s 459H(3).
There may be circumstances where a defendant will adduce evidence which demonstrates that even if the plaintiff establishes its case at trial, the plaintiff will certainly fail for some reason. This may be done by demonstrating that the plaintiff’s arguments are patently feeble in light of uncontested and established facts or law. However, in those circumstances, the defendant is identifying reasons why it says that the plaintiff’s asserted claim is spurious, fanciful or futile. A spurious, fanciful or futile dispute will not be genuine.[51] Therefore, this would not be, in truth, an alternative claim which accepts that the plaintiff’s asserted dispute is genuine.
[51]Malec (n 6) [48]–[49].
In my view, a true alternative claim, which accepts that the plaintiff has established the genuine dispute for which it contends, has no place in the statutory regime. This is because an application to set aside a statutory demand is not a trial of whether the debt is due and payable, where the court may adjudicate inconsistent alternative claims as to the legal basis of an alleged debt. Rather, the court determines whether the low threshold of genuine dispute as to the existence or quantum of the demanded debt has been established. If the admitted total is less than the statutory minimum, it must set aside the demand. The consequence of this is that the parties are left to resolve their dispute through litigation where a court will determine the dispute on its merits, including the consideration of any alternative claims put forward as to the basis of the debt and when it is due and payable.
I address the defendant’s two alternative arguments below. The defendant’s counsel described these alternatives as ‘knockout blows’ which show there can be no genuine dispute that the debt was due and payable at the time the demand was served.[52] I will consider whether the defendant has, through its alternative claims, demonstrated that even if the plaintiff establishes the Alleged Oral Agreement’s existence, the claim would be spurious, fanciful or futile in any event, such that the plaintiff’s asserted dispute does not meet the low threshold of genuine dispute.
[52]Transcript (n 1) 68.
For the reasons that follow, in my view the defendant’s first alternative argument is not a true alternative argument, because its foundation is the uncontested fact that the plaintiff signed a credit application after the Alleged Oral Agreement was reached. The defendant relies upon this credit application to argue that the plaintiff’s dispute as to whether the debt is due and payable is not genuine because the parties agreed to replace any Alleged Oral Agreement with the signed credit application terms and conditions. As I discuss in Part E.1 below, there is a genuine dispute as to whether the credit application has the legal effect contended for by the defendant, and therefore the credit application does not demonstrate that the plaintiff’s dispute as to whether the debt is due and payable is not genuine.
On the other hand, the defendant’s second alternative argument is a true alternative argument that relies upon a selective acceptance of the plaintiff’s alleged dispute. It seeks that the court make determinations of contested fact and law in order to demonstrate that the debt is due and payable pursuant to a basis which is not disclosed in the statutory demand or the supporting affidavit. In my view, the statutory scheme does not permit the court to entertain such arguments, and it does not provide a basis for refusing the relief sought by the plaintiff.

E.1 First alternative - What is the impact of the credit application?

The first alternative argument raised by the defendant is that the application for credit signed by the plaintiff on 19 November 2024 varied the Alleged Oral Agreement (on the assumption it was reached)[53] or the 7 September 2024 agreement contended for by the defendant.[54] The defendant says that by the credit application, the parties agreed that the debt was due and payable 14 days after the services were provided, which would be on or around 27 September 2024.[55] The defendant submits that there can be no genuine dispute that this is the effect of the signed credit application.
[53]Ibid 66.
[54]Ibid 61, 63.
[55]Ibid 68.
Both Mr Rowe and Mr Lunt refer to the credit application in their evidence. Mr Rowe says that on or around 19 November 2024, the defendant requested that the plaintiff execute the application for credit, which it then executed.[56] He does not give any further evidence as to the purpose for which the credit application was signed. In his second affidavit, Mr Rowe says that there was no communication from the defendant as to whether it accepted the credit application, that the plaintiff did not retain any further services from the defendant, and that no credit was provided to the plaintiff pursuant to the credit application.[57]
[56]First Rowe Affidavit (n 16) [19].
[57]Affidavit of Troy Rowe filed on 1 July 2025, [17] (‘Second Rowe Affidavit’).
Mr Lunt says that he is required to procure a signed credit application from new customers,[58] and that:
In or about 18 November 2024, 55 days after [the Invoice] had been issued, I issued the credit application to Mr Rowe and requested that he return a signed copy, given it was apparent that [the defendant was] not going to receive payment within the 60 days as agreed between Mr Rowe and I.[59]
[58]Lunt Affidavit (n 19) [19].
[59]Ibid [21].
The credit application form lists the ‘Customer’ as the plaintiff and the credit required as $10,000.[60] The second page of the form is entitled ‘Terms and Conditions’. The term ‘Supplier’ is defined in clause 1 of the Terms and Conditions to mean the defendant.[61]
[60]Application for Commercial Credit, Exhibit ML-1 to the Lunt Affidavit (n 19) 27.
[61]Ibid 28.
The defendant relies upon clauses 4, 7 and 8 of the Terms and Conditions, which provide:
4.These Conditions shall apply to all contracts for the purchase of Goods and/or Services by the Customer from the Supplier to the exclusion of any other terms and conditions or any other materials which the Supplier may purport to apply or which are endorsed upon any correspondence or documents issued by the Supplier, irrespective of their date of communication to the Customer, except to the extent that the Supplier’s terms and conditions are agreed to in writing and signed by the Customer.
…
7.Disposal or carriage shall be considered earned as soon as the goods are accepted for disposal or carriage whether the goods are delivered to the Consignee or not, and whether damaged or otherwise. Under no circumstances will any payment for disposal or freight be refunded unless expressly agreed to in wiring [sic] by the Supplier.
8.Every special instruction to the effect that charges shall be paid by the Customer shall be deemed to include a stipulation that if the Consignee does not pay the said charges within fourteen (14) days of the date set for payment, or if no date is set for payment, within fourteen (14) days of delivery or tendered disposal & delivery of the goods, then the Customer in this form shall pay the said charges.[62]
[62]Ibid.
The defendant relies upon clauses 4 and 8 to show that the credit application, on its terms, has retroactive effect. This is because clause 4 provides that the conditions apply to ‘all contracts for the supply of … Services’. The defendant submits that therefore it applies to all contracts for the supply of services, including those contracts that pre-date the execution of the credit application.[63] The defendant also submits that clause 8 has retroactive effect on its terms, because it imposes a stipulation into pre-existing special instructions.[64]
[63]Transcript (n 1) 71.
[64]Ibid 68–69.
The defendant relies upon clauses 7 and 8 to establish the plaintiff’s agreement to the Invoice being due for payment within 14 days of delivery of the services. In so doing, the defendant submitted that the reference to ‘Consignee’ in clause 8 ought to be read as a reference to the ‘Customer’.[65]
[65]Ibid 69.
The plaintiff submits that there is a genuine dispute as to whether the credit application is a binding agreement which effects a variation of the Alleged Oral Agreement for a number of reasons.
First, the plaintiff submits that it is arguable that the credit application is not a binding agreement because there is no evidence that the credit application was accepted by the defendant and no credit was provided by the defendant to the plaintiff after the credit application was signed. In this regard, the plaintiff relies upon Mesh & Bar Pty Ltd v CMR Structure Group Pty Ltd & Anor (‘Mesh & Bar’), in which Judge Wise criticised a pleading which asserted a credit application was an agreement without pleading that the supplier had accepted the application.[66] The defendant disputes this, and characterises the application for credit as being an offer by the defendant to provide credit, which the plaintiff accepted by signing the application.[67] I accept that the plaintiff’s contention is arguable, in light of the analysis provided in Mesh & Bar and the fact that the defendant does not dispute that: (a) there is no evidence of the defendant communicating its acceptance of the credit application; and (b) no credit was provided to the plaintiff after the application form was signed.
[66][2024] VCC 858, [24].
[67]Transcript (n 1) 71.
Secondly, the plaintiff submits that the credit application is not binding because no consideration passed in exchange for any promises set out in the signed credit application. Accordingly, the plaintiff submits that the credit application cannot give rise to a binding agreement to vary the Alleged Oral Agreement. The defendant did not point to any consideration and I accept that the plaintiff’s contention is arguable.
Thirdly, the plaintiff submits that it is arguable that even if the credit application is binding, it does not have retroactive effect and therefore does not apply to the services referred to in the Invoice. In this regard, the plaintiff submits that clause 4 of the credit application’s Terms and Conditions does not expressly provide that it applies to services provided by the defendant before the credit application was signed. The plaintiff also submits that there is no evidence that the parties intended that upon completion of the application form, the Invoice debt would become due and payable some six weeks earlier. If that were the case, the plaintiff would be immediately in breach of the alleged agreement upon signing the credit application form. The plaintiff submits that Mr Lunt’s subjective reason for issuing the credit application to Mr Rowe does not assist the defendant, as it does not illuminate the objective intentions of the parties.
The plaintiff’s arguments regarding the construction of the signed credit application are arguable on the terms of clause 4 and the surrounding circumstances. This is because neither the credit application nor the email correspondence exchanged on 18 and 19 November 2024 expressly refer to the Invoice debt or the services provided to the plaintiff in September 2024. Further, there is no correlation between the amount of credit sought on the face of the credit application ($10,000) and the Invoice amount ($81,208.49). Mr Lunt’s evidence is that he requested that Mr Rowe sign the credit application because it was apparent that the defendant was not going to receive payment within 60 days. However, as the defendant accepts, there is no evidence as to what Mr Lunt communicated to Mr Rowe or vice versa. The defendant is asking the Court to infer from the circumstances that the parties intended the credit application to vary the Alleged Oral Agreement (or such other agreement as the defendant may contend for).[68] Nevertheless, from the defendant’s side of the fence, given the debt for services provided and the fact that no further services were supplied on credit, one asks rhetorically: what was the purpose of executing the credit application if not to have some impact upon the parties’ obligations as to the invoiced debt?
[68]Ibid 70.
Lastly, the plaintiff submits that it faces embarrassment from the claim that the debt was due pursuant to the credit application because neither the statutory demand nor its supporting affidavit refer to the credit application. Hence, the plaintiff’s 21-day affidavit does not address any genuine dispute with respect to the enforceability of the credit application.[69]
[69]Ibid 4.
The defendant disputes that it was necessary to refer to the credit application in the statutory demand, because the demand adequately describes the debt as being ‘[m]onies due and owing …for goods and services as described in the [Invoice]’. The defendant submits that it is not necessary for the demand to specify the credit application as the agreement pursuant to which the defendant says the monies have fallen due for payment. Given the various alternative arguments relied upon by the defendant, this strikes me as problematic. It may give rise to unfairness to the plaintiff akin to that discussed in Re Roberts Construction Group Pty Ltd (‘Roberts Construction’).[70] However, given the manner in which this application has been prepared and argued, including the fact that the credit application is referred to in Mr Rowe’s first affidavit, and that the plaintiff did not contend that this argument was not open to the defendant to make, it is not necessary to consider this issue further.
[70][2024] VSC 679, [36]–[37].
There is a clear dispute between the parties as to whether the credit application is an agreement between the parties, and if so, whether the Terms and Conditions are to be construed as applying to the Invoice, with the effect that the Invoice became due and payable 14 days after the services were provided.
Each party’s competing arguments regarding the effect of the credit application are plausible and bona fide. In order for these issues to be determined, the Court would need to consider full evidence of the intention and conduct of the parties, analysis of the effect and meaning of the contractual terms, and submissions as to the applicable law. It would be inappropriate for me to attempt to determine these issues on an application to set aside the demand.[71]
[71]Grandview (n 15) [90].

For these reasons, I am satisfied that there is a genuine dispute between the parties as to what effect, if any, the signed credit application form has upon the date on which the debt became due and payable. Accordingly, I am not satisfied that the existence of the signed application demonstrates that the plaintiff’s claim that the parties entered into the Alleged Oral Agreement is spurious, fanciful or futile, such that it does not meet the low threshold of genuine dispute.

E.2 Second alternative – Was the debt due because the Alleged Oral Agreement was discharged or frustrated?

The defendant raises a second alternative argument in further alternative to the credit application argument. This argument is that the Court should find that the debt was due and payable as at the statutory demand’s date of service in any event, even assuming that the parties entered into the Alleged Oral Agreement and that it was not varied by the credit application.
This argument puts forward another alternative date on which the debt became due and payable. Several such dates were raised in the defendant’s evidence and submissions:
(a)either 7 or 13 September 2024, pursuant to the 7 September 2024 agreement contended for by the defendant;
(b)14 days after delivery of the services, pursuant to the credit application;
(c)23 November 2024, as referred to in Mr Robinson’s evidence; and
(d)an agreement to ‘chip away’ at the debt after 60 days and pay the balance upon receipt of insurance funds, as referred to in Mr Lunt’s evidence.
On its second alternative, the defendant submits that if the Court is satisfied that there is a genuine dispute as to whether the parties reached the Alleged Oral Agreement, the Court should find that:
(a)There is no plausible contention that the defendant agreed to undertake the work on a speculative basis, such that the debt is only payable if the plaintiff receives insurance proceeds and not otherwise. I will refer to this as the defendant’s version of the Alleged Oral Agreement.[72]
(b)The parties entered into the defendant’s version of the Alleged Oral Agreement.
(c)As at the date the statutory demand was served, it was highly likely that the insurer would reject, or in fact had already rejected, the plaintiff’s claim.[73] Accordingly, the plaintiff submits that there is no plausible contention that the plaintiff is ever going to receive money under its insurance policy.[74]
(d)As a matter of law this frustrated or discharged the defendant’s version of the Alleged Oral Agreement. [75]
(e)As a consequence of that frustration or discharge the debt became immediately due and payable, and was due and payable as at the date that the statutory demand was served, such that the plaintiff can no longer rely upon by the Alleged Oral Agreement to withhold payment.[76]
(f)These arguments are so convincing that they demonstrate that the dispute raised by the plaintiff is spurious, fanciful or futile.
[72]Transcript (n 1) 77, 80–81.
[73]Summary of issues which have been resolved or narrowed as a consequence of conferral between the parties’ counsel, provided to the Court on 7 July 2025, [3] (‘Summary of Issues’).
[74]Ibid 90.
[75]Transcript (n 1) 34, 88–89.
[76]Defendant’s Outline of Submissions filed on 4 July 2025, [4], [29]–[33]; Transcript (n 1) 34, 88-–89.
I will address each of these findings in turn.
I will deal first with the proposed finding set out in paragraph 111(a) above. On this second alternative claim, the defendant accepts that there is a genuine dispute as to whether the parties entered into the Alleged Oral Agreement, but contests one of its terms as alleged by the plaintiff, namely that the debt will only be due and payable upon the plaintiff receiving funds from its insurer, and not otherwise. The defendant argues there is no plausible contention that the defendant would accept such a term, which includes a risk of never receiving payment at all.
As addressed in Part D above, I am satisfied that there is a plausible contention warranting further investigation as to whether the defendant agreed to provide the services on a speculative basis. This is precisely the terms of the plaintiff’s Alleged Oral Agreement referred to in Mr Rowe’s evidence, namely that the debt is payable only upon the plaintiff receiving the anticipated insurance claim monies ‘and not otherwise’.[77]
[77]First Rowe Affidavit (n 15) [14].
In support of its second alternative argument, the defendant submits that text messages sent by Mr Rowe to Mr Lunt on 24 April 2025 are not consistent with the defendant agreeing to provide the services on a speculative basis, as they indicate the plaintiff’s willingness to make payment when it starts generating free cashflow in five to six weeks.[78] The defendant argues that this is inconsistent with an agreement that the defendant is only entitled to payment if the plaintiff receives a payout from its insurer. I accept that this is arguable, and that this post-contractual conduct may be admissible on the question of formation of a contract, rather than construction of the terms of the alleged contract. However, this matter is not without doubt, which defendant’s counsel recognised in his submission that he was not pressing this inconsistency argument strongly.[79] These text messages are not the silver bullet that demonstrates that the dispute raised by the plaintiff is spurious, fanciful or futile and therefore not plausible or genuine.
[78]Text Messages Between Michael Lunt and Troy Rowe dated 24 April 2025, Exhibit ML-1 to the Lunt Affidavit (n 18) 31–32.
[79]Transcript (n 1) 91.
This is particularly so where:
(a)The defendant’s primary argument is that there was no binding oral agreement reached as a result of Mr Rowe and Mr Lunt’s discussions on 9 and 10 September 2024.
(b)There is contested evidence as to the terms of the Alleged Oral Agreement. In asking the Court to find that it is plausible that one term of the Alleged Oral Agreement was reached but not another, the defendant is asking the Court to prefer the evidence of Mr Lunt over that of Mr Rowe in one respect but not another. This would be inappropriate.
An alternative argument that proceeds upon a concession that there is a genuine dispute as to the terms of an oral agreement reached between the parties is, in effect, a concession that the dispute alleged by the plaintiff warrants subsequent adjudication. The low threshold for genuine dispute has been surmounted, and that is the end of the matter. This basis alone is sufficient to dispose of the defendant’s second alternative argument.
In my view, it is not appropriate for the Court to make the finding set out in paragraph 111(b) above, that the parties entered into the defendant’s version of the Alleged Oral Agreement. In order to do so, the Court is being asked to determine a contested question of fact, in circumstances where it is accepted by the defendant that there is a genuine dispute as to the terms of an oral agreement. For the reasons that I have already stated, it would be inappropriate for the Court to proceed in this manner on an application to set aside a statutory demand.
It is also not appropriate for the Court to make the factual finding set out in paragraph 111(c) above as to what decision the insurer is likely to make, and whether this likelihood was clear as at the date the statutory demand was served. By this, the Court is being asked to determine a hypothetical question of what the insurer is likely to do. If the Court were to answer this question, it would be determining a disputed question of fact in circumstances where the insurer is not a party to the proceeding. The Court’s decision would necessarily be based upon hearsay and opinion evidence contained in the subpoenaed materials. The Court would necessarily be speculating on the cause of the fire, and reaching conclusive views as to the proper construction of the terms of the plaintiff’s insurance policy and their application to the circumstances of the fire. This is clearly not the Court’s function on an application to set aside a statutory demand.
It was in connection with the issue in paragraph 111(c) that the defendant took the highly unusual step of causing five subpoenas to be issued in this proceeding. The subpoenas sought production of documents relevant to the question of whether the plaintiff’s insurer has accepted or rejected, or is otherwise likely to accept or reject, the plaintiff’s insurance claim. Ms Dark describes the addressees of the subpoenas as follows:
(a)United Insurance Group Pty Ltd – an insurance broker network;
(b)Lloyd Australia Insurance Pty Ltd – the plaintiff’s broker and authorised representative of United Insurance;
(c)VRS ANA Pty Ltd – the loss adjuster engaged by the plaintiff’s insurer; and
(d)Halliwell Pty Ltd – the forensic investigators engaged by the plaintiff’s insurer to identify the cause, origin and insurance ramifications of the fire.[80]
[80]Affidavit of Alicia Marie Dark filed on 16 June 2025, [8].
A large volume of material was produced pursuant to the subpoenas. The documents, or at least a selection of them, are exhibited to Ms Dark’s affidavits filed on 19 and 20 June 2025. In total, 579 pages of subpoenaed documents are exhibited to these affidavits.
It is highly unusual for subpoenas to be issued in applications to set aside statutory demands. This is because parties to statutory demand proceedings are only entitled to seek discovery or issue subpoenas in exceptional circumstances.[81] The following extract of Assaf’s Winding Up in Insolvency neatly summarises the reasons for this:
Discovery is not usually ordered in statutory demand cases and will seldom be required. Given that the onus of proof in setting aside a statutory demand is not high, Courts will be reluctant to make an order for discovery as it would not be in the interests of promoting the just and efficient conduct of litigation. … The issuing of a subpoena and notices to produce is also quite rare but has been permitted in some instances.[82]
[81]CPG Group Pty Ltd v Deputy Commissioner of Taxation [2019] VSC 146, [141(b)]; Robowash Pty Ltd v Robowash Finance Pty Ltd [2001] WASC 112, [18] (‘Robowash’).
[82]Farid Assaf, Assaf’s Winding Up in Insolvency (LexisNexis Australia, 3^rd ed, 2021) [5.98], citations omitted.
In Robowash Pty Ltd v Robowash Finance Pty Ltd, Master Sanderson found that in establishing circumstances for discovery, the debtor had also established enough to show a genuine dispute.[83] The same reasoning applies here, where the creditor has issued subpoenas to obtain evidence from third parties in opposition to the plaintiff’s contention that there is a genuine dispute.
[83]Robowash (n 81) [17]–[18].
No application was made to set the subpoenas aside. The plaintiff explained that it has not meaningfully engaged with the subpoenas or the insurance issue more broadly because of its overarching obligation to keep costs proportionate under the Civil Procedure Act 2010 (Vic).[84] In its view, the documents subpoenaed are irrelevant to the matters to be determined by the Court on this application.[85]
[84]Civil Procedure Act 2010 (Vic), s 24.
[85]Transcript (n 1) 31.
In my view, it was inappropriate for the defendant to issue the subpoenas in support of its second alternative argument. As I have already said, the second alternative claim is a true alternative claim which accepts that the plaintiff has established a genuine dispute. Such arguments have no place in an application to set aside a statutory demand, and certainly cannot justify using the Court’s coercive powers for production of documents from third parties. By the subpoenas, the defendant has fished for evidence by which it might be able to establish its second alternative argument. This might be a step available to the defendant in a trial on the merits, if the pleadings support a legitimate forensic purpose for the documents. However, I do not accept that it is appropriate to subpoena such documents in support of an alternative argument which accepts that the plaintiff has established a genuine dispute. I do not accept the submission that the subpoenas were necessary to enable the plaintiff to test Mr Rowe’s sworn, uncontested evidence that the insurer had not yet made a determination.[86]
[86]First Rowe Affidavit (n 16) [20]; Second Rowe Affidavit (n 57) [7].
Even if it were appropriate for the Court to determine that it is likely that the insurer will reject the claim, and that this likelihood was apparent as at the date the demand was served, it is far from clear that a determination of likelihood would discharge or frustrate the Alleged Oral Agreement. In relation to the questions identified in paragraphs 111(d) and 111(e), the defendant submits that the debt would become due and payable as a matter of law if it became clear that the defendant would receive no insurance payout, as there would ‘be no other way to construe the agreement between the parties’.[87]
[87]Transcript (n 1) 84.
The defendant did not take the Court to any authority in support of this submission, or explain how the term had been discharged or how the doctrine of frustration might assist. These are mixed questions of fact and law about which no evidence was led and no submissions were made.
If the defendant was successful in proving discharge or frustration, it is not clear as a matter of law that this would result in the debt becoming immediately due and payable. Again, the defendant did not address the Court to any authority on this issue. I infer that the defendant’s argument is that frustration or discharge would terminate the contract, which may in turn result in the defendant being entitled to restitution in respect of the services it provided to the plaintiff. However, the defendant’s entitlement to restitution would need to be considered in light of the contract between the parties and the applicable law.
In any event, the debt subject to the statutory demand was not demanded pursuant to a right of restitution, or any right arising from the likelihood that the insurer will reject the plaintiff’s claim for indemnity under the policy. If the defendant were permitted to rely upon this alternate legal basis, questions of unfairness of the kind discussed in Roberts Construction would need to be addressed.[88]
[88]Roberts Construction (n 70) [28]–[30], [36]–[37], citing CM Luxury Pty Ltd v Menzies Civil Australia Pty Ltd [2023] WASC 340 [8], [23]–[25], [52]–[53], [58]–[59].
Lastly I note the following factual matters which do not assist the defendant:
(a)Mr Rowe’s evidence is that the insurer has not yet made a determination.[89]
(b)It is accepted that the subpoenaed documents exhibited to Ms Dark’s affidavits do not contain evidence that the insurer has determined the plaintiff’s claim for indemnity.[90]
(c)The defendant’s evidence does not point to a particular day on which the debt became due and payable because it was highly likely that the insurer will reject the claim.
(d)There is no evidence of the plaintiff’s awareness that the debt became due and payable by reason of this likelihood threshold being reached, and no demand to the plaintiff in relation to it.
[89]First Rowe Affidavit (n 16) [20]; Second Rowe Affidavit (n 57) [7].
[90]Summary of Issues (n 73) [5(d)].
Accordingly, the defendant has not demonstrated that its second alternative agreement is so strong that it demonstrates that the plaintiff’s contention that the debt is not due and payable is not plausible or genuine. Rather, it just demonstrates that the parties’ dispute ought to be determined at a trial on the merits.

F Orders

I will make an order setting aside the statutory demand.
The plaintiff has foreshadowed an application for a special costs order in light of the subpoenas issued by the defendants, amongst other matters.
I direct the parties and their counsel to confer on the question of costs, and will hear the parties on the question of costs at 9.30 am on 12 September 2025 in the event that agreement is not reached. As to evidence and submissions regarding costs, the parties are directed to paragraph 9 of the Notice to Profession – Applications to Set Aside Statutory Demands dated 11 July 2025.

SCHEDULE OF PARTIES

S ECI 2025 02674
BETWEEN:
RESOURCE PTY LTD (ACN 615 144 066)	Plaintiff
- v -
GTV RECYCLING PTY LTD (ACN 664 244 928)	Defendant

[2025] VSC 567

9 September 2025