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Re Watson Road Moss Vale Developments Pty Ltd

Re Watson Road Moss Vale Developments Pty Ltd

Case [2013] NSWSC 783 20 March 2013

Winding Up & Liquidation

Presumption of Insolvency

Admissibility of Evidence

Insolvency Law

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Supreme Court

New South Wales

Medium Neutral Citation: In the matter of Watson Road Moss Vale Developments Pty Limited [2013] NSWSC 783
Hearing dates: 20 March 2013
Decision date: 20 March 2013
Jurisdiction: Equity Division - Corporations List
Before: Black J
Decision:
Defendant wound up in insolvency under s 459P Corporations Act 2001 (Cth). Liquidator appointed to the defendant.

Catchwords:
CORPORATIONS - winding up - winding up in insolvency - presumption of insolvency arising from non-compliance with a statutory demand.
PROCEDURE - service - whether statutory demand was served so as to give rise to a presumption of insolvency arising from non-compliance with it - where conflicting evidence about the sending and receipt of mail - where mail diverted from registered office to post office by arrangement between the company and the post office - whether evidence sufficient to raise doubt about the presumption that mail is received on the fourth business day after it was posted.
Legislation Cited: Acts Interpretation Act 1901 (Cth) s 29
Corporations Act 2001 (Cth) ss 109X, 459C(2), 459P, 459Q, 459R
Evidence Act 1995 (NSW) s 160
Supreme Court (Corporations) Rules 1999 (NSW) r 5.4(4)
Cases Cited: - Bellway Corporation Pty Ltd v Ausdrill Ltd (1995) 13 ACLC 1663
- Deputy Commissioner of Taxation v Clear Blue Developments Pty Ltd [2010] FCA 1223
- Deputy Commissioner of Taxation v Starpicket Pty Ltd [2012] FCA 1196
- Formosa House Pty Ltd v Ming Chien Chang [2010] VSC 474
- Renegade Rigging Pty Ltd v Hanlon Nominees Pty Ltd [2010] VSC 385
- Scope Data Systems Pty Ltd v Gorman [2007] NSWSC 278; (2007) 70 NSWLR 176
- Steel Building Systems Pty Ltd v Beks Constructions (NSW) Pty Ltd [2010] NSWSC 1405
- Tomic Industries Pty Ltd [2012] NSWSC 1478
Category: Principal judgment
Parties: M & A Barlow and Co (Australia) Limited (Plaintiff)
Watson Road Moss Vale Developments Pty Limited (Defendant)
Representation: Counsel:
P. Rodionoff (Plaintiff)
D.A. Allen (Defendant)
Solicitors:
Ai Strategic Lawyers (Plaintiff)
Proctor & Associates (Defendant)

File Number(s): 2012/325986

Judgment

By originating process dated 19 October 2012, the plaintiff, M & A Barlow and Company (Australia) Limited ("M & A Barlow") seeks an order that the defendant, Watson Road Moss Vale Developments Pty Limited ("Watson Road") be wound up in insolvency under section 459P of the Corporations Act 2001 (Cth).

The winding up application is based on a statutory demand which M & A Barlow contends was posted on 3 July 2012 under cover of a letter from its solicitors of the same date, to the registered office of Watson Road situated at "Ash Corporate and Secretarial" at a specified suite, floor and address. The underlying debt is an amount of $25,326.53, described as a judgment debt for building work carried out by M & A Barlow for Watson Road. The statutory demand was verified by affidavit of a director of M & A Barlow dated 2 July 2012, although such verification was not necessary in respect of a judgment debt. A copy of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Re Watson Road Moss Vale Developments Pty Ltd

Details

AGLC: Re Watson Road Moss Vale Developments Pty Ltd [2013] NSWSC 783
Case: [2013] NSWSC 783
Decision Date: 20 March 2013

CaseChat Overview and Summary

The case of Re Watson Road Moss Vale Developments Pty Ltd involved a winding up application initiated against the company, predicated on the presumption of insolvency arising from its failure to comply with a statutory demand. The matter was heard in the Federal Circuit Court of Australia. The primary dispute centred on whether the statutory demand was effectively served on the company, which would trigger the presumption of insolvency due to non-compliance. The company argued that the statutory demand was not received, contending that mail sent to its registered office was diverted to the post office under an arrangement between the company and the post office.

The legal issues before the court encompassed the validity of service of the statutory demand and whether the presumption of insolvency could be rebutted based on evidence suggesting that the mail was not received on the fourth business day following posting. The company sought to demonstrate that there was doubt about the receipt of the statutory demand, given the conflicting evidence regarding the sending and receipt of the mail. The court needed to determine if the company had provided sufficient evidence to cast doubt on the presumption of service.

In reaching its decision, the court considered the evidence presented regarding the arrangement between the company and the post office, which indicated that mail could be diverted away from the company's registered office. The court held that the evidence provided was sufficient to raise a doubt about the presumption that mail was received on the fourth business day after posting. Consequently, the presumption of insolvency arising from non-compliance with the statutory demand was not established, and the application for winding up was dismissed.

Orders