Re Wizard Systems Australasia Pty Ltd

In the matter of Wizard Systems Australasia Pty Ltd, the applicant, Peter McKinnon, sought to wind up the respondent company on the basis of its failure to comply with a statutory demand. The respondent, Wizard Systems Australasia Pty Ltd, had not complied with the statutory demand issued by McKinnon, leading to the presumption of insolvency under section 459C of the Corporations Law. However, the respondent argued that it was solvent and sought to rebut the presumption. The legal issue before the court was whether the presumption of insolvency could be rebutted by the respondent's evidence of solvency.

The court found that the respondent had not adequately demonstrated its solvency, primarily due to the lack of verified financial statements and the errors in the balance sheets provided. The court was not satisfied that the respondent was solvent based on the evidence presented. The court considered the commercial reality of the respondent's financial position, including its ability to pay trade creditors and its operating profits. However, the court noted deficiencies in the respondent's financial administration and account-keeping practices, which made it difficult to assess its true financial position. The court decided to adjourn the application to allow for a more thorough investigation of the respondent's solvency.

The court ordered that the application be adjourned to the callover list and tried speedily. The respondent was directed to engage a reputable firm of chartered accountants to verify its financial position and provide a report. The court also ordered that the respondent pay the applicant's costs for the hearings on 27 and 31 July 1998 due to the late delivery of affidavits and the deficient nature of the material. The court did not appoint a provisional liquidator, as there was no evidence of asset dissipation by the respondent.