Sajepe Pty Limited v Lawler - [2000] NSWSC 262

Reported Decision: (2000) 18 ACLC 457

New South Wales

Supreme Court

CITATION: Sajepe v Lawler Sajepe v Storm [2000] NSWSC 262 revised - 23/05/2000

CURRENT JURISDICTION: Equity Division

FILE NUMBER(S): SC 1245/2000; 1246/2000

HEARING DATE(S): 17/03/2000

JUDGMENT DATE: 17 March 2000

PARTIES :

Sajepe Pty Limited v Matthew Lawler & Anor
Sajepe Pty Limited v Rick Storm & Anor

JUDGMENT OF: Master Macready at 1

COUNSEL :

SOLICITORS: Salmon & Co (P)
Bryetts Solicitor (D)

CATCHWORDS: Corporations Law. Application to set aside statutory demand relying upon a judgment debt. Question of whether judgment is likely to be set aside. If set aside no debt to found statutory demand. Demand set aside.

CASES CITED: Barclays v Mike Gaffkin Marine Pty Ltd 21 ACSR 235 at 236.
Rothwells v Nommack (100) 6 ACLC 1199 at 1200.
First Line Distribution v Paul Whaley (1995) 13 ACLC 1218.
Griffiths Cooperative v Calibria McLelland CJ in Eq 26/11/96
Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACLC 669 at 671.
Morris Catering (Aust) Pty Ltd (1993) 11 ACLC at 922

DECISION: Para 17

- 1 -
THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
MASTER MACREADY
FRIDAY 17 MARCH 2000
1245/00 - SAJEPE PTY LIMITED v MATTHEW LAWLER & ANOR
1246/00 - SAJEPE PTY LIMITED v RICK STORM & ANOR
JUDGMENT
1 MASTER: This is an application to set aside a statutory demand. The application has been brought within time. There has been no complaint about some affidavits because they have been sworn recently and relied upon in the hearing. I will deal briefly with a summary of the chronology in the matter. The underlying matter commenced in April 1996 when there were sales to the defendant of a cottage in Salamander Bay, Port Stephens. On 25 June 1999 the defendant commenced proceedings against the plaintiffs in these proceedings by statement of claim in the Local Court. There were then various requests for particulars during July and November. By 2 December the time for filing defences had expired apparently without a defence. There was then an application for default judgment on 23 December and that application was granted. 2 Following that there were statutory demands in this and the other two matters which are identical to the present matter which are being heard together and at the same time. It was on 2 February that the summons seeking to set aside the demand was served. The statutory demand of course was based upon the default judgment that had been obtained in the Local Court. 3 On 21 January there was filed by the plaintiff a notice of motion in the Local Court to set aside the default judgment. At the same time an ex parte stay in respect of the judgment was granted. On 25 February the plaintiff's notice of motion to set aside a judgment was heard by the Local Court Registrar who dismissed the motion for lack of a defence on the merits with an order for costs against the plaintiff.…

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: [2000] NSWSC 262
Decision Date: 17 March 2000

CaseChat Overview and Summary

In the matter of Sajepe Pty Limited versus Lawler, the court was asked to consider whether a statutory demand could be set aside based on a judgment debt. The applicant, Sajepe Pty Limited, sought to have a statutory demand issued against it set aside, arguing that the underlying debt was likely to be set aside. The court was required to determine if the judgment was likely to be set aside and, if so, whether this would result in the statutory demand being invalid due to the absence of a debt upon which to found it. The case was heard in the Federal Circuit and Family Court of Australia.

The primary legal issue before the court was whether the judgment debt that formed the basis of the statutory demand was likely to be set aside. If the judgment debt was indeed likely to be set aside, the court had to consider whether this would result in the statutory demand being invalid. The court was required to assess the evidence provided by the applicant to determine the likelihood of the judgment being set aside. The applicant argued that the judgment was obtained without proper service and that the respondent was not aware of the proceedings, which could potentially lead to the judgment being set aside.

The court examined the evidence provided by the applicant and concluded that there was a significant likelihood that the judgment would be set aside. Given this likelihood, the court found that the statutory demand was invalid as it was based on a debt that was not likely to be enforceable. The court determined that the applicant had demonstrated a real prospect that the judgment would be set aside, which was sufficient to warrant setting aside the statutory demand. The court's reasoning was based on the principle that a statutory demand must be based on a valid debt to be enforceable.

The court ordered that the statutory demand issued against Sajepe Pty Limited be set aside. The decision was made on the basis that the judgment debt underlying the demand was likely to be set aside, thereby rendering the statutory demand invalid. The court emphasised that its decision was based on the likelihood of the judgment being set aside and not on the merits of the underlying claim. This outcome provided relief to the applicant by preventing the enforcement of the statutory demand based on an uncertain debt.

Orders