Sampey & Sampey & Ors

The parties to this proceeding were Sampey & Sampey Pty Ltd (the first applicant) and Mr. and Mrs. Sampey (the second and third applicants), who sought to set aside a statutory demand issued by the respondent, a former employee. The dispute concerned the validity of the statutory demand, which was based on an alleged debt arising from a settlement agreement and a subsequent deed of release. The applicants contended that the debt was unliquidated and therefore not a proper basis for a statutory demand.

The central legal issue before Stevenson J was whether the amount claimed by the respondent in the statutory demand constituted a liquidated debt. Specifically, the court had to determine if the settlement agreement and deed of release created an undisputed and quantifiable obligation owed by the applicants to the respondent, or if the amount remained unliquidated, thereby rendering the statutory demand invalid.

Stevenson J reasoned that the settlement agreement and deed of release clearly stipulated a fixed sum payable by the applicants to the respondent. The terms of these documents were unambiguous and did not leave room for dispute regarding the quantum of the debt. Consequently, the debt was liquidated. The court applied the principle that a statutory demand can only be based on a liquidated debt, meaning a debt of a certain and determined amount. As the debt was found to be liquidated, the statutory demand was valid.

The application to set aside the statutory demand was dismissed.