FEDERAL COURT OF AUSTRALIA
Space Touring Pty Ltd v Duxton Entertainment Pty Ltd [2019] FCA 983
File number: SAD 77 of 2019 Judge: CHARLESWORTH J Date of judgment: 18 June 2019 Catchwords: CORPORATIONS – application to set aside a statutory demand for the payment of a debt – Registrar dismissing application – review of Registrar’s decision – whether there exists a genuine dispute about the existence of the debt within the meaning of s 459H of the Corporations Act 2001 (Cth) – debt having the character of a promise to pay sum ascertainable under two contracts – sum in fact ascertained in accordance with the contracts – whether supporting affidavit supports a plausible contention that the creditor failed to perform its obligations under the contracts – whether debt inarguably payable notwithstanding apparent breach of contract by creditor – whether contract affirmed notwithstanding breach – whether the supporting affidavit supports a plausible contention that the contracts were novated – whether the existence of an alternative dispute resolution clause is enlivened – whether the existence of an alternative dispute resolution clause constitutes another reason to set the statutory demand aside in accordance with s 459J of the Corporations Act 2001 (Cth) – Registrar’s decision affirmed Legislation: Corporations Act 2001 (Cth) ss 459G, 459H, 459J
Federal Court of Australia Act 1976 (Cth) s 35A
Federal Court (Corporations) Rules 2000 (Cth) r 16.1
Cases cited: ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue (NSW) (2012) 245 CLR 338
Callite Pty Ltd v Peter John Adams & 3 Ors [2001] NSWSC 52
CFB18 v Reader Lawyers & Mediators [2018] FCA 611
Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785
Financial Solutions Australasia Pty Ltd v Predella Pty Ltd [2002] WASCA 51
John Holland Construction and Engineering Pty Ltd v Kilpatrick Green Pty Ltd (1994) 14 ACSR 250
Moyall Investments Services Pty Ltd v White [1993] FCA 912; (1993) 12 ACSR 320
POS Media v B Family [2003] NSWSC 147
Process Machinery v ACN 057 260 590 [2002] NSWSC 45
Rothwells Ltd v Nommack (No 100) Pty Ltd (1988) 13 ACLR 421
Sargent v ASL Developments Ltd (1974) 131 CLR 634
Scruples Imports Pty Ltd v Crabtree & Evelyn Pty Ltd (1983) 1 IPR 315
Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1997) 76 FCR 452
SVI Systems Pty Ltd v Best & Less Pty Ltd (2001) 187 ALR 302
Date of hearing: 7 June 2019 Registry: South Australia Division: General Division National Practice Area: Commercial and Corporations Sub-area: Corporations and Corporate Insolvency Category: Catchwords Number of paragraphs: 75 Counsel for the Plaintiff: Mr P Adams Solicitor for the Plaintiff: Griffins Lawyers Counsel for the…
Continue reading Space Touring Pty Ltd v Duxton Entertainment Pty Ltd
Sign in free to access the full text
Details
- AGLC
- Space Touring Pty Ltd v Duxton Entertainment Pty Ltd [2019] FCA 983
- Case
- [2019] FCA 983
- Decision Date
CaseChat Overview and Summary
Space Touring Pty Ltd sought to set aside a statutory demand issued by Duxton Entertainment Pty Ltd, claiming a debt of $397,500 for a breach of an investment agreement and a concert promotion agreement. The Federal Court was asked to review the decision of the Registrar who dismissed the application to set aside the statutory demand. The central legal issue was whether a genuine dispute existed regarding the existence of the debt, as required under section 459H of the Corporations Act 2001 (Cth). The dispute hinged on whether Space Touring had performed its contractual obligations under the two agreements, and whether any failure by Space Touring to perform constituted a valid defence to the statutory demand.
The court examined the affidavits provided by both parties and found that Space Touring's affidavit failed to present a plausible contention that Duxton had not fulfilled its contractual obligations. Instead, the evidence suggested that Duxton had made the required payments into Production’s account as agreed, and Space Touring had acknowledged receipt of these payments. The court held that the debt was ascertainable and had been determined in accordance with the terms of the contracts. Additionally, the court found that any alleged breach by Space Touring did not negate the indisputable fact that the debt was payable. The court also determined that the existence of an alternative dispute resolution clause did not constitute grounds to set the statutory demand aside under section 459J of the Corporations Act 2001 (Cth).
In light of the foregoing, the court affirmed the decision of the Registrar dismissing the application to set aside the statutory demand. The court ordered that Space Touring pay Duxton’s costs of the interlocutory application.
The court examined the affidavits provided by both parties and found that Space Touring's affidavit failed to present a plausible contention that Duxton had not fulfilled its contractual obligations. Instead, the evidence suggested that Duxton had made the required payments into Production’s account as agreed, and Space Touring had acknowledged receipt of these payments. The court held that the debt was ascertainable and had been determined in accordance with the terms of the contracts. Additionally, the court found that any alleged breach by Space Touring did not negate the indisputable fact that the debt was payable. The court also determined that the existence of an alternative dispute resolution clause did not constitute grounds to set the statutory demand aside under section 459J of the Corporations Act 2001 (Cth).
In light of the foregoing, the court affirmed the decision of the Registrar dismissing the application to set aside the statutory demand. The court ordered that Space Touring pay Duxton’s costs of the interlocutory application.
Orders
Orders of the court
1. The decision of the South Australia District Registrar to dismiss the originating application is affirmed.
2. The plaintiff pay the defendant’s costs of the interlocutory application filed on 31 May 2019.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Apart from the reference to the statutory demand itself, Mr Rankine’s affidavit otherwise makes no mention of the concerts having in fact been promoted and staged, no mention of the entity that in fact promoted and staged them, no mention of the profit or loss derived from the staging of the concerts and no mention of any correspondence passing between him or any other person acting on behalf of Touring and any person acting on Duxton’s behalf in relation to the performance or non-performance of either agreement.DUXTON’S AFFIDAVIT EVIDENCE Ms Jessica Gricks is an analyst employed by Duxton’s holding company Duxton Capital (Australia) Pty Ltd. The holding company manages Duxton’s investment portfolio. In her affidavit sworn on 10 May 2019, Ms Gricks deposes as follows:(1)Mr Eduard Peter is a director of Duxton. He and his wife, Mrs Julie Peter are trustees of a family trust (the Trust).(2)She is responsible for the day to day management of investments made by Duxton and by the Trust in concerts promoted by Touring and by Production.(3)She has had dealings with Mr Rankine since June 2018 in relation to those investments with the approval of Duxton’s directors. The investments include:(a)Investments by the Trust in the following concerts promoted by Production:(i)Bob Dylan held on 11 August 2018;(ii)Foreigner held on 14 October 2018; and(iii)Shania Twain held on 2 December 2018.(b)Investments by Duxton in the following concerts promoted by Production:(i)Bon Jovi held on 4 December 2018;(ii)Florence and the Machine held on 16 January 2019;(iii)Phil Collins held on 25 January 2019 (originally 8 December 2018);(iv)Rudimental (Adelaide) to be held on 2 June 2019 (originally 9 February 2019) and(v)Elton John to be held on 4 December 2019 (originally 10 December 2019).(c)Investments by Duxton in the following concerts promoted by Touring:(i)The Prodigy held on 26 January 2019;(ii)Roger Hodgson held on 6 February 2019; and(iii)Rudimental (Mount Gambier) to be held on 3 June 2019 (originally 10 February 2019).(4)She arranged for Duxton to make payments of money into an account held in the name of Production in relation to the Supertramp concert and in relation to the Prodigy concert. She arranged the payments to be deposited into Production’s account “because payments for the concerts had always been made to this account”. By email communications, Ms Gricks made Mr Rankine aware of the payments that had been made into Production’s account. Receipt of these communications and the payments referred to in them were expressly acknowledged in return correspondence from Mr Rankine. Ms Gricks asserts that Duxton performed its obligations to make the agreed contribution of $397,500 toward the Supertramp concert by depositing $258,375 into Production’s account and by requesting that Mr Rankine make up the balance owing by “rolling over” returns that were owed by Production to Duxton in respect of the Bon Jovi concert. The correspondence shows that Mr Rankine agreed to apply what may be referred to as the Bon Jovi roll over amount toward the sum payable by Duxton in relation to the Supertramp concert as Ms Gricks had requested. It is not disputed that the total of these sums is equivalent to the contribution payable by Duxton under the first IA.
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
Full text does not contain this section.