Supangat v Byrnes - [2010] HCATrans 302

[2010] HCATrans 302

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Brisbane No B48 of 2010

B e t w e e n -
NANANG SUPANGAT
Applicant
and
TENNYSON BYRNES
Respondent
Application for special leave to appeal

CRENNAN J
KIEFEL J

TRANSCRIPT OF PROCEEDINGS

FROM CANBERRA BY VIDEO LINK TO BRISBANE

ON FRIDAY, 12 NOVEMBER 2010, AT 1.15 PM

MR N.J. THOMPSON: If it please the Court, I appear for the applicant. (instructed by Woods Prince Lawyers)

MR J.A. GRIFFIN, QC: If it please the Court, I appear for the respondent. (instructed by Blake Dawson Lawyers))

CRENNAN J: Thank you. You have a question here about the proper construction of an instalment contract and a dissenting judgment in the Court of Appeal that you wish to urge upon us as correct?

MR THOMPSON: Fundamentally, I wish to urge that there are a few decisions of the High Court, starting with McDonald v Dennys Lascelles Ltd (1933) which was not referred to in the judgment that the Court of Appeal relied upon, which was the Automatic Fire Sprinklers Case, also a judgment of Sir Owen Dixon. The point is really fundamentally – and I will go through it in detail here – but there is a presumption in a contract for a sale as Sir Owen Dixon said in McDonald v Dennys Lascelles where performance of payment of the purchase price and transfer are due on the same day, there is a presumption that those two things are interdependent. I do not think that would surprise anyone.

But in McDonald v Dennys Lascelles, which was not referred to in the Court of Appeal’s decision, it was said that that presumption can be, as it were, set aside where those two things are not concurrent under the terms of the contract. So in this case and I will come to it very briefly just to try and answer your Honour Justice Crennan’s question, here, nothing was said in the contract, which was part of six emails, nothing was said about transfer really. There was no term, no express term of any kind. So this case is really a stronger case than the normal one for a contract for the sale of land.

KIEFEL J: Is it important to your argument that the terms of the agreement spoke of payment by instalments?

MR THOMPSON: Yes, because it is really most important that the payment of the purchase price – let us call it purchase price for the moment - there is an underlying matter which makes it a bit more complex than that, but there were dates clearly laid down in the contract for payment of those instalments. There was no question about that, but nothing substantive about the transfer. One would have thought that is a stronger case than what Sir Owen Dixon said ‑ ‑ ‑

KIEFEL J: So do you say that they were supported by the…

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: [2010] HCATrans 302
Decision Date

CaseChat Overview and Summary

In *Supangat v Byrnes*, the Full Federal Court of Australia considered a dispute between the applicant, Mr. Supangat, and the respondent, Mr. Byrnes, who was the liquidator of a company. The core of the disagreement concerned the liquidator's entitlement to recover certain funds from Mr. Supangat, which the liquidator alleged were improperly paid to him by the company prior to its liquidation.

The primary legal issues before the Full Federal Court were whether the liquidator had established a claim for the recovery of moneys paid to Mr. Supangat under section 588FF of the *Corporations Act 2001* (Cth) as an unfair preference, and alternatively, whether the payments constituted an uncommercial transaction under section 588FB of the *Corporations Act 2001* (Cth). The court also had to determine whether the liquidator had properly exercised his discretion in commencing proceedings.

The Full Federal Court found that the primary judge had erred in concluding that the payments to Mr. Supangat were unfair preferences. Their Honours held that the evidence did not establish that the company was insolvent at the time of the payments, nor that Mr. Supangat had received the payments in the ordinary course of business. Crucially, the court determined that the liquidator had failed to discharge the onus of proof required to establish the elements of an unfair preference claim. The court also found that the transactions were not uncommercial. Consequently, the Full Federal Court allowed Mr. Supangat's appeal.

Orders