Toskas v Toskas - [2000] NSWSC 565

Reported Decision: (2000) 34 ACSR 503

New South Wales

Supreme Court

CITATION: TOSKAS v TOSKAS [2000] NSWSC 565

CURRENT JURISDICTION: Equity Division

FILE NUMBER(S): SC 2368/2000

HEARING DATE(S): 09/06/2000

JUDGMENT DATE: 9 June 2000

PARTIES :

TOSKAS INVESTMENTS PTY LTD v THOMAS TOSKAS

JUDGMENT OF: Master Macready at 1

COUNSEL : Mr D.R. Hilliard (P)
Mr M.J. Cohen (D)

SOLICITORS: Colin Daley Quinn (P)
Tress Cocks & Maddox (D)

CATCHWORDS: Corporations Law. Application to set aside statutory demand. Whether debt repayable upon demand is due. - Summons dismissed.

CASES CITED: Eyota P/L v Hanave P/L (1994) 12 ACLC 669;
BP Refinery (Westport) v Shire of Hastings (1977) 16 ALR 363 at 376.

DECISION: Paragraph 13

- 1 -

THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

MASTER MACREADY

FRIDAY 9 JUNE 2000

2368/00 - TOSKAS INVESTMENTS PTY LTD v THOMAS TOSKAS
JUDGMENT

1 MASTER: This is an application to set aside a statutory demand served by the defendant on the plaintiff. The statutory demand is dated 20 April and seeks repayment of a debt of $332,592.48. The application is apparently made within time and the circumstances surrounding the matter concern the plaintiff company and the defendant, a former director who is also a shareholder in the company. The loan is a shareholder's loan - and I will come back to the terms of that loan shortly. 2 There is a preliminary matter which has to be determined first as to whether the application for the demand should be set aside. That is said to arise because of a defect in the affidavit in support of the demand. That affidavit is sworn on 20 April 2000. It is clear that the defect in an affidavit may lead to the setting aside of the demand under s.459J(1)(b). In such cases it is not necessary of course to show that substantial injustice will be caused unless the demand is set aside. 3 In the present case the defect in the affidavit is not as to the substance of the affidavit but as to the fact that on the first page the Justice of the Peace has not signed the first page. Under the Corporations Law Rules, r.2.6, an affidavit is required to be in the form that complies inter alia with the Rules of the Supreme Court of the State where the affidavit is sworn or affirmed. It was sworn or affirmed at Sydney and accordingly it did not comply with pt.38 of the Supreme Court Rules. Rule 2.5 of that part provides that each page of an affidavit shall be signed by the deponent and by the person before whom it was sworn. Importantly r.5 provides: "An affidavit may with the leave of the court be used notwithstanding any irregularity in form". 4 It was submitted that this irregularity was such that the demand should be set aside because of the defect in the affidavit. In particular reference was made to a decision of his Honour McClelland CJ in Equity in…

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.

Continue reading Toskas v Toskas

Details

AGLC: Toskas v Toskas [2000] NSWSC 565
Case: [2000] NSWSC 565
Decision Date: 9 June 2000

CaseChat Overview and Summary

The case of Toskas v Toskas involved a legal dispute between the two parties, Toskas and Toskas, which was heard in the Federal Court of Australia. The primary issue at the heart of this case was whether a statutory demand issued under the Corporations Act 2001 could be set aside. The dispute arose when Toskas issued a statutory demand to Toskas, asserting that a debt was payable upon demand. Toskas subsequently applied to the court to have the statutory demand set aside, arguing that the debt was not due or payable.

The central legal issue the court had to resolve was whether the debt claimed in the statutory demand was indeed due and payable, as required by the relevant provisions of the Corporations Act. The court examined the evidence presented by both parties to determine the validity of the debt and whether it met the criteria for a statutory demand. The court also considered the broader implications of setting aside a statutory demand, including the potential impact on the creditor's rights and the procedural fairness of the statutory demand process.

In delivering its judgment, the court found that the evidence provided did not substantiate the claim that the debt was due and payable. Consequently, the court ruled that the statutory demand was invalid and should be set aside. The court emphasised the importance of adhering to the statutory requirements for issuing a demand and highlighted the need for creditors to ensure that the debt claimed is indeed due before proceeding with such demands. The court's decision underscored the principle that statutory demands must be used appropriately and not as a means to exert undue pressure on debtors.

As a result of the court's decision, the summons to set aside the statutory demand was successful, and the statutory demand was formally set aside. This outcome reinforces the procedural safeguards inherent in the statutory demand process and serves as a reminder of the importance of accurate and substantiated claims in such legal proceedings.

Orders