Willaire Pty Ltd v Equititrust Limited

Willaire Pty Ltd (appellant) appealed against a decision of the Federal Court of Australia (primary judge) which dismissed its application to set aside a statutory demand issued by Equititrust Limited (respondent). The respondent had issued the statutory demand pursuant to s 459B of the Corporations Act 2001 (Cth) in an attempt to wind up the appellant in insolvency. The primary judge dismissed the appellant's application to set aside the statutory demand under s 459G of the Corporations Act. The appellant argued that the statutory demand should be set aside because it had a genuine dispute as to the debt alleged in the demand, and because there was some other reason to set the demand aside under s 459J of the Corporations Act.

The primary judge rejected the appellant's arguments and held that there was no genuine dispute as to the debt alleged in the statutory demand. The primary judge found that the appellant's liability arose under a deed as varied, and that the appellant was liable for the amount claimed by the respondent. The primary judge also held that there was no other reason to set the statutory demand aside. The appellant submitted that the primary judge erred in finding that there was no genuine dispute as to the debt alleged in the statutory demand, and that there was no other reason to set the demand aside. The appellant submitted that its liability was limited by the terms of the second mortgage, and that no debt was due and payable by it to the respondent until the mortgaged properties were realised.

The appeal was allowed. The Court held that the primary judge erred in finding that there was no genuine dispute as to the debt alleged in the statutory demand. The Court held that the appellant had a genuine dispute as to the debt alleged in the statutory demand because it was not liable for the amount claimed by the respondent until the mortgaged properties were realised. The Court also held that there was some other reason to set the statutory demand aside because the respondent's claim was statute-barred. The Court set aside the primary judge's order and the statutory demand, and ordered the respondent to pay the appellant's costs of the application to set aside the statutory demand and of this appeal.