YELDARB Holdings Pty Ltd v ERANINI Pty Ltd
[2001] WASC 320
YELDARB HOLDINGS PTY LTD -v- ERANINI PTY LTD [2001] WASC 320
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2001] WASC 320 | |
| Case No: | COR:306/2001 | 16 NOVEMBER 2001 | |
| Coram: | MASTER SANDERSON | 26/11/01 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Demand set aside | ||
| B | |||
| PDF Version |
| Parties: | YELDARB HOLDINGS PTY LTD (ACN 073 780 293) ERANINI PTY LTD (ACN 009 180 901) |
Catchwords: | Corporations Act Application to set aside statutory demand Turns on own facts |
Legislation: | Corporations Act, s 459G, s 459H |
Case References: | Eyota v Hanabe Pty Ltd (1994) 12 ACLC 669 Meadowfield Pty Ltd v Gold Coast Holdings Pty Ltd (In Liq) [2001] WASCA 360 Redden v Wilkes [1979] WAR 161 Birch Investments Pty Ltd v Lim, unreported; SCt of WA; Library No 7396; 12 July 1988 Chase Manhattan Bank Australia v OSCTY Pty Ltd (1995) 17 ACSR 128 Delnorth Pty Ltd v State Bank of New South Wales (1995) 17 ACSR 379 Mibor Investments Pty Ltd v Commonwealth Bank of Australia (1993) 11 ACLC 1062 NQEA Australia Pty Ltd v ADI Ltd (1999) 17 ACLC 927 Scanhill Pty Ltd v Century 21 Australasia Pty Ltd (1994) 12 ACLC 111 Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1987) 15 ACLC 1001 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
ERANINI PTY LTD (ACN 009 180 901)
Defendant
Catchwords:
Corporations Act - Application to set aside statutory demand - Turns on own facts
Legislation:
Corporations Act, s 459G, s 459H
Result:
Demand set aside
(Page 2)
Category: B
Representation:
Counsel:
Plaintiff : Ms J M Hill
Defendant : Mr A C Thorpe
Solicitors:
Plaintiff : Bennett & Co
Defendant : A C Thorpe
Case(s) referred to in judgment(s):
Eyota Pty Ltd v Hanabe Pty Ltd (1994) 12 ACLC 669
Meadowfield Pty Ltd v Gold Coast Holdings Pty Ltd (In Liq) [2001] WASCA 360
Redden v Wilks & Registrar of Titles [1979] WAR 161
Case(s) also cited:
Birch Investments Pty Ltd v Lim, unreported; SCt of WA; Library No 7396; 12 July 1988
Chase Manhattan Bank Australia v OSCTY Pty Ltd (1995) 17 ACSR 128
Delnorth Pty Ltd v State Bank of New South Wales (1995) 17 ACSR 379
Mibor Investments Pty Ltd v Commonwealth Bank of Australia (1993) 11 ACLC 1062
NQEA Australia Pty Ltd v ADI Ltd (1999) 17 ACLC 927
Scanhill Pty Ltd v Century 21 Australasia Pty Ltd (1994) 12 ACLC 111
Spencer Constructions Pty Ltd v G & M Aldridge Pty Ltd (1987) 15 ACLC 1001
(Page 3)
1 MASTER SANDERSON: This is the plaintiff's application to set aside a statutory demand. The application is brought under s 459G of the Corporations Act ("the Act") and falls to be determined under s 459H of the Act. It is the plaintiff's prime contention that there is a genuine dispute as to the debt and therefore the demand ought be set aside under s 459H(1). In the alternative it is said that the plaintiff has a claim for damages such that the offsetting total is greater than the admitted total and the demand should therefore be set aside under s 459H(2). Given the conclusion I have reached, it is unnecessary for me to consider the plaintiff's application in the context of s 459H(2). However, I would note in passing that there has been no real attempt to quantify any claim the plaintiff may have against the defendant and there is no basis upon which any offsetting total could be calculated. However, as I have said, this is of no consequence in the context of this application and I simply note it in passing.
2 There was no dispute between the parties as to the applicable principles in determining what constitutes a genuine dispute. The Full Court of this Court in Meadowfield Pty Ltd v Gold Coast Holdings Pty Ltd (In Liq) [2001] WASCA 360 approved (at 18) the formulation of principle by McLennan CJ in the often quoted case of Eyota Pty Ltd v Hanabe Pty Ltd (1994) 12 ACLC 669 at 671. I have determined this application in line with the principles set out by his Honour in that decision.
3 In support of the application to set aside the statutory demand the plaintiff relied on two affidavits of Bradley Wayne Griffiths, the first sworn 27 August 2001, the second sworn 15 October 2001. In opposition to the application the plaintiff relied on an affidavit of Stephen Lawrence Hall, sworn 28 September 2001. A copy of the statutory demand appears as annexure "BG7" to the first Griffiths affidavit. The affidavit accompanying the statutory demand does not comply with O 81G r 31. The affidavit does not state the nature of the debt as is anticipated in form 7 and r 31(a). The affidavit refers in its heading to a court proceeding contrary to the provisions of r 31(c). No issue was taken by the plaintiff as to the form of the affidavit and it may be that it substantially complied with the rules and was therefore acceptable within the terms of r 5(1). In a simple straightforward case such as this there is no reason why the affidavit accompanying the statutory demand should not comply strictly with the rules. The statutory demand itself claims that the sum of $45,000 is owing by the plaintiff to the defendant. A reading of the statutory demand and the affidavit does not disclose in any way
(Page 4)
- how this amount is calculated or on what basis it is said the plaintiff is indebted to the defendant.
4 The position which emerges from the affidavits is as follows. In April 1997 the plaintiff entered into an agreement with the defendant for the purchase of a business of a hardware store located at 11 Riseley Street, Applecross. It was an express term of the agreement that it was subject to the plaintiff being granted preliminary approval from Melville City Council for a change of use of the premises to café/licensed bar. This condition was not fulfilled and the contract lapsed. A similar agreement was reached in July 1998. Once again, no approval from the local authority was obtained. On 30 September 1998 the plaintiff entered into an agreement with the defendant extending the time for compliance with the special terms of the agreement until 31 October 1998. There is no dispute between the parties about any of these facts.
5 Griffiths, on behalf of the plaintiff, says that some time in July 1998, on a date he cannot now remember, on behalf of the plaintiff he agreed with the defendant's real estate agent, one Bob Oliver, that the plaintiff would pay rent on the premises while the application for a licence was being considered and such rental payments as were made would be deducted from the eventual purchase price. Subsequently, says Griffiths, the defendant "abandoned" the premises. The plaintiff was concerned that this action by the defendant would jeopardise the lease of the premises. The plaintiff therefore arranged for two companies, namely Inklo Pty Ltd and Applex Enterprises Pty Ltd to pay the rent on the premises. Rental payments were made by these two companies direct to the landlord. The plaintiff says that its contract with the defendant came to an end by flux of time because licensing approval was not obtained. The plaintiff denies it is indebted to the plaintiff in the sum of $45,000 or at all.
6 In his affidavit, Hall takes issue with Griffiths' version of events. He says that by June 1999, almost 12 months after the second of the two contracts was entered into and well after any extension of the agreement referred to by Griffiths, an approach was made by Griffiths on behalf of the plaintiff. Hall says that Griffiths advised him that the plaintiff was prepared to pay $47,000 to take possession of the premises and begin renovations. Occupation of the premises by the plaintiff had been approved by the landlord. Hall says that on 1 July 1999 the defendant gave possession of the premises to the plaintiff. He says that the defendant then continued to make monthly rental payments on the premises and the defendant was reimbursed by the plaintiff. Appearing as annexures "SLH1" and "SLH2" to his affidavit are copies of the receipts
(Page 5)
- issued by the agent to the defendant for rental payments made by the defendant subsequent to the agreement and invoices then raised by the defendant to the plaintiff for the rent. Furthermore, the defendant says the payments being reimbursement of rent made by the plaintiff to the defendant were deposited into the defendant's bank account. Appearing as annexure "SLH3" are copies of bank statements purportedly showing these deposits. The defendant says that there was an oral agreement between the plaintiff and the defendant whereby the plaintiff was entitled to occupation of the premises and a transfer to it of any lease, such oral agreement now being enforceable because there has been part performance: see Redden v Wilks & Registrar of Titles [1979] WAR 161.
7 It is readily apparent from this brief summary of the facts as put by the protagonists that there is a genuine dispute between the parties in relation to the premises. This is not the appropriate forum in which to resolve that dispute. While I appreciate the strength of the defendant's case and in particular, its reliance upon bank statements and invoices which appear to support its position, to accept the version of events propounded by the defendant, would require me to disbelieve Griffiths on his oath. It would also require me to conclude that there was no serious question to be tried as to whether or not there is an enforceable contract between the parties as there was part performance of an oral contract touching and concerning a property interest. The facts in this case are not so clear-cut as to allow such a conclusion to be drawn.
8 As part of her submissions, counsel for the plaintiff contended that this was a case where there should be an order against the defendant for indemnity costs. She pointed to the fact that this was the third statutory demand which had been served by the plaintiff on the defendant, none of the previous two being pursued. While I think that costs should follow the event and be paid by the defendant, I am not satisfied that this is a proper case for an award of indemnity costs. The defendant's version of events is entirely plausible and supported by documentary evidence. While I would accept that there is a genuine dispute in relation to the debt I am by no means satisfied that the defendant, properly advised, should not have resisted this application. In reaching this conclusion I have borne in mind the defects to be found in the affidavit accompanying the statutory demand. Even making allowances for these defects, I am not satisfied that an award of indemnity costs would be appropriate.
(Page 6)
9 Subject to hearing further from counsel the orders I would propose are that the statutory demand be set aside and the defendant pay the plaintiff's costs of the application, including any reserved costs.
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