Ziegler as trustee for the Doris Gayst Testamentary Trust v Cenric Group Pty Ltd

The applicant, Ziegler as trustee for the Doris Gayst Testamentary Trust, sought leave to appeal from a decision of the primary judge who had set aside a statutory demand issued by the respondent, Cenric Group Pty Ltd. The dispute concerned an alleged debt owed by the applicant to the respondent, which the applicant sought to offset against retention monies claimed to be due under a construction contract. The appeal was heard by Meagher, Gleeson and McCallum JJA of the Court of Appeal of the Supreme Court of New South Wales.

The central legal issues before the Court of Appeal were whether the primary judge erred in finding that the applicant's affidavit supported its application to set aside the statutory demand under section 459G of the Corporations Act 2001 (Cth). Specifically, the court considered whether it was necessary for the supporting affidavit to articulate the legal basis of the offsetting claim, which was founded on the contractor's acceptance of the owner's repudiation of the construction contract. The applicant also contended that the primary judge's factual finding that the affidavit supported the application was erroneous and that an injustice had been demonstrated.

The Court of Appeal dismissed the summons for leave to appeal and the notice of appeal as incompetent. The court found that the primary judge's decision was not affected by error. The court held that the affidavit did not need to contain the legal basis of the claim, but rather sufficient information to establish a genuine dispute. The court concluded that the primary judge had correctly found that the affidavit did support the application. Consequently, the applicant was ordered to pay the respondent's costs of the concurrent hearing on the application for leave and the appeal. A subsequent application by the respondent for a special costs order was dismissed, with the respondent ordered to pay the applicant's costs of that application.