Geotech Limited v Mount Grey Downs Limited

[2018] NZHC 3178

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2018-409-000609

[2018] NZHC 3178

BETWEEN

GEOTECH LIMITED

Applicant

AND

MOUNT GREY DOWNS LIMITED

Respondent

Hearing:	26 November 2018
Appearances:	A N Riches and C Mo for Applicant D J Ballantyne for Respondent
Judgment:	26 November 2018

JUDGMENT OF ASSOCIATE JUDGE OSBORNE

(an application to set aside statutory demand)

Introduction

[1]                 The applicant, Geotech Ltd (Geotech), has mining and mineral interests. The respondent, Mount Grey Downs Ltd (Mt Grey), provides a range of contracting services, including site works, cartage and vehicle maintenance. Geotech was using Mt Grey’s services relevantly from mid-2017.

[2]                 Mt Grey regularly billed Geotech by invoices which were stated to be due for payment by the 20th day of the month following the invoice date. Invoices rendered up to 1 November 2017 were fully paid by Geotech. After that, sums claimed under invoices went unpaid and continued to accrue.

GEOTECH LIMITED v MOUNT GREY DOWNS LIMITED [2018] NZHC 3178 [26 November 2018]

The statutory demand

[3]                 On 23 July 2018, Mt Grey served on Geotech a statutory demand (the demand) for $446,109.16, stated to be the balance of the sum owing for goods and services rendered. The demand did not have a statement of account attached – such a statement, dated 30 June 2018, was subsequently provided.  It  includes invoices dated up to   30 June 2018.

Setting aside application

[4]Geotech applies to set aside the demand. It asserts that:

(a)that there is a substantial dispute whether the debt is due and owing under s 290(4)(a) Companies Act 1993; and

(b)a set-off and/or counterclaim of $146,666.21; and

(c)that other grounds exist to set aside the demand.

[5]Geotech’s dispute as to the claimed debt contains three sets of assertions:

(a)Mt Grey has provided no evidence as to what was undertaken under each invoice despite Geotech’s demand for such information. The invoices are therefore not due and owing.

(b)Mt Grey’s claim in one of its invoices (#FC3 dated 31 May 2018 for

$24,954.01) is for interest or finance charges which Geotech staff did not have authority to authorise or agree to. It is therefore disputed.

(c)Four of Mt Grey’s invoices, (1490, 1514, 1515 and the same invoice as at [5](b) – #FC3), altogether totalling $109,612.90, were not at the time of the demand due and owing.

Principles

The jurisdiction to set aside a statutory demand – the principles

[6]                 The Court’s jurisdiction to set aside a statutory demand is contained in s 290 Companies Act 1993, and I refer specifically to the basis upon which the Court may grant an application as contained in s 290(4) which reads:

290     Court may set aside statutory demand

…

(4)The court may grant an application to set aside a statutory demand if it is satisfied that—

(a)there is a substantial dispute whether or not the debt is owing or is due; or

(b)the company appears to have a counterclaim, set-off, or cross- demand and the amount specified…