Hussain v CSR Building Products Limited, in the matter of FPJ Group Pty Ltd (In Liq) [2016] FCA 392

FEDERAL COURT OF AUSTRALIA

Hussain v CSR Building Products Limited, in the matter of FPJ Group Pty Ltd (In Liq) [2016] FCA 392 File number: QUD 153 of 2015

Judge: EDELMAN J

Date of judgment: 13 May 2016

Catchwords: CORPORATIONS – claim to recover alleged unfair preferences under s 558FE of the Corporations Act – whether company insolvent at the time of making payments – whether payments were in relation to "unsecured debts" – meaning of an "unsecured debt" in s 588FA(1)(b) – whether a retention of title clause is a "security" – date for determination of the value of security in s 588FA(2) – operation of "good faith" in s 588FG(2) – operation of "suspicion" in s 588FG(2) – whether running account existed – whether defendant has a set-off under s 553C – whether set-off under s 553C can be made against a preference claim under s 588FF

Legislation: Bankruptcy Act 1966 (Cth) s 122 Chattel Securities Act 1987 (Vic) s 3(1) Corporations Act 2001 (Cth) Part 5.7B; ss 9, 51, 51A, 51E, 95A(1), 95A(2), 442CC, 442CC(2), 442CB, 553C, 553C(1)(a), 553C(2), 588E(3)(b), 588F, 588FA, 588FA(1), 588FA(1)(b), 588FA(2), 588FA(3), 588FC, 588FE, 588FF, 588FF(1)(c), 588FG(1)(a), 588FG(2), 588FG(2)(a), 588FG(2)(b), 588FG(2)(b)(i), 588FG(2)(b)(ii), 588V, 588W Personal Property Securities Act 2009 (Cth) ss 12(1), 12(2)(d), 306(2)(b), 307, 308(a), 310, 310(d), 322(1) Personal Property Securities (Corporations And Other Amendments) Bill 2010 (Cth)

Cases cited: Airservices Australia v Ferrier [1996] HCA 54; (1996) 185 CLR 483 Aluminium Industrie Vaassen BV v Rompala Aluminium Ltd [1976] 2 All ER 552 Associated Alloys Pty Ltd v Metropolitan Engineering & Fabrication Pty Ltd (Voluntary Administrators Appointed) (Receivers and Managers Appointed) (1998) 16 ACLC 1633 Associated Alloys v ACN 001 452 106 Pty Ltd (in liq) [2000] HCA 25; (2000) 202 CLR 588 Australian Securities & Investments Commission v Plymin [2003] VSC 123; (2003) 175 FLR 124 Baden v Société Générale pour Favoriser le Dévelopment du Commerce et de l'Industrie en France SA [1992] 4 All ER 161 Bank of Australasia v Hall [1907] HCA 78; (1907) 4 CLR 1514 BP Australia Ltd v Brown [2003] NSWCA 216; (2003) 58 NSWLR 322 Burness, In the matter of Denward Lane Pty Ltd (ACN 065 418 411) (In Liquidation) [2009] FCA 893 Buzzle Operations Pty Ltd (in liq) v Apple Computer Australia Pty Ltd [2011] NSWCA 109; (2011) 81 NSWLR 47 Carello as Liquidator of Perrinepod Pty Ltd (In Liq) v Perrine Architecture Pty Ltd [2016] WASC 145 Cashflow Finance Pty Ltd (in liq) v Westpac Banking Corp [1999] NSWSC 671 Central Cleaning Supplies (Australia) Pty Ltd v Elkerton (in his capacity as joint and several liquidator of Swan Services Pty Ltd (in liq)) [2015] VSCA 92; (2015) 321 ALR 181 Clifton v CSR Building Products Pty Ltd [2011] SASC 103 Craine v Colonial Mutual Fire Insurance Co Ltd [1920] HCA 64; (1920) 28 CLR 305 Cussen (as Liquidator of Akai Pty Ltd) v Commissioner of Taxation [2004] NSWCA 383; (2004) 51 ACSR 530 Cussen v Sultan [2009] NSWSC 1114; (2009) 74 ACSR 496 Davies v Chicago Boot Co Pty Ltd [2011] SASC 27 Dean-Willcocks v Commissioner of Taxation [2008] NSWSC 1113 Duncan v Commissioner of Taxation; in the matter of Trader Systems International Pty Ltd (in liq) [2006] FCA 885 Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited [2013] HCA 46; (2013) 250 CLR 303 Expo International Pty Ltd v Chant [1979] 2 NSWLR 820 Farah Constructions Pty Ltd v Say–Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 Foots v Southern Cross Mine Management Pty Ltd [2007] HCA 56; (2007) 234 CLR 54 Fortress Credit Corporation (Australia) II Pty Ltd [2015] HCA 10; (2015) 254 CLR 489 General Motors Acceptance Corp Australia v Southbank Traders Pty Ltd [2007] HCA 19; (2007) 227 CLR 305 Globe Motors, Inc v TRW Lucas Varity Electric Steering Ltd [2016] EWCA Civ 396 Hall v Poolman [2007] NSWSC 1330; (2007) 65 ACSR 123 Hamilton v BHP Steel (JLA) Ltd (1995) 13 ACLC 1 In re Nortel GmbH (in administration) and related companies [2013] UKSC 52; [2014] AC 209 Jetaway Logistics Pty Ltd v Deputy Commissioner of Taxation [2009] VSCA 319; (2009) 26 VR 657 JLF Bakeries Pty Ltd (in liq) v Baker's Delight Holdings Ltd [2007] NSWSC 894; (2007) 64 ACSR 633 Kazar v Kargarian [2010] FCA 1381; (2010) 81 ACSR 158 Lee Kong v Pilkington (Australia) Ltd (1997) 25 ACSR 103 Lewis, in the matter of Damilock Pty Ltd (In Liquidation) ACN 008 083 985 v VI SA Australia Pty Ltd ACN 002 433 267 [2008] FCA 1801 Lopez (In his capacity as liquidator of Swan Concrete Products Pty Ltd (in liq)) v Harvey [2015] WASC 292 Manpac Industries Pty Ltd v Ceccattini [2002] NSWSC 330; (2002) 20 ACLC 1,304 Matthews v The Tap Inn [2015] SADC 108 Mineralogy Pty Ltd v Sino Iron (No 6) [2015] FCA 825 New Cap Reinsurance Corporation Ltd v A E Grant [2009] NSWSC 662; (2009) 72 ACSR 638 Olifent v Australian Wine Industries Pty Ltd (1996) 19 ACSR 285 Queensland Bacon Pty Ltd v Rees [1966] HCA 21; (1966) 115 CLR 266 Re Bird; Ex parte M & G Casabene & Sons (1979) 39 FLR 281 Re Emanuel (No 14) Pty Ltd (in liq); Macks v Blacklaw & Shadforth Pty Ltd (1997) 147 ALR 281 Re Parker (1997) 80 FCR 1 Re Toowong Trading Pty Ltd (In Liq) [1989] 1 Qd R 207 Re Tweed Garages Ltd [1962] Ch 406 Rees v Bank of New South Wales [1964] HCA 47; (1964) 111 CLR 210 Roberts v Investwell Pty Ltd (in liq) [2012] NSWCA 134; (2012) 88 ACSR 689 Sandell v Porter [1966] HCA 28; (1966) 115 CLR 666 Sheahan Pty Ltd v Murdock & Gediz Pty Ltd [2008] SADC 5 Sheahan v Fabienne Pty Ltd [1999] SASC 335 Shirlaw v Lewis (1993) 10 ACSR 288 Singer v Williams [1921] 1 AC 41 Smith v Boné in the matter of ACN 002 864 002 Pty Ltd (in liq) [2015] FCA 319 Southern Cross Interiors Pty Ltd (In Liq) v Deputy Commissioner of Taxation (2001) 53 NSWLR 213 Standard Chartered Bank of Australia Ltd v Antico (Nos 1 & 2) (1995) 38 NSWLR 290 Sutherland v Liquor Administration Board (1997) 15 ACLC 875 Sutherland v Lofthouse [2007] VSCA 197; (2007) 214 FLR 157 Sydney Appliances Pty Ltd (in liq) v Eurolinx Pty Ltd [2001] NSWSC 230 The Tap Inn Pty Ltd v Matthews [2015] SASCFC 188 VR Dye & Co v Peninsula Hotels Pty Ltd (in liq) [1993] 3 VR 201 Walsh v Natra Pty Ltd [2000] VSCA 60 Williams (as liquidator of Scholz Motor Group P/L (in liq)) v Peters [2009] QCA 180; (2009) 232 FLR 98 Williams v Roffey Bros & Nicholls (Contractors) Ltd [1989] EWCA Civ 5; [1990] 1 All ER 512 Commonwealth, Parliamentary Debates, House of Representatives, 10 March 2010, 2009 (Dr Craig Emerson) Bant E, The Change of Position Defence (Hart Publishing, 2009) Derham R, Derham on the Law of Set-off (4th ed, Oxford University Press, 2010) Derham R, "Set-off Against Statutory Avoidance and Insolvent Trading Claims in Company Liquidation" (2015) 89 Australian Law Journal 459