Vac-tron v American [2003] NSWSC 529

New South Wales Supreme Court

CITATION : Vac-tron v American [2003] NSWSC 529 HEARING DATE(S) : 12/06/03 JUDGMENT DATE : 12 June 2003 JURISDICTION: Equity Division JUDGMENT OF : Master Macready at 1 DECISION : Proceedings dismissed with costs.

CATCHWORDS : Corporations Law. Application to set aside statutory demand under section 459G of the Corporations Act. Proceedings dismissed. No matter of principle. PARTIES : Vac-Tron Australia Pty Ltd v American Manufacturing & Machine Co Inc FILE NUMBER(S) : SC 1229/03 COUNSEL : M. Pesman for plaintiff P. Russell for defendant SOLICITORS : Adams Leyland Solicitors for plaintiff Luscombe Wright Lawyer for defendant

- 1 - THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

MASTER MACREADY

THURSDAY 12 JUNE 2003

1229/03 – VAC-TRON AUSTRALIA PTY LIMITED v AMERICAN MANUFACTURING & MACHINE CO INC T/AS VAC-TRON EQUIPMENT

JUDGMENT

1 MASTER: This is an application to set aside a statutory demand. The statutory demand is one which is dated 2 January 2003 and claims a total of $US41,502.50. It gives reference by details of invoices and it is apparent from those invoices that there is a sale claimed in the invoices of three machines, together with associated equipment between the defendant and the plaintiff. 2 The machines are equipment used for the purpose of vacuum extraction in connection with pipe laying and other similar matters. The actual invoices, as I say, refer to the supply of those three machines. In respect of two of those machines they have been on-sold by the plaintiff and in respect of one it is apparent they still retain that unit. 3 The schedule to the demand lists the payments that have been made on account, of which there are four, and they have been deducted to give a figure which is the amount claimed in the demand. 4 Some of the history of the matter is probably worth noting. There was initial interest in this project by Mr Sperber who visited the defendant's office in Florida in early 2000 and he apparently took some machines. The plaintiff company and the main principal of it, who is a Mr Collier, became involved in 2000, and the negotiations continued between Mr Collier and the American representative, particularly Mr Showley, representing the defendant. 5 There was contact at a marketing show in Western Australia in October 2000 and, ultimately, on 23 October, a dealership agreement was entered into between the plaintiff and the defendant. The plaintiff had only been incorporated on 5 May 2000. 6 That agreement was executed by Mr Collier on behalf of the plaintiff and it was not executed on behalf of the defendant until 28 October 2000. The terms of that deed of agreement are fairly straightforward. They provide for the period of the agreement which might be two years. There is a requirement to purchase and maintain two units as an inventory and a requirement for the plaintiff to purchase two units in each quarter of each fiscal year. 7 There are paragraphs in relation to pricing and, in particular, the terms dealt with in that agreement require payment ten days after delivery and acceptance of product. 8 On 25 October 2000 in Brisbane, a series of purchase orders were signed on the plaintiff's behalf relating, in particular, to the three machines that were purchased. I will come back to the terms of the conversations that occurred then, but it is apparent that in due course invoices were sent, although the original was addressed to Mr Sperber. Later they were re-issued to what was obviously the correct purchaser in the terms of the dealership agreement, which was the plaintiff. 9 The goods were shipped in November 2000 and arrived in Australia in December 2000. The invoices were then re-issued. Thereafter there follows a whole series of correspondence and e-mails dealing with the course of the project, when payment could be expected, including the payment of the amounts to which I have referred. Eventually relationships broke down towards the end of 2001, and in due course the statutory demand was given and the proceedings were commenced within time. 10 The principal matters that have been raised by the plaintiff in relation to the claim to set aside the demand relate to representations which were said to be made on 25 October 2000. This was after the plaintiff had signed the dealership agreement, and at the time of signing the orders for the equipment pursuant to it. There are also conversations that happened in Perth, which, I would infer, given the timing and where people would have been on about 23 October 2000, relating to whether the agreement would be enforced. 11 The discussions in Perth, which are referred to in paragraph 9 of Mr Collier's affidavit of 23 February 2003 were in these terms: