Rivercorp v Casement [2004] NSWSC 280

New South Wales Supreme Court

CITATION : Rivercorp v Casement [2004] NSWSC 280 HEARING DATE(S) : 11/03/04 JUDGMENT DATE : 8 April 2004 JURISDICTION: Equity Division JUDGMENT OF : Master Macready at 1 DECISION : Statutory demand set aside.

CATCHWORDS : Corporations law. Action to set aside statutory demand under s 459 G of the Corporations Act. Defects in the affidavit in support of the demand. Demand set aside. PARTIES : Rivercorp Pty Ltd v Frank Casement FILE NUMBER(S) : SC 5750 of 2003 COUNSEL : Mr I Neil for plaintiff Mr A Gruzman for defendant SOLICITORS : Paul Baird for plaintiff Baron & Associates for defendant

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

MASTER MACREADY

Thursday 8 April 2004

5750 of 2003 RIVERCORP PTY LTD v FRANK CASEMENT JUDGMENT 1 MASTER: This is an application to set aside a statutory demand under s 459G of the Corporations Act 2001 (Cth) (the Act). The statutory demand dated 24 October 2003 claimed the sum of $80,000.00 in respect of a debt described as being "Loan described as 'Casement Loan Account' in Agreement dated 23 April 2003". 2 There are two bases raised for the setting aside of the demand. The first ground was that the affidavit in support of the statutory demand did not comply with the requirements of s 459E(3) of the Act. The second was that there is a genuine dispute regarding the amount of the debt. 3 I turn to the first question. The objectionable paragraph in the affidavit verifying in the statutory demand is paragraph 2 which is in the following terms:- "The Defendant (referred to in the attached Statutory Demand as the 'Company') is indebted to the Plaintiff (referred to in the attached Statutory Demand as the 'Creditor') in the amount of $80,000 set out in the attached statutory demand." 4 It is said that the affidavit fails to meet the requirements of the Act because it does not verify or state that the alleged debt is due and payable by the plaintiff. What it states is that the plaintiff is "indebted" to the defendant in the amount of $80,000.00. It is said that this in breach of ss 459E(3)(a) and 459E(3)(b) and Rule 5.2(a) of the Act. 5 Before dealing with this point it is necessary to deal with a preliminary point which goes to the question of whether or not this ground was raised in the affidavit that was filed within the time limited by the section. That affidavit was the affidavit of John Phillip Brosnan sworn 14 November 2003. Paragraph 27 of the affidavit is in these terms: "On or about 24 October 2003 the plaintiff was served with a Statutory Demand purportedly issued by Casement, even though the affidavit in support of the demand was sworn by McCann. I am told by my solicitor that the affidavit is defective. A true copy of the document issued by Casement is located at page 117 of Exhibit RC1." 6 As is made plain by the above paragraph the exhibit contained a copy of the statutory demand and an affidavit in support. 7 The most recent discussion of the extensive case law in this area and its development is that of Austin J in POS Media v B Family [2003] NSWSC 147. There His Honour said: "26 The principle asserted by the defendant is that the plaintiff cannot succeed on the 'no debt' ground, because that ground was not set out in Mr Patkin's affidavit of 9 December 2002, and cannot be characterised as an extension of the grounds set out in that affidavit.