John Raymond Gibbons & Anor as official liquidators of Deemah Marble & Granite Pty Ltd (in liq) v Deputy Commissioner of Taxation [2003] NSWSC 936

New South Wales Supreme Court

CITATION : John Raymond Gibbons & Anor as official liquidators of Deemah Marble & Granite Pty Ltd (in liq) v Deputy Commissioner of Taxation [2003] NSWSC 936 HEARING DATE(S) : 27.08.03; 28.08.03; 29.08.03; 02.09.03; 03.09.03 JUDGMENT DATE : 24 October 2003

JURISDICTION: Equity Division Corporations List JUDGMENT OF : Nicholas J DECISION : Plaintiffs entitled to order sought pursuant to s588FF(1)(a) Corporations Act 2001 (Cth); Defendant to pay Plaintiffs interest and costs; Defendant entitled to declaration and order that the Respondent is liable to indemnify it pursuant to 588FGA(2) ; Respondent to pay Defendant interest and costs

CATCHWORDS : INSOLVENCY - UNFAIR PREFERENCE - UNCOMMERCIAL TRANSACTION - PAYMENTS IN REDUCTION OF TAX LIABILITY - Whether company insolvent at time of payments - Whether transactions constituted unfair preferences - Whether transactions constituted uncommercial transactions HELD: Company insolvent at time of payments - payments constituted unfair preferences and uncommercial transactions - Plaintiffs entitled to order sought pursuant to s588FF(1)(a) - Defendant to pay Plaintiffs interest and costs - CLAIM FOR INDEMNITY FROM DIRECTOR DEFENCES UNDER s588FGB(3),(4),(6) - Whether Respondent liable to indemnify Defendant in respect of payments made when company was insolvent - Defences of expectation of solvency, reliance on other person, and all steps taken - HELD: Defendant entitled to declaration and order that the Respondent is liable to indemnify the Defendant pursuant to 588FGA(2) - Respondent to pay Defendant interest and costs. LEGISLATION CITED : Corporations Act 2001 (Cth) s 95A(1), 95A(2), 198(A)(1), 286(2), 459E, 588E(4), 588FA, 588FA(1), 588FB(1), 588FC, 588FC(a), 588FE(2), 588FE(3), 588FF, 588FF(1)(a), 588FGA, 588FGA(2), 588FGB(3), 588FGB(4), 588FGB(4)(a), 588FGB(4)(a)(ii), 588FGB(4)(b), 588FGB(6), 588FGB(6)(a), 588FGB(6)(b), 588H(2) Income Tax Assessment Act 1936 (Cth) s 222AOE ASIC v Plymin & Ors (2003) VSC 123 Bank of Australasia v Hall (1907) 4 CLR 1514 Daniels v Anderson (1995) 37 NSWLR 438 Deputy Commissioner of Taxation v Clark (2003) NSWCA 91 Deputy Commissioner of Taxation v Saunig (2002) 55 NSWLR 722 Hamilton v BHP Steel (JLA) Pty Ltd (1995) 13 ACLC 1548 Keith Smith East West Transport Pty Ltd (in liq.) & Anor v Australian Tax Office (2002) NSWCA 264 CASES CITED : Leslie & Anor v Howship Holdings Pty Ltd (1997) 15 ACLC 459 Manpac Industries Pty Ltd v Ceccatini (2002) NSWSC 330 Sandell v Porter (1966) 115 CLR 666 Spedley Securities Ltd (in liq) v Western United Ltd (in liq) (1992) 27 NSWLR 111 Taylor v Australia & New Zealand Banking Group Ltd (1988) 6 ACLC 808 Tosich Construction Pty Ltd (in liq) & Anor v Tosich (1997) 23 ASCR 466 Tourprint International Pty Ltd (in liq) & Anor v Bott (1999) 32 ASCR 201 Walsh v Natra Pty Ltd (2000) VSCA 60 John Raymond Gibbons & Anor as official liquidators of Deemah Marble & Granite Pty Ltd (in liq) - Plaintiffs PARTIES : Deputy Commissioner of Taxation - Defendant Peter John Solomon - Respondent FILE NUMBER(S) : SC 5129/01 C R C Newlinds - Plaintiffs COUNSEL : R Rodionoff - Defendant C Robinson - Respondent Clayton Utz - Plaintiffs SOLICITORS : Australian Government Solicitor - Defendant Colin Biggers & Paisley - Respondent