Fadale v Bidnia [2009] NSWSC 136

New South Wales Supreme Court

CITATION : Fadale v Bidnia [2009] NSWSC 136

HEARING DATE(S) : 09/03/2009

JUDGMENT DATE : 12 March 2009

JURISDICTION : Equity Division

JUDGMENT OF : Macready AsJ at 1

EX TEMPORE JUDGMENT DATE : 12 March 2009

DECISION : Paragraph 39

CATCHWORDS : Corporations Law. Application to set aside Statutory Demand under s 459G of Corporations Act 2001. Offsetting claim established. Demand set aside. No matter of principle.

PARTIES : Fadale Pty Limited v Bidnia Group Pty Limited

FILE NUMBER(S) : SC 4092/2008

COUNSEL : Mr GM Colman for plaintiff Mr DP O'Connor for defendant

SOLICITORS : MBA Lawyers for plaintiff Lou Baker & Associates for defendant

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

ASSOCIATE JUSTICE MACREADY

THURSDAY 12 MARCH 2009

4092/08 - FADALE PTY LIMITED v BIDNIA GROUP PTY LIMITED

JUDGMENT

1 HIS HONOUR: This is an application to set aside a statutory demand served by the defendant on the plaintiff. The defendant served the statutory demand dated 15 July 2008 which sought payment described as follows: " SCHEDULE Description of the Debt Amount of the Debt

Payment claim titled 'Tax Invoice 61" served and dated 21 April, 2008, claiming the amount of $84,603.75 less payments made on 30 May 2008 in the amount of $15,000.00 and 4 July 2008 in the amount of $10,000.00.

TOTAL $59,603.75 " 2 The debt relates to concrete work performed by the defendant as a subcontractor for the plaintiff on certain residential premises. At the time of commencing the proceedings the plaintiff paid $11,238 to the defendant. This brings the statutory demand down to $48,365.75. On the hearing of the matter the defendant conceded that rather than press for the demand to remain at this amount it conceded it should be reduced further. This concession was based on what is submitted was a clear admission by the plaintiff in a letter of 27 July 2008 that it owed $34,327. After allowing for the $11,238 payment this brings the amount of the demand down to $23,089. 3 There are three grounds advanced by the plaintiff: (a) A genuine dispute as to whether there is a liability for some work; (b) A genuine dispute as to whether the debt is payable because of the provisions of the Home Building Act 1989; (c) Setting aside under s 459J(1)(b) for some other reason being a false affidavit in support. Genuine dispute as to liability 4 The relevant claims by the defendant were included in the invoices which were payment claims under s13 of the Building and Construction Industry Security of Payment Act 1999. There was no payment schedule by the plaintiff and the claims are those of debts due under s 14(4) of the Act. No judgment has been entered. 5 In these circumstances in Ettamogah Pub (Rouse Hill) Pty Limited v Consolidated Constructions Pty Limited (in liq) [2006] NSWSC 1450 White J set out the results of the position in these terms: "11 The procedures provided by the Security of Payment Act were designed to alleviate difficulties which builders experienced in their cash flow whilst their claims for payment under building contracts were mired in litigation or arbitration. The remedies provided by the Security of Payment Act are interim in the sense that the Act does not affect the rights of parties to a construction contract at general law or otherwise under the contract. So much is clear from s 32. 12 Whilst there can be no dispute that the plaintiff is indebted to the defendant for the amount claimed in the statutory demand, the plaintiff will nonetheless have an offsetting claim equal to the amount of that debt if there is a genuine dispute that the defendant was not contractually entitled to the amount claimed in the payment claims made under s 13 of the Security of Payment Act (see Max Cooper & Sons (Builders) Pty Limited v M & E Booth & Sons Pty Limited (2003) 202 ALR 680; M & D Demir Pty Limited v Graf Plumbing Pty Limited [2004] NSWSC 553; Greenaways Australia Pty Limited v CBC Management Pty Limited [2004] NSWSC 1186; Aldoga Aluminium Pty Limited v De Silva Starr Pty Limited [2005] NSWSC 284; Plus 55 Village Management Pty Limited v Parisi Homes Pty Limited [2005] NSWSC 559; and CCD Group Pty Limited v Premier Drywall Pty Limited [2006] NSWSC 1012)." 6 The areas where there is said to be a dispute are as follows: