Bulevi Pty Ltd -v- Alanbert Pty Ltd Davhand Pty Ltd -v- Alanbert Pty Ltd [2012] NSWSC 537

Supreme Court New South Wales

Medium Neutral Citation: Bulevi Pty Ltd -v- Alanbert Pty Ltd Davhand Pty Ltd -v- Alanbert Pty Ltd [2012] NSWSC 537 Hearing dates: 30 March 2012 Decision date: 30 March 2012 Jurisdiction: Equity Division - Corporations List Before: Hammerschlag J Decision: The Statutory Demand from the plaintiff to Bulevi Pty Ltd ACN 003 116 658 dated 28 September 2011 be set aside. The Statutory Demand dated 28 September 2011 to Davhand Pty Ltd 003 574 865 be set aside. Defendant to pay the plaintiffs' costs. Catchwords: CORPORATIONS - Corporations Act 2001 (Cth) s 459G - statutory demand - demand based on judgment which plaintiffs say was compromised - genuine issue that defendant's claim is now contractual and statute barred Cases Cited: Barclay Nominees v Belle Property East Pty Ltd [2001] NSWSC 743 Solarite Air-Conditioning v York International Australia Pty Ltd [2002] NSWSC 411 Category: Principal judgment Parties: Bulevi Pty Ltd (ACN 003 116 658) - Plaintiff Alanbert Pty Ltd (ACN 000 343 493) - Defendant Davhand Pty Ltd (ACN) 003 574 865) - Plaintiff Alanbert Pty Ltd (ACN 000 343 493 - Defendantt Representation: Counsel: C.J. Hockey - Plaintiffs C.P. Carter - Defendant Solicitors: Charles Hockey Solicitors - Plaintiffs Marsdens Law Group - Defendant File Number(s): 2011/334160 2011/334185

EX TEMPORE Judgment 1HIS HONOUR:Before the Court are two identical applications. In each case the respective plaintiff seeks to set aside a Statutory Demand dated 28 September 2011 directed to it by the defendant claiming $312,013 based on a judgment which the defendant obtained against each of them on 22 April 2002. Each application is supported by an affidavit sworn 19 October 2011 by a director of the plaintiff. 2The plaintiffs appealed the judgment and the defendant cross-appealed but by consent on 27 February 2006 both the appeal and the cross appeal were struck out with no order as to costs. 3The plaintiffs say that they and the defendant entered into an agreement compromising the judgment debt and accordingly say that there is a genuine dispute as to its existence. 4The asserted agreement is in writing contained in a letter is dated 27 May 2005 from the defendant (under the hand of a director who has since passed away) to the Registrar of the Court of Appeal and counter signed on behalf of each of the plaintiffs by a director. 5The letter is in the following terms: Please be advised that the parties to the above matter have agreed to an out of court settlement on the following terms:- 1That the judgment debtors have offered an amount of $200,000 as final settlement of the (sic) judgment debt of $323,000.00 and Alanbert P/L has agreed to accept the said amount of $200,000. 2It is also agreed that the sum of $200,000 will be paid by instalments and finalised within 12 months from the signing of this agreement. 3It is further agreed that in the event of Bulevi or Davhand defaulting in instalments within the 12 month period as in clause 2 above interest of 9 percent will be payable from the date of signing the agreement for the period of 12 months. 4In order that proper documentation be submitted to the court, it is further requested that Justice Hamilton's order of the stay of his judgment be extended for two months from today's date. 6The date upon which the letter was countersigned on behalf of the plaintiffs is not clear but it seems that this must have happened no later than 24 February 2006. 7The defendant does not put in issue that the letter was signed. It puts that there was no agreement because there was a total failure of consideration in that the plaintiffs have not performed their obligations under it. It also puts that para 4 of the letter indicates that no final and binding agreement was intended until proper documentation had been signed. It makes no submission as to uncertainty. What the plaintiffs have raised is clearly sufficient to establish a genuine dispute as to the existence of a binding agreement compromising the judgment. 8To satisfy the Court that there is a genuine dispute as to the existence or amount of the debt to which a demand relates, a plaintiff need only show one issue having a sufficient degree of cogency to be arguable. The test is not a difficult or demanding one. The Court does not embark upon any extended enquiry. The Court does not also seek to resolve competing claims but to determine whether the claim is made in good faith which means arguable on the basis of the fact asserted with sufficient particularity to enable the Court to determine that the claim is not fanciful. See, for example Barclay Nominees v Belle Property East Pty Ltd [2001] NSWSC 743 per Palmer J and Solarite Air-Conditioning v York International Australia Pty Ltd [2002] NSWSC 411 at [23] per Barrett J. 9The defendant's submission as to the failure of consideration is unsustainable. The letter embodies promises on behalf of the plaintiff, including as to the payment of interest, which are sufficient to amount to consideration. That an immediately binding agreement was intended is also clearly arguable. No additional terms of any material nature necessary to give effect to the agreement were suggested. 10The plaintiffs put further that, on the footing that the agreement was entered into no later 24 February 2006, more than six years have elapsed since the debt created by the agreement was due and payable and that the defendant's claim is now statute barred. The defendant's answer is that the substance of the compromise is that the judgment debt remains on foot except that the defendant agrees to accept an amount less than the full judgment debt in satisfaction of it. If the defendant's claim is for a judgment debt, it is not statute barred. 11The defendant submitted that the Court should now vary the demand down to $200,000, it being common cause that no amount has been paid by the plaintiffs. 12The issue whether the parties' rights under the judgment were substituted by an agreement underhand or whether the defendant's rights under the judgment remain in place but subject to the terms of the agreement undoubtedly involves resolution of questions sufficient to give rise to a genuine dispute. If the true character of the defendant's claim is contractual, there is undoubtedly an arguable issue as to whether it is now statute barred. 13It follows that the Statutory Demand in each case must be set aside and I so order. 14I order that the Statutory Demand from the plaintiff to Bulevi Pty Ltd ACN 003 116 658 dated 28 September 2011 be set aside. 15I order that the Statutory Demand dated 28 September 2011 to Davhand Pty Ltd 003 574 865 be set aside. 16The plaintiffs have been successful in both cases. The defendant is to pay the plaintiffs' costs.