Shaw (as liquidator of ACN 166 338 138 Pty Ltd (in liq) (formerly Structural Projects Pty Ltd) v KPR Recruitment Australia Pty Ltd (No 2) [2017] NSWSC 707

Supreme Court New South Wales

Medium Neutral Citation: Shaw (as liquidator of ACN 166 338 138 Pty Ltd (in liq) (formerly Structural Projects Pty Ltd) v KPR Recruitment Australia Pty Ltd (No 2) [2017] NSWSC 707 Hearing dates: 5 June 2017 Decision date: 07 June 2017 Jurisdiction: Equity - Corporations List Before: Gleeson JA Decision: (1) The defendant pay to ACN 166 338 138 Pty Ltd (in liq) the sum of $61,420.89.

(2) The defendant pay the plaintiff's costs of the proceeding. Catchwords: PROCEDURE – where liquidator seeking to recover alleged unfair preference from creditor of company in liquidation – whether appropriate to allow liquidator to reopen his case on the issue of insolvency – where at trial counsel for the liquidator had sought to rely on the presumption of insolvency under Corporations Act, s 588E(4) when that presumption was not available because of s 588E(7) – where liquidator's solicitor was not aware that all of the evidence relating to insolvency of company in liquidation was not before the Court at trial – where defendant will suffer no prejudice, having not appeared at any stage of the proceedings.

CORPORATIONS – external administration – application to recover alleged unfair preference under Corporations Act, s 588FF – whether company insolvent – whether temporary lack of liquidity or endemic shortage of working capital – where substantial deficiency between debts then payable and payable in the immediate future compared to the company's cash and other liquid resources – where several cheques drawn on company's bank accounts dishonoured – where company's bank accounts were inflated by passing cheques between them – where substantial debts from relevant period remained unpaid at date of liquidation. Legislation Cited: Civil Procedure Act 2005 (NSW), s 56(1) Corporations Act 2001 (Cth), ss 95A, 286(1), 588E(4), 588E(7), 588FF Cases Cited: Australian Securities and Investments Commission v Rich [2006] NSWSC 826 Autodesk Inc v Dyason (No 2) (1993) 176 CLR 300; [1993] HCA 6 Colin R Price & Associates Pty Ltd v Four Oaks Pty Ltd [2017] FCAFC 75 Inspector General in Bankruptcy v Bradshaw [2006] FCA 22 Shaw (as liquidator of ACN 166 338 138 Pty Ltd (in liq) (formerly Structural Projects Pty Ltd) v KPR Recruitment Australia Pty Ltd [2017] NSWSC 539 Smith v NSW Bar Association (1992) 176 CLR 256; [1992] HCA 36 Taouk v Louis (No. 1) [2014] NSWSC 656 The Owners – Strata Plan No 74602 v Brookfield Australia Investments Ltd [2015] NSWSC 1682 Urban Transport Authority v Nweiser (1992) 28 NSWLR 471 Category: Principal judgment Parties: James Alexander Shaw as liquidator of ACN 166 338 183 Pty Ltd (in liq) (Plaintiff) KPR Recruitment Aust Pty Ltd (Defendant) Representation: Counsel: Mr D Allen (Plaintiff)