SX Projects Pty Ltd (in liq) v V Battaglia & Ors [2018] NSWSC 1830

Supreme Court New South Wales

Medium Neutral Citation: SX Projects Pty Ltd (in liq) v V Battaglia & Ors [2018] NSWSC 1830 Hearing dates: 6, 7 and 8 November 2018 Decision date: 30 November 2018 Jurisdiction: Equity - Corporations List Before: Black J Decision: The Plaintiffs succeed in their claims for compensation for loss resulting from insolvent trading against the First Defendant. The Plaintiffs succeed in their claims for relief in respect of voidable transactions against the Defendants. Catchwords: CORPORATIONS – insolvent trading – claim by liquidators against director under s 558G and 588M of the Corporations Act 2001 (Cth) for insolvent trading – whether companies were insolvent or became insolvent by incurring the debts – whether there were reasonable grounds to suspect that company was insolvent or may become insolvent by incurring the debt – whether director was aware that there were reasonable grounds to suspect insolvency or a reasonable person would have been aware – whether "loss or damage" in s 588M of the Corporations Act is reduced by other recoveries by the liquidators that will allow distribution to creditors.

CORPORATIONS – voidable transactions – claim by liquidators for relief under s 588FF of the Corporations Act in respect of certain payments – whether payments constituted uncommercial transactions under s 588FB of the Corporations Act – whether payments constituted insolvent transactions under s 588FC of the Corporations Act – whether payments constituted unreasonable director-related transactions under s 588FDA of the Corporations Act – whether payments are voidable transactions under s 588FE of the Corporations Act. Legislation Cited: - Corporations Act 2001 (Cth) ss 9, 95A, 588E, 588FA, 588FB, 588FC, 588FDA, 588FE, 588FF, 588G, 588M - Evidence Act 1995 (NSW) s 140 Cases Cited: - Australian Securities and Investments Commission v Plymin (No 1) [2003] VSC 123; (2003) 46 ACSR 126 - Bentley Smythe Pty Ltd v Anton Fabrications (NSW) Pty Ltd [2011] NSWSC 186; (2011) 248 FLR 384 - Briginshaw v Briginshaw (1938) 60 CLR 336 - Capital Finance Australia Ltd v Tolcher [2007] FCAFC 185; (2007) 164 FCR 83; 64 ACSR 705 - Crowe-Maxwell v Frost [2016] NSWCA 46; (2016) 91 NSWLR 414 - Cussen v Sultan [2009] NSWSC 1114; (2009) 74 ACSR 496 - Demondrille Nominees Pty Ltd v Shirlaw [1997] FCA 1220; (1997) 25 ACSR 535 - Edenden v Bignell [2007] NSWSC 1122 - Elliott v Australian Securities and Investments Commission [2004] VSCA 54; (2004) 10 VR 369 - First Strategic Development Corporation Ltd (in liq) v Chan [2014] QSC 60 - Gordon in his capacity as liquidator of Lyon Form Pty Ltd (in liq) v Leon Plant Hire Pty Ltd (in liq) [2015] NSWSC 39 - Hall v Poolman [2007] NSWSC 1330; (2007) 65 ACSR 123 - International Cat Manufacturing (in liq) v Rodrick [2013] QCA 372; (2013) 97 ACSR 200 - Kijurina (as Liquidator of ET Family Pty Ltd) v Taouk [2015] FCA 424; (2015) 105 ACSR 686 - Lesvos Pty Ltd [2012] NSWSC 1288 - Lewis (as liquidator of Doran Constructions Pty Ltd) v Doran [2005] NSWCA 243; (2005) 54 ACSR 410 - Morris v Danoz Directions Pty Ltd (in liq) (No 2) [2010] FCA 836 - Powell v Fryer [2001] SASC 59; (2001) 37 ACSR 589 - Re Swan Services Pty Limited (in liq) [2016] NSWSC 1724 - Skouloudis Group Pty Ltd (in liq) v Planet Enterprizes Pty Ltd [2002] NSWSC 239; (2002) 41 ACSR 369 - Smith v Bone [2015] FCA 319; (2015) 104 ACSR 528 - Smith v Starke Re Action Paintball Games Pty Ltd (in liq) (No 2) [2015] FCA 1119; (2015) 109 ACSR 145 - Southern Cross Interiors Pty Ltd (in liq) v Deputy Commissioner of Taxation [2001] NSWSC 621; (2001) 39 ACSR 305 - Super Art Australia Pty Ltd v Foden [2014] FCA 1168 - Vasudevan v Becon Constructions (Aust) Pty Ltd [2014] VSCA 14; (2014) 97 ACSR 627 - Weaver v Harburn [2014] WASCA 227; (2014) 103 ACSR 416 - White Constructions (ACT) Pty Ltd (in liq) v White [2004] NSWSC 71; (2004) 49 ACSR 220 Category: Principal judgment Parties: SX Projects Pty Ltd (in liquidation) (First Plaintiff) Geoffrey Reidy in his capacity as liquidator of SX Projects Pty Ltd (in liquidation) (Second Plaintiff) Vince Battaglia (First Defendant) Fellmane Pty Ltd (Second Defendant) Bianca (NSW) Pty Ltd (Third Defendant) Contact Constructions Pty Ltd (Fourth Defendant) Karen Battaglia (Fifth Defendant) Representation: Counsel: D L Cook SC/D Krochmalik (Plaintiffs)