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[2011] NSWSC 1277
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Bakota Holdings Pty Ltd v Bank of Western Australia Ltd [2011] NSWSC 1277 (31 October 2011)
Last Updated: 13 December 2011
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Case Title:
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Bakota Holdings Pty Ltd v Bank of Western Australia
Ltd |
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Medium Neutral Citation:
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Hearing Date(s):
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Decision Date:
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Jurisdiction:
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Equity Division - Corporations
List |
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Before:
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Decision:
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Order that the statutory demand dated 14 July 2011
served on the plaintiff by the defendant be set aside. Order that the
defendant pay the plaintiff's costs of the proceedings |
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Catchwords:
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CORPORATIONS - winding up - winding up in
insolvency - statutory demand - application for order setting aside - demanded
debt arises
under guarantee - company relies on offsetting claim - guarantee
requires payment in full and without deduction - whether right to
offsetting
claim bargained away - whether inability of company to set up its claim in an
action for recovery of the demanded debt
deprives the claim of the character of
"offsetting claim" - whether claim genuine - whether amount of claim
sufficiently articulated
in supporting affidavit |
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Legislation Cited:
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Cases Cited:
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Texts Cited:
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Parties:
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Bakota Holdings Pty Ltd - Plaintiff Bank of
Western Australia Ltd - Defendant |
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Representation
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Mr R D Glasson - Plaintiff Mr P J Dowdy -
Defendant |
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- Solicitors:
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Eakin McCaffery Cox - Plaintiff Blake Dawson -
Defendant |
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File number(s):
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Publication Restriction:
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JUDGMENT
- The
plaintiff (Bakota Holdings Pty Ltd) applies under s 459G of the Corporations
Act 2001 (Cth) for an order setting aside a statutory demand dated 14 July
2011 served on it by the defendant (Bank of Western Australia Ltd).
- The
debt or alleged debt to which the statutory demand relates is in the sum of
$122,217,523.74 and is described in the schedule to
the demand as follows:
"The company owes the creditor the sum of $122,217,523.74 ( Debt ) in respect
of a commercial guarantee and indemnity granted by the
company to the creditor
in relation to the loan facilities provided by the creditor to FOB-Airlie Beach
Pty Limited ACN 109 511 757
( Guarantee ) as particularised in the notice of
demand issued by the creditor to the company dated 28 January 2011 ( Demand ).
- As
this description makes clear (and the plaintiff accepts), the plaintiff
guaranteed to the defendant due and punctual payment by
FOB-Airlie Beach Pty Ltd
("FOB") of moneys payable under loan facilities provided to FOB by the
defendant. The guarantee is in evidence.
It is dated 26 October 2006.
- It
is not in dispute that $122,217,523.74 became due and payable by FOB to the
defendant on 19 January 2009 and that FOB's liability
in that respect was caught
by the plaintiff's guarantee. On 26 January 2009, the defendant notified the
plaintiff in writing of FOB's
failure to pay and demanded payment by the
plaintiff as guarantor, specifying $122,217,523.74 as the relevant amount. The
plaintiff
did not pay in accordance with the demand.
- The
affidavit filed and served in support of the originating process is that of Mr
Rory Francis O'Brien sworn on 5 August 2011. Mr
O'Brien is the sole director and
secretary of the plaintiff. He is also the principal of FOB and, in his own
right, a guarantor of
FOB's indebtedness to the defendant.
- The
plaintiff's claim to have the statutory demand set aside is based on the
existence of an "offsetting claim" against the defendant
as referred to in s
459H(1)(b). As will be seen, the plaintiff says that the "amount" of that claim
(paragraph (a) of the definition of "offsetting total" in s 459H(2)) is equal to
the demanded amount so that, under s 459H(3), the court must set aside the
statutory demand. The plaintiff does not rely on the "genuine dispute" ground in
s 459H(1)(a).
- Section
459H(5) defines "offsetting claim" as follows:
"' offsetting claim ' means a genuine claim that the company has
against the respondent by way of counterclaim, set-off or cross-demand (even if
it does
not arise out of the same transaction or circumstances as a debt to
which the demand relates)."
- The
contention of the plaintiff is accordingly that it has, as against the
defendant, a "genuine claim ... by way of counterclaim,
set-off or
cross-demand". The claim in question is a statutory claim for damages for
misleading or deceptive conduct. I shall return
to the precise nature of the
claim.
- It
is necessary first to address a preliminary matter. The defendant says that,
whatever may be the merits of the plaintiff's postulated
claim for damages for
misleading or deceptive conduct viewed alone and in the abstract, it is not
within the s 459H(5) definition of "offsetting claim" set out at paragraph [7]
above. The reason, the defendant contends, is to be found in the contract
of
guarantee made between the plaintiff and the defendant. It is to the content of
that contract that I now turn.
- In
the guarantee, the plaintiff is "you", the defendant is "we" (or "us") and FOB
is "the debtor". Clause 2.1 is as follows:
"You unconditionally and irrevocably guarantee payment to us of the
guaranteed money . If the debtor does not pay the guaranteed money
on time and in accordance with any arrangement under which it is expressed
to be owing, then you agree to pay the guaranteed money to us on demand
from us (whether or not we have made demand on the debtor)."
- The
"guaranteed money" is all money owning by FOB to the defendant at any time on
any account.
- Clause
4.2 of the guarantee reads:
"Rights given to us under this guarantee and indemnity and your
liabilities under it are not affected by any act or omission by us or by
anything else that might otherwise affect them under
law or otherwise,
including:
(a) the fact that we vary or replace any arrangement under which the
guaranteed money is expressed to be owing, such as by increasing the
credit limit or extending the term;
(b) the fact that we release the debtor or give them a concession,
such as more time to pay;
(c) the fact that the debtor opens another account with us;
(d) the fact that we release, lose the benefit of or do not obtain any
security;
(e) the fact that we do not register any security which could be registered;
(f) the fact that we release any person who guarantees any of the debtor's
obligations;
(g) the fact that the obligations of any person who guarantees any of the
debtor's obligations may not be enforceable;
(h) the fact that any person who was intended to guarantee any of the
debtor's obligations does not do so or does not do so effectively;
(i) the death, mental or physical disability or insolvency of any person
including you or the debtor ; or
(j) changes in the membership, name or business of a firm, partnership,
committee or association."
- Clause
4.5(a) is in these terms:
"As long as any of the guaranteed money remains unpaid, you may not,
without our consent:
(a) reduce your liability under this guarantee and indemnity by
claiming that you or the debtor or any other person has a right of set-off or
counterclaim against us;"
- Also
relevant are clause 7.3 and 7.4:
"7.3 You must pay us the guaranteed money in full without set-off,
counterclaim or deduction.
7.4 However, we may set off against the guaranteed money any money we
owe you."
- The
defendant argues that, having regard to these provisions, the plaintiff must pay
under the guarantee in full and without deduction
and has "bargained away" its
right to rely on any set-off, counterclaim or cross-demand that would otherwise
have been available
to it in respect of the defendant's right to receive
payment.
- Mr
Dowdy of counsel, who appeared for the defendant, took me to passages in the
judgments in Commonwealth of Australia v Verwayen [1990] HCA 39; (1990)
170 CLR 394 confirming that, subject to questions of public policy, a person
having a right against another
person may contract with the first person not to
exercise or rely on the right or, by conduct, waive the right. The principle is
summarised in a statement by Abbott CJ in Bonner v Wilkinson (1822) 5 B
& Ald 682 at 686; 106 ER 1340 at 1341 quoted in the judgment of Toohey J at
468:
"It is certainly true that a party cannot , by his own private instrument,
defeat the object of an Act of Parliament, but he may thereby
waive a provision
intended for his own benefit."
- A
right to sue for debt or damages is one that a potential plaintiff can renounce
by contract with the potential defendant. No issue
of "the object of an Act of
Parliament" or public policy arises.
- Mr
Dowdy also relied on the decision of Bryson J in GE Capital Australia v Davis
[2002] NSWSC 1146; (2002) 180 FLR 250 where it was observed that clauses
similar to those quoted at paragraphs [12] to [14] above precluded the guarantor
setting up cross-claims
against the creditor unless and until the money payable
by the guarantor to the creditor had been paid. Bryson J put the matter thus
(at
[97] - [98]):
"The jurisdiction of courts and the rights of parties to make claims before
courts are not conferred by contract and cannot be ousted
by contract. However
there is in my opinion no infringement of this principle where parties agree
that in stated circumstances a
particular sum of money will change hands without
the opportunity at the same time to obtain judicial disposition of any other
claim
between them. In the contract of guarantee there is no infringement of the
principle where parties agree to ensure that the guaranteed
sum will be paid,
and make this the more certain by postponing litigation raising any cross-claim
or set-off.
The effect in substance of the provisions of the guarantee including
cl.8.1(a) is that there is no limit on the right to resort to
the courts if the
guarantor first meets the obligation the protection of which is the primary
purpose of the guarantee and indemnity,
and pays the amount of the debt. It is
well established in this area of the law that the guarantor can have recourse to
securities
given by a principal debtor to indemnify himself, but that he cannot
do so until he has paid the whole debt. The validity of modifications
of what
would under the general law be the rights of guarantors is well established.
These contractual provisions extend the ways
in which the guarantors' remedies
are postponed, and extend the creditor's freedom from competition in enforcement
of its rights.
The condition which must be fulfilled is directly related to the
purposes of the agreement."
- In
the present case, the provisions quoted at paragraphs [12] to [14] above have
the effect that the guarantor must pay the creditor
immediately, even if some
right of action is maintainable by the guarantor against the creditor; and that
there is to be no deduction
from the guarantor's payment on account of the
availability of such a right of action to the guarantor. The provisions of the
contract
do not purport to extinguish any right of action that the guarantor has
against the creditor. They merely require that payment be
made by the guarantor
to the creditor in full and without the guarantor's right of action being used
as a basis for deduction from
the amount paid. The creditor is to be, as Bryson
J put it, free from competition in the enforcement of its rights against the
guarantor.
- Mr
Glasson of counsel submitted on behalf of the plaintiff that, since the
provisions work in that way, it follows that, if the plaintiff's
claim against
the defendant for damages for misleading or deceptive conduct satisfies the
"genuine" requirement of the "offsetting
claim" definition and is of the
requisite amount, the existence of that claim is sufficient to bring the matter
within s 459H(1)(b), even though there is no ability to rely on it and to take
advantage of it in proceedings commenced by the defendant to recover under
the
guarantee. In other words, it is submitted, the plaintiff "has an offsetting
claim", in the words of s 459H(1)(b), albeit one that cannot be asserted or
acted upon in such a way as to bring about reduction (or elimination) of the
payment required
to be made by the guarantor pursuant to the guarantee.
- I
accept that submission; and I do so even though that course is not consistent
with the reasoning of Austin J in Jem Developments Pty Ltd v Hansen Yuncken
Pty Ltd [2006] NSWSC 1308; (2006) 205 FLR 432 and my own reasoning in
Blue Hills Village Management (Liverpool) Pty Ltd v Babcock & Brown
International Pty Ltd [2009] NSWSC 87; (2009) 3 BFRA 450.
- For
reasons discussed in John Shearer Ltd v Gehl Company [1995] FCA 1789; (1995) 60 FCR 136,
an "offsetting claim" within the s 459H(5) definition may exist even though it
could not be pleaded by way of set-off or counterclaim in an action for recovery
of the debt
the subject of the statutory demand. The debt in the John Shearer
case was the engagement of the acceptor of a bill of exchange to pay the
face value to the holder on maturity. The asserted "offsetting
claim" was a
claim by the acceptor against the holder for damages for misleading or deceptive
conduct or for breach of contract.
The court (von Doussa J, Hill J and Tamberlin
J) noted the well-established principle that unliquidated cross-claims cannot be
relied
upon by way of extinguishing set-off against a claim against the acceptor
of a bill of exchange. The court then said:
"It does not follow from the rule or its underlying rationale, that a claim,
as alleged on behalf of Shearer, could not constitute
an 'off-setting claim' as
that expression is defined in s 459H. All that follows from the rule (subject to
any exception relevant to cases where s 52 has been breached) is that if Shearer
[the acceptor of the bill] were sued by Gehl [the holder] and sought to set up a
cross-claim
or cross-demand for an unliquidated amount based either upon s 52 of
the Trade Practices Act or a claim for breach of an implied term, a court would
not stay judgment on the proceedings to recover moneys owing under the bills
until the hearing of any cross-claim or cross-demand. Summary judgment would be
ordered upon proof of the bills, no stay of execution
would be granted and the
cross-claim or cross-demand would proceed for hearing in due course. But to say
that is not to say that
Shearer has no cross-demand."
- In
both Jem Developments Pty Ltd v Hansen Yuncken Pty Ltd and Blue Hills
Village (Liverpool) Pty Ltd v Babcock & Brown International Pty Ltd , it
was decided, in effect, that if $X is owing, due and payable by A to B in
circumstances where, as a matter of contract or for
some other reason, A could
not successfully assert in debt recovery proceedings brought by B a right to set
off a sum of $Y owed
by B to A, then A has no "offsetting claim" for the
purposes of s 459H. As White J pointed out in Property Builders Pty Ltd v
Carlamax Properties Pty Ltd [2011] NSWSC 1068, however, that will be so only
if the effect of the contract is to extinguish A's claim for $Y against B, as
distinct from merely
making it unavailable as a basis for eliminating or
reducing A's obligation to pay if and when B sues A for the $X debt.
- John
Shearer Ltd v Gehl Company is a decision of the Full Federal Court. It was
not drawn to the attention of the judges of this court sitting at first instance
in
Jem Developments and Blue Hills Village . To the extent that
those cases proceeded on the basis that there is no "offsetting claim" if the
claim relied on by the company
could not be pleaded by way of set off or
counterclaim in an action for recovery of the debt the subject of the statutory
demand,
they introduced into the definition of "offsetting claim" an element
that is, in truth, not there. It is the existence of a genuine
claim by way of
counterclaim, set-off or cross-demand that is relevant, not the ability to use
it as a defence in an action for recovery
of the demanded debt. As White J noted
in Property Builders (and had earlier observed in Seaham Air Pty Ltd v
Australian Aerospace Pty Ltd [2006] NSWSC 1241), the inclusion of
"cross-demand" in the definition of "offsetting claim" shows that the concept
extends beyond claims that can be
deployed by way of set-off or counterclaim in
debt recovery proceedings. "Cross-demand" is a wide term apt to include a claim
that
a defendant can assert as an answer to the claim made against him, a
cross-action of counterclaim maintainable in the proceedings
in which the claim
against him is advanced and a claim that can only be pursued in separate
proceedings: see the discussion in McDonnell & East Ltd v McGregor
[1936] HCA 28; (1936) 56 CLR 50 and in Ozone Manufacturing Pty Ltd v
Deputy Commissioner of Taxation
[2006] SASC 91 
; (2006) 94 SASR 269 at [42]
to [45].
- Adoption
of the wide term "cross-demand" in the particular statutory context is
understandable. The purpose of the statutory demand
process is to test whether a
company's failure to pay a particular debt should be regarded as a reliable
indicator of likely inability
to pay debts generally so that, in proceedings for
winding up on the insolvency ground, it should be for the company to prove that
it is solvent rather than for the plaintiff to be put to proof of actual
insolvency. The reliability of the indicator is undermined
if there is a genuine
dispute as to the existence or amount of the demanded debt. In such a case, the
inference that failure to pay
one debt is a product of inability to pay debts
generally is not safe. Nor is it safe where the company shows that it has an
equal
or greater claim against the demanding creditor, whether or not the equal
or greater claim could be litigated in proceedings in which
the demanding
creditor sought to recover the demanded debt.
- I
am accordingly of the opinion that the provisions of the guarantee set out at
paragraphs [12] to [14] above do not remove the ability
of the plaintiff to
seek, pursuant to s 459H(1)(b), to have the statutory demand set aside on the
basis of the existence of a genuine
claim that it has against the defendant.
- I
turn, therefore, to the substance of the plaintiff's s 459H(1)(b) case. FOB is a
property developer. It undertook a major resort
project in Queensland and
obtained substantial loan facilities from the defendant to enable it to do so.
The maturity of the facilities
was extended at least once but all moneys
ultimately became payable by BOS on the revised maturity date of 19 January
2009. Before
that date, FOB - and, more particularly, its principal Mr O'Brien -
had conceived a new and different proposal for the development.
- Construction
was completed in late 2008. Mr O'Brien was, by then, working on a plan to form a
private investment fund based in the
Middle East and to raise finance from that
source to fund on-going plans and to pay out the debt owed to the defendant.
This was
in conjunction with a proposal that a Dubai group would operate and
manage the resort.
- Both
before and in the period immediately after the FOB debt became payable in
January 2009, Mr O'Brien wrote to the defendant on
several occasions requesting
an extension of the facilities and explaining progress with his plans for the
resort. The bank officers
with whom he dealt made submissions to the defendant's
credit department and told Mr O'Brien on several occasions that a decision
was
awaited. Ultimately, however, the defendant did not grant any extension or
additional facility to FOB. The defendant proceeded
to appoint receivers under
securities held from FOB, sued Mr O'Brien under the guarantee given by him and
served on the plaintiff
the statutory demand to which these proceedings relate.
- Mr
O'Brien alleges a number of representations (almost wholly oral) made by
officers of the defendant to him, including:
(a) in September 2008, that the defendant would provide the necessary funding
to launch the Middle East investment fund and extend
facilities as sought;
(b) in September 2008, that the defendant had no concerns in respect of the
loan facilities provided to FOB;
(c) in October 2008, that the defendant agreed with FOB's strategy for the
development and would roll over loan facilities;
(d) in December 2008, that the defendant still intended to provide further
funding to FOB before Christmas 2008 or by early January
2009;
(e) in February 2009, that the defendant would roll over residual loan
facilities to provide further funding to protect the defendant's
own interests;
also that the defendant would provide finance to pay ongoing costs of the
development;
(f) in February 2009, that further funding would be forthcoming;
(g) in February 2009, that funding had been approved and that remaining
paperwork was merely a formality;
(h) in February 2009, that documents regarding further funding had been sent
to Perth for "formal sign-off" within three days;
(i) in February 2009, that funding would be provided in the first week of
March 2009;
(j) in March 2009, that the defendant supported the arrangement with the
Dubai party and would roll over banking facilities as previously
agreed.
- Mr
O'Brien says that, as a result of these representations, he and FOB were led to
believe that the defendant would roll over the
facilities beyond January 2009
and provide further funding. He further says that he and FOB, relying on that
belief, did not seek
alternative sources of funding to refinance the debt due in
January 2009 - something they would have done had they not been of the
state of
mind induced by the representations.
- It
is alleged that FOB suffered loss or damage by reason of the making of the
alleged representations and that the making of those
representations contravened
s 12DA of the Australian Securities and Investments Commission Act 2001
(Cth) or s 52 of the Trade Practices Act 1974 (Cth) as in force at the
relevant time. Furthermore, it is said, each of Mr O'Brien and the plaintiff, as
a guarantor of the obligations
of FOB, suffered loss or damage through the
making of demands under the relevant guarantee and the crystallisation of the
liability
as guarantor, something that would not have happened but for the
representations.
- The
question in these proceedings is whether the claim the plaintiff seeks to
articulate by reference to the representations alleged
by Mr O'Brien is
"genuine" in the sense that it is "arguable on the basis of facts asserted with
sufficient particularity to enable
the court to determine that the claim is not
fanciful". This is the formulation by Palmer J in Macleay Nominees Pty Ltd v
Belle Property East Pty Ltd [2001] NSWSC 743 at [18]; see also Ozone
Manufacturing Pty Ltd v Deputy Commissioner of Taxation (above) at [46],
[47].
- In
the particular circumstances, the viability of the claim will ultimately come
down to issues of credibility. Mr O'Brien has given
his account of relevant
conversations with bank officers. There is, at this stage, no evidence from
those officers. It also seems
tolerably clear that the officers with whom Mr
O'Brien spoke were dependent on decisions of the defendant's credit department
and
that Mr O'Brien not only knew that but also knew that the officers in
question were awaiting the credit department's decision.
- If
and when the matter is fully litigated, this last matter might make it difficult
to establish a case against the defendant. But
that is not the issue here. The
only question now is whether the claim is "genuine" in the sense referred to
above, not whether it
is a strong case. That question must be answered in the
affirmative.
- The
account I have given of the foreshadowed misleading and deceptive conduct claim
alleged by the plaintiff on the present application
is taken largely from a
cross-claim filed by Mr O'Brien in the proceedings in which the defendant sues
on the guarantee given by
him. I am satisfied, however, that the basis of the
plaintiff's claim is sufficiently outlined (although in less detail) in Mr
O'Brien's
affidavit of 5 August 2011 filed and served under s 459G(3) in support
of the present application.
- That
leads me to the next matter and to the defendant's contention that that
affidavit is deficient in a way that means that the plaintiff
cannot succeed
upon the present application.
- Where
a company seeking to have a statutory demand set aside relies on the s
459H(1)(b) ground, the supporting affidavit filed and
served within the period
specified in s 459G(2) and (3) must not only show that the alleged offsetting
claim is of the "genuine"
in the sense already mentioned but also enable the
court to see the "amount" of the offsetting claim. Otherwise, an element made
essential by the definition of "offsetting total" in s 459H(2) is lacking and
the affidavit is not a "supporting affidavit" as referred
to in s 459G(3). The
need for quantification has been referred to in a number of cases. In Broke
Hills Estate Pty Ltd v Oakvale Wines Pty Ltd [2005] NSWSC 638; (2005) 23
ACLC 1266, for example, Gzell J said (at [26], [28]):
"In my view, the task required of a court by the Corporations Act 2001
(Cth), s 459H(2) requires evidence to be put on within the statutory 21-day
period enabling the Court to make a determination of the offsetting total.
That
means that some evidence of quantum must be contained in the affidavit to enable
the Court to take that course.
. . .
It was submitted that an affidavit in support that is more than a mere
assertion but less than final proof is insufficient. In my
view it is
insufficient if it does not contain material from which a Court ... can make an
estimate of the amount of an offsetting
claim."
- As
this passage makes clear, the s 459G(3) affidavit does not need to particularise
the amount to the last dollar and cent; but it must contain sufficient material
- rising
beyond mere assertion - to allow an estimate to be made.
- Mr
Dowdy submitted that the plaintiff has not fulfilled this requirement. He raised
the matter by way of objection to passages in
Mr O'Brien's subsequent affidavit
of 21 October 2011 going to the matter of quantification. The main objection was
not as to admissibility
of parts of the 21 October 2011 affidavit according to
the rules of evidence (although some points of that kind were raised). It
was,
rather, by way of submission as to the need for a "supporting affidavit" to be
filed and served within the relevant period of
21 days and the inability of a
plaintiff to rely on the content of some later affidavit to repair a deficiency
depriving the earlier
affidavit of the character of a "supporting affidavit":
Graywinter Properties Pty Ltd v Gas & Fuel Corp Superannuation Fund
[1996] FCA 822; (1996) 70 FCR 452; Energy Equity Corporation Ltd v Sinedie Pty Ltd
[2001] WASCA 419; (2001) 166 FLR 179.
- Mr
Dowdy submitted that, in the area of quantification, Mr O'Brien's affidavit of 5
August 2011 suffers from such a deficiency. The
only explicit statement in that
affidavit concerning the amount of the offsetting claim is in paragraph 60:
"On the basis of these grounds, Bakota disputes that the Alleged Debt is
owed, or alternatively, claims an offsetting claim for the
full value of the
Alleged Debt."
- The
reference to the "Alleged Debt" is, according to paragraph 15 of the affidavit,
a reference to the debt of $122,217,523.74. The
statement in paragraph 60 is
thus a statement that the offsetting claim is in the sum of $122,217,523.74,
being a sum equal to that
demanded by the statutory demand.
- It
is true that the affidavit does not articulate any process of reasoning leading
to a conclusion that the damages based on the alleged
misrepresentations by the
defendant would be equal to the amount of the guaranteed debt. But the basis for
the conclusion may be
inferred from the overall circumstances stated in the
affidavit. Had the defendant not made representations giving rise to an
expectation
that it would roll over the loan facilities (causing FOB not to
pursue possibilities of obtaining alternative finance in order to
pay out the
defendant), FOB would have obtained replacement finance elsewhere and thereby
avoided a presently enforceable obligation
to pay the defendant on 19 January
2011; the plaintiff, in turn, would not have incurred, as guarantor, an
equivalent presently enforceable
obligation to pay the defendant; the incurring
of that presently enforceable obligation by the plaintiff was therefore caused
by
the defendant's representations and FOB's reliance on them; and the plaintiff
will suffer damage by having to make under the guarantee
a payment that it would
not have had to make had the defendant not made the representations.
- As
I have said, I am satisfied that this reasoning can be inferred from the content
of the affidavit as a whole, including its description
of the parties'
relationship, the surrounding circumstances and the point the relationship had
reached. I am also satisfied that,
although aspects of it might be
controversial, it of sufficient prima facie cogency, in conjunction with
the statement of amount in paragraph 60 of the affidavit of 5 August 2011, to
qualify as sufficient articulation
of the quantification of the offsetting
claim. That affidavit is accordingly a "supporting affidavit" in the s 459G(3)
sense, including as to the matter of quantification of the offsetting claim.
- In
the result, the plaintiff has succeeded in showing that, for the purposes of the
formula in s 459H(2), the "admitted total" is equal to the "offsetting total",
so that the "substantiated amount" is zero. It follows that the court must,
in
accordance with s 459H(3), make an order setting aside the demand. The orders
are therefore as follows:
1. Order that the statutory demand dated 14 July 2011 served on the plaintiff
by the defendant be set aside.
2. Order that the defendant pay the plaintiff's costs of the proceedings.
**********
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URL: http://www.austlii.edu.au/au/cases/nsw/NSWSC/2011/1277.html
