FEDERAL COURT OF AUSTRALIA

Deputy Commissioner of Taxation, in the matter of Gold Coast Titans (Property) Pty Ltd v Gold Coast Titans (Property) Pty Ltd [2012] FCA 511

FEDERAL COURT OF AUSTRALIA

Deputy Commissioner of Taxation, in the matter of Gold Coast Titans (Property) Pty Ltd v Gold Coast Titans (Property) Pty Ltd [2012] FCA 511

CORRIGENDUM

1.    In the Reasons for Judgment, in the last line of [5]:

(a)    insert “taken to have been” before “served on it by the”;

(b)    delete “31 October 2011/”; and

(c)    delete (??).

Associate:

Dated:    29 May 2012

THE COURT ORDERS THAT:

1.    Pursuant to s 465B of the Corporations Act 2001 (Cth), the supporting creditor be substituted as the plaintiff in this proceeding.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

EX TEMPORE REASONS FOR JUDGMENT

1    Mr Tiplady, for the defendant, submitted that Reed Constructions Australia Pty Limited (Reed Constructions), the applicant supporting creditor, is not a creditor within the terms of s 459P of the Corporations Act 2001 (Cth). He made that submission notwithstanding the Deed that was entered into between his client and Reed Constructions in August 2011. That Deed contained within the recital clause a clause to this effect (clause D):

The parties agree that the Principal is at the date of the execution of this Deed, indebted to the Contractor in the amount of $943,858.00 (excluding GST) for work performed by the Contractor pursuant to the Contract (the Outstanding Amount).

2    The Principal is defined in the Parties section of the Deed as being the defendant. The Contractor is defined in the same section as being Reed Constructions.

3    Mr Tiplady submitted that clause D of the recital clause is qualified by the provisions of clause 3 of the Deed which provides for payment according to an unspecified monthly instalment regime. He submitted that there is no evidence as to what amount has been paid under that instalment regime and therefore the debt owing is contingent or prospective. He referred me to the decision of Mackenzie J in Walder v Finance Technology Australia Pty Ltd [2007] QSC 188 at [5], where his Honour stated that:

A contingent creditor is one whose entitlement to be paid a sum of money depends on the happening of some event that may or may not occur. A prospective creditor is one who will become entitled to payment of money by some other person when the actual date for payment in the future is fixed or can be determined by reference to the occurrence of a future event.

4    In my view, clause D of the Deed establishes that, as at August 2011, Reed Constructions was a creditor of the defendant. The debt in clause D is not expressed to be dependent upon the payment regime in clause J. Further, it is not expressed to be dependent upon some event that may or may not occur in the future. Finally, it is not expressed by reference to payment at an actual date in the future, whether fixed or determined by the occurrence of some future event. It is therefore not, in my view, either a contingent debt, or a prospective debt.

5    Even if I am wrong about that, I consider that Reed Constructions should have leave under Rule 5.3 of the Federal Court Corporations Rules 2000 on the ground that the defendant is prima facie insolvent based on its failure to comply with the statutory demand served on it by the Commissioner of Taxation on 31 October 2011/4 November 2011 (??).

Associate:

Dated:    17 May 2012