St George Bank Limited v Leinad Pty Limited [2009] FCA 289 (25 March 2009)

Last Updated: 31 March 2009

FEDERAL COURT OF AUSTRALIA

St George Bank Limited v Leinad Pty Limited [2009] FCA 289

ST GEORGE BANK LIMITED ACN 055 513 070 v LEINAD PTY LIMITED ACN 003 671 529
NSD 928 of 2008

GRAHAM J
25 MARCH 2009
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 928 of 2008

IN THE MATTER OF LEINAD PTY LIMITED ACN 003 671 529

BETWEEN:

ST GEORGE BANK LIMITED ACN 055 513 070 Substituted Plaintiff

AND:	LEINAD PTY LIMITED ACN 003 671 529 Defendant

JUDGE:	GRAHAM J
DATE OF ORDER:	25 MARCH 2009
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. To the extent that leave may be required to enable the substituted plaintiff to make the application for an order that the defendant be wound up in insolvency such leave be granted.
2. Leinad Pty Ltd ACN 003 671 529 be wound up in insolvency.
3. David Young of Pitcher Partners, an official liquidator, be appointed liquidator of Leinad Pty Ltd ACN 003 671 529.
4. The liquidator reimburse the substituted plaintiff the taxed costs incurred by the substituted plaintiff out of the property of the company.
   

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
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IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 928 of 2008

IN THE MATTER OF LEINAD PTY LIMITED ACN 003 671 529

BETWEEN:

ST GEORGE BANK LIMITED ACN 055 513 070 Substituted Plaintiff

AND:	LEINAD PTY LIMITED ACN 003 671 529 Defendant

JUDGE:	GRAHAM J
DATE:	25 MARCH 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. The first order I make will be made in circumstances where the transcript will reveal my view in respect of the need for an order under s 459P(2) of the Corporations Act 2001 (Cth). The capacity of the substituted plaintiff has not been finally determined, that is to say whether it was at the time when the originating process was filed by the Deputy Commissioner of Taxation, the original plaintiff, on 23 June 2008, the substituted plaintiff was a creditor or a contingent creditor. In my earlier reasons for judgment on the Substitution Application of 28 November 2008, I observed that the Deputy Commissioner of Taxation intended to rely upon noncompliance with a statutory demand in accordance with s 459C(2)(a) of the Corporations Act 2001 (Cth). I also said at [12] and [13]:

‘12 I do not consider it necessary to decide whether the amount due under the facility was, in fact, due and payable on or before 23 June 2008. It is clear that the Bank was, at all material times, a contingent creditor of the company and as such eligible to be a plaintiff in an originating process seeking a winding up of the company in insolvency under s 459P of the Act.

13 In my opinion, it would be appropriate to order that the Bank be substituted for Deputy Commissioner of Taxation as the plaintiff in the originating process. ...’

2. Whilst I take the view that it is unnecessary in circumstances where an order for substitution has been so made, that there be a grant of leave to the substituted plaintiff to make an application for the defendant to be wound up in insolvency, in accordance with section 459P(2) of the Act, I am satisfied that if not a creditor the substituted plaintiff is a contingent creditor, and that this is a proper case where leave of the Court should, if necessary, be granted to allow the substituted plaintiff to make the application for the defendant company to be wound up in insolvency. I am satisfied on the evidence that there is a prima facie case that the company is insolvent. Indeed, I am satisfied that the company is insolvent.
   

I certify that the preceding two (2) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Graham.

Associate:

Dated: 31 March 2009

Counsel for the Plaintiff:	Mr A C Casselden
Solicitor for the Plaintiff:	Gadens Lawyers

The Defendant did not appear on the hearing of the Amended Originating Process.

Date of Hearing:	25 March 2009
Date of Judgment:	25 March 2009