In the matter of Bayfoyle Pty Ltd

Medium Neutral Citation: In the matter of Bayfoyle Pty Ltd [2025] NSWSC 1373

Hearing dates: 13 November 2025

Date of orders: 13 November 2025

Decision date: 13 November 2025

Jurisdiction: Equity - Corporations List

Before: Black J

Decision: Plaintiff’s statement of claim be struck out and the proceedings be dismissed.

Catchwords: CIVIL PROCEDURE — pleadings — striking out — where Defendant alleges Plaintiff’s statement of claim has tendency to cause prejudice, embarrassment or delay — where lengthy statement of claim seeking to wind up defendant company alleges unparticularised breaches of a settlement deed, statute and the general law — where statement of claim repeatedly fails to identify facts, matters or circumstances in support of the allegations made —where Defendant alleges Plaintiff does not have standing to bring application — unnecessary to decide — where Defendant alleges winding up application is inappropriate for resolving the Plaintiff’s allegations — held that the complex and unresolved claims would not be appropriately resolved in a winding up application — statement of claim struck out — proceedings dismissed

Legislation Cited: - Corporations Act 2001 (Cth), ss 459A, 459R
- Uniform Civil Procedure Rules 2005 (NSW), r 14.28

Cases Cited: - Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd (2007) 61 ACSR 441; [2007] NSWCA 57
- Australian Securities and Investment Commission v Lanepoint Enterprises Pty Ltd (2011) 244 CLR 1
- Bryant, in the matter of Gunns Ltd (in liq) (recs and mgrs apptd) v Badenoch Integrated Logging Pty Ltd [2024] FCA 97
- Badenoch Integrated Logging Pty Ltd v Bryant [2024] FCAFC 167
- Fortuna Holdings Pty Limited v Deputy Commissioner of Taxation [1978] VR 83
- L&D Audio Acoustics Pty Ltd v Pioneer Electronic Australia Pty Ltd (1982) 7 ACLR 180
- Lin v State of New South Wales [2023] NSWSC 953
- Mackay v Dick [1881] 6 App Cas 251
- Muriniti v Lawcover Insurance Pty Ltd [2022] NSWSC 90
- Re Graziers Pastoral Pty Ltd [2021] NSWSC 1680
- Trau v The University of Sydney (1989) 34 IR 466
- Treadtel International Pty Ltd v Cocco (2016) 117 ACSR 176; [2016] NSWCA 360
- UBS AG v Tyne (2018) 265 CLR 77; [2018] HCA 45
- Young v Hones [2013] NSWSC 580

Category: Procedural rulings

Parties: Sandra Henri Edmonds and David James Edmonds (Plaintiffs/Respondents)
Bayfoyle Pty Ltd (Defendant/Applicant)

Representation: Counsel:
L Smits (Solicitor) (Plaintiff/Respondent)
S Lees (Defendant/Applicant)
Solicitors:
Murray Laws Pty Ltd (Plaintiff/Respondent)
CG Gillis & Co (Defendant/Applicant)

File Number(s): 2025/184474 (007)

JUDGMENT – EX TEMPORE (Revised 17 November 2025)

Nature and history of the application

1. By Originating Process filed on 14 May 2025, now nearly six months ago, Ms Sandra Edmonds and Mr David Edmonds applied to wind up the defendant, Bayfoyle Pty Ltd ("Bayfoyle") under s 459A of the Corporations Act 2001 (Cth) (“Act”) on the basis of insolvency. I should say something as to the history of the proceedings before turning to the nature of the present application, which involves questions as to the summary dismissal or striking out of the claim as it now stands, and the question whether any extension of time should be granted under s 459R of the Act.

2. I addressed issues in respect of the claim by earlier judgments delivered on 9 September 2025. By the first of those judgments, I held that the then winding up application could not be supported by reference to a creditor's statutory demand on which it relied, where that creditor's statutory demand had not been verified. I also then declined other relief sought by the Edmonds, including an application that their solicitor, Mr Smits, be joined as an additional plaintiff in the proceedings. I then made orders that certain aspects of the claim be dismissed, and that the balance of the matter, being the claims by the Edmonds for a winding up on the basis that Bayfoyle was insolvent in fact, or on the just and equitable ground, and their claims that they have standing to pursue the proceedings as contingent or prospective creditors proceed by Pleadings. I also made orders as to the time in which that was to occur, which contemplated that the Edmonds would file and serve a statement of claim by 23 September 2025.

3. As events developed, the Edmonds purported to file a Statement of Claim on or about 23 September 2025, which was mischaracterised when it was filed as an affidavit of Ms Edmonds. By order made on 30 September 2025, I ordered that that Statement of Claim (as wrongly characterised) be struck from the file, and that, by 3 October 2025, the Edmonds file the Statement of Claim on which they wished to proceed and attend to the payment of any necessary filing fee, which, as it emerged, was small in size.

4. Subsequently, the Edmonds filed, on 2 October 2025, a very lengthy Statement of Claim, raising a range of allegations, which it will be necessary to address below. As permitted by the orders which I had made on 30 September 2025, Bayfoyle subsequently filed an Interlocutory Process on 21 October 2025 which sought orders, relevantly, striking out the Statement of Claim under r 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) and dismissing the proceedings in consequence. Bayfoyle also then sought orders as to costs and a personal costs order against the Edmonds solicitor, Mr Smits, which will not be determined by this Judgment. The Court must today determine that Interlocutory Process, and in particular whether the Statement of Claim should be struck out and the proceedings dismissed, and in doing so will need to deal with any related question as to the application of s 459R of the Act, which requires a winding up on the grounds of insolvency to be determined within a six month period, which will expire tomorrow.

Affidavit and other evidence

5. I should briefly refer to the affidavit and other evidence on which the parties relied, although ultimately this application can largely be determined by reference to a review of the Statement of Claim, as it now stands.

6. In support of its application to strike out the Statement of Claim and dismiss the proceedings, Bayfoyle reads part of the affidavit dated 3 July 2025 of its solicitor, Mr Wong. It did not read evidence relating to creditor's statutory demands which was no longer relevant and evidence which had not been admitted, at the previous hearing, and some of that evidence was read on the limited basis on which it had previously been admitted. That affidavit referred to aspects of the long history of the disputes between the Edmonds on the one hand and Bayfoyle on the other, including the entry into a Contract dated 21 February 2018 for sale of certain land (“Contract”) and a Settlement Deed dated 8 February 2019 (“Settlement Deed”) in respect of proceedings which had previously existed between the Edmonds and Bayfoyle, and also referred to an issue which appears to have arisen between the Edmonds and a solicitor's firm which is the subject of separate proceedings in this Court.

7. A bulky exhibit to that affidavit was tendered, which included a Deed of Assignment made on 5 December 2024 (“December 2024 Assignment Deed”) between the Edmonds and Mr Smits, their solicitor, by which the Edmonds' rights, titles, privileges, liens, charges, equities and other interests in relation to the Contract and the Settlement Deed were assigned to Mr Smits. The December 2024 Assignment Deed indicates that, at the time the Edmonds commenced the winding up application against Bayfoyle in May 2025, they had purportedly assigned their rights under the relevant agreements to Mr Smits, although it appears that an attempt has subsequently been made to reverse that assignment. It is not necessary to determine any question as to the status of that assignment, or whether the rights were assignable, or the effect of any subsequent attempt to reverse the assignment, in order to determine this application. That exhibit also contains a letter dated 24 January 2025 from Mr Smits to the solicitors acting for Bayfoyle, which threatened a winding up application, but raised the possibility of a commercial settlement as an alternative to a winding up application. That letter is relied on, by Bayfoyle, in support of a claim for abuse of process on the basis that the application is brought so as to seek to extract a commercial settlement from Bayfoyle. It will not be necessary to determine that claim given the conclusions I reach on other grounds.

8. Bayfoyle also tenders the earlier Statement of Claim filed as an affidavit of Ms Edmonds on 23 September 2025 and subsequently struck from the Court file (Ex A3), and points to the nondisclosure of the position in respect of the assignments as between the Edmonds and Mr Smits in that Statement of Claim. It is also not necessary to determine any aspect of that contention in order to determine this application.

The application to strike out the Statement of Claim

15. As I noted above, Bayfoyle seeks an order under UCPR r 14.28 striking out the whole of the Statement of Claim. That rule relevantly provides that the Court may order that the whole of a pleading be struck out where, inter alia, it has a tendency to cause prejudice, embarrassment or delay in the proceedings. I had drawn the parties’ attention, prior to the hearing, to several decisions which dealt with the role of pleadings, and Mr Smits does not take issue with the content of those decisions, although he contends that the Statement of Claim here meets the relevant requirements. I do not accept that proposition, for the reasons made below.

16. I summarised the applicable principles in Re Graziers Pastoral Pty Ltd [2021] NSWSC 1680 at [51], as follows:

“The requirements for a proper pleading are well-established. In Gunns Ltd v Marr [2005] VSC 251 at [57], in a passage followed by Garling J in Young v Hones [2013] NSWSC 580 at [82] [“Young v Hones”], and which I followed in Iacullo v Iacullo [2013] NSWSC 1517, Bongiorno J pointed to the need for a pleading to inform the defendants of the case they must meet and to set out the facts which the plaintiffs assert with sufficient particularity to allow a trial to be conducted fairly to all parties. His Honour observed, relevantly for present circumstances, that "vague allegations on very significant matters may conceal claims which are merely speculative". Similar observations were made by Harper J in Downer Connect Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd [2008] VSC 77 at [2]-[4], where his Honour emphasised the role of pleadings, not only in informing the parties of the case which they have to meet, but also in identifying for the Court the issues which have to be decided.”

17. In Muriniti v Lawcover Insurance Pty Ltd [2022] NSWSC 90, in a case which involved allegations of serious misconduct of the kind that are also found in the Statement of Claim, Ward CJ in Eq (as the President of the Court of Appeal then was, noted the need to plead with sufficient clarity or particularity the serious claims of wrongdoing that were there made. Her Honour there noted at [485] that:

“A pleading that is 'unintelligible, ambiguous, vague or too general, so as to embarrass the opposite party who does not know what is alleged' is embarrassing and liable to be struck out under rule 14.28(b) of the UCPR (see Meckiff v Simpson [1968] VR 62 at 70, quoted with approval in McGuirk v The University of New South Wales [2009] NSWSC 1424 at [30]...and leave to amend will not be granted in respect of a pleading of that kind....”

18. Her Honour also referred (at [487]) to Gleeson CJ's observation in Trau v The University of Sydney (1989) 34 IR 466 at 475 that difficulty in formulating a case is likely "a very good indication that there is no cause of action", although her Honour indicated she had would not necessarily have gone so far in the particular case. Her Honour also referred to principles of abuse of process, including the summary of those principles by the High Court in UBS AG v Tyne (2018) 265 CLR 77; [2018] HCA 45, and I will refer to the concept of abuse of process below.

19. In Lin v State of New South Wales [2023] NSWSC 953, to which I also drew the parties' attention, Chen J, in a comprehensive summary of the relevant principles, noted the summary of the function of proceedings by Garling J in Young v Hones above at [79]–[80], and in particular his Honour's observation that pleadings must state "with sufficient clarity" the case that the defendant must meet, and thereby serve to define the issues for decision and ensure the basic requirements of procedural fairness, namely that a party should have the opportunity to meet the case against it. His Honour also referred to Garling J's observation as to the role of pleadings in defining the matters in issue, which in turn define the matters which the Court must decide. His Honour also there observed that it is not the Court's role, when pleadings are inadequate, to seek to edit those pleadings. His Honour in turn referred at [38]ff to the scope of UCPR r 14.28 on which Bayfoyle here relies and observed (at [39]):

“When a pleading is 'unintelligible, ambiguous, vague or too general', the rule typically employed in those circumstances is r 14.28(1)(b): Gunns Ltd v Meagher at [57]. The rule is also available when the pleading does not comply with the general or specific principles of pleading such as those set out in rr 14.6-14.20 of the UCPR....”

20. With that background, I turn now to the Statement Claim and to criticisms of it that were made by Mr Lees in the course of submissions, noting, as I have above, that Mr Smits responds by asserting the adequacy of the pleading. I will refer, below, to several examples of pleadings which do not seem to me to adequately articulate the claim so as to allow Bayfoyle the opportunity properly to respond to it or the Court properly to decide it. However, I emphasise that these are merely examples, where the Statement of Claim which is replete with difficulties of this kind.

21. In section B of the Statement of Claim, the Edmonds allege ongoing breaches under the Settlement Deed, there referring to an implied term formulated in a somewhat complex way, but apparently derived from the principle in Mackay v Dick [1881] 6 App Cas 251 and relying, at least in part, on an implied duty of cooperation and other implied duties.

22. Having pleaded those and a consent order on which they rely, the Edmonds then turn in paragraph 8 to contend that completion under the Settlement Deed only partly occurred on 8 February 2019 and involved breaches of implied terms and the relevant duties, as pleaded above, which are then said to be set out in five very complex paragraphs, each involving multiple steps, mixing propositions of fact and law. The formulation of those paragraphs and their density is such that it will be very difficult for Bayfoyle to plead to the paragraphs or the Court to determine what specifically it was required to decide, in that respect. In paragraph (8)(c), the Edmonds then allege that there were breaches of:

“s 32 of the Credit Act and s 911A of the Corporations Law, under which undisclosed payments to Bayfoyle were prohibited and rendered unenforceable which were purportedly made or appropriated in fact or in effect to Bayfoyle to pay the Bobbert Mortgage Debt ($1,215,000) which was assigned to Bayfoyle in August 2018 and the PMA mortgage debt ($902,500 or more).”

23. This paragraph, which is a good example of recurrent difficulties in the Statement of Claim, assumes facts which are not directly pleaded, at least at this point, namely that payments were in fact made or appropriated to pay the Bobbert Mortgage Debt and the PMA Mortgage Debt, neither of which have been previously pleaded. It then alleges, without identifying the facts or matters on which it relies for the allegation, that the payments were "undisclosed payments" and goes further to assert contraventions of s 32 of the Credit Act and s 911A of the Corporations Law. The alleged contravention of s 911A of the Corporations Law, which is the requirement to hold an Australian financial services licence, was then and is now a serious and significant contravention of the Corporations legislation. That allegation is here made without any identification of the factual matters which are said to support it.

24. In paragraph 8(d)), to which Mr Lees also draws attention, the Edmonds allege breaches of "tax laws and constructive and statutory trusts", on an inclusive basis, so that neither the Defendant nor the Court would know the full scope of the breaches that are alleged so as to respond to or determine them.

25. There are, in this aspect of the case, allegations by way of bare assertions, for example, in paragraph 14, that the Edmonds "carried out their obligations under the [Settlement Deed]", without any identification of what those obligations are understood to involve or what was done to comply with them.

26. Paragraph 19 in turn pleads:

“To the extent that clause 4 of the [Settlement Deed] purported to contract out of the bankruptcy consequences as against Mr and Mrs Edmonds or the trustee in bankruptcy of their estates, it was void as against public policy and unenforceable under clause 11.3 of the [Settlement Deed] to the extent of the prohibition or unenforceability created thereby.”

27. The significance of that paragraph for the pleading is mysterious. The words "to the extent" in that paragraph raise a question, which they do not answer, as to whether it is alleged by the Edmonds that this clause in fact contracts out of bankruptcy legislation, and there is no further identification of why that clause is said to have been void, or where any void status of that clause has any significance for the matters to be determined on the winding up application. There are further allegations, which are also mysterious in their effect, of the effect of bankruptcy, in respect of the Edmonds, although the facts of when, or in what circumstances, the Edmonds became bankrupt are now pleaded. The Statement of Claim now asserts, in paragraph 26, the reassignment of the debt from Mr Smits to the Edmonds, although it is not apparent that it pleads the earlier assignment that that reassignment reverses.

28. The next section of the Statement of Claim, headed "Current Debts" refers to table A in paragraph 107 of the Statement of Claim, to which I will refer below, and asserts the status of debts or liabilities identified in that paragraph, again by reference to a complex pleading with multiple subparagraphs. Paragraph 28 then goes on to assert that:

“By reason of Bayfoyle's breaches of contract, statute and other rules of law referred to herein, it was prevented from taking advantage of any situation created thereby and the amended contract was void, rescinded or rescindable and any rights created thereunder were unenforceable, save as to any accrued rights that were preserved at law or in equity.”

29. Again, the problem with this form of pleading is self-evident. First, so far as it refers to breaches of contract, statute and other rules of law "referred to herein", it invites Bayfoyle and the Court to search the 74 pages of the pleading to seek to guess for themselves what the Edmonds (or Mr Smits) may have in mind as amounting to a relevant breach of trust, a relevant breach of contract, a relevant breach of statute or a rule of law and, having done so, Bayfoyle and the Court may or may not be right in the guess that they make as to that question. It is alleged that Bayfoyle is prevented from taking advantage of that situation, where there is no identification of what Bayfoyle is said to have done, if it is said to have done anything, that in fact took advantage of that situation. It is also entirely unclear what is the consequence of the fact that it is alleged that the contract was "rescindable", if it is not alleged, for example, that the contract was rescinded; and if it is alleged that the contract was rescinded, there is no identification of when or how that occurred.

30. Paragraph 34 in turn pleads that:

“In breach of said terms and conditions, on or after partial completion, Bayfoyle did not perform its contractual obligations under the [Settlement Deed] upon the grounds, bases or premises that it did not: [multiple items are then referred to].

31. Again, there is no identification of what are the terms and conditions that are there referred to, so Bayfoyle and the Court is left to guess at the answer to that question; and it is not apparent whether the grounds, bases or premises identified are said to be grounds, bases or premises that Bayfoyle asserted, or whether they are grounds, bases or premises that the Edmonds now attribute to it.

32. Further sections of the Statement of Claim deal with the position in respect of tax, including goods and services tax debts, land tax, and foreign residents capital gains tax withholding debt. There are difficulties throughout these pleadings, including, significantly, a lack of identification as to the facts, matters and circumstances on which, for example, it is alleged that the foreign residents capital gains withholding tax applied. As Mr Lees points out, the Edmonds do not appear to allege that, to the extent the relevant provisions dealt with these matters, any claim for such taxes has been made against the Edmonds in respect of them.

33. Mr Smits responds, in submissions, that it is plain enough that such tax liabilities arose, and I will assume, without deciding, that that may be the case in respect of goods and services tax and land tax, although it is less apparent why that would be so for foreign residents capital gains withholding tax; but, even if such tax or liability arose, it is mysterious how it is said to give rise to any debt or contingent debt owed by Bayfoyle to the Edmonds, if there is no suggestion, and there are plainly no pleaded facts, that any claim for liability on the part of the Edmonds is made in that regard.

34. The Edmonds then plead a discharge of the PMA Mortgage Debt, which commence with the proposition, in paragraph 61:

“Upon true construction of the [Settlement Deed] and in the events which happened, on said partial completion, no said 'difference' arose that was payable or was available for payment to Bayfoyle on account of the PMA Mortgage Debt upon the grounds, basis or premises that [seven matters are then referred to]”

35. Again, the true construction of the Settlement Deed for which this paragraph contends is not identified; the events which happened which are relevant are not identified; and the distinction between a difference that was "payable" and a difference that was "available for payment" is obscure. The Edmonds then advance further allegations of contraventions, or at least prohibitions, under s 32 of the Credit Act and s 911A of the Corporations Law, again without identification of the material facts on which they rely.

36. The Statement of Claim subsequently turns, after dealing with other matters, to claims of contingent liability, commencing at paragraph 68, but also reflecting matters pleaded in paragraph 107 to which I will return below. That pleading commences with the proposition, in paragraph 68, that Bayfoyle was engaged in a commercial business:

"that included the acquisition, dealings in, procuration and supply of large rural real estate holdings, securities and investments, and financial services, credit activities and financial products".

37. However, no pleaded facts are identified for that proposition; instead, the paragraph is particularised by reference to a list of documents, from which Bayfoyle and the Court are left to guess at the facts which those documents might establish, which might be relied upon to support the relevant claim. The Statement of Claim then advances a claim for restitution, pleaded in short form, and again without apparent identification of the particular facts and matters on which reliance is placed.

38. In section I of the Statement of Claim, commencing at paragraph 81, the Edmonds bring an allegation of misleading and deceptive conduct on the part of Bayfoyle, which extends not only to conduct involving DSJSE, a non-party to the proceedings, but also to conduct involving its shareholders, presumably a diverse group of people, and conduct involving Mr Edmonds. The pleading of misleading or deceptive conduct then in turn extends, in paragraph 84, to the following:

“In trade or commerce, Bayfoyle's procuration, execution, acquisition, supply and/or enforcement of the said Deed of loan, deed of variation, Guarantees, PPSR registrations, Bobbert mortgage, PMA mortgage and deniable that it was the holder of 66 DSJSE shares, were used by Bayfoyle to engage in conduct, including silence that was misleading or deceptive or likely to mislead or deceive the [Edmonds] into execution and performance of the [deed of settlement and release], when Bayfoyle and its associates had actual or means of knowledge of matters and participated directly or indirectly in the said conduct.”

39. This paragraph appears to allege five forms of conduct, commencing with procuration and ending with enforcement, in respect of six documents or acts, commencing with the deed of loan and ending with the PMA mortgage, amounting to thirty possible combinations said to give rise to the misleading or deceptive conduct. A claim for a misleading denial that Bayfoyle was the holder of 66 DSJSE shares is then added, although the facts and circumstances of the holding of those shares or that denial do not appear to be pleaded. The conduct that is said to be misleading or deceptive is then identified on an inclusive basis, as "including" silence, so that it just does not give a comprehensive identification of the claim to which Bayfoyle must respond or which the Court must determine. The paragraph then concludes by an allegation that Bayfoyle and unidentified associates had actual or means of knowledge of matters, where the fact and circumstances giving rise to that allegation are not identified, and participated in a way that is also not identified "directly or indirectly in the said conduct". That pleading seems to me to be the antithesis of a claim that would allow a Defendant to know the case that it had to meet, or would allow the Court to know the case that it had to decide.

40. In paragraph 86, the Edmonds return to an alleged contravention s 911A, but now of the Act rather than the Corporations Law, that Bayfoyle was required to hold an Australian financial services licence and, apparently in consequence, that it was prohibited from either enforcing or recovering the PMA Mortgage Debt or the Bobbert Mortgage Debt or any other amount, by reference to four identified sets of matters, again pleaded in complex and expressly inclusive rather than exhaustive terms. Paragraph 87 advances a similar allegation, with a similar multiplicity of claims, in respect of a claim that Bayfoyle was required to hold an Australian credit licence under s 29 of the credit legislation.

41. Paragraph 88 in turn advances a claim that:

“Bayfoyle misrepresented the existence of its said investment in DSJSE and when, how and on what basis Bayfoyle existed its share investments in DSJSE.”

42. A proper pleading of that matter would identify when the alleged misrepresentation was made, and what it was, and the facts, matters and circumstances which were relied on to contend that it was a misrepresentation. Here, there is there no allegation of the material facts relied upon, and instead further particulars by reference to documents and affidavits from which Bayfoyle and the Court is invited to deduce what might be the facts, matters and circumstances relied on for the claim. Similar allegations of misrepresentation made in paragraph 90 in respect of an amount of $511,600, and in paragraph 91 in respect of the provision of guarantees, proceed in a similar way. Paragraph 92 then advances an even wider claim, of unidentified misrepresentations made to DSJSE and its shareholders, together with other unidentified parties to the deed of variation, again without any apparent identification of what it was that is said of any facts that are alleged to have caused the alleged statements or conduct to be misrepresentations. Paragraph 93 in turn contains an even wider claim of misrepresentation, again extended to DSJSE and its shareholders and unidentified "other parties" to the deed of variation which are particularised by a very long list of other documents and matters, again without identification of the facts, matters and circumstances relied on.

43. Section J, commencing at paragraph 94, pleads a claim of unconscionable conduct, and I will here move more briefly, to avoid repetition of examples of the difficulties I have noted above. I should note, however, that paragraph 96 alleges that:

“Management, owners or directors of [Bayfoyle] has or have caused or allowed it to be engaged for several years in prohibited or unlicensed conduct, including misleading, deceptive and unconscionable conduct and uncommercial, insolvent or otherwise illegal activities, transactions and instruments.”

44. This allegation extends to unidentified persons falling within the category of "management", "owners" (presumably being shareholders) or directors of Bayfoyle, where Bayfoyle is here asked to address an allegation that those unidentified persons have, over several years, engaged in unidentified prohibited or unlicensed conduct, including unidentified misleading and deceptive conduct, unidentified unconscionable conduct, and unidentified "uncommercial, insolvent or otherwise illegal activity, transactions and instruments". This claim is presumably at least directed to allegations made elsewhere in the Statement of Claim, although that would still leave the Defendant and the Court to seek to trawl through the 74 pages of the pleading in order to identify what other allegations might fall within these several categories. However, even if that were permissible (which it is not), that would still not allow Bayfoyle in responding to the claim, or the Court in deciding it, to know what other unidentified conduct falling within these categories may be relied on by the Edmonds at a hearing.

45. Section J, commencing at paragraph 98, returns to the theme of unlicensed credit activities and prohibited financial dealings, again alleging that the conduct of Bayfoyle amounted to serious contraventions of the Act, the credit legislation, and now extending to several provisions of the Australian Securities and Investments Commission Act. Paragraph 102 is even wider, contending that:

“For the purposes of s 12GH of the ASIC Act, the relevant conduct of each such director and solicitor as agents of Bayfoyle had actual or ostensible authority of Bayfoyle; had knowledge or means of knowledge in respect of each one of the following matters and essential facts; was involved directly or indirectly in the said illegalities and the said contraventions and was imputable to Bayfoyle apropos: [multiple allegations are then made].”

46. Again, here, these allegations are made without identification of the facts, matters and circumstances said to support them, other than by reference to particulars from which they are to be deduced, and now extend beyond Bayfoyle, to its directors, but also to its solicitors, without any identification of what those solicitors are alleged to have done so as to support the claims in respect of their conduct.

47. Paragraph 104 takes up that proposition, alleging that two firms of solicitors took unidentified steps and engaged in unidentified conduct to give effect to representations "to which Bayfoyle was privy", presumably being the representations that are alleged to be improper. Paragraph 105 goes further still to allege that those two firms of solicitors were involved as accessories in contravention of the relevant statutory prohibitions and aided, abetted, counselled or procured those contraventions; induced them by threats, promises or otherwise; were knowingly concerned in them; or engaged in a conspiracy, no facts of which are otherwise identified, to effect the contravention. I pause here to note that this is an allegation, first, against non-parties to the proceedings; those non-parties are officers of the Court, as to which such an allegation have serious implications; and those allegations extend beyond accessorial liability, which is itself likely an offence or breach of a civil penalty provision, to an allegation of inducing the contravention by threats and to conspiracy. This claim is the antithesis of the basis on which Mr Smits opened, in suggesting that the winding up application was founded on a straightforward contractual case, from which the allegations of that the Edmonds were a creditor or contingent creditor of Bayfoyle was apparent.

48. Paragraph 107, Table A, pleads debts which are alleged to be owed by Bayfoyle to the Edmonds and again does not plead identified facts, matters and circumstances supporting that allegation, but instead particularises a long list of evidence from which those matters are apparently to be deduced. Table B of that paragraph goes further still, to identify multiple claims by third parties, again particularised by references to evidence rather than supported by a pleading of relevant facts, matters and circumstances, which are said to give rise to claims against Bayfoyle and to support allegations that the Edmonds are creditors or contingent creditors of Bayfoyle or that Bayfoyle is insolvent, by reason of an inability to meet the amounts that are the subject of those claims.

49. A review of the remaining paragraphs would largely reflect more of the same. I should again note that, in the last part of the pleading, the Edmonds go further still in asserting claims without reference to pleaded facts, matters and circumstances. So, for example, in paragraph 119, without reference to any pleaded facts identified for the purposes of that paragraph, the Edmonds allege that "Bayfoyle is quite hopelessly insolvent, or at the very least it is financially unstable". Then, in paragraph 121, they allege that:

“Bayfoyle should be precluded from further engagement in insolvent trading and associated illegal activities, which could not be condoned, allowed or supervised by the Court or otherwise with suitable constraints under any circumstances.”

50. Once again, here, there is no identification of facts that might support a claim for insolvent trading, still less of the unidentified "associated illegal activities" to which the paragraph refers.

51. Paragraph 122 goes further still, again without identification of any supporting facts, in contending that:

“It is in the public interest that conduct of Bayfoyle's affairs be investigated by an independent, compulsory liquidator, particularly so far as it is engaged in large scale tax evasion or anti-avoidance conduct under tax laws, which have been concealed for several years, have caused substantial losses to public revenue authorities and in respect of which recovery actions would be prejudiced by further delays and potential dissipation of assets.”

52. These are obviously serious allegations, but those allegations are not there supported by any identification of the facts, matters and circumstances on which they are made.

53. The conclusion that I should reach from this review of the applicable principles and the Statement of Claim is self-evident. The Statement of Claim is replete with improper allegations, not properly supported by a pleading of material facts, and it is plainly embarrassing and should be struck out under UCPR r 14.48 on that basis.

Bayfoyle’s other complaints

54. Bayfoyle also submits that the proceedings should also be struck out because there is plainly a dispute as to whether the Edmonds are creditors, or contingent creditors, of Bayfoyle so as to have standing to bring a winding-up application.

55. I here have regard to the observations of the Court of Appeal, particularly in the judgment of Barrett AJ, in Treadtel International Pty Ltd v Cocco (2016) 117 ACSR 176; [2016] NSWCA 360 at [40]ff. His Honour there pointed out that, in some straightforward cases, it may be possible for a contingent creditor, at least with leave, to bring a winding up application. However, his Honour pointed (at [58]) to the limits of that proposition and, in particular, observed that a contingent creditor should not be permitted to bring a winding up application where:

“The existence of the obligation, as well as the quantification of any damage, is dependent on the resolution of disputed or otherwise unclear legal rights and duties by means of proceedings for damages brought against the company.”

56. Contrary to Mr Smits' submission with reference to a simpler case that the Edmonds do not bring, it is plain enough that the allegations brought by the Edmonds here are extraordinarily complex, extending to the range of alleged misconduct to which I have referred above. To the extent that they claim to be contingent creditors, those claims are plainly disputed and too complex to be relied on a winding up application. It is not necessary to address the question whether the Edmonds’ claims to be creditors, for debts as distinct from contingent debts, would support the claim, given the conclusion that I have reached as to the form of pleading above and the conclusions that I will reach on alternative grounds below.

57. Third, Mr Lees draws attention to the related proposition that a winding up proceeding should be stayed or dismissed if the issues raised in it are inappropriate for determination in such a proceeding, where there is a substantial contest as to the existence or enforceability of a debt relied on by the applicant. That proposition is supported by the decisions in Fortuna Holdings Pty Limited v Deputy Commissioner of Taxation [1978] VR 83 and L&D Audio Acoustics Pty Ltd v Pioneer Electronic Australia Pty Ltd (1982) 7 ACLR 180 at 183, and was noted with approval in the Court of Appeal's decision in Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd (2007) 61 ACSR 441; [2007] NSWCA 57 and in the High Court's decision in Australian Securities and Investment Commission v Lanepoint Enterprises Pty Ltd (2011) 244 CLR 1 at [32]–[33].

58. It seems to me plain that the complex claims put by the Edmonds, by reference to multiple claims of misconduct which do not identify their factual basis, are such that they could not properly be resolved in a winding up proceeding. That is evident, not least, because the resolution of such matters, assuming they had been properly pleaded in the first place, could not conceivably take place within the six month time limit contemplated in s459R of the Act for a winding up. Here, the process adopted by the Edmonds is, in effect, to seek to leapfrog the process of establishing their claims in complex contested proceedings, to proceed directly to a winding up on the assumption that those claims are established or would be established in the winding up proceedings. That approach is, in my view, inconsistent with the observations made in the case law to which I have referred above, and inconsistent with the statutory regime that contemplates in a winding up proceeding would ordinarily be determined within the six month specified in s459R of the Act.

59. For all of these reasons, the statement of claim should be struck out under r 14.28 of the UCPR.

Dismissal of the proceedings

60. The proceedings should also be dismissed, for several reasons. First, as they stand, pleaded in the manner noted above, they could not go forward to a hearing. I also have no confidence, by reference to the pleadings as they stand, or the submissions that have been put by Mr Smiths for Mr Edmonds, that there would be any utility in allowing an opportunity for a further pleading, even part from the time limit under s 459R of the Act. The Edmonds’ approach to this hearing provides no reason to think that have any particular wish to or intention of confining their claims, going forward, in a way that would allow them to be properly pleaded. To the contrary, this hearing has been conducted by Mr Smits, for the Edmonds, on the basis that assumes the propriety of the allegations as put, while seeking to mischaracterise them as a straightforward and simple contractual case. There is no reason to think, when this hearing has been conducted in this manner, that a further opportunity to the Edmonds to re-plead the case, even if it were open to them, would result in a re-pleading that avoided the difficulties to which I have referred above.

61. Further, and in any event, a re-pleading is not here open, for the large part of the Edmonds’ case, since s 459R of the Act requires that an application for a company to be wound up in insolvency be determined within six months after it is brought. Mr Smits accepts that the six month period specified in that section expires tomorrow. Section 459R of the Act in turn provides that the court may by order extend the period, but only if the Court is satisfied that "special circumstances justify the extension", and the order is made within that six month period. I have had regard, here, to the detailed review of the relevant statutory provisions, and their purpose, in Bryant, in the matter of Gunns Ltd (in liq) (recs and mgrs apptd) v Badenoch Integrated Logging Pty Ltd [2024] FCA 97 at [18]ff and, on appeal, in Badenoch Integrated Logging Pty Ltd v Bryant [2024] FCAFC 167 at [42]ff. There is no basis to find that special circumstances justify such an extension here. To the extent that special circumstances exist, namely the breadth of the winding up application; the scope of the allegations made in them and the manner in which they have been pleaded; and the attempt to bring a winding up proceeding, prior to any substantive claim that seeks to establish its premises; then all of those matters tend against extending the time period, rather than being special circumstances that would warrant that extension.

62. The case law recognises that, where a winding up is sought on alternative grounds to insolvency "that are not interwoven and therefore indivisible", then s 459R of the Act will not bar the balance of the claims. Here, having regard to the pleading, it seems to me that the Edmonds’ claims are so interwoven and so indivisible that the effect of s 459R is to bar them as a whole. In particular, the Court cannot, by any process of review of the Statement of Claim, identify what claims would be left and what material facts would be pleaded in support of them, once those matters that are barred by s459R of the are excluded.

Orders

64. For these reasons, I make the following orders, as sought by Bayfoyle in its Interlocutory Application filed on 21 October 2025:

1. Order under r 14.28 of the Uniform Civil Procedure Rules 2005 (NSW) that the Plaintiffs’ Statement of Claim filed on 2 October 2025 be struck out.

2. Order that the proceedings otherwise be dismissed.

65. It will remain to deal with two other matters that have been identified in the Interlocutory Process, but were not listed for hearing today, namely Bayfoyle's claim for a gross sum costs order against the Edmonds and its claim for an order for costs against Mr Smits, the solicitor acting for the Edmonds, under s99(2)(c) of the Civil Procedure Act 2005 (NSW). It would not be appropriate to hear those matters today, not least because the second of them may give rise to a conflict of interest between the Edmonds and Mr Smits, so far as each of them may prefer that the other bear or at least be jointly liable for the costs of the proceedings. The Edmonds and Mr Smits should be given the opportunity to address that conflict of interest before the question of costs goes to hearing. I should also allow the Edmonds, and Mr Smits, an opportunity to lead evidence as to the question of costs, including the quantification of costs on a gross sum costs order, if they wish to do so.

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