In the matter of MTL Construction Group Pty Ltd

Legislation Cited: - Business Names Registration Act 2011 (Cth), s 18
- Corporations Act 2001 (Cth), ss 459H, 459J

Cases Cited: - Ben Furney Flour Mills Pty Ltd v Nonna's Bakehouse Pty Ltd [2025] NSWSC 749
- Britten-Norman Pty Ltd v Analysis & Technology Australia Pty Ltd [2013] 85 NSWLR 601; [2013] NSWCA 344
- Creata (Aust) Pty Ltd v Faull [2017] 125 ASCR 212; [2017] NSWCA 300
- Grandview Ausbuilder Pty Ltd v Budget Demolitions Pty Ltd [2019] 99 NSWLR 397; [2019] NSWCA 60
- Ligon 158 Pty Ltd v Huber [2016] 117 ACSR 495; [2016] NSWCA 330
- Mills v Walsh [2022] NSWCA 255
- Paneltech Industries (Australia) Pty Ltd v Australian Sky Ridge Equipment Pty Ltd (No 2) [2003] NSWSC 896
- Re Growthbuilt Pty Ltd [2014] NSWSC 1418
- Re Wollongong Coal Ltd (2015) 110 ACSR 134; [2015] NSWSC 1680
- Spencer Constructions Pty Ltd v G&M Aldridge Pty Ltd [1997] 76 FCR 452 at 464; [1997] FCA 681

Category: Principal judgment

Parties: UFP Holdings Pty Ltd (Plaintiff)
MTL Construction Group Pty Ltd (Defendant)

Representation: Counsel:
AD Justice (Plaintiff)
C Dobbs (Defendant)
Solicitors:
Catalyst Legal (Plaintiff)
Roche Law Partners (Defendant)

File Number(s): 2025/294101

JUDGMENT – ex tempore (Revised 24 October 2025)

Nature of application

1. By Originating Process filed on 1 August 2025, the Plaintiff, UFP Holdings Pty Ltd (“Holdings”) applies to set aside a creditor’s statutory demand dated 9 July 2025 (“Demand”) issued by MTL Construction Group Pty Ltd (“MTL”).

2. By way of background, the Demand claims that Holdings owed MTL the amount of $136,163.75, being the amount of a debt claimed in the Schedule. The debt claimed in the Schedule is, in turn, described as “Debt due and payable to [MTL] by [Holdings] for outstanding invoices as outlined in the Affidavit of Michal Lazinski dated 9 July 2025”. By that affidavit, which was also read by MTL in this application, Mr Lazinski indicated that he was a director of MTL and verified the amount of $136,163.75 as the total amount of debts due and payable by Holdings pursuant to outstanding invoices issued by MTL to Holdings. That affidavit annexed a statement of account titled “Summary of invoices” which, notably, identified the relevant party, not by reference to the company name of Holdings, but by reference to a business name “Ultraflex Architectural Linings and Joinery”, and by reference to an Australian business number which appears to relate to Holdings.

3. Ultimately, the issue in this proceeding is a very narrow one, because no dispute is raised by Holdings as to the amount due to MTL. Instead, Holdings raises a dispute as to whether that amount is due by Holdings, or by another company, UF Manufacturing Pty Ltd (“UFM”) which it contends traded as “Ultraflex Architectural Linings”. I recognise that UFM does not appear to have registered that business name which was registered to Holdings.

Applicable Principles

4. I should refer to the applicable principles before turning to the affidavit and other evidence. The Originating Process relied on both a claim under s 459H of the Corporations Act 2001 (Cth) (“Act”) that there was a genuine dispute as to the debt claimed and a claim under s 459J of the Act, but the parties’ submissions were directed entirely to the former question.

5. The Court has power to set aside a creditor’s statutory demand under s 459H(1)(a) of the Act where there is a genuine dispute between the relevant company and the issuer of the demand about the existence or the amount of the debt to which the demand relates. In Spencer Constructions Pty Ltd v G*&M Aldridge Pty Ltd* [1997] 76 FCR 452 at 464; [1997] FCA 681, the Full Court of the Federal Court observed that a genuine dispute must be bona fide and truly exist in fact, and the ground for the dispute must be real and not spurious, hypothetical, illusory or misconceived.

6. The case law emphasises that the threshold to establish a genuine dispute is not high. In Paneltech Industries (Australia) Pty Ltd v Australian Sky Ridge Equipment Pty Ltd (No 2) [2003] NSWSC 896 at [18] Barrett J observed that:

“Once the company shows even one issue has a sufficient degree of cogency to be arguable, a finding of genuine dispute must follow. The court does not engage in any form of balancing exercise between the strengths of competing considerations. If it sees any factor that, on rational grounds, indicates an arguable case on the part of the company, it must find that a genuine dispute exists, even where any case apparently available to be advanced against the company seems stronger.”

7. I also have regard to the decision of the Court of Appeal in Britten-Norman Pty Ltd v Analysis & Technology Australia Pty Ltd [2013] 85 NSWLR 601; [2013] NSWCA 344 (“Britten-Norman”) when, in dealing with an offsetting claim, the Court of Appeal undertook a comprehensive review of the cases preferable to establishing whether a genuine dispute was established. The Court there emphasised (at [36]) that the evidence necessary to establish a genuine dispute “need not conclusively prove or otherwise be incontrovertible or substantially non-contestable” and also observed at [46] that:

“In determining whether there is evidence of a genuine dispute as to the debt ... except in extreme cases, the court is not concerned to engage in an enquiry as to the credit of the deponent of the affidavit filed in support of the application [to set aside the demand].”

8. The Court also emphasised at [47] that the Court’s role was, in such an application:

“... to determine whether there was plausible evidence to establish the existence of a genuine dispute, not whether the evidence was disputed or even likely to be accepted on a final hearing of any such claim.”

9. I emphasise that matter because here, from time to time, Mr Dobbs, who appeared for MTL, made submissions which appeared to be directed to establishing that MTL had the stronger claim. That may well be the case, but it is not sufficient for the purposes of supporting a creditor’s statutory demand, unless it can be said, as Mr Dobbs also contended, that the contentions of Holdings did not rise to the level of a genuine dispute and were spurious, illusory or misconceived.

10. I also bear in mind the observations of Barrett AJA in Ligon 158 Pty Ltd v Huber [2016] 117 ACSR 495; [2016] NSWCA 330 at [8], where his Honour proved my observations in Re Wollongong Coal Ltd (2015) 110 ACSR 134; [2015] NSWSC 1680 at [9]ff as to the applicable test. The same test has been adopted by the Court of Appeal in Creata (Aust) Pty Ltd v Faull [2017] 125 ASCR 212; [2017] NSWCA 300 (“Creata”) and again by the Court of Appeal in Grandview Ausbuilder Pty Ltd v Budget Demolitions Pty Ltd [2019] 99 NSWLR 397; [2019] NSWCA 60 (“Grandview”), and I have here drawn on my summary of the applicable principles in Re Growthbuilt Pty Ltd [2014] NSWSC 1418 at [10]ff.

11. I should also draw attention to one further matter recognised by Creata and Grandview. It is well-established that the Court will generally not decide contested issues of fact or complex issues of law in order to decide whether a genuine dispute exists and will also exercise restraint where a question of construction of a contract has any element of rational controversy to it: Creata at [20]ff; Grandview at [90]. That is of significance here, where a primary issue arises as to who were the relevant parties to the relevant contract.

Affidavit and other evidence

12. Turning now to the affidavit and other evidence, Holdings relies on two affidavits dated 31 July 2025 and 11 September 2025 of its director, Mr Fritz. Those affidavits are directed to establishing the proposition that UFM rather than Holdings contracted with MTL, although the question I have to decide is, of course, merely whether there is a genuine dispute as to that matter. Mr Fritz’s evidence is that both Holdings and UFM were subsidiaries of a holding company, which was the trustee company of a trust, and that Holdings held the trade marks, patents, business names and other intellectual property associated with the relevant business, but that the relevant products were manufactured by UFM. His evidence was that Holdings had no other assets or bank accounts and was not registered for GST and only lodged nil GST statements to the Australian Taxation Office as it did not trade. There may be a question as to whether Holdings was in fact registered for GST, although there is documentary evidence indicating that it had not reported earnings for the purposes of GST liability.

13. Mr Fritz's evidence was, in turn, that UFM was the trading entity trading under the name Ultraflex Architectural Linings, which is the name used in the invoices issued by MTL, although in conjunction with an Australian business number referable to Holdings. Mr Fritz in turn contends that MTL was engaged by UFM, in its capacity as the project manager for several projects and relies on that proposition for the contention that any amount due to MTL was owed by UFM rather than by Holdings.

14. By a second affidavit, dated 11 September 2025, Mr Fritz in turn referred to several projects undertaken, he contends, by UFM which were the subject of invoices issued by MTL and in turn the subject of the Demand. He refers to documentation relating to those projects. He there annexes income tax records referable to Holdings, which appear to record that it was not required to lodge income tax returns, and that it had zero activity for the purposes of GST reporting. He annexes a subcontractor order to his affidavit, which is addressed to "Ultraflex Architectural Lining" and does not take the matter further where it refers to the business name rather than the relevant corporate entity. However, a second purchase order is consistent with the position for which he contends, so far as it refers to the contracting entity as UFM trading as Ultraflex Architectural Linings. At that point, I pause to note, there is at least some evidence to suggest that, at least in respect of some part of the Demand, the relevant invoices were issued to the entity conducting the relevant projects, namely UFM as the user of the relevant business name, notwithstanding that it did not hold a business name registration for it.

15. Mr Fritz was cross-examined, with leave, although that cross-examination did not take MTL further and, if anything, emphasised the degree of dispute as to relevant factual matters. Mr Fritz there continued to maintain that, although the business name “Ultraflex” was registered to Holdings, UFM conducted the business under that name, and he adhered to his evidence that, although he had not personally communicated to Mr Lazinski that invoices should be issued to UFM, or at least not to Holdings, he had instructed a member of his staff to do so. He also adhered to the proposition that Holdings was not trading and, in those circumstances, it was not party to the relevant contract, and that the payments which had in fact been made to MTL, in part payment of amounts claimed under the relevant invoices, had been made by UFM rather than Holdings.

16. MTL reads Mr Lazinski’s affidavit dated 9 July 2025 verifying the Demand, to which I referred above, and two further affidavits dated 29 August 2025 and 20 October 2025 of Mr Lazinski. In his affidavit dated 29 August 2025, Mr Lazinski refers to the engagement of MTL to supply skilled labour hire for the installation of joinery and related works at several projects. Mr Lazinski there referred, in several paragraphs, to dealings with "the Applicant," namely Holdings. Those paragraphs were rightly read, by agreement of the parties, with a limiting order under s 136 of the Evidence Act 1995 (NSW) as directed to Mr Lazinski's belief, where they turned on which corporate entity was referable to the relevant trading name. Mr Lazinski there referred to invoices issued to the Applicant, and I bear in mind that those invoices were issued to the relevant business name, although again referring to the ABN of Holdings to which I have referred above.

17. Mr Lazinski also annexed emails with an employee of Ultraflex with whom he dealt, but those emails again used the relevant business name, rather than the company name of either UFM on the one hand or Holdings on the other. Design drawings which were attached to those emails contained a disclaimer which indicated that the documents were the property of UFM, and that provides a second element of contemporaneous support for the proposition that UFM was involved in the relevant project. I was also taken to an email dated 27 August 2024, in which a question had been raised as to the address of a project shown in one of the invoices issued by MTL, but not as to the identity of the entity to which the invoice was issued. Again, that matter does not go very far, where the invoice was issued to the business name and is therefore equivocal as to the entity, apart from the reference to the Australian business number of Holdings. There is a dispute between the parties as to whether Mr Lazinski was asked, by oral communications, to invoice UFM, but that dispute cannot properly be resolved in an application of this kind, having regard to the authorities to which I have referred above.

18. In his affidavit dated 20 October 2025, Mr Lazinski referred to several conversations with persons working for one or other of the Ultraflex companies, but those conversations are also equivocal where typically reference was made to "Ultraflex," the business name, rather than to either UFM or Holdings.

19. I was also there taken to a business name search for the relevant business names, or possibly Australian business numbers, which reported relevant business names being held in the name of Holdings. That, plainly, is a matter, and possibly the substantial matter, on which MTL relies to advance the claim in the Demand. Again, unfortunately, that proposition does not go very far, where it turns on an inference, from the fact of business name registration in the name of Holdings, that it was Holdings that was trading under the relevant name. I recognise that s 18 of the Business Names Registration Act 2011 (Cth) (“Business Names Act”) creates an offence if an entity carries on a business under a name, and the name is not registered to the entity as a business name on the business names register. If this Court was determining a contracts claim on the merits, rather than an application to set aside the Demand, that is a matter that would support a finding that the counterparty to the contract was Holdings, although it is plainly not unknown for companies to trade under unregistered business names or under business names registered to their associated entities. Having said that, the difficulty here is that this is not a contract claim and this is not a merits hearing of a contract claim but instead an application to set aside the Demand based on the claim that there is a genuine dispute as to the contracting entity.

20. For completeness, I was also taken to a web site for Ultraflex, which did not advance matters where it also referred to the business name rather than a particular company name, and an email sent on behalf of MTL which had requested information as to the invoicing details to assist MTL's invoices. No doubt, the difficulties which have arisen would have been avoided, had a response to that email been received, but there is no evidence of any response to that email and MTL therefore proceeded, it seems, by invoicing the business name, but referring to the ABN of Holdings.

Submissions and determination

21. Turning now to the parties' submissions, both parties refer to the principles applicable in an application of this kind, and there appears to be no significant contest between them as to those principles, although there is a contest as to the implications of those principles, where a dispute arises as to which entity is the contracting party in the relevant contract.

22. Mr Justice, who appears for Holdings, refers to the potential complexity of the question who is the contracting party, recognised by Rees J in Ben Furney Flour Mills Pty Ltd v Nonna's Bakehouse Pty Ltd [2025] NSWSC 749 at [96], and to authority that that question is to be determined objectively, as noted by Brereton JA in Mills v Walsh [2022] NSWCA 255. Mr Justice in turn submits that the objective evidence was that MTL was contracting with the company conducting the business known as Ultraflex or Ultraflex Architectural Linings and Joinery, and he contends that the relevant company was Holdings. That, of course, is not the question that I have to decide, or indeed that I am permitted to decide, in an application of this kind, and the real question is whether there is a genuinely arguable claim for that proposition. If there is a genuinely arguable claim for that proposition, then the Demand must be set aside. Here, Mr Justice points to matters which he contends support that position, although a number of those matters are communications which are equivocal, so far as they use the "Ultraflex" business name rather than the company name of either Holdings or UFM. He also points to matters which are more significant, namely the evidence that Holdings did not in fact conduct the relevant business, and did not have, for example, a bank account from which payments could be made.

23. Mr Dobbs, in response, recognises the relevant principles and addresses the history of the dealings between the parties which, with respect, does not take matters much further. It is plain that a company trading under the name “Ultraflex” engaged MTL, and it is plain that MTL undertook the work, and there is no real dispute as to MTL's entitlement to be paid for that work. The dealings between the parties, however, does not take much further the question which corporate entity assumed that liability, where that ultimately turns on the issue of the invoices in the name of the business, although combined with the ABN reference for Holdings. The ABN reference is the strongest point available to MTL to support its claim, when treated together with the fact that the relevant business name is registered in the name of Holdings rather than UFM. Mr Dobbs in turn took me to matters which would be put, in support of a finding that the better view was that Holdings was the party to the relevant contract, but that is not sufficient for MTL's purpose, unless it rises to the level that there is no genuine dispute as to that matter.

24. It seems to me that, here, the result of this application is determined by the principles to which I referred above. It may be that, in a contract case which was heard on the merits, MTL would ultimately prevail, by reference to the use of the ABN number of Holdings in the invoices, combined with the business name registered to Holdings, and an inference that may be drawn from the Business Names Act. However, the countervailing considerations are the objective unlikelihood of Holdings entering into the relevant arrangement, where it did not have capacity, for example, to make any of the payments contemplated by it, absent a bank account, and of MTL contracting with a party which had no capacity to pay its invoices.

25. However, I return to where I began, namely that this case is not a contract case being heard on its merits, but an application to set aside the Demand. Here, the fact that the invoices are issued to the business name; that Holdings lacks a bank account; and the claim, which is made and which I must approach by reference to the principles in Britten-Norman, that MTL had been asked not to invoice using Holding’s ABN number is sufficient to raise a genuine dispute as to the claim. That has the consequence that the Demand must be set aside, because there is a genuine dispute as to the debt claimed. It does not have the consequence that MTL cannot recover the amount claimed where, as in any circumstance where a Demand is set aside by reason of a genuine dispute, that directs attention to the need to bring a contractual claim, or a claim for debt, in a Court which has the capacity to determine that matter on its merits, and not address the matter by a mechanism that is only available for a debt that is not genuinely disputed.

Orders

26. For these reasons, I order that the creditor’s statutory demand dated 9 July 2025 served by the Defendant upon the Plaintiff be set aside. The Defendant must pay the costs of these proceedings, as agreed or as assessed.

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