In the matter of NA Investment Holdings Pty Ltd - Perpetual Nominee Ltd v NA Investment Holdings Pty Ltd

Judgment 1HER HONOUR : Before me for hearing on 21 March 2011 was an application by Perpetual Nominees Limited for the winding up in insolvency, pursuant to s 459P of the Corporations Act 2001 (Cth), of NA Investment Holdings Pty Ltd. Perpetual has st anding under s 459P(1)(b) of the Corporations Act to bring such an application as a creditor of NA Investment. It relies on a presumption of insolvency arising under s 459C(2)(a) of the Corporations Act by reason of the failure by NA Investment to comply with a statutory demand served on it on 30 September 2009 under which Perpetual claimed a debt of $7,655,603.93. 2Also listed for hearing before me on 21 March 2011 was an interlocutory process filed on 22 February 2011 by NA Investment seeking leave under s 459S of the Corporations Act to oppose the winding up application on a ground that it relied on and/or that it could have so relied on for the purposes of an application to set aside the statutory demand under s 459G of the Corporations Act (namely, that the proceedings are brought contrary to clause 11.8 of a loan facility agreement between the parties (the Restated Facility Agreement dated 15 October 2008 ) and that NA Investment is solvent) . NA Investment does not seek to dispute the underlying liability giving rise to the debt (though it had previously asserted an offsetting claim); rather, it wishes, in effect, to establish that Perpetual was precluded from issuing a statutory demand (and is precluded from commencing winding up proceedings) in relation to part or all of that debt. 3The terms of the Restated Facility Agreement have already been the subject of decisions in this Court, both at first instance and in the Court of Appeal, in NA Investment Holdings Pty Ltd v Perpetual Nominees Ltd [2010] NSWSC 248 and NA Investments Holdings Pty Limited v Perpetual Nominees Limited [2010] NSWCA 210. NA Investment now seeks to adduce further evidence in order to establish the extent of any shortfall between the amounts owing to Perpetual under or in connection with the Restated Facility Agreement and the realisation value of what was defined in that agreement as the FFA Trust Property (in order to support its reliance on clause 11.18 of that agreement as precluding Perpetual from bringing these proceedings or seeking to have NA Investment wound up).

Background 4NA Investment holds all of the shares in Future Fuels Australia Pty Ltd (FFA), FFA Properties Pty Ltd (FFA Properties) and FFA Equipment Pty Ltd (FFA Equipment) (collectively referred to, with another company of which NA Investment is shareholder, FFA Oils Pty Ltd, as the FFA Group). Further, in its capacity as an investment company, it also has shares in other companies (see [16] in the Court of Appeal judgment per Lindgren AJA). 5FFA Properties owns land on which there is an oil refinery in Moama in New South Wales. FFA Equipment owns the equipment, plant and materials situated on the land. (As I understand it, FFA operated the oil refinery business at Moama and held the necessary licences for the carrying on of the business). NA Investment holds its shares in FFA Properties and FFA Equipment as trustee of the NA Investment Trust. The FFA Trust Property, as defined in the Restated Facility Agreement, is not necessarily property the subject of the NA Investments Trust (in respect of which NA Investment as trustee would have a right of indemnity). Lindgren AJA was, however, prepared to accept (at [56]) that since FFA Properties and FFA Equipment were wholly owned subsidiaries of NA Investment, the company in its role as trustee enjoyed, in effect if not in form, a right to be indemnified out of the assets of those subsidiaries. 6The Restated Facility Agreement (under which the debt the subject of the statutory demand is claimed) was entered into in October 2008 between Perpetual, FFA and four guarantors. It was an agreement under which an earlier (2006) Facility Agreement was amended and restated (following a substantial reduction in the amount serviced by the facility). The guarantors under the Restated Facility Agreement were two individuals (Mr Nabil Azir Magar and Mr Adil Azir Magar, who were the directions of NA Investments and the FFA Group companies), FFA Oils and NA Investment "in its capacity as trustee of the NA Investments Trust". (FFA Properties and FFA Equipment had been identified as additional guarantors under the initial Facility Agreement, though not apparently actually made party to that agreement, but were not referred to as guarantors under the Restated Facility Agreement.) 7The initial Facility Agreement related to the provision of a facility of $23,000,000 to FFA to fund the development of a bio-diesel plant at Moama. The effect of the arrangements in 2008 was to reduce the $23m facility initially provided by Perpetual to a maximum loan facility of $6,810,053.71, that being the amount of principal then outstanding under the original Facility as amended. The Facility Agreement was amended and as part of those arrangements the parties entered into the Restated Facility Agreement. 8By affidavit sworn 22 February 2011, Mr Adil Magar explained the background to the present dispute. It does not seem that this is broadly in contention. 9Mr Magar has deposed that NA Investment is the Trustee in respect of the FFA Trust Property (that being defined in the Restated Facility Agreement in clause 18.1 as "any shares in any member of the FFA Group, any Authorisation, property, asset, right or undertaking in connection with the Plant, the Equipment, any member of the FFA Group or the operations or business of any member of the FFA Group - the FFA Group defined, as indicated earlier, means FFA, FFA Properties, FFA Equipment and FFA Oils and each subsidiary of any of those companies). 10Mr Magar has deposed that, in November 2007, NA Investment entered into a share sale agreement with Jonvana Enterprises Pty Ltd "which had the effect of converting the FFA Trust Property" to the sum of $68,000, but did not complete that agreement. There are other proceedings in this Court in relation to the termination of that share sale agreement. 11The Restated Facility Agreement recited that FFA had asked Perpetual "to continue to provide it with a term loan facility for a further period of 3 years" and that Perpetual had agreed to continue to provide financial accommodation to FFA on the terms set out in the "Finance Documents" (defined to mean the Facility Agreement and any other document agreed by Perpetual and FFA to be a Finance Document for the purposes of the Restated Facility Agreement). NA Investment entered into the Restated Facility Agreement both as a guarantor and, it would seem, as "Trustee", in its capacity as trustee of the NA Investments Trust. 12Mr Magar says that on the same day as the Restated Facility Agreement was executed, security was granted over the FFA Trust Property to two related companies of Jonvana to permit funds to be raised, among other things, for the continued operation of the oil refinery. (There is other litigation in this Court arising out of those arrangements and caveats have been lodged by the secured companies - the DJM companies - over the Moama land.) An administrator has been appointed by the DJM companies (that appointment itself being the subject of a court challenge). Mr Magar has deposed that, while that dispute is pending, the oil refinery has ceased operation and NA Investment has no "control" in respect of the FFA Trust Property. 13The critical clause of the Restated Facility Agreement, for present purposes, is Clause 11.18 which provided as follows: 11.18 Limitation of liability (a) The Trustee's liability to pay any amount in accordance with the Finance Documents, may be discharged from, and the recourse of the Trustee is limited to, the FFA Trust Property. The Lender may not seek to recover any shortfall in the amounts owing to it under or in connection with this agreement by bringing proceedings against the Trustee or applying to have the Trustee wound up. This clause applies despite anything in this agreement but subject to clause 11.18(b) and clause 11.18(c). (my emphasis) (b) The Mortgagee [not defined but construed by Lindgren AJA as referring to Perpetual] may: (1) do anything necessary to enforce its rights in connection with the FFA Trust Property; and (2) take proceedings to obtain: (A) an injunction or other order to restrain any breach of this agreement by the Trustee; or (B) declaratory relief or other similar judgment or order as to the obligations of the Trustee under this agreement. (c) Clause 11.18(a) does not apply in respect of the Trustee to the extent of fraud, negligence or wilful breach by the Trustee. 14In July 2009, FFA went into voluntary administration and on 14 August 2009 it was ordered to be wound up and a liquidator was appointed. 15On 30 September 2009, Perpetual served its statutory demand. NA Investment then filed an Originating Process on 20 October 2009, accompanied by a supporting affidavit of Mr Adil Magar made on that date, seeking an order for the statutory demand to be set aside. A Further Amended Originating Process was filed in those proceedings by NA Investment on 16 March 2010, with leave from Macready AsJ (adding, as a ground on which reliance was placed to set aside the statutory demand, that there was "some other reason" to set aside the demand). The application made under s 459G was in due course heard by Macready AsJ. His Honour dismissed that application. 16Before Macready AsJ, NA Investment contended that the term "shortfall" in clause 11.18 meant a shortfall between the moneys owing and the aggregate of the amounts paid (ie the outstanding amount of the debt). (As Lindgren AJA observed, if that were the correct construction of the clause, then NA Investment would bear no liability for any part of the Money Owing, even if the whole of the FFA Trust Property remained available to satisfy the full amount of the Money Owing [58], which surely cannot have been the intention as it would render the guarantee by NA Investment meaningless). NA Investment nevertheless contended at first instance that the effect of clause 11.18(a) was to prevent Perpetual from suing for monies which NA Investment otherwise owed under the Restated Facility Agreement (ie even for such amount as related to the FFA Trust Property). 17Perpetual, on the other hand, contended that the true effect of clause 11.18(a) was to limit recovery from NA Investment to the value of the trust estate for which NA Investments is trustee, and that Perpetual was enjoined only from recovering (or seeking to recover) from NA Investment the difference between the value of the FFA Trust Property and the total amount owing under the Restated Facility Agreement. 18At [21]-[24] of Macready AsJ's reasons, his Honour said: "NA Investments' construction ignores the initial qualification in the second sentence of the clause. The bringing of proceedings or applying to have the trustee wound up is conditioned by the first part of the sentence to a situation where the lender is seeking 'to recover any shortfall in the amounts owing to it under or in connection with this agreement ...'. Plainly the shortfall is the extent to which the trust property is insufficient to allow recovery of the full amount due. (my emphasis) The effect of this condition may be illustrated by a situation where a plaintiff simply refuses to pay any amount that is due under the facility. If the lender then sued it would be open to the borrower to plead as a matter of defence that the whole or some part of the amount sought to be recovered is beyond the amount of the trust property and therefore not recoverable. It could hardly be imagined that a proper construction of the clause would allow the borrower to defend the proceedings simply on the basis that they are 'proceedings' for recovery and thus prohibited by the clause. On an ordinary grammatical construction the condition in the first part of the sentence would have to apply to both the alternatives in the second part of the sentence. In the case there is no evidence before me in these proceedings that the amount sought in the demand represents in whole or in part a 'shortfall' in the amounts owing." 19The construction placed by Perpetual on clause 11.18(a) was accepted by Macready AsJ and upheld in due course by the Court of Appeal ([2010] NSWCA 210). In the Court of Appeal, Lindgren AJA said (at [60]): "As a whole, para (a) requires [NA Investment], if it wishes to avail itself of the limitation of liability provided for in the second sentence, either to have recourse to the FFA Trust Property or at least to establish the amount that would be realised if it did so. The onus is on [NA Investment] to do one or other of these things if it is to take advantage of the 'shortfall' provision." 20His Honour further observed that the reference in clause 11.18 to applying to have the company wound up was a distraction (and that the debt itself must be recoverable by action) [63]. His Honour said (at [64]) that: "The notion of seeking to recover by bringing proceedings against the Company in the second sentence of para (a) is a concept wide enough to embrace the bringing of an action for debt. In a hypothetical action by Perpetual against the Company for debt, the Company would bear the onus of pleading and establishing that the claim was in respect of a "shortfall", that is to say, that the limitation of liability provision was enlivened. For all that is known, unless and until the Company pleaded and proved otherwise, the realisable value of the FFA Trust property might be sufficient to pay the Money Owing, that is to say, there might be no 'shortfall'." 21I interpose to note that in the situation postulated by his Honour (i.e. where there was no "shortfall") that could logically only be (as his Honour indicated) because the whole of the Money Owing was able to be (and was in fact) met out of the FFA Trust Property or otherwise. Lindgren AJA further noted that clause 11.18 contemplated that NA Investment might choose not to resort to the FFA Trust Property to satisfy the debt or that it might choose to have recourse to the FFA Trust Property for that debt [61]. His Honour considered that the existence of a range of possibilities in that regard supported the view that "the onus was intended to be on [NA Investment] to raise and establish the amount with which the amount of the Money Owing was to be compared at peril of being indebted to Perpetual for the latter amount" (at [62]). 22Counsel for Perpetual (Mr Marshall) emphasises that NA Investment had adduced no evidence before Macready AsJ that it was entitled to the protection of clause 11.18(a), even on its own construction of the provision. He noted that there was no evidence either that the amount being sought from NA Investment was relevantly a "shortfall" in the amount recoverable from the principal debtor (necessary on the NA Investment construction of clause 11.18) or as to a "shortfall" as between the value of the FFA Trust Property and the amount sought from NA Investment (as required on the construction preferred by Macready AsJ and later the Court of Appeal). 23In his affidavit sworn 22 February 2011, Mr Magar asserts that the debt "currently pursued" by Perpetual is not capable of being paid out of the FFA Trust Property (as it is "deadlocked" and out of the control of NA Investment) and hence that the amount of the debt claimed in the statutory demand is "totally outside of the FFA Trust Property and constitutes, in its totality, the "shortfall" described in clause 11.18 of the Restarted Facility Agreement". In effect, Mr Magar asserts that the FFA Trust Property is not realisable (although the situation he describes appears to relate to a temporal difficulty and one that might relate only to some of the FFA Trust Property). Mr Magar contends that on this basis the debt is not "owed" by NA Investment and cannot be claimed against it by virtue of clause 11.18. To the extent that there is other FFA Trust Property than the shares in the FFA companies now in liquidation that leaves open the possible scenario postulated by the Court of Appeal, namely, that the company (NA Investment) might be able to prove the realisable value of the FFA Trust Property but refuse to realise it in fact. (There is no explanation, for example, as to why NA Investment had not taken steps to realise the FFA Trust Property at an earlier time in order to meet the debt, other than its 'own construction' of the clause - the error of which had been made clear in the Court of Appeal decision.) 24(Pausing there, the assertion that a debt is not "owed" because the debtor cannot readily realise its assets seems to me to be a novel one. Better understood, it seems that what Mr Magar is asserting that by reason of clause 11.18 Perpetual cannot now seek to recover from NA Investment any amounts that NA Investment asserts it cannot, or cannot readily, now realise out of the FFA Trust Property, whether by reference to the liquidation of the two FFA companies or the caveat said to have been lodged by the DJM companies presumably over the oil refinery land.) 25At paragraph [19] of his affidavit, Mr Magar says: "[NA Investment] as a company is capable of paying all of its debts as and when they fall due. But the indebtedness to [Perpetual] is in respect of [NA Investment's] obligations as trustee to the FFA Trust Property and by virtue of the agreement between them [Perpetual] can only look to the FFA Trust Property for its payment and not to [NA Investment] in any other capacity outside of those trust arrangements." 26Exhibited to Mr Magar's affidavit is an extract from a valuation of the refinery as at October 2008 showing it at $41,749,165.69. If that amount were to be realisable by NA Investment, then there would obviously be no shortfall. However, there is a doubt raised as to what might be recovered out of that asset given the dispute with the DJM companies and the liquidation of FFA Properties. Assuming that Mr Magar's assertion that NA Investment cannot as a practical matter now have recourse to the underlying assets of FFA Equipment and FFA Properties is correct, the question whether there is or is likely to be any shortfall between the Moneys Owing and the amount realisable from the FFA Trust Property would depend not only on the outcome of the liquidation of those two companies, but also on the worth of the remaining FFA Trust Property (as to which there is nothing other than an assertion by Mr Magar). 27In his affidavit, Mr Magar appears readily to concede (at [6]) that NA Investment did not attempt to call evidence before Macready AsJ to prove that the "shortfall" provision was enlivened (i.e. to prove the "shortfall" between the FFA Trust Property on the one hand and the $7.6m debt claimed in the statutory demand on the other hand) and that this was "due to its own construction of the clause", but says that NA Investment now wishes to do so. 28Reference was made by both parties to what was said in the Court of Appeal's reasons by Lindgren AJA at [71]: The Court raised with the parties the possibility of a dismissal of the application for leave to appeal with a reservation for the Company, on the hearing of the winding up application, to support its reliance on clause 11.18 by adducing evidence establishing the extent of the shortfall: see section 459S of the Act. This course was not agreed to and the matter was not pursued. (my emphasis) 29Perpetual further points to the fact that when the matter was before Macready AsJ, NA Investment was twice permitted to amend its originating process ([2010] NSWCA 210 at [43] and [45]) and that when the matter was before the Court of Appeal, NA Investment sought leave to adduce further evidence under s 78A of the Supreme Court Act 1970 (NSW), but subsequently withdrew this application ([2010] NSWCA 210 at [42]). 30Mr Marshall submits that the affidavit of Mr Magar makes clear that the only reason NA Investment did not seek to adduce evidence as to the value of the FFA Trust Property when the matter was before Macready AsJ was because it relied on its own construction of Clause 11.18 (a point in effect conceded by Counsel for NA Investment, Mr Sahade) and that there is no suggestion that this is fresh evidence or that NA Investments was unaware of the alternative construction which could be placed on clause 11.18. 31The only "fresh" evidence seems to be that contained in Mr Magar's further affidavit of 17 March 2011, which refers to resolutions passed on or around 10 March 2011 by meetings of creditors of FFA Properties and FFA Equipment, each resolving to wind up the company. Mr Magar deposes (perhaps by way of an undertaking, though this is not clear), that "whatever is returned to the shareholders by the liquidator comprises in its totality the liability amounts to Perpetual (being the FFA Trust Property) and shall be paid to Perpetual pursuant to the Restated Facility Agreement." Mr Magar also asserts that there is no other property owed by NA Investment that comprises the FFA Trust Property "in any way", as defined. (Where that leaves the asset comprised by NA Investment's shareholding in FFA Oils and/or any of the general property falling within the definition of FFA Trust Property is unclear).

Applicable principles 32NA Investment's application is made under s 459S of the Corporations Act , which provides: 459S(1) In so far as an application for a company to be wound up in insolvency relies on a failure by the company to comply with a statutory demand, the company may not, without the leave of the Court, oppose the application on a ground: (a) that the company relied on for the purposes of an application by it for the demand to be set aside; or (b) that the company could have so relied on, but did not so rely on (whether it made such an application or not). (2) The Court is not to grant leave under subsection (1) unless it is satisfied that the ground is material to proving that the company is solvent. 33The essential issues for consideration in determining an application for leave under s 459S were outlined by Austin J in Chief Commissioner of Stamp Duties v Paliflex Pty Ltd [1999] NSWSC 15; (1999) 149 FLR 179 at [49] and adopted by Brereton J in DAG International Pty Ltd v DAG International Group [2005] NSWSC 1036 as being, in summary: (i) whether there is a serious question to be tried on the ground sought now to be raised; (ii) the sufficiency of any explanation as to why that ground was not raised in an application to set aside the statutory demand (involving an evaluation of the reasonableness of the conduct of the debtor at the time when the application was or might have been made); and (iii) whether the court is satisfied that the relevant ground is material to proving that the debtor is solvent. (See also Austin & Black's Annotations to the Corporations Act at [5.459S] and Guardian Group Australia Pty Ltd v Alice Lu and Anor [2005] NSWSC 1299). 34The discretion conferred by s 459S is one which it has been said should be exercised cautiously and sparingly (see Switz Pty Ltd v Glowbind Pty Ltd; Glowbind Pty Ltd v Switz Pty Ltd [2000] NSWCA 37 and Chief Commissioner of Stamp Duties v Paliflex ). (i) Is there a serious question to be tried? 35In Guardian Group (at [69]) and DAG International (at [5]) , where the ground sought to be raised related to the existence of a dispute as to the claimed debt, Brereton J stated that this issue "involves a preliminary consideration of the company's basis for contending that the debt is the subject of a bona fide dispute, though it does not require decision at this stage, whether there is, in fact, a bona fide dispute". 36There is no serious question to be tried as to the proper construction of clause 11.18 of the Restated Facility Agreement. That has been conclusively determined by the Court of Appeal. However, what NA Investments now seeks to do is to establish that, on the construction of this clause as so determined by the Court of Appeal, there is a shortfall which would enliven that provision. 37It seems to me that the Court of Appeal did not exclude the possibility of an argument that NA Investment might be able to establish that the limitation of liability clause was enlivened (or that it might be able to show that its indebtedness had thereby been reduced by the operation of clause 11.18). 38On the information now put before the Court, it seems to me that there is a serious question to be tried (or a seriously arguable proposition - to use the alternative formulation) that the FFA Trust Property (insofar as it comprises shares in the two companies now in liquidation) may not be realisable for an amount sufficient (taken with any other FFA Trust Property) to enable the discharge of NA Investment's debt and hence might operate to reduce the amount recoverable from NA Investment to the lesser amount of any FFA Trust Property so realisable. That issue has not previously been determined. Indeed, it seems that it was this issue that the Court of Appeal had contemplated the parties might seek to pursue in an application of the kind now made. Therefore I accept that this first criterion is satisfied. (ii) Is there a sufficient explanation as to why the ground sought to be raised was not previously raised? 39Mr Marshall submits that the first limb of s 459S(1) is not satisfied because NA Investment has already ventilated clause 11.18 in its earlier attempt to set aside the statutory demand. He submits that although the formulation of NA Investment's argument in respect of this provision has changed, as a matter of common-sense, it is the same 'ground' that has already been considered on two previous occasions. Hence, he submits that there is no serious question to be tried on the ground now sought to be raised. It is said that there is no precedent for a debtor ventilating an issue for a second time under s 459S for no reason other than to address gaps in the evidence which were adduced on the first occasion (and of which the debtor was aware at the time). 40The reason propounded for the failure of NA Investments to adduce evidence to establish the existence or extent of any 'shortfall' between the realisable value of FFA Trust Property on the one hand, and the $7.6m debt claimed in the statutory demand on the other hand, is that it was previously relying on its "own" construction of clause 11.18 (on the advice of its solicitor), and now wishes to rely on a revised construction (its own construction twice having been held incorrect). NA Investment cannot be said to have been unaware of this alternative construction of clause 11.18, nor was it unaware of what evidence might be necessary to establish it. 41There has been little judicial attention given to what a 'sufficient explanation' would be in circumstances such as the present, where a s 459G application was earlier made (invoking the ground later sought to be raised with leave under s 459S) and dismissed (on two occasions) for failure to adduce the necessary evidence to sustain that ground at the stage of the s 459G application. 42It seems to me that an analogy might usefully be drawn with the situation where a company's solicitor had been charged with the responsibility of dealing with the demand and had failed to do so adequately. That has been held not to be an adequate explanation for the purposes of an application for leave under s 459S ( Re Satellite Group Ltd [2000] NSWSC 984; (2000) 35 ACSR 565). 43The fact that account may be taken of the reasonableness of a debtor's conduct in considering the sufficiency of the reason why the ground was not raised earlier (or should now be permitted to be raised again if it had been raised earlier) is indicated by the observation in Perpetual Nominees Ltd v Masri Apartments Pty Ltd [2004] NSWSC 551; (2004) 49 ACSR 719, that there was nothing there to show that the directors had acted other than reasonably in regards to the supervision of the collection of mail from the company's registered office (an observation that would not be necessary if the question of reasonableness did not arise). (I note that this was a case when s 459S leave was not necessary as the evidence established there was no ground that would have been relied on at the time, as the company's directors did not become aware of the existence of a validly-served statutory demand until after the expiration of the 21-day period but nevertheless it seems to me that some guidance can be taken from the fact that there the reasonableness of the conduct was a matter noted). (In this regard I refer also to Grant Thornton Services (NSW) Pty Ltd v St George Wholesale Distributors Pty Ltd [2008] FCA 1777; Willard King Organisation (1978) Pty Ltd v CT Franchises Pty Ltd [2009] NSWSC 97; (2009) 69 ACSR 612.) 44This suggests that where the reason for non-reliance on a ground available to be raised at the s 459G stage is some default on the part of the company (or, perhaps, its advisers) then leave may not be granted. A fortiori , where the reason for reliance on a particular ground to set aside the statutory demand without leading the necessary evidence to sustain that ground is what seems to have been a deliberate election by the debtor. In those circumstances, one might well take the view that the debtor should be left to the consequences of that election. 45NA Investment's position in this regard seems to be that it acted reasonably in relying on its solicitors' advice (though there is no evidence of that advice, merely the assertion that NA Investment proceeded on its "own construction" of the clause) and that, it having now been made clear by the Court of Appeal what is required, as an evidentiary matter, in order to invoke and sustain a claim for limitation of liability clause 11.18, it should be allowed to do so in order to resist the winding up application. 46The real issue (on this aspect) therefore seems to me to be whether NA Investment should be left to its election (apparently consciously made, if not before then certainly when presented with the opportunity by the Court of Appeal) not to seek to adduce the evidence necessary to establish the extent of the shortfall (i.e. to establish its ground based on clause 11.18). 47Perpetual submits that re-litigation of an issue such as this should be permitted only in exceptional circumstances (see paragraphs [21 - 25] of Mr Marshall's submissions), relying upon what was said by the High Court in University of Wollongong v Metwally (1985) 60 ALR 68: It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so. and referring to Dairy Farmers Co-op Ltd v Azar (1990) 170 CLR 293 at [305]; O'Brien v Komesaroff (1982) 150 CLR 310; Mason J at [318-319]; Bloemen v Commonwealth (1975) 49 ALJR 219, Gibbs J at [220]; and Suttor v Gundowda Pty Ltd (1950) 81 CLR 418, at [438]. 48Mr Marshall submits that this general law position should not be regarded as having been ameliorated, or varied, by s 459S(1)(a). Mr Sahade contends, on the other hand, that the application of such a principle would be to render s 459S(1)(a) in effect meaningless, since that provision contemplates the very situation that the debtor has relied upon the particular ground in question on an earlier occasion. 49The thrust of Part 5.4 of the Corporations Act is to make, as far as possible, the procedure of applying under s 459G the only avenue for a company's objections to a statutory demand. Thus, it is recognised that a company receiving a statutory demand that has a reason for objecting to the demand cannot procrastinate or defer its objections until the hearing of the winding up application ( Ford's Principles of Corporations Law at [27.062]). Mr Marshall submits that this purpose would not be realised by the courts allowing issues already litigated under s 459G to be re-litigated in the winding up application under s 459S. At [23], he refers to the basic principle of statutory construction that a statute should be interpreted consistently with the relevant general law doctrine unless the legislature has given a clear indication to the contrary (citing Potter v Minahan (1908) 7 CLR 277 per O'Connor J). 50Mr Marshall submits that it is inconceivable that a discretion that is meant to be used 'sparingly' should be exercised in favour of a litigant who wishes to raise issues of fact rather than construction, particularly when that litigant has previously made an election not to raise these issues. 51Mr Marshall also relies upon the general proposition in Metwally as being equally applicable where a dispute that has already been resolved by the courts and a party seeks to litigate a matter that is intimately connected to the resolution of that dispute, by reference to what was said by the High Court in Port of Melbourne Authority v Anshun (1981) 147 CLR 589: [T]here will be no estoppel unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiffs claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding . (my emphasis) 52The reasonableness of NA Investment's failure to adduce evidence of the shortfall between the value of the trust estate and the amount of the monies owing must, it is said, be viewed in light of the fact, first, that at the time of the hearing before Macready AsJ, NA Investment would have known that evidence could have been adduced which showed the existence of a shortfall and, secondly, that similar evidence should have been adduced in any case in support of NA Investment's own argument that a shortfall existed. 53Mr Sahade submits that s 459S must apply in this situation because if one were required to assume that matters had been dealt with perfectly the first time then s 459S (and there I understand him to be referring to s 459S(1)(a)) would have no operation at all. That subsection clearly contemplates the situation where a ground has been raised (and thus evidence adduced) at the s 459G stage and it is said that the subsection is inconsistent with the conclusion that, just because something was argued once, no leave should be granted. 54There is some tension between s 459S and any automatic preclusion of reliance on evidence that could have been tendered (or a ground raised) on an earlier occasion. Hence that some caution must be exercised in applying principles akin to those that would give rise to an Anshun estoppel in this context. The legislature itself contemplates that a ground already relied upon for a s 459G application may (albeit with leave) be raised again. 55However, it seems to me that what the Anshun principles do illustrate is the need (when considering the sufficiency of the reason not to adduce this evidence or raise this ground based on that evidence at an earlier occasion) for an assessment to be made of the reasonableness of the conduct of the debtor (here NA Investment) in not putting forward the relevant evidence when it had the opportunity to do so. This is similar to the recognition by Handley AJA in Champerslife Pty Ltd v Manojlovski & Anor [2010] NSWCA 33 at [108] that where the extended form of res judicata estoppel in Anshun is in issue "the enquiry is extended to include the reasonableness of the litigant's conduct in the earlier proceedings or the existence of an abuse of process in the later". 56Where, as here, there seems to have been a knowing election by the debtor to rest its case on its own view of the construction of the clause (and to persist in that construction even when faced with the course apparently suggested in the Court of Appeal that leave be sought at that point to deal with the issue on the basis of evidence as to the shortfall), I am of the view that the debtor's conduct fails to meet the test of reasonableness. It is not the fact that this ground was already run (and lost) at first instance; rather, it is that there seems to have been a conscious election made not to address the factual issue at all until after NA Investment had already chanced its arm at success in the appeal - thus inevitably raising the prospect (if it lost on the construction issue) of duplicated costs and wasted court time. 57On balance, I consider that a sufficient reason has not been shown for the failure to establish the "shortfall" at the stage of the earlier application and that the debtor should be left to its election; thus leave should not be granted. However, even if I had not been of that view, the present application would fail on the third issue. (iii) Is the ground sought to be relied upon material to proving that the company is solvent? 58The requirement imposed by s 459S(2) is that the proposed ground must be material to proving that the debtor is solvent. This requirement is mandatory. It has received considerable attention in the context of s 459S cases (see, among others, Topfelt Pty Ltd v State Bank of New South Wales Ltd (1993) 47 FCR 226; 12 ACSR 381; Texel Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 298; (1993) 11 ACSR 535; Master Paving Pty Ltd v Heading Contractors Pty Ltd (1997) 193 LSJS 1; 15 ACLC 1025). 59It is therefore necessary for NA Investment, in order to establish a basis for leave under s 459S, to demonstrate that the debt founding the demand is 'material to proving solvency'. 60There have been both 'narrow' and 'broad' approaches to the question of whether the ground sought to be relied upon is material to proving solvency. 61In Austin & Black's Annotations to the Corporations Act, the learned authors summarise the varied approach to the construction of this section at [5.459S]: In New South Wales, the court will not grant leave to dispute a particular debt if the company contends it is solvent irrespective of whether that debt is due, so the status of that debt is not determinative of the company's solvency: Switz Pty Ltd v Glowbind Pty Ltd , above . A similar approach was taken by the Federal Court in HVAC Construction (Qld) Pty Ltd v Energy Equipment Engineering Pty Ltd , above ; Web Wealth Pty Ltd v Helimount Pty Ltd [2006] FCA 1376; BC200608507 at [43]-[45] and Grant Thornton Services (NSW) Pty Ltd v St George Wholesale Distributors Pty Ltd [2008] FCA 1777; BC200810536 at [19]-[22]. The contrary view was expressed in Bayview Holdings Pty Ltd (in liq) v Zan Holdings Pty Ltd BC9805541 and the difference in the authorities was noted in HVAC Construction (Qld) Pty Ltd v Energy Equipment Engineering Pty Ltd , above at [53]. Another approach is that a particular debt need not be determinative of the company's solvency, and materiality would be established if the company was undoubtedly insolvent if the debt was owed, and may be solvent if the debt was not owed: Radiancy (Sales) Pty Ltd v Bimat Pty Ltd (2007) 25 ACLC 1216; [2007] NSWSC 962 at [64]. In Hanson Construction Materials Pty Ltd v FEC Civil Pty Ltd [2009] NSWSC 161 at [20], Barrett J noted, but did not need to resolve, the difference between these approaches. An application for leave under this section should ordinarily be determined before the hearing of the winding up application: Switz Pty Ltd v Glowbind Pty Ltd , above . 62In Chief Commissioner of Stamp Duties v Paliflex Pty Ltd (1999) 149 FLR 179, Austin J adopted the broad view to the construction of s 459S(2) and said that the materiality threshold should not be set too high. His Honour also noted that the court considers the issue of materiality before deciding whether to give leave to dispute the debt. At that point, the court has not come to a conclusion concerning the company's solvency and may not have heard all relevant evidence. Therefore, the court is not in a position to decide whether the relevant debt is the difference between solvency and insolvency. The question, according to Austin J (at [41]), is not whether there is a genuine dispute concerning the existence of the debt, but whether the dispute has any effect on the standing of the applicant as a creditor or whether the company is solvent. 63His Honour said (at [41]) that the matter must be addressed in three stages: first, whether leave should be granted to allow the company to dispute the debt; secondly, whether, if leave is granted, the applicant has standing as a creditor pursuant to s 459P and, thirdly, whether the company is solvent, taking into account the dispute about the debt. 64In Hanson Construction Materials Pty Ltd v FEC Civil Pty Ltd [2009] NSWSC 161, Barrett J considered the differing approaches to the question of materiality. Although his Honour did not need to resolve this issue, his Honour appeared to be in favour of a broader approach. At [26] - [28] his Honour stated: "The Court of Appeal noted that a decision whether a particular ground of defence is "material" to proving that the defendant company is solvent can only be made in the light of the contentions the company proposes to make in support of the proposition that it is solvent. The principal judgment (that of Spigelman CJ) continued (at [54]): If, as here, the company intends to prove that it is solvent whether or not a debt is payable, then with respect to a ground based on dispute about the debt, the test of materiality to it "proving" its solvency, cannot be satisfied. In Radiancy (Sales) Pty Ltd v Bimat Pty Ltd [2007] NSWSC 962 ; (2007) 25 ACLC 1216 at [64] White J referred to the significance of the words "material to proving": The question is not whether the debt demanded by Radiancy (Sales) is determinative of Bimat's solvency. The question is whether it is material to proving the company is solvent. If the debt is owed, the company is undoubtedly insolvent. If it is not owed, the company may be solvent if Mr Colosimo's evidence as to the payment of creditors is accepted. Accordingly, s 459S(2) is satisfied in relation to the grounds that Radiancy (Sales) is not a creditor, or that the alleged debt is genuinely disputed. The observation that "material to proving" is not the same as "determinative of" may not sit happily with approaches under which the relevant test has been taken to be whether the ground of defence "represents the difference between solvency and insolvency" ( HVAC Construction (Qld) Pty Ltd v Energy Equipment Engineering Pty Ltd [2002] FCA 1638 ; (2002) 44 ACSR 169 at [53] or "is pivotal to the question of solvency" ( Grant Thornton Services (NSW) Pty Ltd v St George Wholesale Distributors Pty Ltd [2008] FCA 1777 at [19]; Deputy Commissioner of Taxation v Neo Rock Pty Ltd [2009] FCA 129 at [9]). For reasons to be mentioned presently, I do not need to reach a conclusion on any difference of emphasis or approach that may emerge from the cases, although my inclination is to think that "material to proving" is not the same as "determinative of" and that a capacity to have some influence or effect is, in general, all that is necessary to make something "material to proving" . " (my emphasis) 65The weight of recent authority appears to be leaning towards the stricter (or narrower) construction to s 459S(2), on which approach, for a ground to be 'material'; it is must be 'pivotal', 'crucial' or determinative of solvency ( Grant Thornton Services; Switz v Glowbind; HVAC Construction; Web Wealth Pty Ltd v Helimount Pty Ltd [2006] FCA 1376 at [43] - [45]). 66In Switz v Glowbind, Spigelman CJ stated (at [53]) that: "The authorities show that "material" means that an applicant, under s 459S, must show that the debt in respect of which it is seeking leave is pivotal to the question of solvency. That is, the defendant must demonstrate that if the debt exists then the company will be insolvent and if the debt does not exist then the company will be solvent." 67In Zan Holdings Pty Ltd v Bay View Holdings Pty Ltd (1997) 15 ACLC 1238, Master Sanderson stated that: "In effect by ignoring the debt upon which the statutory demand is based, the company might be found to be solvent, then, and only then, the existence of a bona fide dispute would be a relevant consideration ... In circumstances where existence of the debt on which the statutory demand is based is pivotal to a decision on solvency, then the existence of the debt is a relevant consideration." (While this reasoning was disapproved in obiter comments on appeal, see Bayview Holdings Pty Ltd (in liq) v Zan Holdings Pty Ltd (unreported, Supreme Court of WA, Ipp, Wallwork and Steytler JJ, 19 October 1998) at [5], where it was considered enough if "the ground....might...be determinative of the...company's solvency", those comments were, in turn, disapproved by the New South Wales Court of Appeal in Switz v Glowbind at [36]). 68In HVAC Construction, French J (as his Honour then was) followed the narrow approach as outlined by Spigelman CJ in Switz v Glowbind . At [53] his Honour stated that: "Leave is not to be granted under s 459S(1) unless the ground which the company seeks to advance is material to prove that the company is solvent. This requirement has been interpreted variously. It has been interpreted as requiring that the debt upon which the statutory demand is based represents the difference between solvency and insolvency: Zan Holdings Pty Ltd v BayView Holdings Pty Ltd (1997) 15 ACLC 1238, a decision of Master Sanderson not approved (albeit obiter) by the Full Court of the Supreme Court of Western Australia in BayView Holdings Pty Ltd (in liq) v Zan Holdings Pty Ltd (unreported, SC(WA), Full Court, No FUL 127 of 1997, 19 October 1998, BC9805541). The observations of the Full Court were not followed by the New South Wales Court of Appeal in Switz Pty Ltd v Glowbind Pty Ltd (2000) 48 NSWLR 661 ; 33 ACSR 723 ; 19 ACLC 532 at 539-60. It is not necessary for present purposes, which are concerned with the grant of a stay, to address those differences of view. I do, however, accept the force of the observations by Spigelman CJ in Switz where his Honour (with whom Handley and Giles JJA agreed), referring to the balance of interests in the process adopted for resolution of disputed debts under Pt 5.4 said (at NSWLR 674; ACSR 734; ACLC 541-2): The legislature has adopted a particular scheme which causes the balance to be drawn in a specific way. The circumstance that commercial injustices may, on some occasions, be caused to the debtor company by the operation of that scheme, may be offset by the commercial injustices that the continued operation of an insolvent company may cause to existing and, if permitted, increased or future creditors of such a company. The chief justice characterised the 1992 reforms as intended to minimise the opportunity for delay by ensuring that disputes as to debts were determined at an early stage and would not delay or prolong the hearing of the issue of solvency. Section 459S(2) should be given a strict construction in order that the purpose of the legislative scheme could best be served. "(my emphasis) 69The meaning of s 459S(2) needs to be considered in the context of Part 5.4 of the Act and its relevant purpose. As Spigelman CJ stated in Switz v Glowbind at [42]: "The purpose of the longstanding statutory demand procedure is to minimise the transaction costs which the law imposes on creditors seeking to enforce debts. The threat of winding up is often effective to ensure that a recalcitrant debtor does not seek to exploit the delays and costs that legal disputation may impose on commercial transactions. That threat is rendered ineffective to the degree to which such delays and costs are permitted to intrude into the statutory procedure itself. The 1992 reforms which introduced the new Pt5.4 were designed to minimise the delay and attendant legal costs which were a common feature of the battle of tactics in insolvency practice under the pre-existing scheme. Furthermore, the Corporate Law Reform Act of 1992 (Cth) which inserted the new Pt5.4 into the Corporations Law, also inserted the new Pt5.7B which, inter alia, reformed the law with respect to insolvent trading. The new Part made new, and in many respects more stringent, provision for civil and criminal liability in the case of directors who permit a company to incur a further debt while insolvent. It also imposed liability on a holding company which fails to prevent insolvent trading by subsidiaries. A new system was established for voidable transactions. The legislative purpose to prevent, as soon as possible, an insolvent company incurring debts, is clear." 70On the strict approach to the question of 'materiality', as was applied by Spigelman CJ in Switz v Glowbind at [674] and [56], a challenge to the debt will be material to proving that the company is solvent if the company is able to demonstrate that, if the debt does not exist, then the company will be solvent. (See also the view expressed by Perram J in Grant Thornton Services (NSW) Pty Ltd v St George Wholesale Distributors Pty Ltd [2008] FCA 1777 at [19 - 22]). 71The broad approach to the question, in contrast, looks to the overall financial position of the company. In Deputy Commissioner of Taxation v Neo Rock Pty Ltd [2009] FCA 129, Logan J held at [10] that: "The evidence led on behalf of Neo Rock on the application is noteworthy for its absence of reference to the overall financial position of that company. There is no evidence which touches upon the assets and liabilities of the company generally, its profit and loss, its balance sheet, or its solvency, either having regard to the debt as it presently stands (which has its origins in that which supported the statutory demand) or otherwise howsoever." 72Mr Marshall relies on the broad approach to the issue and submits (at [27]) that the ground upon NA Investment's view seeks to rely (i.e. the alternative construction of clause 11.18) does not go to the broader financial circumstances of NA Investments. 73In that regard, it is worth setting out in some detail what was said in Switz v Glowbind Pty by Spigelman CJ in this regard (from [43]): The words are not "material to solvency" or "material to finding solvency" but "material to proving " solvency. The use of the word "proving", a present participle in the active voice, indicates that the test is to be applied to a process then under way, or in contemplation, before the Court. Subs459S(1) makes it clear that that process of "proving" is being conducted by the company. ... The 1992 reforms were intended to minimise the opportunity for delay by ensuring that disputes as to debts are determined at an early stage and do not delay or prolong the hearing of the issue of solvency. The strict requirements of s459G are subject only to s459S, which Hayne J has called the "only safety net". (Texel Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 298 at 300-301). However, the scheme did not confer on the Court a general discretion. A mandatory precondition was introduced in s459S(2). The purpose of the legislative scheme is best served by giving that subsection a strict construction. The Court should be slow to adopt a construction that permits the kind of spectacle to which the Court has been subjected on this occasion, in which each party seeks to rely, for tactical advantage, on the expert evidence adduced by the other party, being evidence which each intends to vigorously contest in the principal proceedings and which, in the case of the Plaintiff with respect to the report of the Defendant's expert, was only admitted into evidence over the Plaintiff's objection. By the time an application under s459S is made, the company will be presumed to be insolvent and will have the burden of proving that it is not. In my opinion s459S(2) directs attention, in part, to what it is that the company intends to prove and how it intends to prove it. If the company is not prepared to contemplate the possibility that its assertion of solvency is subject to qualification, then the Court cannot be "satisfied" of the mandatory precondition in s459S(2). An objective element is introduced by the word "material" but that can only be determined after identifying the company's contentions ." (my emphasis) 74It seems to me that the narrow approach is the one that accords with the weight of recent authority but in any event, even on the broader approach the difficulty for NA Investment is that it has made no effort to establish its overall financial position beyond the making of assertions by Mr Magar or to establish the materiality of this evidence to proving solvency. 75On the narrow approach, when reference is made to Switz v Glowbind, the evidence does not permit a conclusion to be made as to whether the ability to rely on the limitation of liability claim is material or crucial to the company establishing solvency. (See also HVAC Construction (Qld) Pty Ltd v Energy Equipment Engineering Pty Ltd (2002) 44 ACSR 169 and Sindea Trading Co Pty Ltd v Asia Pacific Glass Pty Ltd [2003] QSC 460). 76In its terms, clause 11.18 limits recourse against the Trustee (NA Investment) to FFA Trust Property. What seems to have been contemplated is that assets of NA Investment, other than those to which it, as trustee of the NA Investment Trust, could have recourse (the FFA Trust Property) should not be available to meet its liability as guarantor under the Restated Facility Agreement. It does not, as the Court of Appeal made clear, preclude recovery of the debt to the extent to which recourse may be made to the FFA Trust Property. The relevance of the extent of any shortfall is that it may then operate in general terms to reduce the amount of the debt which can be claimed against NA Investment. 77Mr Sahade submits that in circumstances where the claim is limited to FFA Trust Property and the two FFA Group companies (referred to above) are now in liquidation, then the claim against NA Investment is limited to what it may recover on the shares held by it (which cannot be determined until the outcome of the liquidation is known) (that may depend, in turn, on the outcome of the DJM dispute and/or on whether NA Investment as trustee can have recourse to those assets in any event). Mr Sahade submits that the statutory demand fails because the indebtedness is limited only to the FFA Trust Property. However, nothing in clause 11.18 precludes a claim against NA Investment for the payment (out of such assets held by it as FFA Trust Property or realisable by it out of that Trust property) of the amount to which the clause itself says recourse may be had. 78There is no dispute that NA Investment holds assets comprising FFA Trust Property (including the shares in at least two FFA companies now in liquidation for whatever they are worth) but there is a paucity of evidence as to what other FFA Trust Property is available to meet the debt (other than an assertion by Mr Magar that there is none). The definition of FFA Trust Property itself extends beyond the shares in the two FFA companies that are now in liquidation. 79If it is suggested that because winding up proceedings cannot be brought for the amount of any shortfall, this means that no winding up proceedings can be brought once a shortfall is established (which seemed to be how the issue was initially put by Mr Sahade), then that would seem to take clause 11.18 beyond its terms, since the prohibition on winding up proceedings surely only (consistent with the construction placed on the clause in the Court of Appeal) extends to proceedings relating to that part of the debt which represents the shortfall in the FFA Trust Property. The relevance of the shortfall is as to the amount of the debt that can be recovered not the mode by which it is to be recovered (and, on a liquidation, Perpetual would still only be able to have recourse to the FFA Trust Property for the amount owing to it). 80Simply putting on evidence of a valuation of some of the FFA Trust Property (the refinery) at an earlier time does not necessarily mean there is a reasonable basis for assessing what the amount of any shortfall there may ultimately be, taking into account all of the Trust Property. Mr Sahade places weight on the evidence that FFA Properties and FFA Equipment are now in liquidation. However, there is no attempt to quantify what might be the residual value of the FFA companies' shares, on whatever assumptions could reasonably be made as to the outcome of the winding up. Further, there is no evidence as to the value of FFA Oils or of the authorisation plant or equipment also falling within the definition of FFA Trust Property. 81As adverted to earlier, the fundamental difficulty I have with the present application is that there was no attempt to show the solvency of NA Investment apart from the debt it sought to dispute; there is simply an assertion as to solvency in Mr Magar's affidavit. Mr Sahade points to there being no creditors' claims against the company but of itself that would not prove solvency. At present, there is therefore a statutory presumption of insolvency and no evidence to support the solvency of NA Investment other than the assertion by Mr Magar. 82I do not consider that NA Investment has satisfied the mandatory requirement under s 459S(2) and thus it has not established a basis for the grant of leave under s 459S. The application for leave will accordingly be dismissed.

Winding up application 83In Paliflex it was said that ordinarily the application for leave under s 459S should be determined before the winding up application. In the present case, Mr Sahade conceded that if leave under s 459S were not granted then there would be nothing further to put in relation to Perpetual's winding up application. 84Even if leave had been granted under s 459S, this would not have operated to set aside the presumption of insolvency and the burden would still have been on NA Investment to satisfy the Court that it was solvent - Paliflex at 481, Braams Group Pty Ltd v Miric (2002) 44 ACSR 124. While s 459S provides a "safety net", in relation to grounds of opposition which are material to the solvency or otherwise of the company ( Texel at [1061]), on a winding up application based on the presumption of insolvency it remains for the company to prove that it is solvent. 85On what is required to prove solvency, the propositions stated by Weinberg J in Ace Contractors & Staff Pty Ltd v Westgarth Development Pty Ltd [1999] FCA 728, endorsed in Expile Pty Ltd v Jabb's Excavations Pty Ltd [2003] NSWCA 163; (2003) 45 ACSR 711; 21 ACLC 1354 at [16] are applicable (see also Sindea Trading Co Pty Ltd v Asia Pacific Glass ; Lechmere Financial Corp v Aspermont Ltd [2003] FCA 1138; Crema (Vic) Pty Ltd v Land Mark Property Developments (Vic) Pty Ltd [2006] VSC 338; (2006) 58 AC S R631; 24 ACLC 889.) 86The question is whether the company is able to pay its debts as and when they fall due and payable. This is a question of fact to be determined in all the circumstances, including the nature of the company's assets and business. It is not necessary to establish that the company's liabilities exceed its assets. ( Austin & Black's Annotations to the Corporations Act at [1.95A]). Nevertheless, the Court should ordinarily be presented with the "fullest and best" evidence of the financial position of the company. Unaudited accounts and unverified claims of ownership or valuation are not ordinarily probative of solvency. Nor are bald assertions of solvency arising from a general review of the accounts, even if made by qualified accountants who have detailed knowledge of how those accounts were prepared ( Ford's Principles of Corporations Law at [27.050]) (and a fortiori where they are made by those with a direct interest in establishing solvency). Although in Switz v Glowbind , Spigelman CJ observed that knowledge as to solvency is peculiarly within the knowledge of the company's directors, his Honour did not (as I read the judgment) suggest that a mere assertion to that effect was sufficient. 87On the evidence put before me, NA Investment has not displaced the statutory presumption of insolvency. 88I therefore dismiss the application for leave under s 459S and order that the company be wound up in insolvency. I appoint Ginette Dawn Muller and John Gervase Shanahan (whose consents to act have been duly served) as joint liquidators of NA Investment. I order that the plaintiff's costs be paid out of the winding up.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 April 2011