In the matter of XSRE Pty Ltd - XSRE Pty Ltd v Lightning Electrical Group Pty Ltd

Judgment 1HER HONOUR : This is an application brought by XSRE Pty Ltd, the lessee of retail premises in Double Bay, under ss 459G and 459H(1)(b) of the Corporations Act 2001 (Cth) for an order setting aside a statutory demand dated 13 July 2011 by Lightning Electrical Group Pty Ltd. The statutory demand was served under cover of a letter dated 21 July 2011 from Lightning Electrical's solicitors, JT Law. The debt claimed in the demand is a judgment debt in the sum of $59,590.96 arising on registration in the Local Court on 17 May 2011 of an Adjudication Certificate obtained under s 24 of the Building and Construction Industry Security of Payment Act 1999 (NSW) as amended. The debt in question relates to electrical works carried out at the Double Bay shop premises. 2The application to set aside the statutory demand is brought solely on the basis that there is an offsetting claim for the purposes of s 459H(1)(b) of the Act and which it is said exceeds the amount of the judgment debt. In support of the application to set aside the statutory demand (and served within the requisite 21-day period) is an affidavit sworn 10 August 2011 by Ms Monika Jankowska, the director of XSRE. Also read on the application was a later affidavit sworn 9 September 2011 by Mr Sanjeev Mitroo, the manager of the Double Bay shop, who deposes that he was responsible for the fit-out of the shop. 3The offsetting claim identified in Ms Jankowska's affidavit is a claim based on an alleged agreement that "the job agreed to be undertaken" by Lightning Electrical would be completed within 4-6 weeks at a price of $30,000. Ms Jankowska deposes (on information and belief from an unidentified source) as to the agreement and that the work was substantially delayed due to the default of Lightning Electrical for 5 months "thereby holding up other traders in performance of their building works". Ms Jankowska deposes that XSRE subsequently received a bill for $59,000 "without any agreement for the extra amount". She further deposes that the company has suffered loss of trading "amounting to approximately $144,000 for 6 months and paid rent for 6 months at $66,000 when it could not trade". 4It is not suggested that the affidavit sworn by Ms Jankowska fails to meet the Graywinter ( (1996) 70 FCR 452) requirements, although objection was made to the reliance on this affidavit as going to proof of the assertions contained therein (and it was noted that no misleading and deceptive conduct claim was identified in that affidavit). 5Mr Mitroo's affidavit provides more detail as to the alleged offsetting claim. In particular, Mr Mitroo says that he met with Mr Sean O'Dowd, the proprietor of Lightning Electrical, and Mr Chris Novak, the project manager for the fit out of the shop, in early July 2010 - at which meeting he says that they had the plans and specifications and Mr O'Dowd told him that he was able to complete all the electrical work within six weeks. Mr Mitroo says (and Mr O'Dowd denies) that he told Mr O'Dowd that this was essential as XSRE had an obligation under its sublease to start trading then. (In paragraph [2] of his affidavit, Mr Mitroo says that under his lease there was an obligation that the fit-out be completed within 28 days of the Commencement Date, i.e. within 28 days of 28 July 2010. Therefore, even on this time frame it would seem likely that there would have been a breach of the lease.) Mr Mitroo says that Mr O'Dowd gave him an oral estimate of $30,000 at that meeting and that Mr Mitroo engaged him as the electrical subcontractor. (This is inconsistent with the evidence of both Mr O'Dowd and Mr Novak as to the circumstances in which Mr O'Dowd's company was engaged to carry out the electrical works.) 6Mr Mitroo deposes that the delay in completion of some of the electrical work until late September 2010 delayed other work on the fit-out and that the work was not completed until December 2011. Mr Mitroo further says that the first opportunity to open the shop for business was early January 2011 "because of the unfinished electrical work and the 'knock on' effect that had on the trades that had to follow on". Mr Mitroo asserts that had the electrical work been completed from mid July 2010, XSRE could have opened in early September 2010 and that, as a result of the failure of Lightning Electrical to complete the work within the time frame that it had represented, XSRE lost the opportunity to trade for about four months. (As will later be seen, the suggestion that a mid-July commencement date was possible flies in the face of the contemporaneous documents.) 7Mr Mitroo deposes that he has commercial experience of managing many similar shops (and currently manages similar outlets in two other shopping centres). His affidavit annexes a schedule (which I admitted into evidence over objection and subject to weight) he had prepared "projecting the net income that would be expected to be received up to the point when the shop reaches its sustainable turnover level", showing a "projected loss" from September 2011 through to August 2012 (which would seem to have been intended to be from 2010, when it is said the shop could first have opened). The projected loss figures vary on a monthly basis from around $15,050 to $18,050 (apart from the first three months where the projected loss was estimated at $5,950, $4,050 and $7,050 respectively). (Counsel for Lightning Electrical, Mr Johnson, apart from pointing out that the basis on which these figures were prepared and the expertise of the witness to give this opinion evidence were not established, noted that n o actual trading figures had been provided for the months in which the company had been trading, namely since early January 2011, and submits that a Jones v Dunkel ((1959) 101 CLR 298) inference can be drawn that those figures would not have assisted the plaintiff in its case.) 8Counsel for XSRE, Mr Evans, confirmed that the alleged offsetting claim arises out of the warranty alleged to have been given by Lightning Electrical that the electrical work it contracted to perform for XSRE, as part of the fit-out for its shop in Double Bay, would be completed in six weeks. XSRE's claim is said to be for damages for breach of contract and misleading or deceptive conduct. (As noted earlier, no allegation of misleading or deceptive conduct was identified in Ms Jankowska's affidavit, although she does refer to an agreement that the work would be completed within 4-6 weeks.) 9Mr Evans submitted that the measure of damages should be assessed as the loss of opportunity to trade for a period of four months at some time during the whole term of the tenancy, being for five years commencing on 1 July 2010, and hence that the loss is some $60,000 (thus exceeding the debt the subject of the statutory demand) if monthly losses of $15,000 are sustained. It is submitted that as XSRE's business was an entirely new venture, the loss should not be calculated until a sustainable net return is reached, that being said to be from December 2011 to March 2012, as set out in the schedule annexed to Mr Mitroo's affidavit, to which I have referred above. 10Mr Evans submitted that the offsetting claim is on causes of action advanced in good faith, for an amount claimed in good faith, and that XSRE has adduced some evidence to show the basis upon which the loss is said to arise and how that loss is calculated so as to satisfy the test set out in Macleay Nominees Pty Ltd v Belle Property East Pty Ltd [2001] NSWSC 743 per Palmer J and Elm Financial Services Pty Ltd v MacDougal [2004] NSWSC 560 at [19] per Barrett J. He noted, as I accept is the case, that the threshold on an application such as this is a low one. 11Lightning Electrical relied upon two affidavits, each served only shortly before the hearing, those being affidavits sworn on 19 September 2011 by Sean O'Dowd and Chris Novak. Objection was raised to the lateness of service of those affidavits but in circumstances where the matter had been only recently fixed for hearing and no orders as to the service of affidavits by the defendant had been made (and where I was prepared to give the plaintiff time to consider and respond to those affidavits) I read the affidavits. Mr Evans then tendered a draft affidavit of Mr Allister Sarris (the architect engaged in the fit-out works) responding to an issue arising from the defendant's affidavits. 12Relevantly, the evidence of Mr Novak (who provided project management services for the Double Bay shop fit-out) was that Sarris Design finalised the tender drawings on 23 August 2010 and copies of those drawings were annexed to his affidavit (whereas Mr Sarris' draft affidavit states that plans were forwarded by email on 21 July 2010). Mr Sarris' draft affidavit also asserts (in a paragraph to which objection was raised by Mr Johnson) that the plans were sufficient to enable the contractors to commence work at that time. 13It is clear on the affidavits that there is a dispute between the parties as to the date on which Lightning Electrical (or Mr O'Dowd) was engaged to perform the works and as to the date on which the plans for those works were provided to Lightning Electrical. Mr Novak's affidavit, to which Mr Evans refers as supporting the position of XSRE in this regard, deposes to a conversation in late May with Mr Mitroo in relation to the taking of possession of the tenancy and comments that "at that stage the attempt was to complete the fit-out in 4 weeks" which he considered achievable as the design concept was initially of "minimal complexity" and provided that all consultants were engaged promptly. Mr Evans suggested that Mr O'Dowd's evidence to the effect that he received a call from Mr Novak in August in relation to the works was disingenuous (it is, however, supported by Mr Novak's evidence). 14There is also a dispute as to the extent and/or cause of any delays in relation to the works. Mr Novak's opinion as project manager was that one of the main reasons for the delay was the "continuous altering of the design, including material specifications and the lack of payment to the contractors". 15Significantly, however, what the documentary evidence relied upon by Lightning Electrical makes clear (including a bundle of email communications to and from Mr Sarris from 4 August 2010 onwards) is that any plans forwarded on 21 July 2010 were not the final plans. By email on 4 August 2010, Mr Sarris, the architect, advised Mr Mitroo and Mr Novak that "the new and amended plans will be ready for submission to our recommended building surveyor by the end of this week" and that "[o]nce received you will be able to commence the tender process and preliminary works on site". Whatever else may have been the intentions of XSRE in relation to the fit-out works, this makes it very clear that preliminary works at that stage had not commenced (and there does not seem to be any suggestion that any works could by then have been commenced). 16On 6 August, Mr Sarris forwarded plans that he stressed were preliminary and required checking and approval "before they are submitted for approval to the relevant authorities and before they can be released for tender to the trades and suppliers". Mr Sarris was chasing Mr Mitroo for a response on 9 August and on 10 August there is an email from the lessor's management referring to a meeting proposed for 12 August "to run through and approve the plans" and noting that Mr Novak would advise during that meeting when works would commence. Mr Sarris sent amended updated plans on 13 August (presumably after the site meeting the previous day) and those were apparently still in the course of amendment as at 18 August 2010. The process for submission of the application for a complying development certificate had only commenced on 19 August 2010. 17All of the contemporaneous documentary material put before the Court is consistent with work not having commenced by Lightning Electrical until late August (and that being the earliest time at which it was able to be commenced). Mr O'Dowd's diary records a meeting with Mr Novak on 25 August 2010 at which it appears he sought information as to the works (having received the full tender drawings by email the day before). Steps were taken on 30/31 August for a "meter mark" from Energy Australia in relation to the shop. The first quotation submitted by Lightning Electrical was dated 31 August 2010. A revised tender was provided on 2 September 2010. Both tenders were for a total of $43,010.96 inclusive of GST. Mr O'Dowd says that the September tender was approved by Mr Novak (in any event, its submission - in the absence of objection from XSRE - is inconsistent with there being already an agreement for the works to be completed for $30,000). (A further revised tender was issued on 29 December 2010, according to Mr O'Dowd, as a result of variations and changes that Mr Mitroo had asked for during the fit-out of the shop.) 18At the close of the submissions, I adjourned the hearing with leave for XSRE to forward any further evidence in relation to the issue raised by Mr Sarris' draft affidavit as to the submission of the relevant drawings for the works. Forwarded to my chambers (with the consent of Mr Johnson) later that day was a copy of plans bearing an issue date of 21 July 2010 ("For Approval") which would be consistent with Mr Sarris' statement that he emailed plans on that date (although no covering email was produced). However, that does not change the fact that the plans were not finalised until 23 August and that there were ongoing amendments to the plans through until at least December (having regard to the varied tender submissions). 19The emails in Exhibit 1 support Lightning Electrical's position that work could not have been commenced in mid-July (as the plans were at that stage still not finalised and were still to be approved by the lessor and had not been the subject of builder certification) and thus even if a 4-6 week warranty as to time of completion had been given (and I am not in a position to make any factual determination on that issue at this stage), a completion date by the end of August (to permit opening in early September), on which Mr Mitroo bases XSRE's claim, is wholly implausible. 20Mr Evans submitted that the fact that the plans may have changed (from the 21 July version said to have been sent to Mr Novak/Mr O'Dowd, although I note that what I have been provided with is simply a copy of the 21 July drawings, not the email with which they were forwarded to anyone so that I cannot determine who might have been in possession of the plans at that date) is not material (on the basis that the plans might not have changed had the work been carried out and completed when it was represented that it would be) and that there was no need for approval or certification before the works were commenced. However, the 21 July drawings clearly state that they are issued "For Approval" and the terms of Mr Sarris' August email communications (to which I have referred above) are inconsistent with any suggestion that any works were to be commenced prior to approval and issue of the final drawings at least. 21While it may well be that subsequent variations (of the kind to which Mr Novak and Mr O'Dowd depose) would not have affected the date at which earlier works could have been completed in order to allow other tradesmen to progress other building works for the purposes of completion of the fit-out, there is no evidence that would enable me to reach the conclusion that there is a genuine complaint as to this - Mr Mitroo's evidence is based on assertion that the works should have commenced in mid July and have been completed within six weeks. What the evidence makes clear is that there were no final plans for commencement of the electrical works until at least late August. The suggestion that the works should have been commenced in mid July and completed to enable an opening in early September 2010 is fanciful. 22(For completeness, I note that an issue taken by Mr Johnson as to non-compliance with the provisions of rule 2.4 or 2.4A of the Supreme Court (Corporations) Rules 1999 (NSW) was addressed when a copy of a company search obtained the day before the hearing was tendered.) 23There is no dispute as to the amount claimed in the Creditors Statutory Demand for Payment, it being founded upon a judgment. The only issue for determination is therefore whether I am satisfied that XSRE has a genuine offsetting claim within the terms of s 459H(1)(b) of the Corporations Act . 24Mr Johnson submitted that there can be no genuine basis upon which the asserted offsetting claim can be propounded, on the basis that the evidence establishes that any delay was occasioned either by other tradesmen or by changes in instructions by XSRE (to which Mr Novak and Mr O'Dowd have both deposed). Further, Mr Johnson submitted that even if XSRE were able to satisfy the Court that it has a genuine offsetting claim, as alleged, it has not provided any evidence (other than mere assertion) as to the quantum of that claim such that the Court is unable to calculate the offsetting total as required by s 459H(2) of the Corporations Act (referring in that regard to Jesseron Holdings Pty Ltd v Middle East Trading Consultants Pty Ltd (1994) 13 ACSR 455). In Jesseron , Young J, as his Honour then was, accepting that the company in that case had an offsetting claim for damages in trespass arising from the invalid appointment of the receiver, noted that: ...Under s 459H(2) the court must calculate the substantiated amount of the demand in accordance with the formula. A formula then appears in the section which is in deceptively simple language because it is really unclear what the legislature meant. The job of the court, which the court must do, is to find the substantiated amount of the demand. One would have thought that that meant that there had to be something established to the court's satisfaction because the word "substantiated" has that semantic significance. The literal reading of the formula is that one merely takes the admitted amount of the debt and then offsets the amount of any genuine claim, that is, the court does not valued the offsetting claim or assess its chances of success, it merely says "The company has a valid claim, the company claims that that claim is worth $x, therefore I deduct $x from the amount of the creditor's claim." 25Mr Evans emphasised (and I accept) that on an application such as this the Court does not determine the merits of any dispute or offsetting claim that may be found to exist, but simply whether there is such a dispute or offsetting claim. The threshold for that is not high. In Edge Technology Pty Ltd v Lite-on Technology Corporation [2000] NSWSC 471; (2000) 34 ACSR 301, Barrett J said (at [45]): The threshold presented by the test to set aside a statutory demand does not however require of the plaintiff a rigorous and in-depth examination of the evidence relating to the plaintiff's claim, dispute or offsetting claim. That is why cross-examination in contested statutory demand proceedings is limited: Hayne J in Mibor Investments Pty Ltd v Commonwealth Bank of Australia [1994] 2 VR 290. 26Nevertheless some assessment must be made of the evidentiary material before the Court in order to determine whether there is sufficient evidence to meet that low threshold. 27Further, in the case of an application to set aside based on an offsetting claim which is unliquidated (as is the case here), in Broke Hills Estate Pty Ltd v Oakvale Wines Pty Ltd [2005] NSWSC 638; (2005) 23 ACLR 1266 , Gzell J held that an affidavit in support is insufficient if it does not contain material from which a court can make an estimate of the amount of an offsetting claim. There must be sufficient material indicating the nature of the offsetting claim and the way in which it is calculated in order to enable the statutory exercise under s 459H(2) of the Corporations Act to be carried out by the Court. 28The meaning of a genuine dispute in the context of a challenge to a statutory demand was considered by McLelland CJ in Eq in Eyota Pty Ltd v Hanave Pty Ltd (1994) 12 ACSR 785; 12 ACLC 669 and by Barrett J in Panel Tech Industries (Australia) Pty Ltd v Australian Skyreach Equipment Pty Ltd (No 2) [2003] NSWSC 896, in passages that have been oft-quoted . In Eyota , McLelland CJ in Eq said: It is, however, necessary to consider the meaning of the expression "genuine dispute" where it occurs ... in my opinion that expression connotes a plausible contention requiring investigation, and raises much of the same sort of considerations as the "serious question to be tried" criterion which arises on an application for an introductory injunction or for the extension or removal of a caveat. This does not mean that the court must accept uncritically as giving rise to genuine dispute, every statement in an affidavit "however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by the same deponent, or inherently improbable in itself, it may be not having "sufficient prima facie plausibility to merit further investigation as to its [truth]" (cf Eng Me Yong v Letchumanan [1980] AC 331 at 341), or "a patently feeble legal argument or an assertion of fact unsupported by evidence": cf South Australia v Wall (1980) 24 SASR 189 at 194. (my emphasis) But it does mean that, except in such an extreme case [i.e. where evidence is so lacking in plausibility], a court required to determine whether there is a genuine dispute should not embark upon an enquiry as to the credit of a witness or a deponent whose evidence is relied on as giving rise to the dispute. There is a clear difference between, on the one hand, determining whether there is a genuine dispute and, on the other hand, determining the merits of, or resolving, such a dispute .... In Re Morris Catering Australia it was said the essential task is relatively simple - to identify the genuine level of a claim ... 29In Panel Tech , Barrett J similarly noted that the task faced by a company challenging a statutory demand on genuine dispute grounds is by no means a difficult or demanding one. His Honour observed that a company will fail in its task only if the contentions upon which seeks to rely in mounting the challenge are so devoid of substance that no further investigation is warranted. The Court does not engage in any form of balancing exercise between the strengths of competing contention. If there is any factor that on reasonable grounds indicates an arguable case it must find a genuine dispute exists even where the case available to be argued against the company seems stronger. 30In Edge Technology, Barrett J was considering whether a breach of warranty in supply of goods gave rise to a genuine dispute or offsetting claim and the question of quantification of the offsetting claim. Again, it was said that the Court's task was not to resolve competing claims but to determine whether there was a genuine dispute concerning the debt or a genuine offsetting claim against the party serving the statutory demand and if so in what amount. It was not necessary, nor was it appropriate, for the Court to consider the merits of the dispute or offsetting claim (citing Goldspar Australia Pty Ltd v KWA Design Group Pty Ltd (1999) 17 ACLC 456; Re Morris Catering (Aust) Pty Ltd (1993) 11 ACSR 601; Chadwick Industries (South Coast) Pty Ltd v Condensing Vaporisers Pty Ltd (1994) 13 ACSR 37). 31In Jesseron Holdings Pty Ltd v Middle East Trading Consultants Pty Ltd (No 2) (1994) 122 ALR 717; 13 ACSR 787 Young J, as his Honour then was, said (at [57]): It is well known that many claims are ambit claims, and not even the person making them has any real hope of recovering the maximum amount claimed. Often it is appropriate to work out what is the maximum likely amount to be recovered. However, it does not seem to me, although I have tried hard to fit this meaning into the subsection, that one can get this result. The amount of the claim is an expression which has a more or less defined meaning ... [it] means the amount claimed in good faith, so long as that claim is not fictitious or merely tolerable. (my emphasis) 32As to the existence of a genuine offsetting claim, in Macleay Nominees , Palmer J said (at [17]); In my view, a claim for the purposes of CA s 459H(1) and s 459H(2) means not just a cause of action, so that once a genuine cause of action for unliquidated damages is shown by a plaintiff, the court is compelled to accept at face value the damages claimed by the plaintiff as the amount of the offsetting claim for the purposes of the calculation required by s 459H(2). .... In my opinion, a genuine offsetting claim ... means a claim on a cause of action advanced in good faith, for an amount claimed in good faith. "Good faith" means arguable on the basis of facts asserted with sufficient particularity to enable a court to determine that the claim is not fanciful. In a claim for unliquidated damages for economic loss, the court will not be able to determine whether the amount claimed is claimed in good faith unless the plaintiff adduces some evidence to show the basis upon which the loss is said to arise and how that losses calculated. If such evidence is entirely lacking, the court cannot find that there is a genuine offsetting claim ... . 33His Honour had earlier in that case said (at [16]); the real difficulty in this case is the amount of the plaintiff's alleged offsetting claim. Where the case involves a claim for a liquidated sum the application of the section is relatively easy, the court simply determines whether the cause of action is a genuine one and if that proves to be the case, the amount of the offsetting claim is the amount of liquidated sum, the subject of that claim. The position is by no means as easy where claim is a claim is for unliquidated damages and the damages are said to be economic loss suffered by the plaintiff. 34Mr Johnson acknowledged that there is a low threshold to be applied when considering whether there is a genuine offsetting claim but noted that in a not dissimilar context (on an application by a creditor for substitution on a winding up application) in Earthwave Corporation Pty Ltd v Starcom Group Pty Ltd [2011] NSWSC 694, White J noted that where the onus was to show clear and persuasive, or substantial, grounds for the dispute, that was not satisfied by the mere production of a statement of claim (referring to Bhagat v Global Custodians Ltd [2002] FCA 223 at [53] where it was accepted that a statement of claim pleading facts that, if proved, would support a claim was insufficient as it was not evidence of anything) even if that pleading be verified by an affidavit (referring to ICM Agriculture Pty Ltd v Young [2009] FCA 109 at [76]). Here, it is submitted that the evidence of XSRE rises no higher than mere assertions. I consider there to be force in that submission. 35I am not satisfied that XSRE has established that there is a genuine offsetting claim in the present case. Ms Jankowska makes various assertions on information and belief from an unnamed source. Her evidence goes no higher than a belief as to the existence of an offsetting claim. Mr Mitroo's evidence as to the time at which the works should (on his account of the representation or warranty by Mr O'Dowd on behalf of Lightning Electrical) have commenced and been completed is contradicted by the contemporaneous documents adduced by Lightning Electrical. His evidence as to the expected quantum of damage goes no further than an assertion (based on his stated experience but without reference to any actual trading figures from that or the other businesses that he manages) as to the expected revenues. Coincidentally or otherwise, the claimed losses only exceed the undisputed debt (even on the untested figures put forward by Mr Mitroo) if the works should have been completed by the end of August 2010 (which on no view of the contemporaneous documentary evidence could have been the case). 36If the six week completion warranty was given (and I make no finding on that), the subsequent email communication and documents indicating changes to the specifications strongly suggests that the inability to meet that timeframe was not due to the fault of XSRE and there is no evidence (other than assertion) from XSRE that suggests that there is a genuine dispute as to the fact that there were ongoing changed specifications. In that regard, the assertions of Mr Mitroo, having regard to the documentary evidence do not have sufficient prima facie plausibility to meet the test outlined in the authorities referred to above. 37The earliest point from which any claim for damages would run would could logically only be from around November 2010 (assuming completion by mid October and a 2 week period for completion of other works to enable a shop opening in November). On the estimate put forward by Mr Mitroo (which is no more than assertion, albeit one with the benefit of his asserted commercial experience in managing retail boutiques of this kind - relied upon by Mr Evans as specialist expertise in this area - though not by reference to any actual trading figures), at its highest there would be a damages claim of around $30,000 but even that is dependent on various factors as to which there was little or no evidence to support XSRE's claim, such as the effect of delay on the work of other tradesmen or any contributing delay on the part of those tradesmen - both matters put into issue by Mr Novak's evidence. 38The assertion of a breach of warranty claim, on the evidence as it is before me, goes no higher than assertion. The contemporaneous documents make the assertion of a mid July commencement date (and hence any early September opening) untenable. The amendments to specifications during the period up to December 2010 is inconsistent with an imperative that the works be finished within 6 weeks of commencement and with any reliance being placed on whatever warranty might have been given in relation to the likely completion date for the works before the amendment of the specifications. There is evidence (such as the commissioning of joinery works at a late stage in November 2010) that the late opening of the shop may in any event have been due to other causes. Further, I am not satisfied that there is sufficient evidence as to the quantum of any offsetting claim (as opposed to mere assertion) to enable the exercise required in s 459H(2) to be carried out (and, had I been satisfied that there had been an offsetting claim, it would have been necessary for me largely to speculate as to the quantum, which is inconsistent with the task the Court is required to do - as noted in Jesseron ). 39Notwithstanding the low threshold on matters of this kind, having regard to the inconsistent documentary evidence and the basis on which XSRE puts its claim based on assertion contradicted at least in part by that evidence, I am not satisfied that the test outlined by Palmer J in Macleay Nominees , and applied by Barrett J in Elm Financial Services Pty Ltd v MacDougal at [13], as referred to above, has been met on the present application. 40I therefore dismiss the application to set aside the statutory demand, with costs.