Plaintiff v Defendant

For Kornucopia Pty Ltd, Avant-Garde Ventures Pty Ltd and Efektiv Pty Ltd

1 There are three applications before the Court to wind up each of Kornucopia Pty Ltd (Kornucopia), Efektiv Pty Ltd (Efektiv) and Avant-Garde Ventures Pty Ltd (AGV). (Collectively, the Companies).

2 Each application is made by originating process under s 459P of the Corporations Act 2001 (Cth) (the Act). The sole ground relied on is presumed insolvency by virtue of the relevant company's failure to comply with a statutory demand.

3 In Kornucopia, the statutory demand was made by a landlord, Jeffrey Chen (Chen), of a property Kornucopia is a tenant of, for $12,281.66 for arrears of rental sworn to be due and payable. No application was made to set aside the statutory demand within the relevant 21 day period, and relying on presumed insolvency, Chen commenced the winding up application.

4 In Efektiv, the statutory demand was made by Madgwicks, a firm of solicitors, for $69,731.57 for professional services rendered and sworn to be due and payable. No application was made to set aside the statutory demand within the relevant 21 day period, and relying on presumed insolvency, Madgwicks commenced the winding up application.

5 In AGV, the statutory demand was also made by Madgwicks, for $203,104.88 for professional services rendered and sworn to be due and payable. No application was made to set aside the statutory demand within the relevant 21 day period, and relying on presumed insolvency, Madgwicks commenced the winding up application.

6 The Companies (and other related parties) are engaged in substantial litigation in multiple jurisdictions within Victoria.[1] The Companies are, it appears, engaged in the business of leasing apartments from landlords, like Jeffrey Chen, and then subletting or licensing those apartments to others. Like Jeffrey Chen, many landlords have not been paid and have commenced proceedings in VCAT. In evidence, officers of the Companies estimated that the Companies were engaged in approximately fifty different matters in VCAT (which have led to various judicial review applications and appeals in this Court) in which rental arrears and/or possession orders are sought.[2]

7 Putting to one side the various technical matters raised by the Companies, in these applications, matters largely associated with the statutory demand procedure, the main complaint of Kornucopia (in the case of Chen and others) is that they were denied the right of a tenant to quiet enjoyment, which, it was submitted has given rise to a potential offsetting claim. It is not suggested that Chen (or other landlords) denied them such a right, but rather that the relevant Owners Corporation had. The basis of that claim is racist abuse (or similar conduct) by some of the Owners Corporation, which has been the springboard for other litigation.[3] It is not apparent and has not been explained what this has to do with Chen, and indeed what the loss is, especially if Kornucopia's subtenants have continued paying rental to the company. This potential offsetting claim was not made within the 21 day period within which Kornucopia could have applied to set aside the statutory demand. Whether it can now be made is an issue to be determined after a number of technical and preliminary matters are first dealt with.

8 The main complaint of Efektiv and AGV is that Madgwicks should be precluded from using the winding up regime to collect their fees. First, because Madgwicks did not provide adequate costs disclosure to the Companies prior to their entry into a retainer agreement. Secondly, because there is currently a proceeding in the Costs Court in which the Companies seek a taxation of their bill of costs (commenced after Madgwicks' winding up applications), which ought to result in a stay for abuse of process of this proceeding. There is also an allegation that Efektiv and AGV are not debtors to Madgwicks; there was only one agreement and that was between Kornucopia and Madgwicks. Like the offsetting claim referred to above, this was not raised in an application to set aside the statutory demands. These issues will be dealt with at a later stage.

9 The first issue to be dealt with is service of the statutory demands. It arises in all three cases. If there is no valid service of the demands, that may well be the end of each matter.[4]

10 If the statutory demands were validly served then, subject to a further technical issue arising only in relation to Kornucopia, the next stage is to hear the winding up applications. This would include the Companies' application under s 459S of the Act to rely upon grounds (including the claims referred to above) that the Companies could have relied on to set aside the statutory demands but did not. A key aspect of this application is whether such grounds are relevant to the solvency of the companies, and to this extent it is desirable to deal with these issues, and other related issues, as part of the trial on the winding up applications. The other issues all relate to grounds that could have been raised, whether in relation to offsetting claims, the existence of the debt, and the usual discretionary matters that arise in applications to wind up companies. The issues are numerous and some are complex. For this reason it was in my view desirable to deal first with the issue of service of the statutory demands and the technical issue in Kornucopia identified at the beginning of this paragraph and referred to next.

11 The second issue for determination relates to the originating process filed by Chen in the Kornucopia proceeding. Kornucopia contends that the originating process originally filed is and was at all times invalid, because the statutory demand was not attached to it as required by s 459Q of the Act. An amended originating process (subsequently filed pursuant to leave to amend granted by the Order of Judicial Registrar Hetyey) purporting to cure the defect is said not to have such effect, given the initial invalidity and notwithstanding the granting of such leave to amend. It is also contended that in any event a further supporting affidavit (also required by s 459Q) was not sworn within 7 days prior to the amended originating process, leading to a further fatal defect.

12 There is much to be done in these proceedings. Notwithstanding the required and necessary caution that must be exercised when dealing with cases in stages,[5] it is desirable in these proceedings to deal with the two issues identified as they are serious, technical and potentially dispositive issues. They are clearly in the nature of preliminary issues. Further, at the hearing of 12 November 2019, I permitted very limited cross-examination of various officers of the Companies. The evidence was narrow and restricted and directed to the specific issues referred to, namely delivery and receipt of the statutory demands, which has little or no bearing on the later issues which may need to be determined.

13 On 11 September 2018, Chen as landlord entered into a residential tenancy agreement (Lease Agreement) with Kornucopia as tenant for an apartment located at 1204N/889 Collins Street, Docklands, VIC 3008. The monthly rental pursuant to the Lease Agreement is $2,086.00.

14 Kornucopia did not pay rental for the period of 11 November 2018 to 7 May 2019, arrears for which were in the sum of $12,281.66 (Rental Arrears). In fact, Kornucopia has not made any rental payments and as at 11 September 2019 the arrears of rental is in the sum of $20,860.

15 On 15 May 2019, a creditor's statutory demand was signed Vaughan William Hager, a consulting principal of Keypoint Law, Chen's solicitors (Kornucopia Demand). The Kornucopia Demand relies upon the Rental Arrears, which are said to be due and payable. A supporting affidavit was also affirmed by Chen on 15 May 2019.

16 On the same date, the Kornucopia Demand was sent by prepaid ordinary post to Kornucopia's registered office of Unit 1, 95 Coventry Street, Southbank, VIC 3006 (U1/95 Coventry Street). Nikhil Sood, a solicitor employed by Keypoint Law, affirms that he posted the statutory demand and supporting affidavit to U1/95 Coventry Street by placing the documents in the letter box near the corner of William Street and Bourke Street, Melbourne, at approximately 1:12pm.

17 Upon receiving a statutory demand, the debtor must, within 21 days of receiving the demand, either pay the creditor the amount stated or secure or compound for that amount, as per s 459E(2)(c) of the Act. If the debtor disputes the statutory demand, it must apply to the Court to have the statutory demand set aside under s 459G of the Act. Kornucopia did not file an application to set aside the statutory demand. Kornucopia was therefore presumed insolvent pursuant to s 459C of the Act and Chen was entitled to bring a winding up application under s 459P of the Act, relying on such presumed insolvency.

18 On 21 June 2019, Chen applied to the Court pursuant to s 459P of the Act for an order winding up Kornucopia on the grounds of presumed insolvency by virtue of the unsatisfied statutory demand. Kornucopia accepts that the originating process was delivered by post and that it had received it.

19 On 24 July 2019, Naveen Raghavan (Raghavan), the solicitor for the Companies, deposed to Kornucopia not having received the Kornucopia Demand, and only having become aware of it after being served by the originating process in that proceeding. Lulu Xu (Xu), director of Kornucopia, also deposed to the company not having been served or made aware of the Kornucopia Demand prior to the commencement of the winding up proceeding.

20 At some time around March 2018, Shivesh Kuksal (Kuksal), a director of Efektiv Group Pty Ltd (but not of its wholly-owned subsidiaries, AGV or Efektiv) engaged Madgwicks to act on behalf of AGV. In or around October 2018, Kuksal engaged Madgwicks to act on behalf of Efektiv.[6]

21 The Companies were dissatisfied with Madgwicks' provision of legal services, and refused to pay the outstanding accounts. On 9 April 2019, Madgwicks ceased acting for AGV and Efektiv.

22 Madgwicks issued numerous invoices with respect to legal costs which remain unpaid. As at 6 June 2019, the debts said to be due and payable were as follows:

(a) Efektiv - the amount of $69,731.57; and

(b) AGV - the amount of $203,104.88.

23 On 6 June 2019, two creditor's statutory demands (one in respect of each company) were signed by Peter Robert Kennedy (Kennedy), the managing partner of Madgwicks. Supporting affidavits were also sworn by Kennedy on 6 June 2019 (the AGV Demand and/or Efektiv Demand), (with the Kornucopia Demand, collectively referred to as the Demands).

24 On the same date, the AGV and Efektiv Demands were sent by prepaid priority post to the Companies' registered office of U1/95 Coventry Street. Jack Keenan, a clerk employed by Madgwicks, swears that he posted the statutory demands and supporting affidavits of Kennedy to U1/95 Coventry Street by placing the documents in the letter box near the corner of William Street and Bourke Street, Melbourne, at approximately 5:05pm.

25 Madgwicks had also made and posted a further statutory demand to Kornucopia. Kornucopia denies that it was received or delivered. This statutory demand is not relied upon to bring a winding up application with respect to that company as Madgwicks was pre-empted to do so by Chen's winding up application. It is, however, relevant to the factual background pertaining to service, as discussed below. It is referred to where relevant.

26 On 18 June 2019, the AGV Demand (but not the Efektiv Demand) was returned by Australia Post to Madgwicks. The envelope which contained the AGV Demand is marked with a handwritten notation which states 'rts'. Kennedy sent an email to Maria Di Gregorio (Di Gregorio) and Lulu Xu (Xu), the directors of AGV, and copied to Kuksal, in which he said:

I attach documents that were served on the registered office of Avant-Garde Ventures Pty Ltd at Unit 1, 95 Coventry Street, Southbank, VIC 3006 which have been returned to us. I expect that we will also receive the documents that were served on the other two companies [being, Efektiv and Kornucopia]. ... I strongly recommend that you read the correspondence and attached documents.

27 Attached to Kennedy's email was a copy of the AGV and Efektiv Demands, as well as the statutory demand issued by Madgwicks against Kornucopia, his affidavits sworn 6 June 2019 supporting each demand, and a copy of an ASIC search with respect to each of the Companies.

28 Di Gregorio deposed to having 'perused' the email on 18 June 2019. She later said she only properly reviewed the email, and its attachments on 20 June 2019.[7] Xu deposed to not having received Kennedy's email of 18 June 2019 until around 11 September 2019, where it was found in her 'clutter' folder.[8]

29 On 29 June 2019, Di Gregorio sent an email to Kennedy rejecting that any documents (with respect to either AGV or Efektiv) had been received at the registered office of the companies, at U1/95 Coventry Street, such that service had not been effective.

30 On 2 July 2019, Kennedy sent an email to Di Gregorio, Xu and Kuksal maintaining that the documents had been sent by post on 6 June 2019 (but not necessarily that service had been effected on that date). Kennedy further confirmed that the 'envelope addressed to Avant-Garde with enclosed documents [the AGV Demand, presumably] was returned to our office which you may inspect by prior appointment'. The email, enclosing the demand, was said to have been sent as a 'courtesy'. This email exchange is referred to in more detail below.

31 On 10 July 2019, Madgwicks applied to the Court pursuant to s 459P of the Act for an order winding up AGV and Efektiv on the grounds of presumed insolvency by virtue of the unsatisfied statutory demands.

32 On 2 July 2019, Kennedy sent an email to Gregorio, Kuksal and Xu, quoting a report from a process server (which has not been sworn as an affidavit in this proceeding):

On Monday, 24 June 2019 at 4:04pm at the address of Unit 1, 95 Coventry Street, Southbank and being a commercial property consisting of 4 levels, including ground floor. A Ground Floor director board lists Efektiv Group being on Level 1. Up on Level 1, I found the door to be closed and locked. On the door itself, there is signage for Efektiv Group. I could see office furniture inside, however, the lights were off and there was (sic) no persons there. I noted that there were several addressed mail items pushed under the door for Efektiv Group, including an Australia Post delivery card. The closest neighbouring business on Level 1, was Exponential Interactive P/L and I spoke with Tyler there. He advised that Efektiv moved in about 3-4 months ago, and there is rarely anyone seen there in Efektiv, and maybe once a fortnight, or even less Tyler was unable to help any further.

33 The veracity of that report is disputed by the Companies.[9] For completeness, Xu responded to that email in an affidavit filed 25 September 2019:

[8] Mr Peter Kennedy, managing partner of Madgwicks made some outlandish claims in an email sent on 2nd July 2019. Among these, were claims that a process server he had engaged could not find anyone at the Registered Office Address on a certain date whilst mail accumulated near the main door and that the process server spoke to a gentleman named Tyler, an employee of Exponential Interactive P/L who made hearsay allegations to the effect that AGV rarely operated from the Registered Office Address.

[9] Besides the preposterousness of the notion of considering such scandalous and unverifiable hearsay claims consideration worthy, the Defendant has never had any association with Exponential Australia P/L or any of its staff.

[10] Having made some enquiries at our office, I can confirm that none of the staff or agents of AGV have ever spoken to or know of any employees of Exponential Australia P/L.

[11] It is fanciful, therefore, that Tyler might have any knowledge of the operations or working hours of the Defendant's staff.

[12] Further, the assertions are especially shocking given the layout of AGV's rather large office premises, which is secured through an electronic lock and the internal space is not visible through the transparent entrance door.

34 Xu and David Youl (Youl), an employee of Efektiv Group deposed to the following arrangements which are in place for mail that is delivered to U1/95 Coventry Street:

(a) Ordinary prepaid post is delivered by physically entering the building, going up the lift to the first floor and sliding letters under the door.

(b) Registered post is delivered by physically entering the building, going up the lift to the first floor, knocking on the door and getting a staff member to sign for it.

(c) The same registered postal delivery procedures apply to each of the other eight offices situated in the building.

(d) There is generally always a staff member present at the premises who is accountable for the receipt of post, whether that is ordinary or registered.

(e) Youl was solely responsible for administering the collection and organisation of mail for the Companies, for the period of 15 April 2019 to 15 August 2019.[10] He deposed to the following:

[5] I did not take any leave from work between 15 April and 15 August.

[6] My operational instructions necessitated that upon the receipt of legal, financial or compliance-related documents I promptly brought the documents to the attention of a director of the relevant entity, as well as Mr Shivesh Kuksal, the director of Efektiv Group.

[7] Furthermore, when receiving any documents with deadlines I was required to immediately notify a director of the relevant entity and Mr Shivesh Kuksal by creating an electronic entry in their calendars, as well as notifying them in person.

...

[10] I can unequivocally state that [the Demands and supporting affidavit were] not served at the Registered Office Address, in the original or as a copy, at any point between 15th April 2019 and the commencement of the Proceeding[s].

[11] I have recently also extensively inspected my notes, contemporaneous electronic records and calendar entries created by me during the relevant period but have been unable to find any information that contradicts my assertions above.

35 Youl gave further evidence in cross-examination that the Companies did not keep incoming or outgoing mail ledgers recording every letter received or sent, but he would 'scan any relevant documents and distribute them to the relevant persons.' He would 'also photocopy documents for directors of the different entities' and 'create electronic entries regarding those documents' which, in his discretion, were financially or legally significant.[11]

36 Xu, Di Gregorio and Kuksal gave the following evidence in cross examination:

(a) There is a gap under the front door to the registered office, which is big enough to put mail under 'if it's not too bulky.'[12]

(b) Whether or not someone is at the office, mail could be placed under the door.[13]

(c) Documents, such as letters from 'electricity companies', addressed to the Companies have been received that way.[14]

(d) Ordinarily, if mail is sent by ordinary post, it will be left under the door. If it is registered post, and no one is there to sign for it, then it would most likely be returned to sender.[15]

37 Against this background, the following issues arise:

(a) Were the Kornucopia, AGV and/or Efektiv Demands served on each respective Company on a date not less than 21 days before the commencement of the winding-up application (being, 21 June 2019 in the case of Kornucopia, or 10 July 2019 in the case of AGV and Efektiv)?

(b) If service by post was ineffective, does Kennedy's email of 18 June 2019 to the Di Gregorio, Xu or Kuksal constitute as effective informal service of either the AGV and/or Efektiv Demands?

38 In short, the answer to the first question is 'Yes' and if I am wrong, the answer to the second question is also 'Yes'.

39 In each case service of the statutory demands is disputed. The Companies contend that the plaintiffs have failed to establish service. It is contended, by reference to authority,[16] that they have failed to establish the various evidential matters that proof of service requires, relating essentially to the addressed envelope and posting. The various matters are referred to in detail below. They contend further that on the evidence they have in any event successfully rebutted any presumption of service. In this regard they contend, by reference to authority,[17] that given the 'strict mail handling systems in place at the registered office', the non-receipt of the statutory demands by all relevant parties amounts to a failure to deliver. This contention is referred to in detail below.

40 The plaintiffs disagree and contend that they are entitled to rely on the presumptions set out below, and in respect of which the evidence is not sufficient to establish any rebuttal. They contend further that they have done everything necessary to bring the Demands to the attention of the Companies and in the case of Efektiv and AGV, there has been informal service of the Demands.[18] As noted, service is a critical threshold matter and is dealt with first.

41 The principles to be applied where service is sought to be proven by postage of a statutory demand to the registered office of a company are generally not in dispute and are set out below.[19]

42 The statutory framework creates two presumptions which affect service: one relating to delivery of a statutory demand and therefore, the occurrence of service, and one concerning the time of service.[20]

(a) Section 29(1) of the Acts Interpretation Act 1901 (Cth) (AIA Act), in conjunction with s 109X(1)(a) of the Act provides that service of a document to the registered office of a company is presumed to be effected if the letter is properly addressed, prepaid and posted, and unless the contrary is proved, to have been delivered at the time in which the letter would be delivered by the ordinary course of post.

(b) Section 160 of the Evidence Act 2008 (Vic) (Evidence Act) presumes (unless evidence sufficient to raise doubt about the presumption is adduced) that a document sent by prepaid post to the company's registered office is received at that address on the fourth working day after having been posted.

43 The serving party must establish the following facts, by either direct evidence, or inference from the evidence, in order to raise the presumption under s 29(1). This requires:[21]

• Proof that the envelope bore the correct name and address;

• Proof that the envelope contained the relevant document to be served;

• Proof that the envelope bore the correct cost of postage; and

• Proof that the envelope was placed in the post.

44 The Company bears the onus of establishing 'proof to the contrary' pursuant to s 29(1) of the AIA Act.[22] It does so by proving non-delivery of the statutory demand to the premises of the company's registered office, or delivery to some address other than the registered office. If the company successfully proves alternative delivery or non-delivery, the presumption does not apply, and proof of non-delivery is effective as proof of non-service.[23] However, 'if there is no evidence of actual delivery or non-delivery, then the presumption will apply and the item will be deemed to be delivered in the ordinary course of post.'[24]

45 In a case recently before me where a demand had been sent to a registered office by post, In the Matter of AXF Group Pty Ltd (AXF Group), the only piece of evidence tending to suggest whether or where a statutory demand had been delivered was the absence of a notice from Australia Post indicating that the statutory demand had been returned to the plaintiff marked 'undelivered', 'returned to sender', or 'not at this address'. I referred to A/S Cathrineholm v Norequipment Trading Ltd,[25] and Fancourt v Mercantile Credits Limited,[26] where the postal articles had similarly not been returned to the serving party,[27] which could be distinguished from CGU Workers' Compensation (Victoria) Ltd v Carousel Bar Pty Ltd,[28] and Commonwealth Broadcasting Corporation Pty Ltd v Pacific Mobile Phones Pty Ltd,[29] where the statutory demands had been returned by Australia Post to the serving party marked 'return to sender' or 'left address'.[30] As I observed in AXF Group, 'the absence of a notice from Australia Post marking the Demands as undeliverable is a significant indication as to whether or not delivery had occurred.'[31] To this, I would add the observation of Colvin J in Deputy Commissioner of Taxation v Melking Holdings Pty Ltd (Melking Holdings):[32]

...it is a question of fact in each case whether the circumstances indicate that there has been non-delivery at the relevant place (as distinct from an unwillingness to receive the documents at the place where they were delivered or a failure for the documents to be brought to the attention of a particular person despite being delivered to that place).

46 Furthermore, as Colvin J also said in Melking Holdings, '[t]he registered office of a company must be a location that accommodates the possibility of service by post'.[33] In Partners of Piper Alderman v Sharjade Pty Ltd, Barrett J said there is, implicit in the statutory regime 'an expectation that there will be in place at the registered office a system for the safe and secure reception of documents delivered by post.'[34] In that case, the defendant company's mailbox was located outside the confines of the registered office itself and of the relevant building, such that it were accessible by anyone passing by and that 'anything might happen to documents put into a letter box situated on the public walkway'.[35] Non-receipt of the statutory demands would not, therefore, have been a solid foundation upon which an inference of non-delivery could have been drawn. The demand might not have been delivered, or it might have been and then removed from the letter box by any person passing by. There were there, as I said in relation to the scenario in AXF Group, 'an infinite number of possibilities' and each of which was 'equally likely'.[36] Where there are numerous such possibilities, but no evidence tending to suggest which is most likely, the Court may inevitably hold that service (that is, delivery) has been effective, for that is the default position by virtue of the presumption, and no evidence has been adduced to suggest that it has not occurred.

47 I reiterate that it is incumbent on the company to adduce proof of non-delivery. If there is only proof that the statutory demands have not been received by the Company, the presumption is not displaced and service has been effective according to s 29(1).[37] While proof of non-receipt does not prove non-delivery,[38] proof of non-receipt at a place by its occupant, as distinct from non-receipt by a person who is not an occupant, may prove non-delivery at that place for the purpose of s 29(1) of the AIA Act.[39] That is, however, subject to what was said by McKerracher J said in Deputy Commissioner of Taxation v Josway Hospitality Pty Ltd (Josway):[40]

while mere denial of non-receipt by the addressee would scarcely, if ever, suffice to prove 'non-delivery', evidence of non-receipt at a place by an appropriate occupant, depending on the cogency of the evidence, may be sufficient to create a doubt for the purposes of s 160 of the Evidence Act. While such evidence needs to be sufficient to create a 'doubt' it does not need to be proof to the civil standard of fact finding at trial as to actual non-delivery. A 'doubt' ought not to be assimilated with proof or demonstration.[41]

48 Following from that, it should be observed, that while the burden imposed by s 160 of the Evidence Act is evidence that is 'sufficient to raise doubt of about the presumption', the burden of s 29(1) of the AIA Act is arguably higher, insofar as it requires that the 'contrary is proved'. This is how McKerracher J's reference to mere denial of non-receipt being 'scarcely, if ever, suffic[ient] to prove "non-delivery"' ought to be understood. A mere denial by a person of having received a document may raise a doubt for the purpose of s 160 of the Evidence Act; but it may not establish proof to the contrary of delivery having occurred for the purpose of s 29(1) of the AIA Act.

49 In Panimo Nominees Pty Ltd v Vasiliki Lobsters Melbourne Pty Ltd (Vasiliki Lobsters), Gardiner AsJ said, that while the company disputing service 'bears the onus of proving non-delivery, the defendant is not required to prove a negative.'[42] In cases of this kind, there will usually be no direct evidence which can positively prove that delivery has or has not occurred. The company must usually, and necessarily, bring an inferential case, based upon circumstantial evidence, and the permissible, probable inferences which may be drawn from such evidence.[43] The company does not need to adduce evidence that would exclude an inference of delivery, but must upon the evidence, establish that delivery is the most improbable inference to be drawn or conversely, that non-delivery is the most probable.[44] In other words, the operative question may be phrased as follows: Has the company established actual non-delivery to the registered office address, actual delivery to some alternative address, or any other competing possibility which is more probable than the demand having been delivered to the registered office?[4]

50 Section 109X of the Act, however, is not an exhaustive code of the ways in which a corporate entity may be served. The 'effective informal service rule' has been applied many times in relation service of statutory demands and other documents on a corporate entity in ways that are not provided for by s 109X.[45] There are two distinct lines of authority on what precisely is necessary for the serving party to establish when it comes to service by email.[46] In Woodgate v Garard Pty Ltd (Woodgate), Palmer J set out a number of principles. Of these, I repeat the following which are relevant to the present case:[47]

(iv) the prescribed modes of service are not exclusive: If some other mode of service is employed, whether it is good service depends upon whether the serving party can prove to the court's satisfaction that the document actually came to the attention of an officer of the company who was either expressly or implicitly authorised by the company to deal directly and responsively with the document, or documents of that nature (the responsible officer);

(v) there is no special exception to the "effective informal service rule" in the case of service by email or facsimile - the question remains whether that mode of service actually brought the document to the attention of a responsible officer;

(vi) where a document, not served in a prescribed mode, comes to the actual attention of the sole director of a company it will be presumed, unless a strong case to the contrary is shown, that director is the responsible officer and that service is good;

(vii) a party invoking the effective and formal service rule bears the onus of proving the time at which the document came to the actual attention of a responsible officer of the company and, in the view of the serious consequences which may attend, the Court will not lightly draw inferences or make assumptions as to the time of service.' (citations omitted)

51 In Newsnet Pty Ltd v Patching, White J considered that service would be effective when the email is received, but not necessarily 'when the document is brought to the attention of a responsible officer.'[48] Recently, in SGR Pastoral Pty Ltd v GJ, LE & JN Christensen (SGR Pastoral),[49] Bowskill J reviewed the varying lines of authority, and preferred the view of White J. Her Honour concluded:[50]

In the case of service by email, in my view, what must be shown is that the electronic copy of the application and supporting affidavit was received, in a complete and legible form, at the address for service, within the prescribed time. That is, that the email was sent to an email address that bellows to the nominated agent for service....that the email attaching the documents to be served actually arrived at the email address; and that the email and attached documents were capable of being opened and read (even if they were not opened and read until later). (emphasis added).

52 Sood gave uncontradicted evidence on behalf of Chen, that the Kornucopia demand was sent by prepaid ordinary post at approximately 1:12pm on 15 May 2019, to Kornucopia's registered office, at U1/95 Coventry Street. As noted, a statutory demand can be served in this manner, and I am satisfied that the Kornucopia Demand was properly addressed and contained within the envelope, prepaid and properly posted to the registered office of the Company.[51]

53 The presumption pursuant to s 29(1) of the AIA Act has been raised. No evidence was adduced as to displace delivery in accordance with the 'ordinary course of post', and therefore, service is presumed to be effective on the fourth working day after the Kornucopia Demand was posted on 15 May 2019. Service is presumed to have taken place on Tuesday, 21 May 2019.

54 The evidence with respect to delivery or non-delivery is in short compass. The Companies have adduced some evidence of procedures that mail would usually go through upon its receipt, in order to bring it to the attention of an officer of the relevant Company. From those arrangements, the evidence of Youl is of the most importance. He deposes that he was the member of staff present at the premises and accountable for the receipt of post for the period of 15 April 2019 to 15 August 2019. He was, accordingly, present over the period the Kornucopia Demand (and AGV and Efektiv Demands) would have been received. He stated unequivocally that the Demands were not received. Had one been received by him, he would have scanned it into the Companies' computer system and emailed it to the relevant officer. Youl gave evidence that if mail was delivered at a time when he was absent, it would be placed on his desk for him to deal with when he returned. The other officers of the Companies deposed that over this time, they did not collect the mail, and that if they had received any of the Demands (which they deny), it would have been provided to them by Youl. However, the evidence of the officers (other than Youl) that they had not received the Demands is not particularly probative of the question of whether the Demands were delivered.[52]

55 From the mail procedures described above, the Companies sought to establish that it was more probable than not that the Demands had not been delivered. Had they been delivered they would have been received and actioned by Youl. But as the evidence exposed, that system was not infallible.[53]

56 The Companies sought to rely upon the decision of Gardiner AsJ in Vasiliki Lobsters.[54] In that case, evidence was led from the company's accountant, whose office was the registered office for the company, that the statutory demand was not received. His Honour accepted that it was legitimate to draw an inference of non-delivery to that address, from evidence that the statutory demand had not been received by the accountants. His Honour said:[55]

Mr Trebish deposes that mail from a solicitor would invariably be shown to the partner responsible because of its potentially litigious nature. Mr Trebish deposes that he is aware of the seriousness of receiving a creditor's statutory demand and would have immediately contacted the client and emphasised its urgency.

...

The second affidavit is that of Cheryl Davis. Ms Davis is a senior accountant at Guests. She is the staff member responsible for the defendant's affairs, and is presumably answerable to Mr Trebish. She deposes that she did not receive any mail from the plaintiff's solicitor addressed to the defendant on or about the date of the alleged service of documents, namely 9 December 2010 and 27 January 2011 or at any other time. She deposes that she was not on leave on those dates. She says that she is aware of the significance of the receipt of documents from a solicitor and would have certainly remembered receiving any such document, which would immediately been on-forwarded to the defendant.

...

The issue I have to consider is whether there is evidence of non-delivery as distinct from evidence of non-receipt. Mr Kohn contends that the evidence adduced by the defendant goes to establishing non-receipt as distinct from non-delivery.

Both deponents swear that neither the statutory demand nor the originating process were received by them. Both deponents are accountants and they are aware of the significance of documents from solicitors. Ms Davis said she certainly would have remembered receiving any such documents, which would have been immediately on-forwarded to the defendant.

Moreover and significantly, Mr Trebish deposes in some detail to the mail system in operation at Guests. He states that the mail which is delivered to Guests from a solicitor would invariably be shown to the partner responsible due to its potentially litigious nature. In particular he states that he is aware of the seriousness of receiving a creditor's statutory demand and would have immediately contacted the client and emphasised its urgency.

57 His Honour then concluded as follows:[56]

The defendant's evidence was not the subject of cross-examination and is inherently plausible. To my mind, the quality of the defendant's evidence is such to establish non delivery to Guests, not just non receipt. There is credible uncontradicted evidence from the senior person responsible and from the particular accountant having responsibility for the defendant's affairs at Guests that establishes on the balance of probabilities that the documents were not delivered to that address. It is remarkable that neither the statutory demand or the originating process are said to have been delivered to Guests. I consider that the defendant has established on the balance of probabilities that the contrary has been proved within the meaning of that expression where it appears in s 29 of the Acts Interpretation Act.

58 This case does indeed bear some superficial similarities to Vasiliki Lobsters,[57] insofar as the occupants of the registered office of the Companies deny receiving the Demands, and depose to the mail arrangements in place at that address which it is said would have been efficacious in raising any statutory demands to the officer of the relevant company. However, the Companies overemphasise the effect of this decision, insofar as it tends to submit that it may be used to support the proposition that evidence of non-receipt at a particular address will usually or always be probative of the issue (and legitimate drawing of an inference) of non-delivery to that address. Obviously, whether that inference will be drawn is a question which will always and must necessarily be dependent on the facts in question.

59 In Vasiliki Lobsters, there were a number of additional features (which are not present here) which Gardiner AsJ took into account in concluding that an inference of non-delivery was the most probable inference to be drawn in the circumstances:

(a) First, it was significant that the evidence of non-receipt was given by the practising accountants which were engaged by the defendant company. As professionals, they owed various duties at law to ensure that the statutory demands, of immense legal significance, were brought to the notice of their corporate clients. There was absolutely no basis to doubt the veracity of their evidence that they did not receive the statutory demands, and as such it was inherently improbable to suggest anything other than the fact that the statutory demands were not at the post office when Guests' office staff went to collect the mail.[58]

(b) Secondly, the originating process for the winding up application also had not been received by the accountants. Gardiner AsJ described this as 'remarkable'.[59] Here, various other documents relevant to these proceedings have been successfully delivered to Kornucopia's registered office. The originating processes and affidavits in support were served on the company by post to its registered address. Those documents were received.[60] The fact that other pieces of mail have been successfully delivered tends to detract from the plausibility of drawing an inference that the Demands were not delivered.

(c) Thirdly, Gardiner AsJ took particular significance of the following:[61]

[Mr Trebish] concludes by saying that Guests has been at 234 Balaclava Rd, Caulfield North for nearly 20 years. To the best of his knowledge there has never been a situation where court documents have "failed to be served" on Guests as the registered office of its corporate clients. I understand this to mean that over that period of time, there has never been a controversy in respect of service on any of its corporate clients for whom it serves as the registered office.

This is vastly different to the present state of affairs. Indeed, as the evidence has exposed, there are various documents which are said not to have been delivered or alternatively, which must have fallen through the cracks of the Companies' mail arrangements. First, there are the three Demands with which I am concerned. There is then, the further statutory demand issued and posted by Madgwicks, which it had attempted serve upon Kornucopia. Xu could not recall having received that statutory demand.[62] Youl conclusively denied ever seeing or having received that statutory demand.[63] The volume of lost items of mail tends to discredit the efficacy and the reliability of the mail arrangements that the Companies had in place to ensure that documents are dealt with appropriately.

(d) Finally, mail addressed to Guests would be redirected to the post office, and conversely, no mail was received the street address. The probability of mail following the mail process would therefore, be much higher, as this would lessen the risk of mail being picked up by someone other than the staff member with the responsibility for sorting mail. This was a possibility that Youl, as described below, could not describe as inherently unlikely.

60 In short, there were features which justified a conclusion in Vasiliki Lobsters, that the probable inference to be drawn from evidence of non-receipt was that there had been no delivery. That is not the case here. Not only is Vasiliki Lobsters distinguishable, but the evidence points to the contrary conclusion, namely that non-delivery is an improbable inferential conclusion to be arrived at.

61 It is elementary law, that in civil proceedings, an inference can be drawn from circumstantial evidence if it is the more probable inference to be drawn as against some other competing inference which is less probable.[64] It need not be the only available inference from the evidence. In Bradshaw v McEwans, the High Court (Dixon, Williams, Webb, Fullagar and Kitto JJ) said:[65]

Of course as far as logical consistency goes many hypotheses may be put which the evidence does not exclude positively. But this is a civil and not a criminal case. We are concerned with probabilities, not with possibilities. The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypotheses consistent with innocence while in the latter you need only circumstances raising a more probable inference in favour of what is alleged.

In questions of this sort where direct proof is not available it is enough if the circumstances appearing in the evidence give rise to a reasonable and definite inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture (see per Lord Robson, Richard Evans & Co Ltd v Astley [1911] AC 674 at 687). But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then though the conclusion may fall short of certainty it is not to be regarded as a mere conjecture or surmise: cf per Lord Loreburn, above, at 678.

62 Winneke P said in Transport Industries Insurance Co v Longmuir, that the task involves considering 'the weight of the combination of facts proved to its satisfaction and then to determine whether the combined weight of those facts and circumstances support the inference as a matter of probability'.[66] All of the facts proved to the Court's satisfaction and to which I have referred are relevant; not just the mere fact that company officers have deposed to the fact the Demands have not been received.

63 Both sides advances arguments as to why, based on the limited evidence and permitted inferences, their argument as to service was more probable than the opposing argument.

64 The matter is not free from difficulty. Ultimately, however, the onus is on the Companies to rebut the presumption of service. In my opinion, they have not done so.

65 I do not accept that it is more probable than not, that in the case of Kornucopia (and Efektiv), statutory demands addressed to each company, posted and capable of delivery to its registered office, were simply not delivered without any explanation in circumstances where many other documents, including the originating processes, were delivered and the usual indicia of non-delivery are not present.[67] Rather, in my opinion it is more probable than not that the documents were delivered to each company at their registered office but might not have come to the attention of the relevant person, which of course is not a necessary requirement to constitute valid service. Delivery is sufficient. There is more scope for documents to have 'fallen through the cracks' at the Companies' end rather than that of the post office. It is difficult to accept that they were, in the circumstances, simply not delivered. This is pure speculation without any foundation. However, there is a sufficient evidentiary foundation to support the more probable contention of delivery.

66 First, as pointed out, evidence of non-receipt is not sufficient and does not of itself establish non-delivery. To this extent the evidence of Xu and Di Gregorio, to the effect that they did not receive the statutory demands, does not establish non-delivery. Neither could conclude that it was inherently improbable that the Demands were delivered, and indeed both accepted that they were capable of delivery to the Companies' registered office. The only basis on which they speculated that there was no delivery was because of the central and critical position, in relation to mail, occupied by Youl. The notional and flawed argument was that if we didn't see it, Youl didn't see it (because he would have given it to us) and if Youl didn't see it, it was not delivered to the Companies.

67 Secondly, even accepting the Companies' mail arrangements, the Companies were very busy and Youl was engaged in many other aspects of the business.[68] He gave evidence that, while present on a full time basis while working as a project coordinator or manager for the Companies, he had other responsibilities, such as negotiating with suppliers or liaising with customers or other stakeholders.[69] He added that he 'had quite a few different responsibilities' and he would 'hover around'.[70] Given the nature of the business, the volume of activity and the numerous legal proceedings on foot to which the Companies are parties, it is not unreasonable and is more probable that following delivery, the Demands were simply mislaid.[71] Although Youl gave evidence that the mail came to him,[72] it did not always come directly to him, or he was not directly and solely responsible for its collection. Everyone had access to, and could have collected or picked up mail pushed under the door.[73] Indeed, in evidence, Youl recalled instances where, if he was not present at his desk when mail arrived, another staff member would put that mail on his desk.

68 Finally, I have made reference to the Companies' mail arrangements above. I observe that the Companies kept neither an incoming or outgoing mail log. All mail was left to Youl's discretion as to what would and would not be forwarded on. Youl gave evidence that any mail of significance would be scanned into the system and forwarded to the appropriate officer, yet there were no records of this.[74] Furthermore, there is evidence that various other documents have either been or were not received. I have referred to the statutory demand sent to Kornucopia, by Madgwicks as an example. Other pieces of mail were received. I have, for example, referred to the originating processes filed in each proceeding seeking to wind up the respective Companies. Given the evidence of both delivery and non-delivery of various documents by mail to the Companies I am left with these possibilities; either Australia Post are inept, posted documents are not properly addressed on a regular basis, or the Companies' mail arrangements permit for documents to 'fall through the cracks'.

69 The latter is the most probable inference that I propose to draw. There is here, like there was in AXF Group and the other cases referred to in that decision, the absence of a notice from Australia Post indicating that the statutory demand had been returned to the plaintiff marked 'undeliverable' or similar. Nevertheless, the Companies submit that it is more probable that Australia Post did not deliver (or lost) the Demands, than it was for them to have been delivered, and then lost or mislaid by the Companies.

70 Accordingly, a postal officer of Australia Post must have attended the premises of the registered office, on four separate occasions (the three Demands in issue, plus the demand posted by Madgwicks to Kornucopia, which is not the subject of dispute here),[75] and on each occasion, must have failed to deliver the relevant document (noting of course, that it was capable of delivering documents to that address, because on the Companies' evidence, some posted documents were received, Youl or another officer was always present, or alternatively, they could have been placed under the door). This is inherently implausible.

71 In the case of Kornucopia and Efektiv it runs deeper, however. Not only would Australia Post have misdelivered a piece of mail on four separate occasions, but in the case of three of them,[76] it must have resulted in one of two distinct outcomes. First, each statutory demand was perhaps delivered to a neighbouring office. That neighbour then did not recognise it was meant for the Companies, and did not deliver it to the Companies' office next door.[77] This is implausible. Secondly, the Australia Post officer, for whatever reason, concluded that they could not deliver the Kornucopia or Efektiv Demand. On the Companies' submission, not only did Australia Post not deliver them, but they must have lost them or departed from regular procedure, because they were not returned to Madgwicks and/or Chen and marked 'undeliverable' or similar. Of course, it is entirely possible for Australia Post to have embarked on this comedy of errors, but it is also so entirely improbable, that it can only be characterised as fanciful and entirely speculative.[78]

72 In light of these matters, I am not satisfied that Kornucopia has adduced 'proof to the contrary' for the purpose of s 29(1) of the AIA Act. Service is, therefore, presumed effective on Tuesday, 21 May 2019, which is a date not less than 21 days before the filing of the winding up application on 21 June 2019.

73 Much of what has been said, particularly in relation to the evidence and mail arrangements, in relation to the Kornucopia Demand applies equally to the Efektiv Demand, and save for one matter, the AGV Demand.

74 Keenan gave uncontradicted evidence on behalf of Madgwicks, that the Efektiv and AGV Demands were properly addressed, contained within the relevant envelope and sent by priority prepaid post at approximately 5:05pm on 6 June 2019, to the Companies' registered office, at U1/95 Coventry Street. As noted, a statutory demand can be served in this manner, and I am satisfied that the Efektiv and AGV Demands were properly addressed, prepaid and posted to the registered office of the Companies.

75 The presumption pursuant to s 29(1) of the AIA Act has been raised. No evidence was adduced as to displace delivery in accordance with the 'ordinary course of post', and therefore (subject to the matter referred to below in relation to the AGV Demand), service is presumed to be effective on the fourth working day after the Efektiv and AGV Demands were posted on 6 June 2019. Service is presumed to have taken place on Wednesday, 13 June 2019.

76 Like the Kornucopia Demand, the Efektiv Demand was not returned undelivered. For the reasons set out above, I am not satisfied that Efektiv has adduced 'proof to the contrary' for the purpose of s 29(1) of the AIA Act. Service of the Efektiv Demand is, therefore, presumed effective on Wednesday, 13 June 2019, which is a date not less than 21 days before the filing of the winding up application on 10 July 2019.

77 Unlike the other two statutory demands, the AGV Demand was returned by Australia Post to Madgwicks. Kennedy confirmed this on 18 June 2019, by his email to Di Gregorio, Xu and Kuksal:

I attach documents that were served on the registered office of Avant-Garde Ventures Pty Ltd ... which have been returned to us.

78 Although the AGV Demand was returned to Madgwicks, I am in the particular circumstances of this case, satisfied that there is nonetheless sufficient evidence of delivery. Accordingly, I am not satisfied that presumption has been displaced.

79 The starting position is that the return of the AGV Demand to Madgwicks is prima facie evidence of non-delivery which may be raised by AGV to rebut the presumption of delivery.[79] There are, however, a number of features which lead me to the finding that it is entirely reasonable to infer, and more probable than not, that the AGV Demand was, like the other Demands, delivered to the registered office and then unlike the other Demands, returned by someone within the organisation to Madgwicks.[80]

80 First, at least two other statutory demands (the Kornucopia and Efektiv Demands, and potentially, Madgwicks' statutory demand which it issued upon Kornucopia) were delivered. It is curious to say the least, that while two statutory demands were deliverable and delivered, the third was not.

81 Secondly, there is a handwritten notation on the envelope which contained the AGV Demand which states 'rts'. This presumably means 'Return to Sender.' A piece of mail being returned to its sender is not inconsistent with that same piece of mail having been delivered. Mail may be returned to its sender subsequent to either successful or unsuccessful delivery of that mail to its first intended address. Each of those possibilities is just as probable as the other. The notation does not state, as has arisen in many other of the decisions referred to in AXF Group, that the envelope was 'Undeliverable.' Indeed, it would be remarkable if it bore such a marking. As noted, staff members were present at the office. Mail could be received by them or slid under the door. Mail was deliverable.

82 Thirdly, the notation is handwritten, rather than imprinted by stamp or sticker as would ordinarily be expected of Australia Post. Not much can be made of this, but it is perhaps unusual. Xu deposed that she could not exclude the possibility that another member of staff could not have written that notation. She did, however, give evidence that she could not recognise the handwriting. [81]

83 Finally, and critically, what conceivable reason would Australia Post have had for marking the envelope with 'rts' and then returning it to Madgwicks. The envelope was not undeliverable. Mail is and was perfectly capable of delivery to the Companies' registered office. Either, accepting the Companies' evidence, someone was present over the period within which it would have been delivered, or it could have been slid under the door. This is not a case in which there are alternative possibilities of where it could have been delivered or that it was simply lost. There is no evidence suggesting that the envelope was undeliverable. The circumstances are consistent with its delivery, and then immediate return, by someone within the organisation.

84 In the end result, I am not satisfied that AGV has adduced 'proof to the contrary' for the purpose of s 29(1) of the AIA Act. It is more probable than not that it was delivered and then returned. Service of the AGV Demand is, therefore, presumed effective on Wednesday, 13 June 2019, which is a date not less than 21 days before the filing of the winding up application on 10 July 2019.

The AGV Demand - Informal Service via Kennedy's Email

85 In the event that I am wrong, I will consider whether Kennedy's email of 18 June 2019 is capable of constituting effective service upon AGV (and Efektiv). I am of the view that it constitutes valid service.

86 As noted, on 18 June 2019, Kennedy sent an email to Di Gregorio, Xu and Kuksal. Attached to that was a copy of the AGV Demand, his supporting affidavit sworn 6 June 2019 and an ASIC company search.[82]

87 The relevant legal principles and two distinct approaches with respect to 'effective informal service' by email have been referred to above. On the view more favourable to AGV, Madgwicks must prove to 'to the court's satisfaction that the document actually came to the attention' of the responsible officer of the company. [83] Di Gregorio initially deposed to having received Kennedy's email on 20 June 2019. Xu deposed to not having received Kennedy's email of 18 June 2019 until around 11 September 2019, where it was found in her 'clutter' folder.

88 There are various internal inconsistencies with respect to Di Gregorio's evidence as to the precise date she saw the email:

(a) In her affidavit of 23 August 2019, she states that:

[5] ...I commenced my holiday on 21 April 2019. Most of my holiday was spent abroad and, in the countryside, in remote areas with only intermittent internet and phone connectivity. As such, given the coverage, I was unable to access my e-mail account on a regular basis. During this period, some of my emails were also forwarded to the Company [AGV].

[6] On 20 June 2019, having returned from my holiday, I perused e-mail correspondence that had been sent in my absence. One such e-mail correspondence was from Kennedy that he had sent on 18 June 2019. Upon reading the e-mail correspondence carefully, I discussed the matter with Shivesh over the next couple of days.

(b) In her affidavit of 23 September 2019, she sought to clarify this:

[6] Further to the First Affidavit [of 23 August 2019], with respect to Mr Peter Kennedy's email sent to me attaching the Statutory Demand against Avant-Garde Ventures, I did not receive the attachments to the e-mail or read the e-mail prior to 20th June 2019. (emphasis added)

(c) In cross-examination, she firstly said, 'I think I flicked it over [sic] on about the 20th, sorry, I perused it on the 20th and looked at it properly three or four days later.'

89 Prior to this, in her email response to Kennedy, dated 29 June 2019 she stated: 'When I received your correspondence....on the 18th of June 2019, I forwarded it to Shivesh who was responsible for engaging your firm.' Commenting on that email, the following evidence was given in cross-examination:[84]

Mr Lovell: So you've said again that you received Mr Kennedy's email on 18 June?

Ms Di Gregorio: Yes. As I said, I perused it on the 18th, flicked it to Shivesh, didn't read the detail till later but before I wrote that document.

Mr Lovell: Okay. So you don't deny receiving in [sic] Kennedy's email on 18 June but what you say is you didn't get round to reading it until the 20th or some time thereafter?

Ms Di Gregorio: I didn't open it and read it in detail until later which also means I didn't open the attachments until later.

Mr Lovell: Okay. And maybe you could explain to his Honour why you didn't read them when the email was received on the 18th?

Ms Di Gregorio: Because it was normal practice that all legal matters were coordinated through Shivesh rather than through the directors. (emphasis added)

90 I proceeded to ask Di Gregorio a number of questions in order to avoid a misunderstanding on issue:[85]

Sifris J: Let's short circuit this. ...Your evidence is that you received that email on the 18th and you perused the email but didn't open the attachment?

Ms Di Gregorio Correct.

Sifris J: But in perusing the email you saw it refer to attaching documents?

Ms Di Gregorio Correct.

Sifris J: ...You noticed what the general content of the document was? ...Not the attachment, the email?

Ms Di Gregorio Not even - not even that.

Sifris J: You ran your eyes down the email?

Ms Di Gregorio I ran my eyes down the email. I saw it was from Madgwicks. I said, in my own mind, I don't - I won't know what this is about because I don't normally get engaged in the legal affairs. I sent it to Shivesh. Before I returned to work I read it a little clearer. I then spoke to Shivesh and I - we then - I crafted the response. ... That's the guts of it.

91 Di Gregorio then confirmed that she 'skimmed it [on the 18th], and on the 20th [she] read it.'[86] She clarified, that the reference in her 23 September 2019 affidavit to her not having 'read the email' was ambiguous and in error. It was meant to refer to the attachments.[87] She had 'ran the eye down the email' on the 18th but 'didn't read it properly until the 20th.'[88]

92 Although I accept for present purposes that the AGV Demand did not come to the attention of Xu until after the filing of the winding up application with respect to that company, I am satisfied that the AGV Demand came to the attention of Di Gregorio on 18 June 2019.

93 Even from merely skimming that email, it is sufficiently clear what the attachments were, the subject to which they pertained, and the importance of those documents. Kennedy commences that email with 'I attach documents that were served on the registered office of Avant-Garde Ventures...' Di Gregorio had knowledge of, and had been engaged in various meetings to discuss the disputes which had arisen between AGV and Madgwicks. I am satisfied that the document came to her attention, whether she opened it or not. Furthermore, Madgwicks is entitled to assume, that as a director and officer of AGV, she is authorised to deal with the document. Although Di Gregorio forwarded the email to Kuksal (on the same day), who she said would deal with such legal matters, she was in fact the one that responded to Kennedy.

94 In any event, Di Gregorio accepted that Kennedy's email, and its attachments were received in her inbox on 18 June 2019, being the same date that she at the very least perused the email. The email specifically directed her to the important attachments. In my opinion, and consistent with the approach of Bowskill J in SGR Pastoral, which I intend to follow, service has been effective irrespective of the date that she 'carefully' reviewed the AGV Demand and the supporting affidavit. Those documents, received on 18 June 2019, 'were capable of being opened and read (even if they were not opened and read until later)'.[89]

95 On either view and on either approach, I am satisfied that there has been effective informal service of the AGV Demand on 18 June 2019. The next question is whether the application to wind up AGV was filed at least 21 days after service of the AGV Demand.

96 Section 459F(2)(b) of the Act provides that where no application has been made to set aside a statutory demand under s 459G of the Act, 'the period for compliance with a statutory demand is ... 21 days after the demand is served.' Section 459C(2)(a) then provides that 'the Court must presume that the company is insolvent if during or after the 3 months ending on the day when the application was made the company failed (as defined by section 459F) to comply with a statutory demand.' Companies served with a statutory demand have 21 days to either pay the money owed or to make an application to set aside the statutory demand. Conversely, once that period has elapsed, a creditor may make an application to wind up the company, relying on its failure to comply as the basis for its allegation that the company is insolvent.

97 The reference to '21 days' in s 459F means 21 clear days, not 21 business days. It is not affected by the fact that weekends or public holidays may have fallen within the period. As Brown J said in J & K Homes Pty Ltd v Evans Lawyers, in the context of whether an application filed pursuant to s 459G had been filed within time:[90]

Section 459G specifically refers to "days". This is in contrast to "business days" which is defined in s 9 of the Corporations Act to mean "a day that is not a Saturday, a Sunday, or a public holiday or a bank holiday in the place concerned."

The fact that the 21 days specified in s 459G may include a period of public holidays which may lead to some parties having shorter time to respond and harsh results given the Court has not got the power to extend the time prescribed, has been recognised by the courts.

98 That 21 day period begins on the first day following service.[91] In Autumn Solar Installations Pty Ltd v Solar Magic Australia Pty Ltd, Barrett J recognised 'as a general rule, the law takes no account of fractions of a day.'[92]. His Honour's conclusion has been upheld and applied many times.[93] In Verimark Pty Ltd v Passiontree Velvet Pty Ltd, Ward CJ in Eq endorsed the commentary stated by the learned authors of Austin & Black's Annotations to the Corporations Act in their annotation to s 459G, that:[94]

The day of service of the [statutory demand] is not counted in determining whether an application to set aside the demand was made within 21 days after service of the demand.

99 AGV did not file an application to set aside the statutory demand pursuant to s 459G. The date for compliance, required by s 459F(2)(b) was the day ending 21 clear days, after the date of service. The date of service on AGV (by email, through Di Gregorio) is 18 June 2019. The date for compliance is, therefore, 9 July 2019. The originating process seeking orders winding up AGV was filed one day after this, on 10 July 2019. On this basis the originating process was filed 21 days after the date of service,[95] and Madgwicks is entitled to rely upon the AGV Demand, and the presumption of insolvency pursuant to s 459C of the Act.

100 I am therefore satisfied that there has been effective service of each of the Demands on each of the relevant Companies.

C Kornucopia - Validity of the Originating Process

101 The next matter to be dealt with relates to various alleged defects in the originating process seeking orders winding up Kornucopia. Kornucopia submits that these defects cause the originating process to be invalid and must result in its dismissal. Chen submits that the defects either do not arise as is contended, do not result in invalidity, or may be cured by an order of the Court. In summary, three issues arise:

(a) First, whether Chen's failure to attach the Kornucopia Demand to the originating process rendered the originating process invalid from the outset.

(b) Secondly, whether the leave to amend the originating process granted by Hetyey JR, and subsequent filing of the amended originating process 'cured' the defect (if any such defect was present or resulted in invalidity).

(c) Thirdly, whether Chen's failure to file a contemporaneous supporting affidavit with the amended originating process rendered the amended originating process invalid. And consequently, whether a further grant of leave may cure such a further defect and, if necessary, should be granted.

102 On 21 June 2019, the originating process was filed by Chen (OP). The OP stated:

1. The plaintiff relies on failure by the defendant to comply with a statutory demand. A copy of the demand, marked A, is attached to this originating process. (emphasis added)

103 The Kornucopia Demand was not attached to the OP. It was, however, exhibited to an affidavit of service, which Kornucopia was served with at the same time as the OP.

104 On 23 July 2019, Kornucopia filed its Notice of Appearance, setting out its Grounds of Opposition to the Winding Up as required of it by s 459C of the Act. Kornucopia opposes the winding up because, inter alia, '[t]he originating process served on the defendant did not meet the requirements under legislative provisions of the Corporations Act 2001.' In particular, the OP was said to not comply with s 459Q(b)(i) of the Act, requiring that:

Application relying on failure to comply with statutory demand

If 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 application:

...

(b) must have attached to it:

105 On 24 July 2019, the proceeding came before Hetyey JR, where the following exchange occurred:[96]

Mr Hager: If an adjournment is to be granted and these other orders made, it would be appropriate under 467A to give us leave to amend [the OP].

Hetyey JR: I hear what you say. Mr Kuksal, why are you rising to your feet? What is it?

Mr Kuksal: So the specific stipulation of the Corporations Act states unequivocally that the originating process must be accompanied by a statutory demand. There is no equivocation there. It must be accompanied by a statutory demand. It does not talk about additional documents containing it. What they're essentially saying is that even though that did not happen, the court should give us some indulgency and then make an exception under 467 and cure the defect.

The authorities set out a course of action for that, which is to have the original originating process set aside and permit a new originating process to be promptly initiated ...

106 At the conclusion of that hearing, the Judicial Registrar delivered an ex tempore ruling and made the following order:

1. Pursuant to s 467(3)(f) of the Corporations Act 2001 (Cth), by 4.00 pm on 30 July 2019 the Plaintiff file and serve an amended originating process attaching a copy of the underlying statutory demand.

107 The Judicial Registrar gave the following reasons for making that order:[97]

Dealing with the first point, raised on behalf of the defendant that there is some defect in the originating process I make a number of observations. Firstly, s.467A of the Corporations Act says that an application for a winding up - I am paraphrasing a little bit - must not be dismissed merely before one or more of the following: (a), in any case, a defect or irregularity in connection with the application or, in the case of an application to be wound up in insolvency, a defect in the statutory demand, unless the court is satisfied that substantial injustice has been caused that cannot otherwise be remedied, for example, by an adjournment or an order for costs.

Now, s.467(3)(b) of the legislation allows the court to dispense with any notices being given or steps to be taken that are required under the Act, and s 467(3)(f) allows the court to give such directions as to the proceeding as the court sees fit. Section 467(3)(a) allows the court to direct that any notices be given or steps be taken, before or after the hearing of the application.

It is clear the originating process, when filed, did not attach a copy of the statutory demand, which is required by the Act. There is no doubt about that. On its face, the originating process fails to comply with the requirements of s.459Q of the legislation. But the Corporations Act deals with these type of irregularities under 467A. I am not satisfied that there is any substantial injustice that has arisen. Certainly, none has been brought to my attention.

I understand the plaintiff has all the material in now, including the statutory demand. But even if there was some substantial injustice, that injustice can be remedied by an order of the court, and the order that I am going to make is this: that by a particular date and pursuant to s.467(3)(f), the plaintiff will need to file an amended originating process.

108 Kornucopia did not appeal from the order of Hetyey JR. It did, however, on 26 August 2019, file a Summons purporting to seek the following declaration:[98]

1. That the Court makes a declaration that the Plaintiff's Originating Process requirements were not met pursuant to Section 459Q of the Corporations Act 2001 due to non-attachment of the statutory demand and that therefore, there is no valid application under Section 459P of the Corporations Act 2001;

109 Because an appeal has not been brought, the Judicial Registrar's order must stand as being capable of curing the OP. Whether an amendment is so capable is discussed below, but in the case of this perceived deficiency, no more can be said to challenge it.[99]

110 In Meyers v Casey (Meyers),[100] Stipendiary Stewards of the Victoria Racing Club disqualified the plaintiff, Meyers, and his horse, from competing in a particular race for having engaged in the offence of 'suspicious practices'. Meyers appealed against the Steward's decision to the Committee of the Victoria Racing Club, who dismissed the appeal. The Rules of Racing, to which Meyers had contracted himself gave the Stewards power to disqualify the horse where suspicious practices had been proved, but it did not make such a charge or offence applicable to him, or in fact, any person. In other words, the Rules did not give the Stewards power to try, convict, punish or disqualify him for the offence of suspicious practices. On his appeal to the Committee as to the charge on which he was disqualified, the plaintiff submitted as one of his grounds that '[he] was not guilty of the charge alleged'. He did not challenge the point relating to the Stewards' jurisdiction.

111 Meyers commenced a proceeding in the Supreme Court of Victoria seeking to impugn his disqualification by the Stewards, and then the Committee. Hodges J dismissed his action, which Meyers eventually appealed to the High Court. Barton A-CJ described what had transpired at his appeal to the Committee as follows: [101]

Instead of raising the question of jurisdiction, he submitted to it, not only before the Stewards, but by lodging an appeal to the Committee, which, both in his notice and at the hearing of the appeal, he rested on the grounds that the disqualification was not warranted by the evidence. Before the Committee he did not even protest that there was no rule to warrant his disqualification by the Stewards, nor did he attempt to say that it was beyond the powers of the Committee to confirm a decision which was without the support of any rule that he had contracted to accept.

112 Isaacs J remarked that it was clear that the Stewards did in fact 'exceed the limit marked out for them in finding Meyers guilty of "suspicious conduct," and thereupon disqualifying him.'[102] However, his Honour then went on to say:[103]

It is not a question now, in considering the effect of the Committee's decision, whether the Stewards had authority or not as this court might think, but whether the Committee had authority to entertain the appeal and decide the matter finally as to the fate of the Stewards' decision. If they had, then the Committee's decision against Meyers, confirming the Stewards' decision, and necessarily involving the determination that the Stewards had jurisdiction, is final and conclusive; and whatever we might think apart from that determination, we have no power - as between these parties in relation to that matter - to say differently.

113 There were, further, various defaults in natural justice raised in the formulation of the charge before the Stewards, which too were not the subject of a ground of appeal to the Committee. Isaacs J said:[104]

Nor is it now a question as to whether the Stewards acted wrongly and against natural justice in not formulating the charge before trying the appellant. Strictly speaking, I think they should have done so. Every man is entitled to know what he is charged with. He may know it without being formally indicted, and in this case Meyers, as will appear later, probably did know. But a regular course of proceeding requires a clear intimation of the misconduct alleged. That, however, is no longer material; the subsequent proceedings before the Committee have merged both objections in themselves. T_hey are, by reason of the Committee's decision, res judicatae, as much as if instead of the Committee it had been the Supreme Court unappealed from, that had so held. That rests on the well-known rule that a competent court or other tribunal has jurisdiction to give a wrong judgment, and if there is no appeal in the strict sense, then its decision, whether right or wrong, must stand, and cannot be questioned in any subsequent proceedings elsewhere._

_In order to show how strongly this principle is enforced, I refer to a case decided by the Privy Council in 1900 - Malkaryun v Nahari, 25 Bomb. 337. There property mortgaged by a person afterwards deceased was sold under a judicial decree. The law required that before sale, notice must be given to the mortgagor's legal representative. Notice was not given to him, but to another person, and the real owners challenged the validity of the sale. The court, directing the execution, erroneously decided that the person to whom notice was actually given was to be treated as the proper representative, though he said he was not. The Privy Council upheld the sale, because the court was acting within its jurisdiction, though it misinterpreted the law, and their Lordships said - _

In doing so, the court was exercising its jurisdiction. It made a sad mistake it is true; but a court has jurisdiction to decide wrong as well as right. If it decides wrong, the wronged party can only take the course prescribed by law for setting things right, and if that course is not taken, the decision, however wrong, cannot be disturbed.

Here, there is no appeal in the proper sense from the Committee to any court of law. If the Committee had jurisdiction to entertain the appeal, its decision cannot be disturbed. (emphasis added).

114 As his Honour made clear, the principle applies equally to the unique position of the decision maker there, to which Meyers had contracted himself to abide by the decision of, as it does with respect to a decision of this Court which has not subsequently been appealed from.[105] I am therefore satisfied that as Kornucopia has not appealed from the order or ruling of the Judicial Registrar it is not entitled to challenge that order or ruling now.[106] The Order of Hetyey JR must be taken to have cured the defect present in the OP.

115 On 26 July 2019, Chen filed an Amended Originating Process (AOP) pursuant to the Orders of the Hetyey JR made on 24 July 2019. The AOP attached a copy of the Kornucopia Demand.

116 However, Kornucopia has raised a further issue with respect to the AOP, insofar as it is said to be noncompliant with s 459Q of the Act, because a fresh contemporaneous supporting affidavit was not also filed.

Application relying on failure to comply with statutory demand

If 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 application:

...

(c) unless the debt, or each of the debts, to which the demand relates is a judgment debt--must be accompanied by an affidavit that:

(i) verifies that the debt, or the total of the amounts of the debts, is due and payable by the company; and

(ii) complies with the rules.

118 Reg 5.4 of the Supreme Court (Corporations) Rules 2013 (Rules) states as follows:

Affidavit in support of application for winding up (ss 459P, 462, 464 of the Corporations Act)

(2) If the application is made in reliance on a failure by the company to comply with a statutory demand, the affidavit must -

(a) verify service of the demand on the company;

(b) verify the failure of the company to comply with the demand; and

(c) state whether and, if so, to what extent the debt, or each of the debts, to which the demand relates is still due and payable by the company at the date when the affidavit is made.

...

(4) The affidavit must be made within 7 days before the originating process is filed.

119 By requiring an affidavit that 'complies with the rules' s 459Q imports the requirements contained within the Rules as mandatory requirements which 'must' be complied with in order to permit a plaintiff to rely upon a failure to comply with a statutory demand or the consequent presumption of insolvency provided for by s 459C of the Act. Insofar as the originating process does not comply, the plaintiff cannot rely upon failure to comply with the statutory demand as the basis of its allegation of the company's insolvency.

120 The following provisions are also relevant. Section 467A of the Act provides:

Effect of defect or irregularity on application under Part 5.4 or 5.4A

An application under Part 5.4 or 5.4A must not be dismissed merely because of one or more of the following:

(a) in any case--a defect or irregularity in connection with the application;

(b) in the case of an application for a company to be wound up in insolvency--a defect in a statutory demand;

unless the Court is satisfied that substantial injustice has been caused that cannot otherwise be remedied (for example, by an adjournment or an order for costs).

121 Section 467 provides:

Court's powers on hearing application

(1) Subject to subsection (2) and section 467A, on hearing a winding up application the Court may:

...

(c) make any interim or other order that it thinks fit.

...

(3) The Court may, on the application coming on for hearing or at any time at the request of the applicant, the company or any person who has given notice of intention to appear on the hearing of the application:

...

(e) allow the application to be amended or withdrawn; and

122 Read together, s 467A provides that a winding application 'must not be dismissed', merely because there is 'a defect or irregularity in connection with the application', 'unless the Court is satisfied that substantial injustice has been caused that cannot otherwise be remedied.' If the Court is satisfied of this matter, the Court may grant the application, notwithstanding the defect, or it may pursuant to s 467, 'make any interim or other order that it thinks fit' or 'allow the application to be amended' in order to cure that defect or irregularity. Amendments, dispensation or other procedural-type orders and directions are contemplated by the section.

123 The question, then, is one of characterisation. On one view, non-compliance of an originating process with s 459Q of the Act at the time of its filing means that it is invalid and must be dismissed. On the other, this constitutes a 'defect' or 'irregularity', with the result that the originating process must not be dismissed (unless there is substantial injustice) and orders of the kind contemplated by ss 467A and 467 may be made.

124 There are two distinct lines of authority which diverge on this question. They were discussed in great detail by Colvin J in Melking Holdings, and Hetyey JR in In the Matter of DG Haulage Pty Ltd (DG Haulage), to which I have had regard.[107] In summary:

(a) Melking Holdings stands for the proposition that an originating process which does not meet the requirements of s 459Q of the Act at the time it is commenced, is invalid. It cannot be cured by a later amendment, and must therefore, be dismissed.

(b) DG Haulage stands for the alternative position. Namely, an originating process which does not meet the requirements of s 459Q of the Act at the time it is commenced, is defective, but not invalid. Even if the requirements of s 459Q are not met, they may be met by permitting a plaintiff to amend their originating process, or by the Court making orders pursuant to s 467 and 467A of the Act. The Court, subject to the proviso referred to, must not dismiss the application.

125 In Melking Holdings, Colvin J said:[108]

Section 459Q may be construed as dealing with requirements that must be met at the time that the application is commenced. If those requirements cannot be met then the application cannot be validly commenced in reliance upon a failure to comply with a statutory demand as the basis for the allegation that the company is insolvent. In that instance, there must be some other basis for the winding up application. Even if the requirements of s 459Q can be met, but they are not properly attended to, then there is no valid application. The provision is expressed in mandatory terms and controls the circumstances in which an application to wind up a company can be commenced if the application relies on a failure to comply with a statutory demand. It is a protection to be afforded to companies who may be sought to be wound up on the basis of deemed insolvency. In such a case, the applicant does not rely upon the existence of an evidentiary basis to make a claim of actual insolvency but instead relies only upon the presumption. It is important in those circumstances that the step of commencing winding up proceedings based upon a failure to comply with a statutory demand is only taken where there is a proper foundation for the presumption upon which commencement of the application is based. The form of application ensures that there is precision as to the particular failure to comply. The relevant matters must be stated in the application itself which must include a copy of the statutory demand (noting that a statutory demand must itself be in respect of a debt the existence of which is verified by affidavit). It is significant that s 459Q specifically regulates the form of application that might be used to commence an application. The provision would carry little if any force if a failure to meet the requirement could be cured by later amendment. Applying the principles stated in Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at [93], the evident purpose of the provision is that an application which is brought in a manner that does not conform to s 459Q is invalid.

126 In DG Haulage, Hetyey JR said:[109]

Even if the requirements of s 459Q of the Corporations Act are treated as mandatory and not procedural in nature, there is clear authority which suggests the requirements of that section can be addressed by way of amendment to the originating process after the presumption contemplated by s 459C(2)(a) arises.

It may also be that s 467A of the Corporations Act can be utilised in this regard. That section relevantly provides that "[a]n application under Part 5.4 or 5.4A must not be dismissed merely because of ... a defect or irregularity in connection with the application ... unless the Court is satisfied that substantial injustice has been caused that cannot otherwise be remedied (for example, by an adjournment or an order for costs)". Further, s 467(1)(c) relevantly states that "[s]ubject to ... section 467A, on a hearing of a winding up application the Court may ... make any interim or other order that it thinks fit." Section 467(3)(e) also contemplates that the Court may, on the application coming on for hearing, "allow the application to be amended or withdrawn".

As previously noted, the relevant error in the originating process was the assertion that the statutory demand had not been complied with at the time of filing. To that extent, the originating process did not comply with s 459Q. It is also a defect or irregularity in connection with the application for the purpose of s 467A. However, taken at the time of the hearing, the originating process was correct as the statutory demand had well and truly expired unsatisfied. Further, there is no evidence before the Court to suggest that the identified defect or irregularity relating to the originating process has caused any substantial injustice. The defendant has not sought to oppose the winding up application or otherwise engage with it.

In the event, it is appropriate to grant the plaintiff leave to file forthwith an amended originating process and supplementary supporting affidavit to achieve compliance with s 459Q and r 5.4 of the Supreme Court (Corporations) Rules 2013. The material changes will include the date the document is filed and its description as an amended document. The amended originating process will also need to attach the statutory demand and accompanying affidavit in conformity with s 459Q(b). I will then order that the amended originating process is to take effect from today. These orders may ameliorate the concern raised by Gardiner AsJ in Surdex about the operation of the relevant relation back day.

At the same time, having regard to the requirements of s 459Q, nothing I have said in these reasons should be taken to encourage the filing of a winding up application prior to the expiry of a statutory demand as a matter of course. The Court should guard against any obvious abuse of the statutory demand regime.

127 The view of Judicial Registrar JR is supported by the Full Court of the Federal Court in Deputy Commissioner of Taxation v National Skin Institute (Aust) Pty Ltd (Skin Institute), which was not referred to in DG Haulage or Melking Holdings. In Skin Institute, Finn, Gordon and Murphy JJ said:[110]

... Under s 467A of the Act, the court may grant a winding up application notwithstanding non-compliance with s 459Q if the company which is the subject of the application has not suffered substantial injustice. In other words, the parliamentary drafters accepted that compliance with these provisions was required but recognised that non-compliance would not necessarily lead to the dismissal of the application.

128 That view is also supported by Lavercombe v Auscott Ltd (Lavercome),[111] which was in turn adopted by French J (as his Honour then was) in Australian Securities & Investments Commission v Eastlands Pty Ltd (No 3) (Eastlands).[112] Notably, the defect in Eastlands was the same as that before the Judicial Registrar, namely, a failure to attach the statutory demand to the originating process. His Honour entertained the winding up application, notwithstanding the non-compliance. In Lavercombe, Barrett J said:[113]

As to the apparent non-compliance with s 459Q(b)(i), it cannot be contended that it caused the application to be a nullity. In circumstances where the necessary document was in fact annexed to the supporting affidavit rather than the contemporaneously filed originating process, the non-compliance was a "defect or irregularity in connection with the application" as referred to in s 467A(a) and, since no injustice could conceivably have been occasioned, the court was bound by s 467A not to dismiss the application merely because of the non-compliance. (emphasis added).

129 Counsel for the Companies attacked the authorities which stand for the proposition that non-compliance is a 'defect'. It was submitted, that the comments made by those Courts were obiter, not sufficiently explained (in contrast to the reasoning of Colvin J in Melking Holdings), or were directed to an uncontested issue before the relevant Court. Indeed, Counsel invited me to adopt Melking Holdings, which is said to be a well-reasoned analysis. I was invited, by contrast, to reject those other decisions, which it was submitted, are plainly wrong.[114]

130 I reject the Companies' submission and intend to follow DG Haulage, Skin Institute, Lavercombe and Eastlands. Furthermore, I observe that in Melking Holdings, the relevant statutory demand was compliant with s 459Q and Colvin J was not referred to ss 467 or 467A or any of those decisions. His Honour's comments were strictly obiter on the topic and, with respect, I am not bound to follow that view.

131 The following reasons support my view that an originating process that does not conform with s 459Q of the Act can be cured by dispensing with the need for compliance, a later amendment, or by making a remedial order contemplated by ss 467 and 467A to cause such an application to be compliant, provided there is no substantial injustice in the making of that order. Given the submission made by the Companies, to the effect that such a finding or conclusion has not been sufficiently explained or expanded upon by the relevant authorities, or was indeed obiter in the cases in which it arose, I intend to state my views in detail.

132 First, I disagree with the characterisation given by Colvin J, that 'an application which is brought in a manner that does not conform to s 459Q is invalid', with the result that:

Even if the requirements of s 459Q can be met, but they are not properly attended to, then there is no valid application.

Rather, as Barrett J said in Lavercombe, and with which I agree, the originating process is not 'invalid', in the sense that it is a nullity. It is 'defective', and the effect of non-compliance with s 459Q is that an application for the winding up of a company cannot be maintained with reliance upon a failure to comply with a statutory demand as the basis for the allegation that the company is insolvent. The plaintiff would need to establish a separate basis for winding up the company that does not involve the statutory demand (such as, establishing insolvency by evidence). If it does not rely on other grounds, the application must be dismissed (unless cured under s 467 and 467A), not because it is invalid, but because there are simply no grounds relied upon to support an otherwise valid winding up application.

133 Second, support for this proposition is found in the fact that this statutory regime is entirely distinct from that which was in issue in David Grant and Co Pty Ltd v Westpac Banking Corporation (David Grant),[115] a case which Kornucopia sought to rely upon extensively.[116] That case is well known. There, an application made pursuant to s 459G of the Act to set aside a statutory demand was filed out of time, contrary to the requirement of s 459G(2). The applicant sought orders extending the time within which that application could be brought. Gummow J said (and the entire Court agreed) that as the application was filed out of time, there was no valid application before the Court at all, and therefore, no jurisdiction to make an order extending the time within which an application could be brought. Simply put, as the application was a nullity, there was nothing before the Court that any order could remedy. As Gummow J said:[117]

Section 467A provides that an application under Pt 5.4 "must not be dismissed" merely because of "a defect or irregularity in connection with the application", unless the court is satisfied that substantial injustice has been caused and this cannot otherwise be remedied. However, s 467A cannot assist the appellants. If an application for an order setting aside a statutory demand has not been made within 21 days after service of the demand, there is no application under Pt 5.4 before the court. Therefore, there is no question of such an application being dismissed because of a defect or irregularity in connection with it. In Re J and E Holdings Pty Ltd, Sheller JA summed the matter up as follows:

"The position is quite simply that unless the Court has a power to extend the time within which the application to set aside the statutory demand can be made, the plaintiff has no right to make it."

134 Thirdly, by contrast to the position here, s 459Q of the Act is not the section pursuant to which an application for the winding up of a company is made. That is s 459P (or ss 234, 462 or 464). Section 459Q can instead be characterised as a provision which is ancillary or additional to s 459P, and facilitative of the means by which proof of insolvency can be adduced by a plaintiff. Prior to setting out the pre-conditions with which s 459Q is concerned, it states 'If 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 application must'. That section presupposes that there is 'an application for a company to be wound up in insolvency', which is that brought under s 459P. Upon there being an application made by a competent applicant under s 459P, the Court is vested with jurisdiction to make orders as it sees fit with respect to that application. There is nothing in the text of ss 459Q or 459P which ties the jurisdiction of the Court, granted by s 459P, with the requirements of s 459Q. The word 'If' contained within s 459Q premises the conditions which 'must' be met for that otherwise valid application to 'rel[y] on a failure by the company to comply with a statutory demand' as the basis for the allegation that the company is insolvent. The effect of non-compliance does not affect the validity of the application, but rather, the basis upon which a plaintiff can establish insolvency (that is, by presumption if there is compliance or by evidence if there is not). It could not, therefore, be said that even if there is non-compliance with s 459Q, that there is, as was the case in David Grant, 'no application under Pt 5.4 before the court' for remedial orders to be made in respect of.[118]

135 Fourthly, this may be tested by referring to the example of a winding up application which relies upon s 459P of the Act (and in particular, failure by the company to comply with a statutory demand), and in the alternative, winding up upon the just and equitable ground under s 461(1)(k). If the application does not attach a statutory demand, such that there is non-compliance with s 459Q, it could not be said that the originating process is invalid in toto. The application made pursuant to s 461(1)(k) could still proceed without any reference to or reliance upon the statutory demand. Rather, the defect in the application means that there can be no reliance on the presumption of insolvency under s 459C.

136 Fifthly, this would accommodate and explain the line of reasoning relied upon by Hetyey JR in DG Haulage. In one of those authorities, Re Plutus Payroll Pty Ltd,[119] the Deputy Commissioner of Taxation applied to wind up a number of companies on the just and equitable ground. Almost a month after the originating process was filed, it was amended to join a twelfth company, and then a further amendment sought to amend the originating process to rely on a statutory demand which had been served on the twelfth defendant company after it had been joined and which had expired unsatisfied. Brereton J concluded as follows:[120]

...The requirement of s 459Q, even if mandatory, can be satisfied in the context of a failure to comply with a demand occurring after institution of proceedings, by amendment of the originating process after the presumption arises. ...

It follows where proceedings are commenced invoking grounds other than a presumption of insolvency arising from failure to comply with a statutory demand, but there is subsequent such failure to comply before the hearing, the presumption becomes available. In this case, the proceeding (as against BRW Services) having been commenced invoking other grounds - namely 'actual' insolvency and the just and equitable ground, which continue to be advanced - leave was sought and granted at the hearing to amend the originating process to rely on the presumption, it having arisen subsequently, but before the hearing. In the absence of any argument let alone evidence to rebut it, the Court must presume that BRW is insolvent. (emphasis added).

From his Honour's conclusion it is evident that s 459Q need not be satisfied at the time of the commencement of the application. Compliance could not, therefore, be a matter that goes towards invoking the Court's jurisdiction.

137 Sixthly, if there is non-compliance with s 459Q within an application that relies solely upon failure by the company to comply with a statutory demand, it follows that there is nothing in my view to stop the Court from granting the plaintiff leave to amend their originating process, so as to permit them to establish insolvency by evidence (rather than by presumption), or to rely upon the just and equitable ground contained within s 461(1)(k) of the Act, or a statutory demand which the company has not since the commencement of the application complied with.[121]

138 Seventhly, there being no bar to the jurisdiction of the Court to make a remedial order (whether that is an amendment, dispensation, or some other order) to cure a defective application, the Court must do so unless it is of the opinion that this would cause the company the subject of the application to suffer substantial injustice that could not be remedied by some other means. Of course, the commencement of winding up proceedings is a serious matter with potentially grave financial consequences, and that step should only be taken where 'there is a proper foundation for the presumption upon which commencement of the application is based.'[122] But that is the matter with which s 467A is concerned. A company without notice of the particulars which support an attempt to have it wound up would, in the vast majority of cases, have no difficulty in establishing 'substantial injustice' of a kind that should result in the application's dismissal. The Court will not look favourably upon abuses of the statutory regime consisting of where a winding up application is filed prior to the expiry of a statutory demand,[123] or without an adequate supporting affidavit which verifies the debt, or indeed without any contemporaneous affidavit.[124] Brereton J described this in powerful terms in Re Vangory Holdings Pty Ltd, in the case of a supporting affidavit which did not verify the relevant debt:[125]

In my view, the role of s 459Q(3) is very similar. Its function is to require a creditor, before instituting proceedings reliant on the presumption of insolvency - and in which, by reason of s 459S, the defendant will ordinarily be precluded from disputing the existence of the debt - to give close and serious attention to the existence of the debt a second time, this time before instituting proceedings. In such proceedings, a creditor has many advantages, s 459S being perhaps the most obvious of them. It is not asking too much of a creditor who seeks to invoke those draconian consequences first to comply strictly with the requirements that trigger them.

139 It is my view that the construction set out above is not only open on the words of the Act, but gives adequate effect to its purpose, insofar as it would permit otherwise meritorious applications to be pursued rather than dismissed or prolonged on technical or procedural grounds, whether or not the defect complained of caused injustice to the company. That too is a matter towards which s 467A is directed; defects and irregularities which cause no material prejudice. Opportunistic conduct (namely, procedural omissions or defaults by plaintiffs which cause no material prejudice to defendants, but which defendants take advantage of) must not be looked at favourably by the Court, especially in light of considerations of efficient civil procedure and the timely and just resolution of real issues which arise in winding up applications.[126] In this respect, the following observation of Doyle J (with whom Parker and Lovell JJ agreed) in Heirloom Vineyards Wine Company Pty Ltd v Sante Wines Pty Ltd, is particularly apt:[127]

It is true that the operation of s 467A does not extend to cure defects that have the consequence that the court's jurisdiction under s 459G has not been invoked. However, the existence of s 467A is consistent with an intention on the part of the legislature that the overall focus be on matters of substance rather than form. It is also true that in emphasising a focus upon the commercial justice of the dispute, and upon substance over form, the legislature most likely had in mind that it would typically be recalcitrant debtors who might seek to exploit technicalities or matters of form, rather than creditors. But I do not think that it follows that substance is to be preferred over form only where that is to the advantage of the creditor. Rather, it is a general approach that should guide the Court in its consideration of issues ...

140 Finally, by way of conclusion, where there is non-compliance with the requirements of s 459Q within an application that relies solely upon failure by the company to comply with a statutory demand, the Court has two options:

(a) the application is dismissed, not because it is invalid, but because the presumption is unavailable, meaning there are no grounds to support the winding up application, and making a remedial order, providing dispensation, or granting leave to amend would cause substantial injustice within the meaning of s 467A that cannot be remedied otherwise than by dismissing the application; or

(b) the application is not dismissed, because making a remedial order, dispensing with compliance, or granting leave to amend would not cause substantial injustice, or would cause substantial injustice which can be remedied by an order other than an order dismissing the winding up application.

141 Moving to the next issue, and even though not strictly necessary, it should be evident that I am satisfied that the order of the Judicial Registrar was within power. Further, and in any event, in Civil Procedure Victoria, the learned authors state:

[I 36.01.20] Time from which amendment operates

The general rule is that amendment of a document operates from the date of the document. The document is treated as containing the amendment from the start. ... "[An] amendment, duly made, takes effect, not from the date when the amendment is made, but from the date of the original document which it amends": Baldry v Jackson [1976] 2 NSWLR 415 at 410, per Glass JA, referring to Sneade v Wotherton Barytes and Lead Mining Co Ltd [1904] 1 KB 295 and Warner v Sampson [1959] 1 QB 297; [1959] 1 All ER 120

142 The effect of the Judicial Registrar's order was to grant Chen leave to file the AOP. The AOP is filed, with effect from the date of the OP, being 21 June 2019. The AOP stands as the OP. It is then as if, the first defect (the failure to attach the Kornucopia Demand to the OP) were cured ab initio and the proceeding regularised for there was then compliance with s 459Q from the date of the document.

143 However, this too means that the issue with the asserted lack of a contemporaneous affidavit supporting the AOP should fall away. Chen's supporting affidavit of 21 June 2019 is an affidavit which meets the requirements of r 5.4 of the Rules, as it is contemporaneous with the date of the OP (and AOP). Still on the other hand, it might be said that the affidavit issue remains, for even if the AOP has retrospective effect, r 5.4 requires that the affidavit must be contemporaneous with (that is, made within seven days of) the date that the originating process is 'filed'. Even if the AOP had retrospective effect, it was filed on 26 July 2019.

144 As discussed above, I am satisfied that recourse to ss 467 and 467A is available. Section 467A provides that an 'application under Part 5.4 or 5.4A must not be dismissed merely because of ... a defect or irregularity in connection with the application ... unless the Court is satisfied that substantial injustice has been caused that cannot otherwise be remedied (for example, by an adjournment or an order for costs)'. It is, therefore, open for me to give effect to s 467A by not dismissing the application for any non-compliance with r 5.4 of the Rules and s 459Q of the Act.

145 I am satisfied that I should take that course. Kornucopia cannot point to (and has not adduced evidence of) any substantial injustice (barring of course, the consequence that the application would not be dismissed on technical grounds). Indeed, it is common ground that Chen's supporting affidavit of 21 June 2019 otherwise complies with the requirements of r 5.4, and of s 459Q of the Act. That affidavit has been on the Court file at all times and accompanied the OP when it was first filed and served. It verifies the debt and there is no attack on the substance of the affidavit. The argument that it is not contemporaneous is nothing more than a strategic or technical argument to have the winding up application dismissed, in circumstances where Kornucopia cannot point to any, let alone any 'substantial' injustice.[128]

146 The winding up jurisdiction and procedure, and in so far as it is based on the service of a statutory demand (non-compliance with which gives rise to presumed insolvency) is, for good reason, highly technical and exacting on both creditors and debtor-companies. It is not surprising therefore and it is my experience, that non-compliance or less than full compliance occurs very often. Historically, both in the bankruptcy and winding up jurisdictions anything less than full compliance resulted in drastic or draconian consequences, usually dismissal of the application. This is no longer the case. Technical difficulties or defects are able to the remedied and the Court should do so, controlled not unreasonably by whether the remedy (to cure the technical defect) would cause substantial injustice.

147 It is neither necessary nor productive to determine or categorise what precisely constitutes a 'defect' or 'irregularity'. The words of s 467A of the Act are self-evidently of wide import. Further, if there is such a defect the application must not be dismissed unless there is not only injustice, but substantial injustice. A defect is an imperfection or deficiency. An irregularity contemplates non-compliance with prescribed rules. There is no reason of principle or policy (or indeed precedent) for reading down the words or application of ss 467 and 467A so as to exclude its operation where the requirements of the Act are mandatory, that is where things 'must' be done (as in s 459Q). To suggest that things must be done, and are not done, but are incapable of being remedied, however minor and whether or not there is any prejudice, is precisely what the remedial provision is aimed at. To suggest that this should not include a 'fundamental' defect or irregularity - whatever that may mean - probably contemplates a situation where there is likely to be substantial injustice that may not be remedied. The distinction does not lie between 'fundamental' or 'minor' defects, or 'mandatory' or 'procedural' requirements, but as David Grant makes plain, a defect or non-compliance which deprives the Court of jurisdiction, and one which does not. That is a question and exercise of statutory construction in all cases.

148 It is not necessary for present purposes to explore the limit any further. All of the issues raised by the Companies are (where and to the extent that such defects have been found or may arise) technical defects or irregularities of an inconsequential nature, such that I am not permitted to dismiss the applications, but rather get on with the real substance of the applications. This is what I propose to do. It is in the interests of all parties including the Companies. The Companies are involved in substantial litigation in VCAT and in this Court and are entirely familiar with the relevant procedures.[129] There is no injustice and given the context and circumstances, no substantial injustice.

149 I do not propose to make any orders at this stage. None are necessary or desirable to enable the originating processes to proceed. If and when necessary, orders will be made in accordance with these reasons and any application which may be made. The originating processes will not be dismissed. Based on my findings, I propose to proceed to the next stage, being the applications to wind up each of the Companies and the Companies' applications under s 459S to rely on grounds which they could have relied on to set aside the statutory demands, which I have found, in each case, to have been validly served.[130]

[1] As at 4 November 2019, there were 185 proceedings which had been commenced and finalised in VCAT in 2019. As at 15 November 2019, there are a further 12 matters in VCAT which have been commenced and remain active. As of late September 2019, there were 19 proceedings which had been commenced and finalised in the Supreme Court in 2019. There are a further 19 proceedings which have been commenced and remain active, including the 3 proceedings which are presently before me. As at 14 November 2019, there is 1 proceeding which has been commenced and remains active in the County Court. As at 15 November 2019, there are 15 proceedings (most of which are registrations of VCAT orders) which have been commenced and remain active in the Magistrate's Court. These are proceedings in which one or various of the respective Companies before me, or in some cases, their directors, are parties (either as plaintiff/applicant or defendant/respondent).

[2] See evidence of Xu at T28-9 and Youl at T63. The number is much higher.

[3] See reported decisions from 2019 in: Kornucopia Pty Ltd v Tse [2019] VSC 442; Kornucopia Pty Ltd v Zhang [2019] VSC 439; Kornucopia Pty Ltd v Zhu [2019] VSC 440; Kornucopia Pty Ltd v Li [2019] VSC 441; Kornucopia Pty Ltd v Wong [2019] VSC 443; Tse v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 537; Effendy & Anggrek v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 1146; Wong v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 915; Hwang v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 1436; Wirawan v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 1437; Ye v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 824; Effendy v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 1435; Ho v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 917; Wei v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 878; Li v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 877; Li v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 697; Wong v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 648; Home Sweet Home Investments Pty Ltd v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 1438; Wang v Efektiv Pty Ltd (Residential Tenancies) [2019] VCAT 1369; Tam v The State Of Our Times Pty Ltd (No. 2) (Residential Tenancies) [2019] VCAT 1167; Tam v The State Of Our Times Pty Ltd (Residential Tenancies) [2019] VCAT 1037; Nguyen v Efektiv Pty Ltd (Residential Tenancies) [2019] VCAT 1680; Efektiv Pty Ltd v Hodge [2019] VSC 636; Efektiv Pty Ltd v Jescal Nominees [2019] VSC 628; Wang v Efektiv Pty Ltd (Residential Tenancies) [2019] VCAT 1369; Nguyen v Efektiv Pty Ltd (Residential Tenancies) [2019] VCAT 1680; 278 Kingsway Gpg Pty Ltd v Efektiv Pty Ltd (Costs) (Residential Tenancies) [2019] VCAT 1707; Ye v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 824; Hwang v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 1436; Tse v Kornucopia Pty Ltd (Residential Tenancies) [2019] VCAT 537. In many cases the validity of service was an issue.

[4] I considered that the issues of service and non-compliance with other technical requirements might be dispositive of the case, if found in the Companies' favour. The application to wind up each company, as presently formulated, relies solely on the presumed insolvency of each Company arising out of the failure to pay or set aside the statutory demands. It may be necessary to decide whether new particulars or claims of insolvency (whether based upon evidence of insolvency, or other expired statutory demands) can be introduced by amendment, if the statutory demands or any of them are set aside (or even if they are not set aside), or whether a substitution of creditors should be permitted.

[5] Hoh v Ying Mui Pty Ltd [2019] VSCA 203 [389]-[402] (Beach, Hargrave JJA and Sifris AJA). Furthermore, it is not unusual and indeed commonplace for winding up applications to be dealt with in stages, with preliminary issues (service, notice, technical issues and the like) dealt with first, and the trial (the hearing on insolvency, abuse of process, and applications under s 459S) following that stage. In any event, this stage dealt with distinct issues (rather than the formulation of particular and abstract questions with an unavoidable degree of overlap), and all parties supported this approach.

[6] There is an issue (see paragraph [8]) insofar as the Companies assert that Kuksal was not authorised to engage Madgwicks on behalf of Efektiv or AGV, and that rather, only a single retainer agreement existed between Madgwicks and Kornucopia. It is said that all fees were to be charged to Kornucopia, and that Efektiv or AGV acted as agent of Kornucopia. This is the subject of the s 459S application and for the moment it is not necessary to resolve it.

[7] See paragraphs [88] to [91].

[8] A 'clutter' folder is another name used for what is traditionally known as a 'spam' folder. Xu deposed that she 'had no reason to expect service of documents from [Madgwicks] via email.' This would, however, tend to contradict an email from Di Gregorio to Kennedy dated 29 June 2019 in which Di Gregorio said: 'If you wish to serve any documents related to Kornucopia Pty Ltd, you may send these to Lulu Xu via [her email address].' In cross-examination Xu gave evidence that she had received correspondence from other solicitors at Madgwicks, but not Kennedy, which went to her inbox rather than the clutter folder. Xu gave further evidence that it was not unusual for emails to end up in her clutter folder, for she would occasionally receive emails from other internal members of staff (such as Kuksal) there, and not her inbox. (T47).

[9] The process server's report contradicted the sworn evidence of the Companies' officers. The process server was not called as a witness and the report is not sworn. I have not placed any weight on the report.

[10] Being the period within each of the Demands were sent and should have been delivered. Youl commenced working for the Efektiv Group on 15 April 2019. (T70).

[12] Xu at T39. Di Gregorio gave evidence that while nothing 'particularly large' would fit through the gap, 'single pages' or 'standard envelopes' would fit. (T96).

[16] Northumbrian Ice Cream Co Ltd v Breakaway Vending Pty Ltd [2006] NSWC 1216 (Northumbrian). See footnote 52.

[17] Panimo Nominees Pty Ltd v Vasiliki Lobsters Melbourne Pty Ltd [2011] VSC 321 (Vasiliki Lobsters). See paragraphs [56] to [60]

[18] CGU Workers' Compensation (Victoria) Ltd v Carousel Bar Pty Ltd [1999] VSC 227; (1999) 151 FLR 270, 279 [84] (Gillard J) (CGU Worker's Compensation)

[19] This summary of principles is based upon those set out by McKerracher J in Deputy Commissioner of Taxation v Josway Hospitality Pty Ltd [2018] FCA 466 at [2] (Josway), which I gratefully adopt.

[20] In the Matter of AXF Group [2019] VSC 671 [40] (Sifris J) (AXF Group).

[21] Northumbrian [2006] NSWC 1216 [12] (Brereton J); Deputy Commissioner of Taxation v Clear Blue Developments [2010] FCA 1223 [24] (Logan J) (Clear Blue Developments).

[22] AXF Group [2019] VSC 671 [42] (Sifris J).

[23] That is, unless the plaintiff can then establish service on the company by alternative means without relying upon the presumption, such as through effective informal service by email or some other means.

[24] Formosa House Pty Ltd v Chang [2010] VSC 474 [11] (Ferguson J) (Formosa House).

[25] [1972] 2 Q.B. 314, 320-2 (Lord Denning) citing London Country Quarter Sessions Appeals Committee, Ex parte Rossi [1956] 1 Q.B. 682, 694 (Salmon LJ).

[26] [1941] ArgusLawRp 85; (1983) 48 ALR 1, 7 (Mason, Murphy, Wilson, Deane and Dawson JJ) (Fancourt).

[27] See also von Risefer v Mainfreight International Pty Ltd [2009] VSCA 179; (2009) 25 VR 366, 374 [21] (Ashley JA).

[28] [1999] VSC 227; (1999) 151 FLR 270, 278 [74]-[77] (Gillard J).

[29] [2008] QSC 210; (2008) 219 FLR 422, 423 [1], 425 [11], 429 [23] (White J) (Commonwealth Broadcasting Corporations).

[30] See discussion of authorities at AXF Group [2019] VSC 671 [67]-[86] (Sifris J). See also Deputy Commissioner of Taxation v Melking Holdings Pty Ltd (2019) 137 ACSR 411, 425-6 [54] (Colvin J) (Melking Holdings).

[31] [2019] VSC 671 [84] (Sifris J).

[32] (2019) 137 ACSR 411, 426 [56] (Colvin J).

[34] [2011] NSWSC 6 [18] (Barrett J).

[36] AXF Group [2019] VSC 671 [83] (Sifris J).

[38] Fancourt (1983) HCA 25; (1983) 154 CLR 87, 96-7 (Mason, Murphy, Wilson, Deane and Dawson JJ); Re Rustic Homes Pty Ltd (1988) 49 SASR 41, 44 (von Doussa J); Dwyer v Canon Australia Pty Ltd [2007] SASC 100 [8]-[9] (Debelle J); Deputy Commissioner of Taxation v Contract Synergies Administration Pty Ltd [2011] FCA 743 [5]-[18] (Jacobson J).

[39] Scope Data Systems Pty Ltd v Goman [2007] NSWSC 278; (2007) 70 NSWLR 176, 188 [49] (White J).

[40] [2018] FCA 466 [2] (McKerracher J).

[41] Josway [2018] FCA 466 [2] (McKerracher J) citing Deputy Commissioner of Taxation v Manta's on the Beach Pty Ltd [2012] FCA 417; (2012) 88 ATR 193 [12] (Logan J).

[42] [2011] VSC 321 [19] (Gardiner AsJ).

[43] This is expanded upon at paragraphs [61] to [62].

[44] Bradshaw v McEwans [1920] ArgusLawRp 118; (1951) 27 ALR 1, 5 (Dixon, Williams, Webb, Fullagar and Kitto JJ) (Bradshaw).

[45] See Woodgate (as trustee for the bankrupt estate of Fenton) v Garard Pty Ltd (2010) ACSR 468, 476 [42] (Palmer J) (Woodgate) and the authorities referred to therein.

[46] In this case, on either approach, informal service is effective. It is not necessary to engage in a discussion of which line of authority is correct and/or preferable.

[47] Woodgate (2010) ACSR 468, 476-8 [44] (Palmer J).

[48] [2011] NSWSC 690; (2011) 81 NSWLR 104, 116-7 [40]-[41] (White J).

[49] [2019] QSC 229 (SGR Pastoral).

[51] In Northumbrian [2006] NSWC 1216 Brereton J set out (at [12]) the facts which must be proved to raise the presumption. They are recited at paragraph [43] of this Judgment. It was submitted, that as the envelopes were not exhibited to the affidavit evidence, these facts were not established. I reject this submission. As Logan J identified in Clear Blue Developments [2010] FCA 1223, with reference to s 183(b) of the Evidence Act, those facts may be established by direct evidence (the envelope itself) and (at [24]) the inferences drawn from the direct evidence, including the affidavit of service deposing to such postage. I am satisfied that the affidavits of service of Sood and Keenan (who are the individuals who effected postage - See Clear Blue Developments at [23]) establish, by reasonable inference, the facts necessary to raise the presumption with respect to postage of each Demand to each Company. Furthermore, the Companies did not (as they had initially foreshadowed) seek to cross-examine either Sood or Keenan. Sood and Keenan were not given the opportunity to challenge any propositions put to them. Had the Companies sought to contend they had made a mistake in the process of posting the envelopes, contradict their evidence, or challenge the veracity of the same, this should have been put to them in accordance with the rule in Browne v Dunn (1893) 6 R. 67. Their evidence, not having been contradicted, is accepted and founds the necessary inferences.

[52] Xu's evidence of non-receipt is of little weight. In cross-examination she said 'I'm not personally in charge [of handling mail] and my colleague, David [Youl], he is in charge of that.' (T22) Furthermore, and in so far as it concerns the Kornucopia Demand, during the period of the 17 to 27 or 29 May 2019 (the period in which the Kornucopia Demand would have been delivered and received) Xu was sick and 'in and out of office'. She believed that Youl was a 'competent colleague' and would have been notified her 'if any documents of that sort had been received.' (T26). Her evidence of non-receipt is equally consistent with her not having been notified by another staff member of its receipt. Di Gregorio's evidence can be treated in the same vein with respect to the Efektiv and AGV Demands. She was on holiday roughly from 21 April 2019 to 20 June 2019. (T87). Furthermore, Di Gregorio gave evidence that she would go into the premises depending on 'what's going on and when [she is] required.' She said that she 'mainly work[s] at home or ... at other organisations [for which she is] a non-executive director.' (T96).

[53] See paragraph [68].

[54] [2011] VSC 321.

[55] Ibid [8], [10], [15]-[17].

[56] Vasiliki Lobsters [2011] VSC 321 [18].

[57] Counsel for Chen submitted the Companies' affidavits ought to be treated with some suspicion or caution, for it was submitted that they are 'strikingly similar' to paragraphs [7] to [9] of Vasiliki Lobsters and drafted in a manner so as to replicate the evidence that gave rise to inference of non-delivery there. Counsel for Madgwicks supported this submission, by referring to the fact that the affidavits which detailed the mail system were only affirmed after the submissions had been filed, which submissions included reference to Vasiliki Lobsters, but not the mail procedures. Counsel for Madgwicks went further, and said that this approach would tend to explain why there had been a 'patchwork' approach to the Companies' affirmation of affidavits deposing to the relevant facts and matters. It is not necessary to and I do not have regard to these matters.

[58] Vasilki Lobsters [2011] VSC 321 at [16]: 'Both deponents are accountants and they are aware of the significance of documents from solicitors' and [17]: 'he states that he is aware of the seriousness of receiving a creditor's statutory demand and would have immediately contracted the client and emphasised its urgency' and at [18]: 'There is credible uncontradicted evidence from the senior person responsible and from the particular accountant having responsibility for the defendant's affairs'.

[59] Vasilki Lobsters [2011] VSC 321 [16] and at [18]: 'It is remarkable that neither the statutory demand or the originating process are said to have been delivered to Guests. (Emphasis added).'

[60] For instance, on 24 July 2019, Kuksal admitted in open court before Hetyey JR that the originating process in the Kornucopia proceeding was received.

[61] Vasilki Lobsters [2011] VSC 321 [9] (Gardiner AsJ).

[64] Transport Industries Insurance Co v Longmuir [1997] 1 VR 127, 141 (Tadgell JA) (Longmuir). The test of whether an inference can be drawn in the first place is 'whether, on the basis of the primary facts, it is reasonable to draw the inference.' Seltsam Pty Ltd v McGuiness (2000) 49 NSWLR 262, 276 [88] (Spiegelman CJ) citing Layton v Vines [1952] HCA 19; (1952) 85 CLR 352.

[65] [1920] ArgusLawRp 118; (1951) 27 ALR 1, 5 (Dixon, Williams, Webb, Fullagar and Kitto JJ).

[66] Longmuir (1997) 1 VR 127, 128-9 (Winneke P).

[67] For example, a notation on the envelope marking the demands as undelivered; return of the envelope to the serving party; a change in registered office, not updated on ASIC's records; a problem in mail redirection; mail being held at the post office for collection; delivery to a neighbour or adjacent property; impossibility of delivering to the registered office address; absence of a mailbox or other receptacle; placement of the mailbox or receptacle outside of the confines of the building housing the registered office.

[68] Youl gave evidence that 'it doesn't sound like an outlandish statement to say that the company is a busy corporation.' (T64).

[71] See footnotes 1 and 3.

[72] Youl gave evidence that he would collect the mail 'every day' when he saw a bundle or several letters under the front door. (T68) He estimated that 25 per cent of the time he would take mail off of the post man, and the other 75 per cent of the time he would collect mail from under the door (T69).

[73] Youl gave evidence that if he was not there, or was out to lunch, or when there was something under the door the other members of staff saw before him, 'they may put it to the side for [him] but they, they [sic] would leave it on the desk where I was working at.' (T69).

[74] The evidence of the mail arrangements did not include any documentary evidence.

[75] Both parties accepted, that just because the three statutory demands issued by Madgwicks had been posted at the same time, it did not necessarily mean that they would be delivered at the same time.

[76] The Kornucopia and Efektiv Demand, and demand from Madgwicks to Kornucopia.

[77] Evidence was given by Xu that the front of the glass door to the registered office bears the name 'Efektiv'. (T39).

[78] To this end, Counsel for the Companies commented in his submissions, to the effect that: 'It was said by my learned friend that I was speculating yesterday. Well of course, I necessarily have to.'

[79] AXF Group [2019] VSC 671.

[80] I refer to and repeat the passage from Melking Holdings (2019) 137 ACSR 411, 426 [56] per Colvin J, which is quoted above at paragraph [45].

[82] The same was attached with respect to the statutory demands issued by Madgwicks on Efektiv and Kornucopia.

[83] Woodgate (2010) ACSR 468, 476-8 [44] (Palmer J).

[89] SGR Pastoral [2019] QSC 229 [37] (Bowskill J).

[90] [2017] QSC 24 [8]-[9] (Brown J). Section 459F also refers to 'days' rather than 'business days'.

[91] By way of example, if a statutory demand is served on 1 January 2020, the time for compliance ends on 22 January 2020. The debtor must file an application to set aside the statutory demand within that period. A question which I do not need to address, is whether a creditor may bring a winding up application on 22 January 2020, or whether they must file that application on 23 January 2020 or thereafter.

[92] Autumn Solar Installations Pty Ltd v Solar Magic Australia Pty Ltd [2010] NSWSC 463 [8] (Barrett J)

[93] Verimark Pty Ltd v Passiontree Velvet Pty Ltd [2019] NSWSC 455 [28]-[31] (Ward CJ in Eq) (Verimark); V & M Davidovic Pty Ltd v Professional Services Group Pty [2012] NSWSC 134 [5] (Black J); Heraz Pty Ltd v Rumsley [2019] FCA 493 [10] and [15]-[16] (Banks-Smith J).

[94] Verimark Pty Ltd [2019] NSWSC 455 [30] (Ward CJ in Eq).

[95] To the extent (and only if I am wrong on service by post) that the application (and the application in relation to Efektiv) does not 'set out the particulars of service of the demand on the company' (or other matters) as required by s 459Q, I consider for the reasons below that this may be cured by an amendment.

[96] Transcript of Hearing - 24 July 2019. T:32-3.

[97] Transcript of Hearing - 24 July 2019. T36-7.

[98] Counsel for the Companies contended that the Judicial Registrar's reasons did not determine the question of whether the granting of leave would cure the defect; rather the Judicial Registrar simply granted leave and it was said that this other question was left for me to determine. This would tend to explain why the Companies had filed the summons rather than an appeal. Nonetheless, reading the Judicial Registrar's ruling as a whole, and in its context, it is clear that the order was intended to address - and cure - the defective OP that was before him.

[99] In any event, the Judicial Registrar did not act in error, but rather, was acting within power as it concerns the grant of leave. The summons, referred to above, cannot amount to an appeal. Even if characterised as such, it was filed outside of the timeframe within which an appeal could have been brought.

[100] [1913] HCA 50; (1913) 17 CLR 90.

[101] This passage is omitted from page 98 of the reported Judgment contained within the CLR. It is found in the unreported judgment: [1913] HCA 50.

[102] Meyers v Casey [1913] HCA 50; (1913) 17 CLR 90, 113 (Isaacs J).

[105] This principle has been applied in the following decisions: Uniting Church in Australia Property Trust (NSW) v Industrial Relations Commission of NSW [2004] NSWCA 183 [78] (Handley JA_); SK Foods LP v SK Foods Australia Pty Ltd (in liq) (No 3)_ [2013] FCA 526 [53] (Flick J); Lewis v Garvey [2017] WADC 76 [28] (Troy DCJ). See also Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163, 179-80 (Brennan, Deane, Toohey, Gaudron and McHugh JJ).

[106] Even if an appeal had been brought (and an extension of time granted for such an appeal to be commenced) I would dismiss it for the reasons set out below. I am not satisfied that the Judicial Registrar erred. Furthermore, the Kornucopia Demand, which was not attached to the OP, was exhibited as NS-1 to the Affidavit of Service of Nikhil Sood affirmed 17 May 2019, and served on the Companies with the OP. Evidently, no injustice could arise, for Kornucopia received the Kornucopia Demand, albeit in a different form, but at the same time it would have been received it but for the defect and omission.

[107] (2017) 54 VR 705 (DG Haulage).

[108] (2019) 137 ACSR 411, 418 [25] (Colvin J).

[109] (2017) 54 VR 705, 718-9 [45]-[49] (Hetyey JR).

[110] [2012] FCAFC 2; (2012) 285 ALR 102, 108 [25]. The Judicial Registrar also referred to the following authorities supporting his conclusion: Workers-Compensation Nominal Insurer v Lozito-Strada Pty Ltd [2013] FCA 625 [8] (Jacobson J); Workers-Compensation Nominal Insurer v Lime Gourmet Pizza Bar (Darby Street) Pty Ltd (No 2) [2014] FCA 151; Lime Gourmet Pizza Bar (Darby Street) Pty Ltd (in Liq) v Workers-Compensation Nominal Insurer [2014] FCA 567 [86] (Foster J); Re Plutus Payroll Pty Ltd [2017] NSWSC [12] (Brereton J).

[111] [2006] NSWSC 867; (2006) 58 ACSR 586 (Lavercombe).

[112] [2006] FCA 1702 [24]-[27] (French J).

[113] Lavercombe [2006] NSWSC 867; (2006) 58 ACSR 586 [6] (Barrett J).

[114] It worth noting that this conclusion has been reached by not one, but two Judges who would later be appointed to the High Court.

[115] [1995] HCA 43; (1995) 131 ALR 353.

[116] The Companies' submission emphasised the word 'must' contained within s 459Q. This should, it was submitted, receive the same construction and effect as the words 'may only' contained within s 459G(2), being the words the Court was concerned with in David Grant, and concluded was a requirement the application must meet for the Court to have jurisdiction with respect to the same. I reject this submission. First, syntax and semantics can only go so far in answering the question of whether a particular requirement is amenable to s 467A. This is expanded upon at paragraph [147] of this Judgment. Secondly, this an entirely distinct regime within the Act. Thirdly, there are various mandatory conditions (things which 'must' be done) which are amenable to dispensation or relief under ss 467A and 467. Sections 465A(1) and 470(1)(a) are two examples - (the plaintiff 'must' lodge and publish the prescribed notice) - of mandatory requirements that are so amenable: Australian Beverage Distributors Pty Ltd v Evans & Tate Premium Wines Pty Ltd [2007] NSWCA 57; (2007) 61 ACSR 441, 463 [118] (Beazley P); Knights Quest Pty Ltd v Daiwa Can Co (No 2) [2018] VSC 551 (Sifris J).

[117] David Grant and Co Pty Ltd v Westpac Banking Corporation [1995] HCA 43; (1995) 131 ALR 353, 361-2 (Gummow J) (David Grant).

[118] David Grant [1995] HCA 43; (1995) 131 ALR 353, 361-2 (Gummow J) (David Grant).

[119] [2017] NSWSC 1360.

[120] Re Plutus Payroll Pty Ltd [2017] NSWSC 1360 [12]-[13] (Brereton J).

[121] Whether such an amendment would be made is subject, of course, to the Court's satisfaction that there is no substantial injustice in making that order that cannot otherwise be remedied.

[122] Melking Holdings (2019) 137 ACSR 411, 418 [25] (Colvin J). Kirby J made this point with force in Emanuele v Australian Securities Commission [1997] HCA 20; (1994) 144 ALR 359 at 381: 'In line with the requirements of company law stretching back to the English legislation of the 19th century, these provisions enacted various gateways by which the court, administering the companies legislation, was afforded the power to supervise applications for the winding up of companies. The need for such supervision is obvious. The very commencement of proceedings to wind up a company, particularly on grounds of insolvency, and the publicity which may attend that course, may do irreparable damage to the company's reputation, to its capacity to raise capital for its continued operations, to the value of its shares and the interests of its shareholders, officers and employees.'

[123] See DG Haulage (2017) 54 VR 705, 717-8 [41]-[43] (Hetyey JR).

[125] [2015] NSWSC 1809 [17] (Brereton J). His Honour did not ultimately conclude whether or not recourse to s 467A is available in the case of the non-compliance of an application with s 459Q(3). His Honour said at [22]: 'It follows, in my view, that proceedings for winding up in insolvency in reliance on the presumption of insolvency have not been validly instituted by reason of non-compliance with s 459Q(3) or, at the very least, if they have been validly instituted, they are attended by a defect or irregularity which has caused substantive injustice.'

[126] It is common experience that dismissal on minor technical grounds leads only to additional delay and expense. A further application would be required, which relies on the same or similar grounds, and which must eventually arrive at the same point - the trial of the application. The timely, cost effective and efficient resolution of winding up applications is one consideration supporting this construction. As the High Court said in Australian Securities and Investments Commission v Lanepoint Enterprises Pty Ltd (recs and mgrs apptd) [2011] HCA 18; (2011) 244 CLR 1 at [27]: the "evident policy of [Part 5.4 of the Act] is that there be a speedy resolution of applications to wind up in insolvency". Of course, abuses of the statutory regime are sternly discouraged and penalised, and procedural rights should be protected by the Court. The s 467A proviso finely balances these interests. It ensures that a technical defect should only result in dismissal if it caused real prejudice to, or deprived something of substance from, the party responding to the application. Conversely, it too ensures that inconsequential defects do not delay resolution of the true issue in dispute: the company's solvency. In Chief Commissioner of State Revenue v Boss Constructions (NSW) Pty Ltd (2018) 131 ACSR 631, Bathurst CJ said at [28]: 'To the extent that such a conclusion may produce harsh results, this must be balanced against the public interest in determining applications to wind up insolvent companies promptly and avoid injustices that may be caused by the continued trading of such companies'. While there, has not yet, been a determination of the company's solvency, the Court should guard against allowing inconsequential procedural defaults to permit potentially insolvent companies to continue trading. This is a conclusion which is, furthermore, consistent with the legislative purpose set out in the Explanatory Memorandum to the Corporate Law Reform Bill 1992 (Cth) at [670], [711], [738]-[739], being to prevent technical disputes from prolonging the determination of a winding up application.

[127] (2018) 128 ACSR 212, 242 [158] (Doyle J).

[128] There is also power under r 2.04 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) for the Court to 'dispense with compliance with any requirements of these Rules, either before or after the occasion for compliance arises.' By dispensing with the need for compliance with r 5.4 of the Rules, the affidavit may well and in any event 'compl[y] with the rules' so far as s 459Q is concerned.

[129] See footnotes 1 and 3.

[130] As I indicated at the handing down of the Judgment, I will not grant a stay of the applications pending the Companies seeking leave to appeal. It is, in my view, desirable for any application for a stay or leave to appeal to follow the hearing of the winding up application, if that is necessary. On an unrelated note, Counsel for the Companies indicated that there may be an issue insofar as the relation-back date is concerned in Kornucopia, given the filing of the AOP. I have not heard submissions on this and it may be dealt with at a later stage, if the plaintiffs are successful in their application.