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Corporations Act - Application to set aside statutory demand - Failure to complete return date on application served on the defendant - "Copy of application" not served as required by s 459G(3)(b)

1 MASTER SANDERSON: This is an application to set aside a statutory demand. The defendant maintains there was a defect in the service of the application with the effect that there is no application properly on foot. In the event there was no disagreement between the parties on the facts and the fate of the application can be quickly determined.

2 On 18 January 2002 the defendant served on the plaintiff a statutory demand. On 8 February 2002 the plaintiff filed an application to set aside the statutory demand which was supported by an affidavit of Roy Albert Edwards ("Edwards") sworn that same day. The application was served by forwarding to the defendant's solicitors, Minter Ellison, what purported to be a copy of the application and the affidavit in support. That letter was dated 8 February 2002. On 18 February 2002 the defendant's solicitors wrote back pointing out that the copy of the application served upon them did not contain the return date. They alleged that consequently the plaintiff had failed to comply with s 459G(3)(b) and there was therefore no application properly on foot. The plaintiff's solicitors wrote back on the same day enclosing a copy of the application with the return date endorsed and further advising that the return date was 21 February 2002.

3 It was not in dispute that the copy of the application served on the defendant's solicitors did not contain the return date. Nor was any evidence led by the defendant to suggest that they had suffered any prejudice as a result of the omission. In fact, counsel for the defendant appeared on 21 February ready to argue the matter. The case was adjourned at the request of the plaintiff to allow counsel to marshal her argument.

4 In David Grant & Co Pty Ltd v Westpac Banking Corporation [1995] HCA 43; (1995) 184 CLR 265 the High Court pointed out that s 459G sets out, in effect, a code which limits the circumstances in which a statutory demand may be set aside. Thus there is no power to extend time under s 459G(2). An application is properly brought only if it is brought within 21 days after the demand is served. There is no power within s 459G itself to extend that time limit and other provisions of the Corporations Act are of no assistance.

5 Equally, for an application to be properly made, the plaintiff must comply with the requirements of s 459G(3). That section reads as follows:

"An application is made in accordance with this section only if, within those 21 days:

(a) an affidavit supporting the application is filed with the Court; and

(b) a copy of the application, and a copy of the supporting affidavit, are served on the person who served the demand on the company."

6 An applicant must comply with both requirements of the subsection. Only if this is done within the 21 days specified in s 459G(2) is an application properly on foot. Furthermore, the use of the word "copy" in subpar (3)(b) means an exact copy. This was established by the decision of the Full Court of this Court in Robowash Pty Ltd v Robowash Finance Pty Ltd [2000] WASCA 409. In that case the plaintiff served on the defendant what purported to be a copy of the affidavit in support of the application. Quite by accident, four pages of one of the exhibits was omitted. The Full Court held that as a consequence a "copy" of the affidavit in support of the application had not been served on the defendant and the application was not properly on foot.

7 That means that in this case for the plaintiff to comply with the requirements of the section it was necessary to serve on the defendant a copy of the application endorsed with the return date. As that was not done, no application is properly on foot. It matters not that the defendant suffered no prejudice. It is also of no consequence that the plaintiff's solicitors acted at the first available opportunity to rectify the defect. By that time 21 days had passed and nothing could be done to resuscitate the application.

8 In the course of her submissions counsel for the plaintiff referred to two decisions - Benonyx Pty Ltd v Fetrona Pty Ltd [1999] NSWSC 1181 and Chelring Pty Ltd v Coombs [2000] WASC 60. Both of these cases dealt with a situation where the copy of the application to set aside the statutory demand was not endorsed with the return date. In both cases the conclusion was that the application was not properly on foot. Both of these decisions must now be read in the light of the decision in Robowash. In the Chelring decision I did consider whether or not the provisions of s 467A might assist a plaintiff who had omitted a return date. I concluded that on the facts of that case the section would not apply. However, I think it is now clear that s 467A can have no operation at all in relation to s 459G(3)(b). Unless there is compliance with that section there is no application.

9 Accordingly the plaintiff's application is incompetent. I will hear the parties as to costs.