Elite Motor Campers Australia v Leisureport Pty Ltd Leisureport Pty Ltd v Bremer Pty Ltd [1996] FCA 951

Elite Motor Campers Australia v Leisureport Pty Ltd Leisureport Pty Ltd v Bremer Pty Ltd [1996] FCA 951

Because Leisureport failed to comply with a statutory demand, Pt 5.4 of the Corporations Law gave rise to a presumption of insolvency that could be rebutted in any winding up application. Even assuming Leisureport's material established solvency, the mere assertion of solvency by a company in default under a statutory demand did not make a creditor's proposed winding up application an abuse of process. The proper occasion for canvassing solvency was the winding up proceeding, not an injunction to restrain its presentation.

Jurisdiction
Australia
Judgment Date
17 October 1996
Procedural Posture
Application for Injunction to Restrain a Winding Up Application Based on Failure to Comply With a Statutory Demand / Application Filed in Court on 17 October 1996
Outcome
Application dismissed; injunction refused.
Legal Topics
['winding Up by the Court' 'statutory Demand' 'application to Set Aside Statutory Demand Not Served Within Time' 'presumption of Insolvency' 'injunction to Restrain Winding Up Proceedings' 'abuse of Process']
['corporations Law' 'insolvency'] ['winding Up by the Court' 'statutory Demand' 'application to Set Aside Statutory Demand Not Served Within Time' 'presumption of Insolvency' 'injunction to Restrain Winding Up Proceedings' 'abuse of Process']

Case Brief

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Procedural Posture

Application for Injunction to Restrain a Winding Up Application Based on Failure to Comply With a Statutory Demand / Application Filed in Court on 17 October 1996

Legal Issues

  1. 1 ['Whether Leisureport was precluded from applying to set aside the statutory demand because the application was not served within the time required by s 459G(3) of the Corporations Law.' 'Whether the Court should grant an injunction restraining Bremer from applying to wind up Leisureport where Leisureport asserted solvency despite non-compliance with a statutory demand.' 'Whether the presentation of a winding up application against a company that asserts it is solvent would amount to an abuse of process in the circumstances.']

Ratio Decidendi

Because Leisureport failed to comply with a statutory demand, Pt 5.4 of the Corporations Law gave rise to a presumption of insolvency that could be rebutted in any winding up application. Even assuming Leisureport's material established solvency, the mere assertion of solvency by a company in default under a statutory demand did not make a creditor's proposed winding up application an abuse of process. The proper occasion for canvassing solvency was the winding up proceeding, not an injunction to restrain its presentation.

Court Disposition

Application dismissed; injunction refused.

Orders

  • ['The application filed in court on 17 October 1996 be dismissed.' "The applicant pay the respondent's costs of the application, to be taxed if not agreed."]