Wily v Eastern Elevators Pty Limited [2003] NSWSC 377

Wily v Eastern Elevators Pty Limited [2003] NSWSC 377

The progress payments were not part of a running account or continuing business relationship as defined under s 588FA(3), and the defendant successfully established the statutory defence under s 588FG(2), having provided evidence that late payments were common in the industry and there were no reasonable grounds to suspect insolvency. Consequently, there was no basis to make an order for repayment, and no error of law was found in the Magistrate's decision.

Parties
First Plaintiff: Andrew Hugh Jenner Wily (in his capacity as liquidator of Goltep Constructions (NSW) Pty Limited (in liquidation)); Second Plaintiff: Goltep Constructions (NSW) Pty Limited (in liquidation); Defendant: Eastern Elevators Pty Limited
Jurisdiction
Australia
Judgment Date
06 May 2003
Procedural Posture
Appeal / Judgment
Outcome
Appeal dismissed.
Legal Topics
Winding Up, Voidable Transactions, Preferential Payments, Running Account, Progress Payments Under Building Contract, Insolvency, Unfair Preference
Corporations Law Winding Up Voidable Transactions Preferential Payments Running Account Progress Payments Under Building Contract Insolvency Unfair Preference

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Parties

Andrew Hugh Jenner Wily (in his capacity as liquidator of Goltep Constructions (NSW) Pty Limited (in liquidation))

First Plaintiff

Goltep Constructions (NSW) Pty Limited (in liquidation)

Second Plaintiff

Eastern Elevators Pty Limited

Defendant

Procedural Posture

Appeal / Judgment

Legal Issues

  1. 1 Whether payments made to the defendant constituted unfair preferences under s 588FA of the Corporations Act 2001
  2. 2 Whether the payments were part of a 'running account' or 'continuing business relationship' for the purposes of s 588FA(3)
  3. 3 Whether the statutory defence under s 588FG(2) was established by the defendant

Ratio Decidendi

The progress payments were not part of a running account or continuing business relationship as defined under s 588FA(3), and the defendant successfully established the statutory defence under s 588FG(2), having provided evidence that late payments were common in the industry and there were no reasonable grounds to suspect insolvency. Consequently, there was no basis to make an order for repayment, and no error of law was found in the Magistrate's decision.

Court Disposition

Appeal dismissed.

Orders

  • Appeal dismissed with costs.