[2009] QSC 262 SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION DAUBNEY J. No 6855 of 2009 GREEN GLOBAL TECHNOLOGIES LIMITED

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1 [2009] QSC 262 SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION DAUBNEY J No 6855 of 2009 RE: GREEN GLOBAL TECHNOLOGIES LIMITED GRANT THORNTON (QLD) PTY LTD (ACN ) Applicant and GREEN GLOBAL TECHNOLOGIES LIMITED (ACN ) Company and CRAIG FRANCIS CARROLL Third Party BRISBANE..DATE 20/08/2009 JUDGMENT 1-1

2 HIS HONOUR: This is an application by Grant Thornton (Qld) Pty Ltd for the winding up of the respondent, Green Global Technologies Limited. The basis upon which it is sought to wind up the respondent is a contention that the respondent is deemed insolvent by reason of a failure to meet a statutory demand which it is alleged was served on the respondent. Accordingly, the applicant proceeds to seek the winding up of the respondent under part 5.4 of the Corporations Act. It is contended on behalf of the applicant that the respondent was served with a statutory demand dated 12 March 2009, together with a supporting affidavit sworn 12 March 2009, by which demand was made for the payment of the sum of $29,150 within 21 days. It is asserted that service of that statutory demand and supporting affidavit occurred by posting the statutory demand and supporting affidavit by prepaid ordinary post to the respondent's registered office. The registered office of the respondent, according to ASIC searches, is at a firm of accountants at Robina. When the matter first came on before me, a service issue was raised on behalf of the respondent, which contended by reference to an affidavit of the accountant, whose address is the registered office, that the statutory demand had not in fact been received. In reliance on that evidence, the respondent filed a cross application seeking a permanent stay, or alternatively, an injunction to restrain the winding up of the respondent in insolvency. Further factual issues were sought to be raised on behalf of 1-2 JUDGMENT

3 the respondent which involve a contention by the respondent that the debt claimed under the statutory demand is disputed, and goes to the circumstances under which the applicant contends the debt is payable to it. It is unnecessary, for present purposes however, for me to descend into any further detail concerning that factual dispute or indeed whether the respondent would otherwise be entitled to raise such a factual dispute on the present application. It is, however, necessary for me to say something further about the preliminary point raised on behalf of the respondent concerning alleged non-service of the statutory demand. For completeness, at this stage, I should observe that after I heard argument on the matter, and then reserved the matter to peruse the material in further detail, the parties were requested to make further submissions to me on the question of adequacy of the evidence before me concerning the proof of service of the statutory demand. Each of the parties has had the opportunity to put on further written submissions, and each has had the opportunity to make further oral submissions before me today, particularly in respect of that point. I have already noted that the respondent disputes having received the statutory demand. An affidavit by the respondent s accountant, Mr Goldspring, confirms that he practices as an accountant at a named address at Robina, and that those premises, and his office, are the registered office 1-3 JUDGMENT

4 of a number of companies including the respondent. He says that when he commenced practicing as an accountant from those premises substantial problems arose with the delivery of post to the physical address of the company, and to overcome that difficulty the body corporate, which controls the common property of the building, installed a system of building mail boxes. He says those were constructed in the basement of the building about 12 months ago. Mr Goldspring asserts in his affidavit that over the last six to 12 months, and certainly during the period when the statutory demand was alleged to have been posted to his office, all mail which was addressed to the "physical" address of the building (by which I infer he means the street address notified as the registered office in the ASIC records) would be deposited by the postman in the basement mail boxes. He says each of the mail boxes has the business name of the recipients clearly identified on the front of them. Mr Goldspring also deposes to his internal business systems by which a dedicated member of the secretarial staff (the same member each time) goes to the building mail boxes, and also to his post office box everyday and collects mail from both locations. He describes the process by which all collected articles of mail are opened by his staff and then given to him personally on a daily basis. He further deposes that when documents are received in relation to companies' affairs, he ensures that those pieces of correspondence are brought to the attention of the relevant principal officer in each case. 1-4 JUDGMENT

5 Specifically in relation to statutory demands, Mr Goldspring says that his procedure upon receiving a statutory demand is to immediately telephone the responsible officer of the relevant company and to advise of receipt of the statutory demand. He says that where possible he arranges for an immediate electronic or facsimile dispatch of such documents to the responsible company officer, and that is followed up by mailing a hard copy of the documents. He deposes: "From my memory, and from the records of the company, I am able to state that no statutory demand was ever received by me or by Green Global Technologies Ltd at my address from Grant Thornton (Qld) Pty Ltd or from any solicitor acting for that company." The affidavit of Mr Goldspring goes to non-receipt of the statutory demand. However, the authorities which analyse the dichotomy between delivery, which is statutorily deemed to occur consequent upon the posting of an article for service (in reliance on section 109X of the Corporations Act), and non-receipt of that article make it clear that once it is proved that a document is sent by post the statutory presumption of service can be overcome by proof of nondelivery as opposed to mere assertion of non-receipt. Cases of non-delivery include those in which it is able to be proved that an envelope has been returned to the serving party and marked: "Return to sender". The authorities in that regard include, but are not limited to, the recent judgment of Justice White in Re: Pacific Mobile Phones Pty Ltd 1-5 JUDGMENT

6 [2008] QSC 210, and Workers Compensation [Victoria] Limited v Carousel Bar Pty Ltd [1999] VSC 227, each of which adopted and apply the observations by the High Court in Fancourt v Mercantile Credits Limited [1983] 154 CLR 87, particularly in the passage at pages In the present case, as I have already noted, the applicant contends that a statutory demand was served on the respondent by post. It is unnecessary for present purposes for me to make any final decision as to whether Mr Goldspring's affidavit is sufficient evidence of non-delivery as opposed to non-receipt because, the challenge to service by post having squarely been raised on the material, the anterior question, namely, whether service by post had been proved by the applicant, came sharply into focus. Hence the request for the parties to address me further, specifically in relation to the question of the adequacy of that proof. In that regard the only evidence of proof of the service of the statutory demand by post is contained in an affidavit of service by a solicitor within the office of the applicant's solicitors, Mr Edgecombe. Relevantly Mr Edgecombe deposes: "I did on the 13th of March 2009 cause a letter dated 13 March 2009 enclosing the Creditor's Statutory Demand for Payment of Debt dated 12 March 2009 and an Affidavit of Debt of Ramesh Benedict sworn on the 12th of March 2009 to be forwarded by prepaid post, pursuant to the provisions of the Corporations Act 2001, to the registered office of GREEN GLOBAL TECHNOLOGIES LIMITED(ACN ). Exhibited hereto and 1-6 JUDGMENT

7 marked GME1, GME2 and a GME3 respectively are copies of the said letter, Creditor's Statutory Demand for Payment of Debt and Supporting Affidavit." The exhibits to that affidavit include a letter dated 13 March 2009 addressed to: "The Directors, Green Global Technologies Limited, Goldspring and Co. HQ Building Suite 44/58 River Walk Avenue, Robina Town Centre, Qld, 4230". I am satisfied on the evidence before me that this was the registered office of the respondent company as at the date of that letter. The question then is whether the affidavit of Mr Edgecombe, and in particular the statement to which I have just referred, is sufficient evidence of proof of posting to enable the applicant to invoke the benefit of deemed service pursuant to section 109X of the Corporations Act. The short answer, it seems to me, is that it is not. In that regard the judgment of Barrett J in Pearlburst Pty Ltd v Summers Resort Group Pty Ltd [2007] NSWSC 1126 is instructive. In that case the affidavit of service of the statutory demand was by the solicitor for the applicant. His Honour extracts the relevant part of that affidavit of service at [18] in his judgment. The affidavit of service in that case exhibited copies of letters and other documents which were exhibited to the affidavit and included specifically a deposition that one of the exhibited documents was a "Letter that I caused to be sent by prepaid ordinary post to the plaintiff at its registered office on 15 August 2007 which enclosed the original of the 1-7 JUDGMENT

8 document, a true copy of which appears as annexure B to this affidavit". At [22] - [24] of his judgment, Barrett J referred to a number of previous authorities which had considered the proof necessary and adequate to prove service by post and said: "Section 109X (1)(a) of the Corporations Act says that a document may be served on a company by 'posting it to the company's registered office'. Proof of service of a document on a company by 'posting it to the company's registered office' involves proof of the several elements identified by Debelle, J in Dwyer v Canon Australia Pty Ltd [2007] SASC 100 (at [6]): In order to be able to establish service by post upon a company it is therefore necessary to prove that the letter was:. Properly addressed;. Pre-paid;. Posted as a letter and;. Sent to the registered office of the company. Service by post will not be established unless each of those facts has been proved. 1-8 JUDGMENT

9 [23] To like effect our observations of Brereton J, in Northumbrian Ice Cream Co Ltd v Breakaway Vending Pty Ltd [2006] NSWC 1216 at [12] concerning service by post: Proof of service by post requires, at least:. 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. [24] In the present case, there is no direct evidence about what appeared on the face of the envelope; there is only evidence of what appeared on the letter of 15 August Indeed, there is no direct evidence of the existence of any envelope in that, while it is said in Mr Bailey's affidavit that the letter was sent by prepaid post, there is no explicit statement that the letter (and the Annex B documents said to have been enclosed with it) were put into any envelope. There is no evidence of the amount or value of any stamp of franking affixed to any such envelope, and there is no direct evidence that anyone lodged any stamped or franked envelope (and contents) at any post office or in any post box." 1-9 JUDGMENT

10 Having made those observations, his Honour found that with the evidence in that state before him he could not find that the statutory demand was, as contemplated by section 109X (1)(a), posted to the company's registered office. I am left in a similar state so far as the evidence of service by post in this matter is concerned. I have already referred to the only deposition relied on to prove service of the statutory demand by post. There is no evidence before me of any of the processes within the applicant's solicitor's office which could give me any proper basis for concluding that posting of the documents in question in an envelope addressed to the registered office of the respondent company actually occurred. Accordingly, I find that the applicant has not proved service of the statutory demand by post. In those circumstances, the application to wind up the respondent company fails in limine. There is no basis for the only contention relied on by the applicant for the winding up of the respondent, viz, deemed insolvency arising from non-compliance with the statutory demand in question. Accordingly the winding up application will be dismissed.... HIS HONOUR: The applicant will pay the respondent's costs of and incidental to the application including any reserved costs to be assessed JUDGMENT

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