Minister for Transport v Ian Charles Francis and Antony Leslie John Woodings As Joint Liquidators of Civcon Pty Ltd (In Liq)

[2000] WASCA 149

Western Australia Court of Appeal

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Interrogate

Catchwords

1. Corporations
2. › Winding up
3. › Voidable transactions
4. › Unfair preferences
5. › Whether principal under construction contract a creditor
6. › Whether advance payments on account of contract price or loans
7. › Corporations Law, s 588FA
1. Corporations
2. › Winding up
3. › Voidable transactions
4. › Unfair preferences
5. › Meaning of 'transaction'
6. › Composite transactions
7. › Whether sub-transaction must be identified
8. › Corporations Law, s 588FA, s 9
1. Contract
2. › Construction contracts
3. › Progress payments
4. › Advance payments
5. › Whether advance payment on account of contract price constitutes prepayment or loan
6. › Whether principal has right of action to recover advance
1. Corporations
2. › Winding up
3. › Set-off
4. › Whether set-off available under s 553C(1) if transaction set aside
5. › Notice of insolvency
6. › Corporations Law, s 553C(1), s 553C(2)

Quick Take

Where a principal under a construction contract makes advance payments to a contractor on account of the contract price, and those payments are later deducted from progress certificates, the principal is not a 'creditor' of the contractor for the purposes of s 588FA of the Corporations [name withheld]. The labels used by the parties in correspondence (such as 'advance' and 'repayment') do not determine the legal character of the payments, which is fixed at the time they are made. Liquidators cannot recover such deductions as unfair preferences.