The Court dismissed an application for leave under s 459P(2) and the winding up application under s 459A, holding that a contingent creditor owed no more than $70,000 could not establish a prima facie case of insolvency where the respondent had deposited funds exceeding that amount in its solicitors' trust account and had over $10.5 million in its savings account. The Court held that a disputed debt underlying a statutory demand that was no longer relied upon could not be treated as a debt for the purposes of the s 459P assessment. In considering solvency, the Court emphasised that commercial realities of a corporate group structure — including centralised treasury, a deed of cross-guarantee, and the parent company's evident interest in maintaining the subsidiary's solvency — must be taken into account, even absent a formalised support agreement, and that a cross-guarantee is relevant to commercial realities notwithstanding that it may not directly bear on the s 95A cash flow test.
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