› Insolvency — Presumption of insolvency — Rebuttal — Single-asset company — Commercial reality
Corporations
› Winding up
› Statutory demand — Failure to comply — Statutory demand served but not received — Superintendence of registered office
Corporations
› Winding up
› Section 459S — Leave to oppose winding up — Materiality to proving solvency — Interaction with primary solvency case
Corporations
› Winding up
› Appeal from judicial registrar — Hearing de novo
Quick Take
1A company that has failed to comply with a statutory demand may rebut the presumption of insolvency under s 459C(2)(a) of the Corporations Act by demonstrating a substantial surplus of real property assets over liabilities, assessed by reference to commercial reality, even where the company holds no liquid assets and has not adduced specific evidence of borrowing capacity or ability to effect a quick sale, provided the asset value is sufficiently established and the margin over liabilities is significant.
2Where a company advances a primary case that it is solvent irrespective of the disputed debt but also mounts an alternative case under s 459S(1) contemplating that the disputed debt may be determinative of solvency, the materiality requirement in s 459S(2) is satisfied; the narrow reading of Switz Pty Ltd v Glowbind Pty Ltd does not preclude leave where the company has in fact contemplated the possibility that its solvency depends on the debt not being owing.
3Unreasonable superintendence by a director of a company's registered office — such as relying on an unrelated tenant to forward mail — means s 459S(1) is engaged (the company 'could have' relied on the ground in a set-aside application), but does not of itself preclude the grant of leave under s 459S(2); the consequence of unreasonable conduct is that the company must satisfy the solvency gateway, not that it is foreclosed from seeking leave altogether.
