Service of a creditor’s statutory demand – the importance of serving at the registered office maintained by ASIC

The recent decision of Mills Oakley v Asset HQ Australia Pty Ltd [2019] VSC 98 highlights the need for strict compliance when serving a creditor’s statutory demand on the registered office of a company. The Court considered whether a creditor’s statutory demand, with an error in the registered address of the company, was served in accordance with section 109X of the Corporations Act 2001 (Cth) (the Corporations Act) and section 28A of the Acts Interpretation Act 1901 (Cth) (the Interpretation Act).

The Facts

On 8 November 2018, Davies Moloney (solicitors for Mills Oakley) served a creditor’s statutory demand on Asset HQ Australia Pty Ltd (Asset HQ) at its registered office.

Asset HQ’s registered office as maintained by the Australian Securities and Investments Commission (ASIC) was at all material times –

The creditor’s statutory demand served on behalf of Mills Oakley was addressed to Asset HQ at –

In applying to wind up Asset HQ, Mills Oakley relied on the statutory presumption of insolvency pursuant to section 459C(2)(a) of the Corporations Act.

Asset HQ disputed service of the creditor’s statutory demand, arguing that it was not served on it at its registered office.

Mills Oakley’s Position

Mills Oakley argued that the address listed on the envelope was an immaterial difference, did not mean that the envelope was incorrectly addressed and that the Court should infer that an envelope addressed to the “Pacific Way Address” would have been delivered to the registered office of Asset HQ.

Further, it was also Mills Oakley’s position that there was no significant difference between “Way” and “Highway” and it was not the law that misspelling the address would invalidate the creditor’s statutory demand.

Asset HQ’s Position

Asset HQ’s primary position was that Mills Oakley had failed to comply with the necessary elements of section 109X of the Corporations Act and section 28A of the Interpretation Act in that there was a failure to post the creditor’s statutory demand to it at its registered office and the “Pacific Way Address” was not its registered office.

Counsel for Asset HQ relied on a number of authorities including Deputy Commission of Taxation v ABW Design and Construction Pty Ltd and Chen v The College of Building Ltd, which considered the meaning of “the company’s registered office” and which established that strict compliance was required.[1]

In particular, Asset HQ submitted that the Court could not presume service was effected at the time the envelope would be delivered in the ordinary course of post. Asset HQ disagreed with Mills Oakley’s submission that there was no practical difference between “Way” and “Highway”, as the cases establish that the envelope has to be addressed to the registered office as stated in the ASIC records, which here it was not.

Court Findings

Mills Oakley was not entitled to rely on the deemed service provision in section 29 of the Interpretation Act, as the creditor’s statutory demand was not delivered to the registered office in conformity with section 109X of the Corporations Act and section 28A of the Interpretation Act.

The Court followed the decisions in Deputy Commission of Taxation v ABW Design and Construction Pty Ltd and Chen v The College of Building Ltd that there must be strict compliance with the document being addressed to the registered office as recorded in the ASIC register.

Registrar Matthews held that Mills Oakley’s repeated submission that there was no “material difference” or “practical difference” between “Way” and “Highway” was not to the point as “Way” was not the registered office of Asset HQ.

As Mills Oakley was unable to establish service of the creditor’s statutory demand, the presumption of insolvency under s459C(2)(a) of the Corporations Act arising from a failure to comply with a creditor’s statutory demand did not arise.

Key takeaway / conclusion

This decision provides as an important reminder that when serving a creditor’s statutory demand it must be sent to the exact registered office address as maintained by ASIC.

Authored by:

Susan Forrest, Partner

Caitlin Milligan