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CORPORATIONS ACT 2001

CHAPTER 5 - EXTERNAL ADMINISTRATION  

PART 5.4 - WINDING UP IN INSOLVENCY  

Division 3 - Application to set aside statutory demand  

SECTION 459H  DETERMINATION OF APPLICATION WHERE THERE IS A DISPUTE OR OFFSETTING CLAIM  

459H(1)  [Court satisfied of dispute or offsetting claim]  


This section applies where, on an application under section 459G, the Court is satisfied of either or both of the following:


(a) that there is a genuine dispute between the company and the respondent about the existence or amount of a debt to which the demand relates;


(b) that the company has an offsetting claim.

459H(2)  [Calculation of substantiated amount]  


The Court must calculate the substantiated amount of the demand in accordance with the formula:

Admitted total - Offsetting total

where:

admitted total means:


(a) the admitted amount of the debt; or


(b) the total of the respective admitted amounts of the debts;

as the case requires, to which the demand relates.

offsetting total means:


(a) if the Court is satisfied that the company has only one offsetting claim - the amount of that claim; or


(b) if the Court is satisfied that the company has 2 or more offsetting claims - the total of the amounts of those claims; or


(c) otherwise - a nil amount.

459H(3)  [Substantiated amount less than statutory minimum]  


If the substantiated amount is less than the statutory minimum, the Court must, by order, set aside the demand.

459H(4)  [Substantiated amount equal to or greater than statutory minimum]  


If the substantiated amount is at least as great as the statutory minimum, the Court may make an order:


(a) varying the demand as specified in the order; and


(b) declaring the demand to have had effect, as so varied, as from when the demand was served on the company.

459H(5)  [Definitions]  


In this section:

admitted amount , in relation to a debt, means:


(a) if the Court is satisfied that there is a genuine dispute between the company and the respondent about the existence of the debt - a nil amount; or


(b) if the Court is satisfied that there is a genuine dispute between the company and the respondent about the amount of the debt - so much of that amount as the Court is satisfied is not the subject of such a dispute; or


(c) otherwise - the amount of the debt.

offsetting claim means a genuine claim that the company has against the respondent by way of counterclaim, set-off or cross-demand (even if it does not arise out of the same transaction or circumstances as a debt to which the demand relates).

respondent means the person who served the demand on the company.

459H(6)  [Paramountcy]  


This section has effect subject to section 459J.

[CCH Note: There is no section 459I.]


 



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