Background
GW Capital No 2 Pty Ltd managed a unit-trust investment fund in which members of the Mackenzie family and their associated superannuation vehicles had invested. After GW Capital failed to satisfy redemption requests, the parties entered a settlement deed dated 25 March 2025. The deed required GW Capital to make scheduled redemption payments totalling $9.05 million. GW Capital made some payments but did not complete the schedule.
Three groups of Mackenzie investors consequently served statutory demands for amounts due under the deed. GW Capital applied under s 459G of the Corporations Act 2001 (Cth) to set aside all three, alleging genuine disputes based principally on estoppel and waiver. It also asserted an offsetting claim against Mark Mackenzie. A separate issue arose because the application concerning Mark, Jane and Mackenzie Holding Company was emailed to their South Australian solicitors on the final day of the 21-day period, although the demand had been served in New South Wales and specified the interstate office as its address for service.
The Court’s Holding
Nixon J dismissed all three challenges. GW Capital had not established a genuine dispute concerning the settlement debts. Its estoppel case was deficient, including because it did not show that Mark Mackenzie had actual or ostensible authority to bind the other investors, and it did not sufficiently identify a clear representation capable of preventing enforcement. The asserted waiver and offsetting claim likewise did not establish an arguable basis for disputing the debts.
For the Mark and Jane demand, emailing the application to solicitors in South Australia did not satisfy the mandatory interstate-service requirements of ss 9 and 15(3) of the Service and Execution of Process Act 1992 (Cth). Sections 110C and 110D of the Corporations Act did not displace those requirements, so the Court’s jurisdiction was not validly invoked within the 21-day period. The Court also declined to declare that demand void for specifying an interstate service address: GW Capital suffered no relevant prejudice because its challenge would have failed on the merits in any event. The Peter and Wendy demand remained effective but was varied from $2,475,274 to $2,325,275 to account for an omitted $150,000 payment.
Key Takeaways
- The threshold for showing a genuine dispute is low, but an applicant must still present a plausible, sufficiently particularised contention rather than an unsupported or misconceived assertion.
- Electronic transmission under ss 110C and 110D of the Corporations Act does not override the specific requirements governing interstate service of initiating process under the Service and Execution of Process Act.
- A defect in a statutory demand’s nominated address will not necessarily justify declaring the demand void, particularly where no substantial injustice or practical prejudice is shown.
Why It Matters
The decision underscores the strict, jurisdictional nature of the 21-day commencement-and-service requirements for statutory-demand challenges. A debtor cannot cure ineffective service after that period, even where the documents reached the creditor’s solicitors by email on time.
It also illustrates the evidentiary discipline required when estoppel, waiver or an offsetting claim is invoked to establish a genuine dispute. Although the Court does not finally adjudicate the debt on a s 459G application, the asserted dispute must have a coherent legal and factual foundation.