Guardi Shoes Limited -v- Datum Contracts
Monday, 28 October 2002
Key terms: Injunction - Winding up Petition - Statutory Demand - Counterclaim - s111
Guardi Shoes Limited ("Guardi") was seeking a continuance of an injunction restraining the advertisement of a creditor's petition, following Datum Contracts' ("Datum") attempts to enforce an adjudicator's award.
Guardi engaged Datum to perform refurbishment and fit out works of a shop. Following completion of the works there were certain snagging items outstanding. Datum had accepted these items and intended to return to site to remedy them. Gaudi, however, viewed the defects as substantial and was not prepared to have Datum return to the site. Datum was informed that no further payments would be made and, accordingly Datum referred its claim for payment to adjudication.
Datum was successful at adjudication and subsequently enforced the award and some payments were made by Guardi by way of instalments. Datum eventually served a statutory demand. Guardi continued in correspondence to refer to a claim in respect of defects but did not take any effective steps to bring this claim to any form of adjudication.
Datum then presented a winding-up petition. This caused Guardi's solicitors to furnish draft particulars of claim in respect of outstanding defects. However, given the protracted nature of proceedings thus far, Datum made it clear that the petition would be advertised. This led Gaudi to seek the without notice application restraining such advertisement.
Gaudi then sought to raise its counterclaim to set off the remaining amount outstanding to Datum.
His Honour Justice Ferris refused to continue the injunction. Guardi had had the opportunity to serve a s 111 notice in relation to its claims but failed to do so. Datum was a judgment creditor and that the principles to be applied to an application of this kind were well established.
Guardi's cross claim had come very late and after other excuses not connected with the defects had been offered for the failure to satisfy the judgment. The judge was of the opinion that the whole situation was unconvincing and "smacked" of an attempt to drag together sufficient grounds to get the advertisement of the petition restrained.
His Honour Justice Ferris noted that the two matters were closely connected and that the contract machinery plainly gave Gaudi the opportunity to serve an appropriate counter notice which it did not take. Accordingly Gaudi only had itself to blame and that the presentation of a petition by Datum in the circumstances was not an abuse. He noted that it was usual for a successful part of an adjudicator's award to proceed to judgment and if still unsatisfied to present a petition.
On these grounds, Justice Ferris found no proper basis for continuing with the injunction granted and continue with the application. Costs were awarded in favour the judgment creditor.
Guardi engaged Datum to perform refurbishment and fit out works of a shop. Following completion of the works there were certain snagging items outstanding. Datum had accepted these items and intended to return to site to remedy them. Gaudi, however, viewed the defects as substantial and was not prepared to have Datum return to the site. Datum was informed that no further payments would be made and, accordingly Datum referred its claim for payment to adjudication.
Datum was successful at adjudication and subsequently enforced the award and some payments were made by Guardi by way of instalments. Datum eventually served a statutory demand. Guardi continued in correspondence to refer to a claim in respect of defects but did not take any effective steps to bring this claim to any form of adjudication.
Datum then presented a winding-up petition. This caused Guardi's solicitors to furnish draft particulars of claim in respect of outstanding defects. However, given the protracted nature of proceedings thus far, Datum made it clear that the petition would be advertised. This led Gaudi to seek the without notice application restraining such advertisement.
Gaudi then sought to raise its counterclaim to set off the remaining amount outstanding to Datum.
His Honour Justice Ferris refused to continue the injunction. Guardi had had the opportunity to serve a s 111 notice in relation to its claims but failed to do so. Datum was a judgment creditor and that the principles to be applied to an application of this kind were well established.
Guardi's cross claim had come very late and after other excuses not connected with the defects had been offered for the failure to satisfy the judgment. The judge was of the opinion that the whole situation was unconvincing and "smacked" of an attempt to drag together sufficient grounds to get the advertisement of the petition restrained.
His Honour Justice Ferris noted that the two matters were closely connected and that the contract machinery plainly gave Gaudi the opportunity to serve an appropriate counter notice which it did not take. Accordingly Gaudi only had itself to blame and that the presentation of a petition by Datum in the circumstances was not an abuse. He noted that it was usual for a successful part of an adjudicator's award to proceed to judgment and if still unsatisfied to present a petition.
On these grounds, Justice Ferris found no proper basis for continuing with the injunction granted and continue with the application. Costs were awarded in favour the judgment creditor.