Event and Time
Event Description
A legal dispute arose between K2M (the applicant) and Unita (the respondent) regarding a statutory demand issued by Unita for payment under a construction contract for a residential apartment development. K2M alleged that there was a genuine dispute concerning the indebtedness because it claimed Unita failed to fulfill its contractual obligations.
Application and Claims
- K2M filed an application to set aside a statutory demand served by Unita claiming a debt for work performed under the construction contract.
- K2M contended that:
- The contract did not take effect due to Unita's failure to provide a detailed cost estimate and scope of works. - Alternatively, if the contract was binding, K2M was unable to pay due to Unita’s breach.
Judicial Decisions
- The application to set aside the statutory demand was dismissed.
- K2M was ordered to pay Unita's costs of the application.
Dispute Points and Legal Basis
Dispute Points
K2M (Applicant):
- Claimed there was a genuine dispute regarding the existence of the debt:
- Contended the contract was ineffective as Unita failed to perform according to its obligations. - Claimed inability to pay arose from Unita's actions preventing K2M from obtaining necessary financing.
- Argued the statutory demand was an abuse of process since Unita had initiated a separate action for the same debt.
Unita (Respondent):
- Argued that K2M's claims did not constitute a genuine dispute, focusing on:
- The contract’s terms which required payment for work completed, which had occurred prior to termination. - The statutory nature of the debt under the Building Industry Fairness (Security of Payment) Act 2017 (Qld), asserting no real dispute could exist once a statutory demand was properly issued.