Menzies Haulage loses bid to stay afloat

Court rejects plea to give Menzies Haulage more time to fend off liquidation

Menzies Haulage loses bid to stay afloat
Menzies Haulage loses bid to stay afloat
By Brad Gardner | November 13, 2009

Menzies Haulage has lost its bid to stay afloat after a court rejected an application to give the company more time to fend off liquidation.

The operator wanted an extension to review a decision by the Registrar Caporale on September 3 to send in liquidators.

Paccar Financial made the application due to the NSW-based operator’s debt of $373, 541.09.

Justice Michelle Gordon ruled there was no reason to extend the time because of the company’s financial situation.

"Put simply, there is no objective evidence of solvency and, in fact, evidence which tends to suggest that the company, in fact, is insolvent," Gordon says.

The court was told Menzies Haulage had not traded since August 26 last year and that Ian and Colleen Menzies, the directors and shareholders, were paying the company’s bill to try and reduce its debt.

Furthermore Gordon says the operator had capital of $2 made up to two $1 shares.

"The difficulty for Menzies Haulage in this case is it has no prospect of success on the application to review," Gordon says.

Prior to seeking liquidators, Paccar had mailed a statutory demand to the company on July 24 seeking the money owed.

Ian Menzies says he did not receive the letter because he had organised mail to be redirected to a post office box which may have caused confusion and resulted in the mail being misplaced.

However, Gordon dismissed the reason by saying it was insufficient and that reasonable steps were not taken to resolve any problems with mail being lost due to redirection.

Furthermore, the court ruled Paccar would suffer prejudice if the operator was given more time to review the Registrar’s decision.

"Challenge to that decision now, two months after the appointment, would inevitably create uncertainty," Gordon says.

The court also ordered Menzies Haulage to pay Paccar’s court costs.

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