Builder loses appeal against winding-up notice for debts over $100k

After performing work for a construction company for a shortfall of over $100,000, one subcontracting company has had its winding-up application adjourned, with the court offering the construction company the opportunity to repay its debt prior to further action.

Having failed to comply with a statutory demand for a winding-up application in late 2025 for $117,006 in debt, construction company Zerdest Pty Ltd failed in its ground against electrical and solar system business Technoport Co Pty Ltd at the Supreme Court of Victoria.

The two companies worked together on 10 to 15 separate building sites from 2016 at Niddrie, Airport West and Rye, when the subcontractor, Technoport, made an application for a winding-up order, asserting that Zerdest was insolvent as it did not pay its $117,006 debt.

”Technoport contends that Zerdest is presumed insolvent by reason of its failure to comply with the Statutory Demand,” the court heard.

Despite this, Zerdest disputed this amount, claiming that it was in fact $102,006, and its “profitable” business was solvent.

“It seems to me that, at best, the evidence adduced by Zerdest addresses one inference that might be drawn from Zerdest’s failure to pay the amounts claimed by Technoport, and that is that it did not pay that particular debt because it did not have the resources to do so.”

Despite this, the Crisp Report, which Zerdest relied on to prove solvency, revealed that it had made $166,388 available to its solicitors EK Lawyers.

“Having regard to Mr Bulut’s evidence on this topic and the moneys paid into EK Lawyers’ trust account, I do not draw that inference from the non‑payment. It is otherwise unnecessary for me to address the dispute raised by Zerdest or reach any conclusions about it,” the court said.

Further in the Crisp Report, it stated that insolvency was weighed heavily against due to a selection of matters, such as Zerdest was in business for 12 years, it had a pipeline of budgeted profitable work in place, it operated within its overdraft and credit card facility, and operated a profitable business.

“I am not satisfied that the matters listed, either separately, or in combination, justify the dismissal of the winding up application,” Associate Justice Fary said.

Although “some measure of comfort as to its financial viability,” Fary was not convinced that it had proved solvency.

Thus, Fary adjourned the winding up application until 6 August 2026, determining that Zerdest failed to provide solvency, providing a seven-day window to pay the $117,006 debt owing to Technoport.

The case citation: Re Zerdest Pty Ltd [2026] VSC 491 (31 July 2026).