Company dodges winding-up order after assets found nearly $2m in excess of debt

A trustee has lost its bid to wind up a company after the court found that it had proved solvency with an excess of nearly $2,000,000 in assets.

In his decision, the Supreme Court of Victoria Justice Michael Sumner Osborne has set aside a winding-up order against a company and ruled that the company must pay the plaintiff’s costs, finding that it is highly unlikely that the company would be insolvent.

The company, HNWM Developments Pty Ltd, was wound up in mid-2026 after it failed to respond to a statutory demand for a winding-up order.

Vlado Mega was the company’s sole director and sought an appeal against the order.

“This Company is very simply constituted. It has one asset, the Land, and for present purposes, one debt, being the judgment debt,” the court found.

The company’s sole asset was a vacant land located at Lot 501 Warrengie Drive, Meningie, South Australia, valued at $3,850,000.

The company had three liabilities: “Two current liabilities comprising the judgment sums owing to Mr Kypri in the total sum of $1,683,283 plus trade creditors of $255, and a non‑current liability in the form of a loan owed to Mr Mega in the sum of $463,042.”

This leaves the excess of total assets for the company at $1,703,419.

The court said that while Mega’s affidavit did not include the trade creditors of $255, the debt was “de minimis”.

“Any suggestion that the Company is unable to pay such a small debt, as a matter of commercial reality, is ridiculous,” the court said.

“Here, there is evidence of a substantial property asset which is worth more than double the judgment debt.

“In that context, there is an air of unreality about the contention that the Land could not be used to secure finance or be realised in sufficient time to discharge the judgment debt.

“I accept that the Company has rebutted the statutory presumption of insolvency. Given the de novo nature of this appeal, that conclusion means that the application for winding up must be dismissed.”

Judge Osborne ruled that the appeal should be allowed and the winding-up order should be set aside on the basis that the company proved solvency; however ordered Mega to pay Kypro for “wasted costs”.

“The defendant shall pay the plaintiff’s costs of and incidental to the setting aside of those judgments on an indemnity basis, such costs to be taxed in default of agreement,” the judge said.

The court listed the proceedings for further directions.

The case citation: Kypri v HNWM Developments Pty Ltd [2026] VSC 625 (28 September 2026).