DISTRICT COURT OF QUEENSLAND
CITATION: 	Commercial Images (Aust) Pty Ltd (in liq) v Manicaros [2023] QDC 77	
PARTIES: 	COMMERCIAL IMAGES (AUST) PTY LTD (IN LIQUIDATION) 
ACN 011 023 617
(Plaintiff)
v
MICHAELA MANICAROS
(Defendant)	
FILE NO:	BD No 4568 of 2018	
DIVISION:	Civil 	
PROCEEDING:	Claim	
ORIGINATING COURT: 	Brisbane District Court 	
DELIVERED ON:	12 May 2023	
DELIVERED AT:	Brisbane 	
HEARING DATE: 	24 and 26 October 2022	
JUDGE:	Porter KC DCJ 	
ORDERS:	1.	The defendant pay to the plaintiff the amount of $765,196.46 including interest to this day and that the defendant pay the plaintiff’s costs of the proceeding (including reserve costs) to be assessed. 	
CATCHWORDS:	LIMITATION OF ACTIONS – EXTENSION OR POSTPONEMENT OF LIMITATION PERIODS – CONFIRMATION – ACKNOWLEDGMENTS AND PROMISES TO PAY – where the defendant was a director of the plaintiff company – where the defendant received various unsecured loans from the company between 2005 and 2009 – where defendant signed company accounts in 2016 in which the debts were recorded – where the defendant sent various pieces of correspondence in relation to the debts – where some of that correspondence was exhibited to an affidavit of the defendant filed in proceedings where the plaintiff was a party – where the liquidator of the plaintiff sought to recover the debts owed by the defendant by proceedings commenced in 2018 – where the debts would be statute barred if the 2016 accounts, the correspondence or the affidavit did not amount to an acknowledgement of the debt made to the plaintiff – whether any of those documents amounted to an acknowledgment of debt made to the plaintiff 	
LEGISLATION:	Corporations Act 2001 (Cth) ss 45A, 292 and 296 
Limitation of Actions Act 1974 (Qld) ss 35 and 36 	
CASES:	Blair v Nugent (1846) 3 Jo. & Lat. 668
Bucknell v The Commercial Banking Company of Sydney Limited (1937) 58 CLR 155
Green v Humphreys (1884) 26 Ch D 474
Hemat v Sayed [2014] WADC 30
Hepburn v McDonnell (1918) 25 CLR 199
Hipworth v Mahar (1952) 87 CLR 33 
In re Compania de Electricidad [1980] 1 Ch 146
Sexton Development v Yarrawonga Pty Ltd [2003] QCA 173
Stage Club Ltd v Millers Hotels Pty Ltd (1981) 150 CLR 535
Tapiolas v Tapiolas [1985] 2 Qd R 310
Van Reesema v Flavel (1992) 7 ACSR 225
VL Finance Pty Ltd v Legudi (2003) 54 ATR 221
Woo v Woo [2010] NSWSC 1216
Secondary Materials 
G E Dal Pont, Law of Limitations (LexisNexis Butterworths, 2nd ed, 2021)
Robert Austin and Ian M Ramsay, LexisNexis Butterworths, Ford, Austin & Ramsay’s Principles of Corporations Law (online at 9 May 2023)	
COUNSEL:	  C Wilkins KC for the Plaintiff 
  A J H Morris KC and I Erskine for the Defendant	
SOLICITORS:	  Colin Biggers & Paisley Lawyers for the Plaintiff
  Cronin Miller Litigation for the Defendant	

Contents
Summary
Facts
Background
The 2016 accounts
The directors fall into dispute
The alleged 2 July acknowledgement
The alleged 18 August acknowledgement
The winding up proceedings
The alleged 4 December acknowledgement
General Principles
Queensland statutory provisions
Statutory history and cognate statutes
Acknowledgment in the High Court
Hepburn (1918)
Bucknell (1937)
Hipworth (1952)
The Stage Club (1981)
First alleged acknowledgment: the 2016 accounts
The plaintiff’s contentions
The defendant’s contentions
Analysis
Preliminary observations
The 2016 accounts contain an admission of the debts
The acknowledgment is made to the company
VL Finance Pty Ltd v Legudi
Conclusion
Second alleged acknowledgment
Initial observations
The plaintiff’s contentions
The defendant’s contentions
Analysis
Acknowledgment of the debt?
Acknowledgment made to the company?
Third alleged acknowledgment
Acknowledgment of the debt?
Acknowledgment made to the company?
Fourth alleged acknowledgment
Acknowledgment of the debt?
Acknowledgments made to the company?
Fifth alleged acknowledgment
Conclusion

Summary 
[1]	On 11 November 2016, the defendant (Ms Manicaros) signed the financial accounts of the plaintiff (Commercial Images or the company) for the 2016 year (the 2016 accounts) as director, declaring the accounts to present fairly the company’s financial position.  The accounts recorded debts totalling $686,797 owing by Ms Manicaros to the company as current assets (the debts).  The company, under the direction of its liquidator, sues to recover those debts.  Ms Manicaros accepts that the accounts accurately record her debts to the company.  However, she defends the claim on the basis that the debts are statute barred pursuant to s. 10(1)(a) LAA.   
[2]	Commercial Images accepts that the claims for the debts accrued more than 6 years before commencement of these proceedings and are prima facie statute barred as Ms Manicaros contends, but contends that by signing the 2016 accounts, Ms Manicaros acknowledged the debts to Commercial Images with the consequence that the claim for the debts accrued afresh on 11 November 2016 pursuant to ss. 35(3) and 36 Limitation of Actions Act 1974 (Qld) (the LAA).  Further, Commercial Images contends that Ms Manicaros also acknowledged the debts by two later emails sent in 2017, by an affidavit filed and served on 24 October 2017 in oppression proceedings involving the company and her co-director and brother Mr Verschoyle, and by a later written communication from her solicitors.  
[3]	Ms Manicaros contends that neither the signing of the 2016 accounts nor the subsequent emails, affidavit and letter, comprised acknowledgement of the debts which met the statutory requirements in ss 35(3) and 36 LAA.
[4]	There were two other substantial defences raised on the pleadings which involved contested issues of fact:
(a)	That various statements allegedly made by the liquidator’s solicitor gave rise to an estoppel (or various other related defences) precluding Commercial Images from recovering the debts; and
(b)	That Ms Manicaros was entitled to set off against the debts, unpaid amounts of rent and outgoings due by Commercial Images under its lease with a company related to Ms Manicaros (which had allegedly assigned those debts to her).
[5]	On the morning of the first day of trial, however, Mr Morris KC, who appeared with Mr Erskine for Ms Manicaros, abandoned all defences except the limitations defence.  A Third Further Amended Defence was filed by leave which abandoned all allegations relevant to the above defences.  Accordingly, there are no disputes of primary fact remaining in the trial.  The evidentiary record is comprised of documents admitted without objection.  
[6]	For the reasons which follow, I find that:
(a)	Each of the 2016 accounts and the affidavit filed in the oppression proceedings contained an acknowledgement of the debts which met the requirements of ss 35(3) and 36 LAA;
(b)	As a result the right of action to recover the debts is deemed to have accrued on 11 November 2016 and 24 October 2017 respectively; and
(c)	In either case, these proceedings were commenced within the 6-year period allowed by s. 10(1)(a) LAA and are not statute barred.
[7]	As no other defence was raised at trial to the claims by Commercial Images on the debts, I order judgment for the plaintiff. 
Facts  
Background 
[8]	Commercial Images operated a commercial furnishings business from premises at 387 Montague Road, West End (the Property) under a lease dated 17 December 2009 (the lease).  Its directors and shareholders were Ms Manicaros and Mr Stephen Verschoyle.  Ms Manicaros and Mr Verschoyle are siblings and appear to have run the business together.  They are also equal shareholders in Commercial Images and were directors of the company from at least 10 December 2001.
[9]	The Property was owned as tenants in common by TCB Team Pty Ltd (TCB) and SV14 Pty Ltd (SV14), each company holding its share as trustee.  These two companies were controlled by Ms Manicaros (and her husband) and Mr Verschoyle respectively.   
[10]	The 2016 accounts record that Commercial Images made loans to each of Ms Manicaros and Mr Verschoyle during each financial year between the year ended 30 June 2005 and the year ended 30 June 2009.  This is admitted on the pleadings and that admission is confirmed in Ms Manicaros’ trial submissions.  Those amounts are recorded in Note 6 to the 2016 accounts (with slight formatting changes) as follows (the debts):
  
Unsecured Loan	Debtor	2016	2015	
Unsecured loan 2005	S Verschoyle	50,000	50,000	
Unsecured loan 2005	Manicaros Manicaros	50,000	50,000	
				
Unsecured loan 2006	S Verschoyle	30,000	30,000	
Unsecured loan 2006	Manicaros Manicaros	30,000	30,000	
				
Unsecured loan 2007	S Verschoyle	70,002	70,002	
Unsecured loan 2007	Manicaros Manicaros	70,002	70,002	
				
Unsecured loan 2008	S Verchoyle	217,056	217,056	
Unsecured loan 2008	Manicaros Manicaros	171,119	171,119	
				
Unsecured loan 2009	S Verschoyle	372,391	372,391	
Unsecured loan 2009	Manicaros Manicaros	365,676	365,676	
				
		$1,426,246	$1,426,246	

[11]	The detailed trial submissions did not dispute the sums recorded had been advanced to Ms Manicaros by the company as identified in the 2016 accounts.  Further, there was no challenge to the evidence of the debts comprised in the 2016 accounts.  I find that there were debts incurred by Ms Manicaros to Commercial Images as particularised in the above table.  (Note that the 2016 accounts record a debt due from Commercial Images to Ms Manicaros which is not disputed by the company and accordingly the company sues for the net sum of $631 276.)
The 2016 accounts   
[12]	The 2016 accounts were prepared by Crowe Horwath.  It is admitted that Crowe Horwath were accountants for Commercial Images and that the 2016 accounts were prepared for Commercial Images as client.  There is no other evidence about the preparation of the 2016 accounts or their subsequent use.  They are left to speak for themselves.  While the parts of the 2016 accounts directly relating to the debts are important, the submissions of the parties require attention to be given to the whole of the document.  Ultimately, like all documents, the 2016 accounts must be construed as a whole.
[13]	Pages 2 to 4 of the 2016 accounts contain a trading statement and profit & loss statement (the 2016 P&L).  It is sufficient to note the following:
(a)	The trading statement showed a gross profit from trading of $1,396,588 in 2015 and $1,247,732 in 2016;
(b)	The P&L showed a small profit of $58,398 in 2015 and a small loss of $19,930 in 2016;
(c)	The principal non-costs of sales expenditure in each year were salaries at about $700,000 and rent of $263,695 in 2016 and a little more in 2015.
[14]	The 2016 P&L finished with the following reconciliation of retained profits:
[15]	Pages 5 of the 2016 accounts contains the balance sheet as follows:

[16]	Page 6 contains the reconciliation of Equity of the company:
[17]	Pages 7 and 8 contain the Notes to the 2016 accounts.  Those pages relevantly provide:
(a)	By Note 1:
1	Statement of Significant Accounting Policies
The financial statements are a special purpose report prepared for use by directors and the member. [sic] The directors have determined that the company is not a reporting entity.
The statements are prepared on an accruals basis.  They are based on historic costs and do not take into account changing money values or, except where specifically stated, current valuation of non-current assets.
No Australian Accounting Standards, Australian Accounting Interpretations Views or other authoritative pronouncements of the Australian Accounting Standards Boards have been intentionally applied.
(b)	By Note 6, a table substantially in the form of that set out in paragraph [10] above;
(c)	By Note 7, detailed particulars of property plant and equipment referred to in the Balance Sheet;
(d)	By Notes 9 and 10: 
[18]	Pages 10 to 12 contain a detailed depreciation schedule.
[19]	Page 13 of the 2016 accounts is central to these proceedings.  It contains a Directors’ Declaration (the 2016 declaration), is signed by each of Mr Verschoyle and Ms Manicaros and is hand dated 11 November 2016.  It provides:
DIRECTORS’ DECLARATION
The directors have determined that the company is not a reporting entity and that this special purpose financial report should be prepared in accordance with the accounting policies outlined in Note 1 to the financial statements.
In accordance with a resolution of the directors of [Commercial Images], the directors of the company declare that:
1. 	the financial statements and notes as set out on pages 2 to 12 present fairly the company’s financial position as at 30 June 2016 and its performance for the year ended on that date in accordance with the accounting policies outlined in Note 1 to the financial statements; and
2.	in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
			[underlining added]
[20]	Note 1 is set out in paragraph [17](a) above. It is referred to again in the Compilation Report at Page 14 of the 2016 accounts which provides:
COMPILATION REPORT
TO COMMERCIAL IMAGES PTY LTD
We have compiled the accompanying special purpose financial statements for the year ended 30 June 2016 of [Commercial Images], as set out on pages 2 to 12.  The specific purpose for which the special purpose financial statements have been prepared is set out in Note 1 to the financial statements.
The Responsibility of Directors
The directors of [Commercial Images] are solely responsible for the information contained in the special purpose financial statements and have determined that the basis of the accounting used is appropriate to meet their needs and for the purpose that the financial statements were prepared.
Our Responsibility
On the basis of information provided by the directors of [Commercial Images], we have compiled the accompanying special purpose financial statements in accordance with the basis of accounting adopted and APES 315: Compilation of Financial Information.
Our procedures use accounting expertise to collect, classify, and summarise the financial information, which the directors provided, in compiling the financial statements.  Our procedures do not include verification or validation procedures.  No audit or review has been performed accordingly no assurance is expressed. 
The special purpose financial statements were compiled exclusively for the benefit of the directors of [Commercial Images].  We do not accept responsibility to any other person for the contents of the special purpose financial statements.
[underlining added]
[21]	The Compilation Report is signed by a Mr Brett Collins as principal of Crowe Horwath.  That page is undated. 
[22]	Although there was no direct evidence as to the preparation or use of the 2016 accounts, some inferences can reasonably be drawn.
[23]	First, by Note 1 and by the 2016 declaration, the 2016 accounts state that Commercial Images was determined by the directors not to be a reporting entity.  In my view, considering the character of Commercial Images disclosed by the 2016 accounts, it can be inferred this means that it is not a corporate entity required by the Corporations Act 2001 (Cth) (CA) to prepare financial reports and directors’ reports.  I explain as follows.  
[24]	Section 292(2) CA deals with the financial reporting obligations of small proprietary companies.  Based on the 2016 accounts, Commercial Images could reasonably be considered by the directors to be such a company: see s. 45A(2) CA.  Small proprietary companies are not required to produce financial reports unless they fall into the specific categories in s. 292(2)(a) and (b).  There is no suggestion in the evidence that Commercial Images falls into any of those specific categories.  The references to not being a reporting entity appear to be linked to the lack of formal application of the Accounting Standards.  Those references make sense when considered in the context of s. 292.  The CA provides, in my view, extrinsic facts relevant to the objective interpretation of company accounts, at least in relation to statutory provisions of general application.  
[25]	Second, the 2016 declaration states that the 2016 accounts should be prepared in accordance with the accounting policies in Note 1.  In my view, the accounting policies objectively discernible in Note 1 comprise are as follows:
(a)	The accounts are prepared on an accruals basis;
(b)	The accounts use historic costs unless otherwise stated; and
(c)	No Australian Accounting Standards have been intentionally applied.
[26]	Third, the Compilation Report states that the 2016 accounts have been prepared for the specific purpose in Note 1.  In my view, the purpose objectively discernible in Note 1 is “use by directors and the member” [sic members].  That certainly seems to have been Crowe Horwath’s view, given the second underlined statement in the Compilation Report which confirms that the financial statements were produced exclusively for the use of the directors (who in fact are also the members).  This language must be considered, however, considering the admission in paragraph 5 of the TFAD that the 2016 accounts were prepared for Commercial Images by Crowe Horwath.  
[27]	In my opinion, references to use by the directors and members of Commercial Images in that context objectively refers to use by the Company, through its directors and its constituent shareholders.  I consider this further when considering whether any acknowledgement contained in the 2016 accounts was made to the company.
The directors fall into dispute 
[28]	There was no oral evidence led at trial.  The trial bundle, tendered by consent, did include, however, affidavits filed by both Ms Manicaros and Mr Verschoyle in oppression proceedings commenced in October 2017 by Ms Manicaros.  There was no cross examination on either affidavit.  However, their contents appear to be largely uncontentious in so far as the issues in this proceeding are concerned and they can provide some background to the documents relied upon by the parties.
[29]	Mr Verschoyle states that over the period between March and December 2016, Ms Manicaros told Mr Verschoyle from time to time that she no longer wanted to be involved with Commercial Images.  Ms Manicaros’ affidavit exhibits correspondence between the parties from about February 2017 which broadly confirms that statement.  It will be recalled that the 2016 accounts were signed in November 2016.  The siblings do not appear to have fallen out at that time, though one might infer that discontent was brewing.
[30]	The correspondence shows that over the period from February to about May 2017, there was discussion between the siblings about Mr Verschoyle buying out Ms Manicaros and discussion of the practicalities related to her departure from the company and sale of her shares.  Much of the attention was focussed on her entitlements as an employee.
[31]	During this period there was little mention of the directors’ debts to Commercial Images, though the occasional comment reveals that the parties were aware that there were debts due from both parties which had to be dealt with in any sale.  The only material observation about the debts prior to April 2017 that I could locate was in an email from Mr Verschoyle dated 3 March 2017 where he wrote to his sister, relevantly:
Obviously the current uncertainly [sic] is personally challenging for us both, however given that we both have requested our accountant to provide information relating to the possibility of forgiving the Directors loans – and the information and a decision on same is imminent – I request that we wait on receipt of advice.
If the suggestion from Brett is that there is an option – I require confirmation – and then obviously, our mutual decision on same – with clear and defined outcomes.
Although we both personally stand to save a significant amount of money – quite the windfall - the consequence of a forgiven loan will negatively affect the Company’s equity position. 
[32]	It is worth observing that, based on that email, Mr Verschoyle plainly took the view that the loans were assets of the company able to be enforced, because if that were not the case, their forgiveness could scarcely negatively affect the equity position of the company.  There was no evidence I could locate of any response directly to this email by Ms Manicaros, though as will be seen, it was a consistent theme of the correspondence that the debts had to be dealt with.
[33]	It was in that context that on 12 April 2017, Ms Gray, a solicitor with Clifford Gouldson Lawyers, wrote to Ms Manicaros enclosing a draft deed of forgiveness for Ms Manicaros’ review (the draft deed).  The tenor of the covering letter is that Ms Gray was acting for Ms Manicaros.   It was sent under cover of an email to Ms Manicaros.  It was not copied to Mr Verschoyle, though it was shared with Crowe Horwath recipients.  It was also forwarded by Ms Manicaros to Mr Verschoyle senior, father to Ms Manicaros and Mr Verschoyle.  The draft deed was between Commercial Images and Ms Manicaros. Mr Verschoyle is not mentioned by name, nor is there any reference to any debt owed by him to Commercial Images.  However, the execution block contemplated execution by two directors and, of course, Mr Verschoyle was the other director.  The draft deed relevantly provided:
(a)	By the recitals:
1.	[Commercial Images] made a number of Loans to [Ms Manicaros] over time. 
2.	[Ms Manicaros] may be indebted to [Commercial Images] for the amount of up to $686,796.87.
3.	[Commercial Images] acknowledges that some of that amount may have already been forgiven. 
4.	To the extent that [Ms Manicaros] is indebted to [Commercial Images] for any remainder of the amount, [Commercial Images] has resolved to forgive the debt on the terms and conditions set out in this Deed. 
(b)	By the definitions section:
1.1	The meanings of the terms used in this document are set out below.
Term	Meaning	
Debt	means any amount of the Loans still owing to [Commercial Images] by [Ms Manicaros] and not otherwise already forgiven by operation of law or for any other reason including but not limited to any statutory limitation period in respect of the Loans.	
Deed	means this document and any subsequent amendment or variation made in accordance with this document from time to time.	
Loans	means as the monies loaned to [Ms Manicaros] as set out in Schedule 1.	
(c)	For a full release of all the Debts as defined; and
(d)	By Schedule 1, the debts identified in Note 6 to the 2016 accounts. 
[34]	Despite the email from Mr Verschoyle on 3 March 2017, there is no evidence that he was ever provided with this draft.  There is also no evidence that he, Ms Manicaros nor Commercial Images ever received advice from Crowe Howarth on forgiving the debts each owed the company.  One might imagine that any such forgiveness might have had significant tax consequences because the advances might have been dealt with as deemed dividends, but there is no need to form a view on this issue to resolve these proceedings.
[35]	The correspondence in Ms Manicaros affidavit shows a certain impatience with Mr Verschoyle’s progress towards making an offer for Ms Manicaros shares.  A proposed heads of agreement were sent to Ms Manicaros from Russells (acting for Mr Verschoyle) on 10 May 2017. That heads of agreement include a term that the agreement was “subject to the Company forgiving the current loans to” Ms Manicaros and Mr Verschoyle.  Agreement could not be reached, and contentious correspondence continued, seemingly with little progress being made. 
The alleged 2 July acknowledgement 
[36]	The next relevant event is an exchange between Ms Manicaros and Mr Verschoyle in early July 2017.  Part of that exchange is relied upon by Commercial Images as an acknowledgement of the debts by Ms Manicaros made to the company.  That email must be put in context.
[37]	On Sunday 2 July 2017, Mr Verschoyle noticed a withdrawal of $121,923 from the Commercial Images bank account.  He queried his sister as to the withdrawal and called for its immediate return.  It was in that context that on 3 July 2017, Ms Manicaros sent an email as follows (the 2 July email):
Stephen
Withdrawal was partially for TCB share of rent for July, Aug and Sept.  Given you have recently withdrawn significant funds for personal ‘allowances’ without discussion, I wanted to ensure monies were available for rent.
The balance of the withdrawal was to normalize the loans we have with the company.  You will be aware your loans as of June 30th 2016 were higher than my loans.  I have brought us to ‘even’ as of 1st July 2017 but we can determine at a subsequent date whether this amount shall be classified as a loan or applied against any Director’s fees and/or other adjustments that may arise during the year. 
I am still waiting on clarification from you regarding your distribution of allowances paid in the weekly payroll amounts over the past few weeks. 
I note that you continue to deny me access to company records.
Kind Regards
Michaela Manicaros 
[38]	This email was written in the context of the on-going contentious correspondence between the directors in which each criticises the management of the affairs of the company by the other.  The background to that correspondence is Ms Manicaros’ wish to exit the company. The plaintiff relies on this email, and the underlined section in particular, as a further acknowledgement of the debts made to the company.
The alleged 18 August acknowledgement 
[39]	The correspondence continued in a similar vein.  Notably, the father of the directors, by 26 July 2017, had decided that he was not able to assist his warring offspring to resolve their dispute and had decided to stay out of future negotiations. 
[40]	In the days leading up to 18 August 2017, Ms Manicaros and Mr Verschoyle returned to a previous area of dispute, namely, the rent payable by Commercial Images under the lease.  This was obviously a point of contention given that the two directors were also the guiding minds of the two companies which together owned the premises.  The dispute seems to have largely resolved to a question about whether the rent was over paid or under paid and whether Ms Manicaros had acted wrongly in transferring company funds to pay rent.
[41]	In the context of that continuing dispute between the directors, Mr Verschoyle sent an email to Ms Manicaros in the following terms at 10:20am on 18 August 2017:
Michaela,
I am working on EOY 2017 figures allocations and need below
(a)	Your Credit Card Receipts for Last 6 months.
(b)	Your position on Forgiveness of Loans
		…
[42]	That email led to the next document relied upon by the plaintiff as an acknowledgement.  On the same day at 3:50pm, Ms Manicaros responded to Mr Verschoyle’s email as follows (the 18 August email):
Stephen

All my expenditure relates to running of company car and some Telstra invoices.
Original Receipts will be submitted on my return

Director's [sic] loans remain and at this stage are not forgiven, however seeming actions [sic]
you took when I made an attempt to equalise the loan positions, you  should
equalise the loan positions.
Is there any reason why you feel that you should have approximately $64,000 in
company loans above what I have in company loans?
You should act to equalise our loan positions. This can be either by increasing my
loan position or decreasing yours. Given the concern you seem to convey to me
with regards to the company's financial  position (especially when it comes to
abiding by the lease agreement)you may  consider it best for Commercial Images if
you inject those additional loan funds you have taken back into the company.  If you
do not feel at this current time Commercial Images requires these additional funds
(to pay items like rent), you should increase my overall loan amount to bring it into
line with yours.

Advise your position regarding the loans and your intentions to equalise / normalise
the loans between us.

I note you still include  the title 'Managing Director' in your email signature.  Again,
you are NOT Managing Director and should cease to hold yourself out as such

You have also not provided TCB Pty Ltd with any correspondence regarding its
request for payment of the rent.
I again confirm that as equal Director and Shareholder , I am not in dispute of the
terms of the current agreement and therefore it cannot be Commercial Images'
position that it disputes the terms of the lease and actual rent owing. Your position
in disputing the rent and terms of the lease is a personal position and not the
position of the Company.  I, as Company Director, have every intention of abiding
by the current Lease Agreement we have both signed as Lessee of the premises.

Also, I still await all other outstanding information requests.
Further to that, you should forward to me with urgency all figures etc on all revenue
and expenses currently available to you regarding 2017.  Obviously if you require
items like petrol receipts by this Tuesday, you would certainly have  Sales figures
available. I expect that you forward all this information to me if not immediately,
then certainly by the 22/8/17

Kind Regards

Michaela Manicaros
[underlining added]
[43]	The company relies on this email, and the underlined sections in particular, as comprising a further acknowledgment of the debts made to the company.
The winding up proceedings  
[44]	On 23 October 2017, Ms Manicaros, as applicant, commenced Supreme Court proceedings against the company and Mr Verschoyle as respondents, seeking an order under CA s. 461(1)(k) for the winding up of the plaintiff on the just and equitable ground.  The basis of the application was oppression by Mr Verschoyle.   Her application was supported by her affidavit sworn and filed on 24 October 2017 which exhibited copies of the 3 July 2017 the emails and 18 August emails set out above (the 2017 affidavit).  The 2017 affidavit was served on the plaintiff on or about 24 October 2017.  Various correspondence which included the 2 July and 18 August emails, was incorporated by paragraph 20 of the 2017 affidavit which stated:
20. 	I have exchanged the following correspondence with the second respondent,
Richard Alan Stuart Verschoyle and others in relation to the operation of the
Company or alternatively, I have been copied into the following correspondence relating to the operation of the Company. 
	
[45]	The only other relevant statements in the 2017 affidavit are contained in paragraphs 23 to 26 which state:
Removal as director and subsequent demands from the Company
[23]	As noted above, I was removed as a director of the Company on 13 December 2017 without my knowledge. 
[24]	Following my removal, I received three demands from the company as follows.
(a)	A demand that I immediately repay my director related loans (see pages 184 to 191 of MM1.
…
[25]	I note for much of 2017, the second respondent and myself have been negotiating a possible sale of my interest in the business to him. In this regard, I received a proposed heads of agreement from his solicitors on 10 May 2017 (see pages 118 to 119 of MM1) following earlier discussions in February 2017 (see 65 to 66 of MM1).
[26] 	I am of the opinion that the second respondent has sent the above demands in order to exert pressure to force me to sell me interest in the Company on terms favourable to the second respondent. 
[46]	The plaintiff alleges that the adoption of the alleged acknowledgements in the 2 July and 18 August emails in the affidavit amounts to further acknowledgements of the debts.  The plaintiff also alleges that these acknowledgments were made to the company because of their inclusion in an affidavit filed and served in proceedings to which the company was a party.   
The alleged 4 December acknowledgement 
[47]	At the instigation of Mr Verschoyle, on 25 October 2017, voluntary administrators were appointed to the plaintiff.  On 31 October 2017, the Supreme Court of Queensland found that the voluntary administrators had been improperly appointed and made orders ending the administration of the plaintiff, appointing Darryl Kirk as provisional liquidator of the plaintiff, for the defendant’s application to wind up the plaintiff to continue as if started by claim, for pleadings, and for a further review on 4 December 2017.
[48]	Following the appointment of Mr Kirk as provisional liquidator, Mr Williams of Kemp Strang solicitors wrote to Ms Manicaros’ solicitor on behalf of the company (and on instructions from Mr Kirk) seeking to facilitate the operation of the company.  Mr Williams wrote:
Dear Bruce
As you are aware:
•	the Provisional Liquidator is being asked to sign work orders for the purposes of continuing the business operations of the Company; and
•	the order confirmations arising from those work orders will result in the Company incurring liabilities.
We note that the Provisional Liquidator has previously asked Michaela to pay an amount of $150,000 in reduction of her director loan account for the purposes of providing the Company with working capital to fund its ongoing business operations. That request has not been met by Michaela to date.
In the circumstances, would you please arrange for Michaela to sign and date the attached Indemnity as a matter of priority and return a copy to us by 1.00pm on Friday 1 December 2017.
[49]	On 4 December 2017, Ms Manicaros’ solicitor sent an email as follows:
Dear Glen
Further to recent communications we have been instructed to reaffirm our client’s position that it is unnecessary for your client to be dealing with the loan accounts at this stage.
Our client says that she is at a disadvantage because of the proposed path and is being forced to bid in order to avoid the unpalatable circumstances of having her estranged brother buy the loan account and then wield same as a sword.
Our client says your client should simply focus on the business sale and leave the loan accounts to be dealt with after should the need arise.
Can you please advise whether the current offer from Stephen includes our client’s loan account?
[50]	This email seems to be a non sequitur to the preceding letter from Mr Williams.  There is nothing else in the evidence which explains what the recent communications might be that are referred to in that letter.  The plaintiff contends that this email comprises a further and final acknowledgement of the 2016 debts. 
[51]	On 15 February 2018, the Supreme Court made consent orders in Proceeding BS11087/17 for the winding up of the plaintiff and the appointment of Mr Kirk as liquidator.  
[52]	On 19 December 2018, the company, by its liquidators, commenced these proceedings to recover the 2016 debts.
General Principles 
Queensland statutory provisions 
[53]	It is common ground that the debts are prima facie statute barred pursuant to s. 10(1)(a) LAA on the basis that more than six years has passed since the causes of action accrued to recover the debts in each case.  To succeed on its claims, the company must therefore establish that the claims in respect of the debts accrued afresh because of one or more of the alleged acknowledgements.  That requires the plaintiff to establish that it can make out the requirements of ss 35(3) and 36 LAA. 
[54]	Section 35 is headed “Fresh accrual of action on acknowledgment or part payment”.  Section 35(3) provides:
Where are right of action has accrued to recover a debt or other liquidated pecuniary claim, or a claim to the personal estate of a deceased person or to a share or interest therein and the person liable or accountable therefore acknowledges the claim or makes a payment in respect thereof, the right shall be deemed to have accrued on and not before the date of the acknowledgement or the last payment.  
[underlining added]
[55]	Further conditions for the fresh accrual of claims under s. 35(3) are articulated in s. 36.  It provides:
36	Formal provisions as to acknowledgement and part payment
(1)	Every acknowledgement referred to in section 35 shall be in writing and signed by the person making the acknowledgement.
(2)	Any acknowledgement or payment may be made by the agent of the person by whom it is required to be made under section 35 and shall be made to the person or to an agent of the person whose title or claim is being acknowledged or, as the case may be, in respect of whose claim the payment is being made.
		[underlining added]
[56]	Reading the two provisions together, the relevant conditions for the fresh accrual of the claims to the debts by the company are:
(a)	First, that Ms Manicaros acknowledges the debts; 
(b)	Second, the acknowledgement is in writing; 
(c)	Third, the acknowledgement is signed by her or signed by her agent; and
(d)	Fourth, the acknowledgement is made to the company or to an agent of the company.  
[57]	Each of the alleged acknowledgements relied upon by the plaintiff are in writing, so the second condition is not contentious.  Ms Manicaros accepted at trial that each of the alleged acknowledgments were signed either by her or (in the case of the correspondence from her solicitor) by her agent.  Each of the other two conditions are contentious for each of the alleged acknowledgements.  
Statutory history and cognate statutes
[58]	A key issue in dispute for each of the five alleged acknowledgments is whether the writing relied upon in each case is an acknowledgement of the 2016 debts within the meaning of that word, properly construed, in s. 35(3) LAA.  The LAA does not define the words ‘acknowledgement’ or ‘acknowledge’.  One is left to the general law to inform the meaning of that key word.
[59]	Before turning to the authorities, it is convenient to note the common law and statutory contexts in which the various authorities were decided, as the contexts are not uniform.  The principle of acknowledgement (or part payment) began as judge made law.  The development of the principle is explained by Professor Dal Pont (footnotes omitted):
The Limitation Act 1623 (Imp) made no reference to a prospect that the running of time in relation to a cause of action in debt should recommence in the event that the debtor acknowledged or confirmed the debt. Yet in what has been judicially described as ‘originally judge made law’, ‘invented’ by judges or, in terms more trenchant, the result of ‘decisions of three centuries… decorously disregarding an Act of Parliament’, the law came to recognise the concept of acknowledgment, and of part payment, as a means of mitigating the potential unjust affect so that the limitation statute could work. Where the debtor had acknowledged the debt, or made a part payment on account of it, within the limitation period the law declared it in the interest of justice that time should start afresh for limitation purposes. The right of action, it is said, is thereby ‘given a notional birthday and on that day, like the phoenix of fable, it rises again in renewed youth and - also like the phoenix, it is still itself’.
A series of cases, going back to at least 1698, established that an express promise to pay a debt, or even a simple acknowledgement of the debt - itself implying a promise to pay - sufficed to take the debt out of the statute. The assumption was that ‘a promise to pay what you owe (even if the limitation period has run) should be honoured’. Also, a promise to pay the debt was implied from a general acknowledgment, unless it was inconsistent with the circumstances of the terms of the acknowledgment. The ‘new’ promise was what triggered the ‘revived’ running of time (accrual date), for which the existing (acknowledged) debt was the consideration. Recognition of acknowledgment as a basis to post-date the running of time was reconciled with the strict words of the limitation statute by viewing the original loan and the subsequent promise as ‘one continuous transaction’; so while the creditor made the loan ‘once and for all’, the debtor ‘had not finished promising as long as he went on promising’, so that the debtors undertaking (assumpsit) ‘was still in being till within six years of the action’. Yet it cannot be denied that the explanation wore ‘an aspect of unreality’, not assisted by curial willingness to imply the relevant promise often on ‘highly artificial grounds’, such that ‘almost anything short of a denial of liability was held to be capable of implying a promise to pay’.
[60]	As the learned author explains, the principle is of some antiquity.  The first statutory provision referring to the principle was in 1828, though that statute was primarily concerned with creating a requirement that any acknowledgment be in writing and signed.  It was not until 1969 that detailed statutory provision was made for the principle by s. 24(3) Limitation Act 1969 (UK) (1969 UK Act).  The key alteration to the common law position made by the 1969 UK Act, reflected also in the various Australian provisions, is the omission of the common law requirement to show an express or implied promise to pay.  This was explained by Gibbs CJ as follows (footnotes omitted):
Under the law in force before the Limitation Act 1969 was passed it was necessary, in order to take a debt out of the operation of the statute of James I, that a new promise to pay should be capable of being inferred from the acknowledgment. However, an unconditional acknowledgment was held to imply a promise to pay Hepburn v. McDonnell; Bucknell v. Commercial Banking Co. of Sydney Ltd.  Under the Limitation Act 1969 it is not necessary that any promise to pay should be expressed or implied. What is necessary is an acknowledgment of the existence of the debt - and according to the submission for the appellant it must be an acknowledgment that the debt is existing at the time when the document containing the acknowledgment is signed. It is clear enough that, under the former law, it was necessary that there should be an admission that the liability still existed at the date of the acknowledgment, for one could not ordinarily imply a promise to pay from a statement that a liability had existed in the past. There had to be the admission of a present obligation to pay: see, for example, Spencer v. Hemmerde. Although under the Limitation Act 1969, it is no longer necessary that there should be a promise to pay, it is still necessary, in my opinion, that an acknowledgment should admit or recognize the present existence of a cause of action; in other words, where the claim is for payment of a debt, an acknowledgment, to be sufficient, must recognise the present existence of the debt. I respectfully agree with the statement of Kerr J. in Surrendra Overseas Ltd. v. Sri Lanka, that "To acknowledge a claim, as a matter of ordinary English, signifies an admission that it is due". There is no acknowledgment of a debt unless there is "an admission that there is a debt . . . outstanding and unpaid": Good v. Parry.
[61]	The UK provision considered by Gibbs CJ is in materially the same terms as s. 35(3) LAA and to the acknowledgement provisions in Tasmania and Victoria.  South Australia is similar but not the same as the provision in those three states.  New South Wales, Western Australia and the Territories have similar provisions which materially differ from the Queensland provisions.  It is unnecessary at this point to compare and contrast the differing statutory provisions.  It is sufficient to note that while the differing provisions significantly overlap in the purpose and terms, care must be taken when considering the authorities to note any distinctions in the statutory context in which the decisions are made.
Acknowledgment in the High Court 
[62]	Given the submissions made by the parties, it is necessary to trace in a little detail the evolution of the acknowledgment of debt in the High Court.  
Hepburn (1918) 
[63]	The first case of note is Hepburn v McDonnell (1918) 25 CLR 199.  In that case, the plaintiff, by his solicitor, wrote to the defendant stating that the defendant owed the plaintiff a specified sum of money and that any reasonable proposal put forward by the defendant for repayment would be considered. The defendant replied:
I was indeed more than surprised to receive a letter through your solicitor re my indebtedness to you. Well in the first place I always knew, and had intended to pay you a certain sum, which I knew I was indebted … I am offering you £26 per year until the War is over and when my daughter is of age we can sell some land which I shall advise them to give you a portion … At any rate this is the best offer I can offer at present—what the future brings forth rests in God's hand … I trust you will see your way clear to answer this at once, and trust my word to do what I say I will. 
[64]	The plaintiff sued to recover the debt and the defendant pleaded a limitation defence. The plaintiff relied on the defendant's letter as being an acknowledgment in writing of the debt sued upon.  The High Court in separate judgments accepted that the letter comprised an acknowledgment of the debt.  This case was decided at a time when acknowledgment and promise to pay had to be established and the only statutory intervention was the requirement for writing provided for in Lord Tenterden’s Act.  It is sufficient to set out the analysis of Isaacs J:
Then, what amounts to an unconditional acknowledgment as distinguished from a promise? In Green v. Humphreys Fry L.J. says:—“In my view an acknowledgment is an admission by the writer that there is a debt owing by him … In order to take the case out of the Statute there must upon the fair construction of the letter, read by the light of the surrounding circumstances, be an admission that the writer owes the debt.” That admission, as is seen in Maniram's Case, need not mention the amount of the debt and need not even be an unconditional admission of a debt, but it must be an admission of a debt conditionally or unconditionally. And it must, of course, be an admission of the debt sued for. And in order to raise the implication of a promise an admission must be made as an acknowledgment. That is, it must be so made as to stand on its own footing, and to be made as an admission. It may be preceded or followed by words which prevent the implication of an unconditional promise or even a conditional promise arising. But the presence of those words does not prevent an admission from being an acknowledgment capable in itself—if it were not qualified—of supporting the implication…
Now, in the present case, having regard to the distinct reference to the £1,120 5s. 1d. in the plaintiff's letter, the statement in the defendant's letter in reply, “I always knew, and had intended to pay you a certain sum, which I knew I was indebted,” is a clear unqualified unconditional admission of the debt claimed—not of its amount, but of the debt identified by the figures claimed in the plaintiff's letter. The words are manifestly used as an admission, and detached both in position and, what is more important, in sense from any words of promise and offer. From this admission the law implies an equally unconditional promise to pay “if,” to repeat the words of Sir Alfred Wills, “nothing is said to the contrary.” That phrase sums up and gives effect to the language of Cleasby B. in Chasemore v. Turner, quoted by Lord Cozens-Hardy M.R. in Cooper v. Kendall, and to the language of that learned Lord himself and of Lord Wrenbury (then Buckley L.J.). It also supports the observation of Bowen L.J., in Green v. Humphreys, that it is not sufficient, in order to prevent the implication arising, that the words of promise should be less than that implication but they must express the lesser promise in “such a way as to exclude the greater.”
In order to find that implication destroyed or qualified we have then to see something “contrary” in the rest of the document. What is there contrary? As Fry L.J. said, we have to read the debtor's letter by the light of surrounding circumstances, and one material circumstance is that in the plaintiff's letter, to which the defendant's is a reply, there is not only a definite claim for the debt, but a threat to proceed unless some reasonable proposal towards settling the claim is made by her. Reading the letter as an answer to this, it appears, besides being an unqualified admission of liability, to be an offer—not a definite promise—but an offer for consideration, stating what her present ability is, in view of other claims, upon her She says: “At any rate this is the best offer I can offer at present—what the future brings forth rests in God's hand.” Really there is no qualification of the admission of liability; there is no promise of payment at all; there is in response to a threat of proceedings an offer, and an explanation, that apparently are intended as an inducement not to resort to compulsion.
[underlining added]
[65]	Barton J also expressly adopted the approach in Green v Humphreys.
[66]	It is worth noting that (even when a promise was also required) an acknowledgment arose from an unconditional admission of the debt.  It did not require any form of words promising to pay the debt, that was inferred from the admission of the existence of the debt.  Further, the admission of the debt can itself be construed from the words used in the relevant writing, read in context.  
Bucknell (1937) 
[67]	The next case to consider is Bucknell v The Commercial Banking Company of Sydney Limited (1937) 58 CLR 155.  In that case, Mr Bucknell was overdrawn at the respondent bank as at April 1926 in respect of sums drawn on his account to acquire shares in a particular company.  Correspondence passed between Mr Bucknell and the bank in around 1926/27 in which Mr Bucknell seemed to suggest some erroneous advice by the manager of the bank in relation to the share acquisition.   Ultimately, Mr Bucknell called on that bank to take action on his overdraft so that the matter could be ventilated (presumably in a trial).  Nothing occurred for the next five years. 
[68]	In early 1933, a new manager raised the outstanding liability and there was a meeting at which some kind of arrangement for payment might have been made.  In early November 1933, the manager wrote to Mr Bucknell calling him to take the steps to pay which he said had been arranged in the meeting.  Mr Bucknell responded by letter of 20 December 1933.  The bank sued on the debt and Mr Bucknell relied on a limitations defence.  The bank alleged acknowledgment by Mr Bucknell’s letter. 
[69]	This case also arose prior to enactment of the modern statutes regulating acknowledgment.  Apart from the requirement for writing and signature in the 1828 statute, the case fell to be determined on the common law.  The only issues were whether the letter contained an acknowledgment and if so, whether the terms of the acknowledgement were expressly or impliedly inconsistent with a promise to pay. 
[70]	Dixon J, with whom McTiernan J agreed, concluded that Mr Bucknell was liable on the debt.  Dixon J began by observing that a proper understanding of the letter could not be obtained without an account of the facts to which it related.  His Honour then set out the events summarised above and the text of the letter.  Notably, those events were relevant to understanding the text of the letter, as those events were discussed in the letter.  Dixon J then summarised the law applicable as follows:
An express promise in writing by the debtor to pay revives his liability.  But the liability is revived only according to the tenor of the promise.  If it is expressed as to be conditional or subject to limitations, the conditions must be fulfilled before the liability becomes enforceable and the limitations must be observed.  The letter upon which the plaintiff depends contains no express promise either conditional or unconditional, restricted or unrestricted.  But although a document relied upon as an acknowledgment contains no express promise, it may effect a revival of the debtor’s liability if there is found in it a distinct admission of the debt.  The law implies from an acknowledgment of the existence of the liability a promise to discharge it.  Words clearly acknowledging that the writer is liable suffice to raise the implication.
[underlining added]
[71]	His Honour then applied that law.  His Honour’s approach is useful to set out in some detail given the issues in this case:
The first step in applying the principles or rules stated above is to determine whether the letter contains a sufficiently clear or distinct acknowledgment of the existence of the liability. In my opinion it does. The references in the second paragraph to “my liability” and “full liquidation of the debt” are, I think, clear admissions of the liability. It is no doubt true that the statement in which they occur is, or purports to be, a narrative of what “was put before” the writer, the defendant. But in the course of stating or narrating what was laid before him, the writer clearly gives his own adherence to the description of the bank’s claim as “his liability” and as a “debt.” The admission of liability does not stop there. The fourth paragraph of the letter gives the defendant’s account of the transaction with the bank out of which the present claim arose. The statement plainly implies and almost expressly says that the defendant did overdraw his account. When this is read with the last paragraph of the letter, the claim that, for the reason he has given, the writer “should be absolved from any further payment” must, I think, mean that he should be absolved from paying the amount of his overdraft. The admission of liability thus involved appears to me to be sufficiently distinct.
[underlining added]
[72]	Evatt J came to a contrary conclusion to the majority, concluding that in his Honour’s view, the words of the letter did not communicate acknowledgement of the liability and an implied promise to pay it.  His Honour does however concur in the importance of the prior letter from the bank in construing the letter from Mr Bucknell, observing:
The letter of 8th November 1933 is of great importance because it is in relation to it that the subsequent letter must be construed. It is quite erroneous to assert that the court is so confined to the terms of the alleged written acknowledgment that it must ignore the prior correspondence. The contrary is asserted in Spencer v. Hemmerde, Lord Sumner stating that “there are … connections, in which the debtor's intention as a matter of fact may be essential, e.g., where, in order to understand his written words, the circumstances under which they were written are material”.
[73]	This decision again confirms that acknowledgment by way of admission of the existence of the liability is sufficient without any express promise to pay, and also is a good example of the importance of considering the context in which the acknowledgment is said to arise.  That is, both context that provided by the whole of the document said to contain the acknowledgment and the extrinsic circumstances relevant to objective interpretation of it.
Hipworth (1952) 
[74]	The issue in Hepburn and Bucknell was whether there had been an acknowledgment by the debtor in unconditional terms which could be identified in the writing relied upon by the creditor.  The issue of whether the acknowledgment was made to the creditor did not arise, presumably because in each case the writing was in a letter addressed to the creditor.  However that issue arose in Hipworth v Mahar (1952) 87 CLR 33.
[75]	In that case, Mr Mahar guaranteed Mr Hipworth’s liability to a bank.  Mr Hipworth agreed to repay to Mr Mahar any amounts that the bank required Mr Mahar to pay.  That promise was secured by a mortgage.  Mr Mahar paid a sum to the bank on the guarantee in May 1933 and later died.  
[76]	In June 1937, Mr Hipworth signed a proposal for adjustment of debts and an accompanying comparison statement and provided it to the proper authority under the Farmers Debts Adjustment Act 1935 (Vic) (the Adjustment Act).  The proposal showed the debt at the amount claimed by Mr Mahar’s estate.  The comparison statement was designed to show any dispute as to the amount of any debt between the farmer and a disclosed creditor.  It set out the amount of the debt claimed by the creditor and the amount that was conceded as owing by the farmer.  
[77]	Mr Hipworth’s comparison statement showed the two amounts (claimed and conceded) as being the same sum and included the following statement “Amount agreed to by farmer and creditor” as the sum claimed.  The Adjustment Act required the proposal for debt adjustment and the supporting documents be forwarded by the proper authority to the creditors identified in the documents and for a meeting of creditors to be called.
[78]	Proceedings to recover the debt by Mr Mahar’s personal representative were commenced in October 1950 and were met with, relevantly, a limitations defence.   The case was run by Mr Mahar at trial on the basis that the applicable limitation was that contained in s. 82 Supreme Court Act 1928 (Vic).  That section however did not apply if there was any special enactment dealing with a particular cause of action.  In the High Court it was recognised that s. 304 Property Law Act 1928 (Vic) appeared to be just such an enactment.  That section dealt with money secured by a mortgage (as this debt appeared to be).
[79]	Both sections had the same generous limitation period of 15 years.  Both limitations were subject to provisions for the limitation period to recommence on acknowledgment.  However there was a material difference in the terms of the two acknowledgment provisions.  The Supreme Court Act provision provided for time to run anew from the date of “any acknowledgment…made…by some writing signed by the party…” while the Property Law Act provision provided for time to start again from the date of an “acknowledgement…given in writing signed by the person to the person entitled thereto”.
[80]	The High Court held that the Property Law Act provision was the relevant provision and that the acknowledgment had to meet the more stringent conditions for renewal of the limitation period in that provision.  The principal difference was obviously that the Property Law Act provisions expressly required the acknowledgment to be given to the creditor.
[81]	This case was not concerned with whether the Adjustment Act documents contained an acknowledgment of the debt.  The trial judge found that they did, and the High Court agreed with the trial judge.  The question as articulated by the joint judgment was whether the acknowledgment contained in those documents was given to the creditor.  The analysis by the High Court is therefore concerned only with that issue.  This must be borne firmly in mind given that the defendant relies on the case seemingly as authority relevant to whether there is an acknowledgment to be construed from the writing relied upon by the company.  
[82]	After an exhaustive review of authority dealing with the analogous situation of acknowledgments contained in schedules of creditors created by insolvency regimes, the Court concluded:
There is thus seen, we think, to be a substantial body of authority in favour of the view that an admission by a bankrupt in his statement of affairs that a debt is owing to a particular creditor must, if there is no sequestration or the bankruptcy is annulled, be regarded as a sufficient acknowledgment “given to” the creditor concerned, and available as such in subsequent proceedings in which the debtor claims that his debt is barred by a statute which makes time run anew from the date of an acknowledgment given by him to the creditor. The admission has, of course, no effect in a bankruptcy itself, for statute-barred debts are not provable, and statutes of limitation cease to run on sequestration; see Lightwood, Time Limit on Actions, p. 154. But in other proceedings not barred by a bankruptcy the better view is that the admission is an effective acknowledgment “given to” the creditor. The reasons stated in the authorities are not very clear, but the reasons are not far to seek. The admission is not made directly to the creditor, but it is made with the intention that it shall be communicated to the creditor and for the purpose of enabling a compromise of rights as between all creditors. Having that intention and that purpose, it is fairly and properly regarded as a statement made to each and every creditor: “I admit to you that I owe you so much, and I inform you that I owe so much to so many other creditors”. This view represents, as Sir Edward Sugden said, “a just and fair construction of the statute”. No distinction can be drawn between an admission made in abortive insolvency or bankruptcy proceedings and an admission made in abortive proceedings under the Farmers Debts Adjustment Act. The official who receives the “Proposal for Adjustment” is directed by s. 19 of the Act to communicate it to all the creditors. Admissions contained in the proposal must be regarded as made with the intention that they shall be communicated to the creditors concerned. It seems correct, and in accord with authority, to regard them as acknowledgments given to the creditors. The case is different from that of a will or of an executor’s affidavit for probate. Neither a will nor an executor’s affidavit is made for the purpose, or with the intention, of its being communicated to creditors. 
[underlining added]
[83]	It can be seen from this passage that the case does not stand for the principle that in determining if a document contains an acknowledgment (in the sense of an admission of the liability), it must be established that the document was intended by the debtor to be an admission of the debt and was produced by the debtor for the purpose of admitting the debt.   However, the case does support the proposition that in determining whether an acknowledgement is given to a creditor, the Court may take into account the statutory context in which the document containing the acknowledgment is created.  
[84]	I make three further observations:
(a)	First, the Court did not inquire into whether and to what extent Mr Hipworth in fact knew of the statutory context or understood its implications.  While it might be thought reasonable to infer he understood it, the lack of interest of the Court in that matter is consistent with the conclusion that the test both for identifying whether a document contains an acknowledgment and whether it is given to a creditor is objective;
(b)	Second, the facts which can inform that assessment can include statutory provisions which inform the meaning and use of the document; and
(c)	Third, there seems no meaningful distinction between the words considered by the High Court (acknowledgement given to the creditor) and the words in s. 36 LAA, (acknowledgment made to the creditor) which would prevent the preceding two principles being applied. 
The Stage Club (1981)
[85]	The next case is The Stage Club Limited v Millers Hotels Proprietary Limited (1981) 150 CLR 535.  It is another case concerned with whether an acknowledgment is made to a creditor.  In 1962, the Stage Club borrowed money from Millers to fund the setup of its business and undertook to buy beer from Millers.  By December 1966, the debt to Millers totalled some $27,000.  It was not repaid.  Millers commenced proceedings to recover the debt in September 1976.  
[86]	It was common ground that the claim was statute barred unless either the 1970 or 1971 balance sheets comprised an acknowledgment of the claim.  Each of the balance sheets showed Millers as a secured creditor for the debt.  The 1970 balance sheet bore a statement signed by two directors on 5 April 1971 stating that the balance sheet was: “drawn up so as to exhibit a true and fair view of the state of the affairs of the company as at December 31 1970”.  It also bore a report by the auditor that it was properly drawn up and a declaration by the secretary that it was to the best of his knowledge and belief correct and was adopted by a general meeting of the Stage Club on 4 May 1971.  The 1971 balance sheet was the same other than for the omission of the secretary’s declaration.
[87]	There was no evidence in the books and records of Millers by the time of the proceedings that the balance sheets had been provided to Millers, though the Court did not think that surprising given that Millers was winding up its business.  However, a Mr Walker was an employee of Millers with responsibility for overseeing its interests in the affairs of the Stage Club.  Mr Walker became a director of the Stage Club by choice, partly to assist in that oversight and partly out of his own interest in the business of the club.  He signed the 1970 balance sheet but not the 1971 version.  He gave evidence that balance sheets for debtor clubs were required to be sent to Millers and that he had received the balance sheets.  Mr Walker was known in the Stage Club to be a Millers representative.
[88]	The case fell to be determined by reference to the then current version of s. 54 Limitation Act 1969 (NSW).  (That remains the applicable provision and remains in substantially the same form as that considered in The Stage Club).  At the time, s. 54 provided:
(1)	Where, after a limitation period fixed by or under this Act for a cause of action commences to run but before the expiration of the limitation period, a person against whom … the cause of action lies confirms the cause of action, the time during which the limitation period runs before the date of the confirmation does not count in the reckoning of the limitation period for an action on the cause of action by a person having the benefit of the confirmation against a person bound by the confirmation.

(2) 	For the purposes of this section—
(a) 	a person confirms a cause of action if, but only if, he—
(i)	acknowledges, to a person having … the cause of action, the right or title of the person to whom the acknowledgment is made; or
…
(4) 	An acknowledgment for the purposes of this section must be in writing and signed by the maker.

(5)	For the purposes of this section a person has the benefit of a confirmation if, but only if, the confirmation is made to him or to a person through whom he claims.

(6)	For the purposes of this section a person is bound by a confirmation if, but only if—
(a) 	he is a maker of the confirmation;
…
[89]	The question of agency was dealt with in a separate provision.  Section 11(2)(c) provided (and still provides) that “a thing done to or by or suffered by an agent is done to or by or suffered by his principal”. 
[90]	Millers succeeded before the trial judge and on appeal. Before the High Court, the Stage Club advanced three arguments:
(a)	First, that the balance sheets were not signed by or on behalf of the company but rather by the directors in the performance of personal statutory obligations and were reports by the directors to the members;
(b)	Second, that the balance sheets could not comprise an acknowledgement under s. 54 because they acknowledged an historical liability not a liability current at the date of signing; and
(c)	Third, that there was no acknowledgement to the creditor (Millers) or its agent (Mr Walker) because the balance sheets were given to Mr Walker as director and member of the Stage Club, not as agent for Millers.
[91]	The Court comprised Gibbs CJ, Murphy, Aickin, Wilson and Brennan JJ.  Murphy, Wilson and Aickin JJ comprised the majority with Wilson J giving the leading judgment and Aickin J giving short concurring reasons.  Murphy J agreed with Wilson J.  The majority rejected all three arguments.  Gibbs CJ agreed with the majority on the first and third points but accepted the appellant’s argument on the second.  Brennan J accepted the appellant’s argument on the second and third points and did not deal with the first point. 
[92]	The principal focus of all judgments was the second issue.  However, that issue is not significant in this proceeding.  Assistance is to be gained, however, from the analysis of the first and third arguments.  
[93]	Only Gibbs CJ and Wilson J addressed the first argument.  Both judges rejected it.  Gibbs CJ dealt with the issue as follows:
The first question for decision is whether the balance sheets were signed by agents of the Stage Club. It may be accepted that the auditors were not agents of the company, and that their signatures on the balance sheets were not sufficient to satisfy s. 54(4): see In re Transplanters (Holding Company) Ltd. The question then is whether the signatures of the directors were sufficient. Mr. Handley submitted that they were not — that the directors did not sign the balance sheets on behalf of the company, but in pursuance of a statutory duty imposed on them by s. 162 of the Companies Act 1961 (N.S.W.), as amended. That section was amended by the Companies (Amendment) Act 1971 (N.S.W.) which was assented to on 15 December 1971. The unamended section was in force when the 1970 balance sheet was signed and presented to the annual general meeting, but the amended section applied to the 1971 balance sheet. However, for present purposes there is no material difference between the provisions in their original and in their amended form. The directors were required to cause to be made out and laid before the company at each annual general meeting a balance sheet, giving a true and fair view of the state of affairs of the company at the end of the relevant period, and the balance sheet was to be accompanied by a statement signed by two directors: see s. 162(3), (11) and (12) in their original form, and s. 162(3) and (10) in the amended form. There is no doubt that the directors signed the balance sheets in pursuance of their duty as directors, but that does not mean that they did not sign as agents for the company. The directors of a company are its agents, and the balance sheet is a statement by the company of the state of its assets and liabilities. The directors who sign a balance sheet do so as agents of the company. 
[94]	Wilson J held:
I now address myself to the three propositions on which the case for the appellant rests. The first objection is that the balance sheets were not signed by the debtor company or its agent. It appears that the balance sheet for the year ending 31 December 1971 was signed by Mr. Walker in the capacity of a director of the Club, thereby raising the question of personal disqualification referred to in In re The Coliseum and In re Transplanters. If Millers was obliged to rely solely on this particular balance sheet to answer the defence based on the Act it would be necessary to consider whether the signature of the other director was sufficient to satisfy the requirement in s. 54(4) that the acknowledgment “be signed by the maker”. However, as I have said, it is common ground that if either of the two balance sheets answers the description of an acknowledgment within the meaning of s. 54 Millers is entitled to succeed. Mr. Walker's signature does not appear on the earlier balance sheet. As I understand it, Mr. Handley takes a different point. He relies on s. 162(12) of the Companies Act 1961 (N.S.W.), as it existed prior to its amendment in 1971, which requires that every balance sheet shall be accompanied by a statement signed “on behalf of the directors” by two directors of the company. The statement is signed, not on behalf of the company, but on behalf of the directors. But in my opinion this provision does not deny the collective agency of the board of directors in the management of the company. It merely prescribes the procedure by which the board will discharge its responsibility in relation to the balance sheet, without undermining in any way the character of the document, when signed, as the company's document. I can see no reason in the present case to doubt that the balance sheets were written documents signed by the Club's agent. Such a conclusion is consistent with every one of the balance sheet cases determined in England during the present century, for in none of those cases is there any suggestion that the signature of directors does not bind the company save where a particular director is disqualified by interest.
[95]	It is worth noting for later comment the personal disqualification issue identified by his Honour.  At page 555 of the report, his Honour observed:
In re The Coliseum (Barrow) Ltd. was a case in which Maugham J. was confronted with the question whether an item in respect of outstanding fees due to the directors which appeared in a balance sheet signed by those directors was capable of constituting an acknowledgment. He answered the question in the negative, on the ground that the signature of the directors on the balance sheet could not bind the company, they being disqualified by reason of their interest in the subject-matter. However, Maugham J. remarked, obiter, that he thought that had the balance sheet shown that the company owed a specified sum to a shareholder to whom the document was sent in the usual way there would have been a sufficient acknowledgment within the authorities. As in Atlantic Fibre, there is no discussion of the question of the date to which such an acknowledgment might have been related.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
[96]	Each of Gibbs CJ, Wilson and Brennan JJ addressed the third argument.  Justice Brennan dissented on this argument. Gibbs CJ’s analysis was factual in character and turned on inferences he considered flowed from the evidence.  His Honour held:
Mr. Handley's final submission was that if there was an acknowledgment it was not made to Millers or to Mr. Walker as Millers' agent. There is no doubt either that the balance sheets were delivered to Mr. Walker, or that he was an agent of Millers whose duty it was to watch Millers' interests. Having regard to the evidence that the Stage Club was required to send balance sheets to Millers, and that Mr. Walker was known by the secretary of the club to be “a Millers' person”, and to the important part played by Millers in the formation of the club, it seems to me that it was proper to infer that it was intended by the Stage Club that Mr. Walker should receive the balance sheets as agent for Millers as well as in his individual capacity as a shareholder. Having regard to the conclusion that I have reached on the second of the matters raised by Mr. Handley it is unnecessary to discuss this question further, or to consider the correctness of the view expressed by Slade J. in In re Compania de Electricidad that a company balance sheet must be regarded as implicitly addressed to (among other persons) those creditors whose debts are referred to in it.
[97]	Wilson J (with whom Murphy J agreed on this issue) observed:
The third proposition advanced for the appellant is that there has been no acknowledgment to the creditor or his agent. Again, this is an area where flexibility in approach is evident: see Hipworth v. Mahar, and In re Compania de Electricidad. Mr. Handley argues that the balance sheets were given to Mr. Walker in his capacity as a member of the Club, and not as agent for Millers. In my opinion, it clearly emerges from the cases which I have reviewed that the absence of an intention on the part of the debtor to communicate to the creditor or his agent is immaterial so long as the document is actually delivered to him. In any event, in my opinion there was sufficient evidence before Begg J. to support the findings of fact which he made in this regard, and which support the conclusion that the delivery of the balance sheets to Mr. Walker was a communication to Millers. 
[underlining added]
[98]	It is evident that the principal authority to which his Honour was referring in reaching his conclusion on the third point (apart from Hipworth, analysed above) was In re Compania de Electricidad [1980] 1 Ch 146.  That case was explained by his Honour in the following passage (at 559 to 560):
In the recent case of In re Compania de Electricidad (1980) 1 Ch 146, the company's balance sheet for the year ended 31 December 1973 referred under current liabilities to "Capital repayments due to shareholders", and to "Unclaimed dividends". Slade J. followed the decision and reasoning of Brightman J. in In re Gee (1975) 1 Ch 52. He observed that under the English Act of 1939 it was no longer necessary that an acknowledgment should embody any express or even implied promise to pay the debt in question, but stressed the necessity for the acknowledgment to be communicated to the creditor or his agent. In this respect, the judgment is pertinent to Mr. Handley's third proposition. The learned judge said (1980) 1 Ch, at pp 193-194:
In my judgment, though no authority has been cited to me which either confirms or rejects such proposition, a written acknowledgment cannot be said to be 'made to' a creditor or his agent, within the meaning of s. 24(2) unless either (a) it is delivered to the creditor or his agent by or with the authority of the debtor or his agent or (b) it is expressly or implicitly addressed to and is actually received by the creditor or his agent.
In my judgment, in case (a) it would not matter that the acknowledgment was not, according to its terms, expressly or implicitly addressed to the recipient. In case (b) it would not matter that the acknowledgment reached the hands of the creditor otherwise than by or with the authority of the debtor. In either case, however, it would be necessary that the creditor should actually receive the acknowledgment before he could rely on it.
A company's balance sheet must in my judgment be regarded as implicitly addressed to (among other persons) those creditors whose debts are referred to in it. It follows that . . . an effective 'acknowledgment' of a debt must be said to have been 'made' by the company to any creditor who can establish by appropriate evidence that (i) he has actually received, from whatever source, a copy of a balance sheet of the company, signed by directors of the company and referring to 'sundry creditors'; (ii) he is one of the 'sundry creditors' so referred to. In such circumstances the balance sheet of the company would constitute an effective acknowledgment of the relevant debt, not as at the date on which it was actually signed by the directors or received by the creditor, but as at the date of the balance sheet, being the date to which the signature of the directors related; and the cause of action would be deemed to have accrued at that date . . ."                                              
[99]	There is perhaps some tension between Wilson J’s observation underlined in the quote in paragraph [97] above and the cases to which he refers, particularly Compania.   The underlined comment in Wilson J’s reasoning appears to state that delivery to a creditor means an acknowledgment is made to that creditor, regardless of the intention of the debtor.  However, Compania requires that the acknowledgment is either delivered to the creditor by or with the authority of the debtor (which would require an intention to deliver the acknowledgement to the creditor) or expressly or impliedly addressed to the creditor (which again arises from an objective intention to communicate with the creditor shown on the face of the document).  Brennan J approach it that way: see the passage quoted in the next paragraph.  In VL Finance v Legudi (2003) 54 ATR 221, discussed in detail below, the judgment plainly treats this passage of Wilson J’s judgment as meaning what it appears to say.  However, it is difficult to reconcile the underlined statement with the authorities to which it plainly refers.    
[100]	It is also of assistance in this proceeding to note what Brennan J had to say about the third argument, albeit in dissent.  His Honour observed (at page 577):                                                                                                                                                                              
Nor is there any foundation upon which to find that either balance sheet was an acknowledgment made to the creditor, Millers. The phrase “made to” is not defined, but the alternatives stated by Slade J. in In re Compania de Electricidad seem to exhaust the possibilities. It is not possible to predicate of an acknowledgment that it is made to a creditor unless — “(a) it is delivered to the creditor or his agent by or with the authority of the debtor or his agent or (b) it is expressly or implicitly addressed to and is actually received by the creditor or his agent.”
In either event, the debtor intends that the creditor receive an acknowledgment. However, with respect to Slade J., I do not share his Lordship's view that a balance sheet must be regarded as implicitly addressed to creditors whose debts are referred to in it. When a company refers to its balance sheet in making a statement about its financial position to its creditors, and furnishes them with a copy of it, it is the statement made which gives a character to the balance sheet and the entries therein — whether as a warranty, an acknowledgment of a cause of action or an admission of an element in a cause of action. But it is a different thing to say that a company intends a balance sheet attached to its directors' report to come into the hands of the creditors whose debts are reflected in it and to be an acknowledgment of those debts. A balance sheet covered by an auditor's report and the directors' report in the usual form is not addressed, in the first instance, to creditors but to the company in general meeting.
[underlining added]  
[101]	His Honour noted that Mr Walker received the balance sheets as a member and rejected the inference accepted by the other judgments.   His Honour then referred to Hipworth v Mahar and said:
An acknowledgment is “made to” a creditor by his debtor if the debtor adopts some means, direct or indirect, with the intention of communicating the acknowledgment thereby to the particular creditor or to his creditors generally.
[102]	In my view, those judgments provide endorsement for the analysis of Slade J in Compania set out in paragraph [98].  It had the support of each of Wilson, Murphy and Brennan JJ.  At the least it provides a useful guide to analysis of whether an acknowledgment is made to a creditor.  Given that s. 36(2) LAA uses the same language as in Compania (“made to”), it is a directly applicable guide.  However, care must be exercise in substituting any judicial language for that contained in the statute.  As is evident from the analysis of the facts in each of Hipworth and The Stage Club, each case turns substantially on its facts and the various principles said to inform the question of whether an acknowledgment is made to a creditor must be considered in light of those particular facts.
First alleged acknowledgment: the 2016 accounts 
[103]	The first acknowledgment alleged by the company is said to be contained in the 2016 accounts.  The context and content of that document is set out in paragraphs [8] to [27] above.  It is convenient to begin by setting out the parties’ contentions.
The plaintiff’s contentions 
[104]	The plaintiff’s contentions can be summarised as follows.
[105]	First, based on authority that an acknowledgment is an admission that the writer owes the debt, the plaintiff submits that the balance sheet in the 2016 account, read with its notes, comprises an admission by Ms Manicaros that she was indebted to the company as shown in the accounts.
[106]	Second, the plaintiff points out that the company, as a small proprietary company, was not obliged by statute to prepare financial reports and that accordingly, the preparation and execution of the 2016 accounts by the directors was voluntary.
[107]	Third, the company relies on the line of authority recognised and applied in The Stage Club that a balance sheet signed by directors can be an acknowledgment by the company to which the balance sheet relates and has been frequently recognised as one.  That proposition is subject to the constraint that the director cannot, as agent for the company, acknowledge a debt owed to the director because of the conflict of interest of the director in doing so.  The company contends there is no such conflict here, nor could there be, because an admission of a debt is a statement against interest.
[108]	Fourth, the company recognises that this case is the opposite of The Stage Club.  That is, in this case the company seeks to rely on the 2016 accounts as creditor, whereas in The Stage Club the creditor was a third party creditor of the company.  However, the company submits there is no reason in principle why the acknowledgment by Ms Manicaros, which it contends arises from the 2016 accounts, cannot also be an acknowledgement made to the company.  It recognises that VL Finance arguably provides such a reason by [67] of the judgment.  That paragraph, analysed in more detail below, states: 
In my opinion an annual return is not capable of constituting an acknowledgment by the directors of the company of debts which they owe to the company. It may perhaps be an acknowledgment by the company (in the same way that a balance sheet may be an acknowledgment by the company), because it may be supposed that the return is intended for use by the company's creditors. But I do not consider that it is an acknowledgment by the directors, because in my view it cannot be supposed that the return is made out to be used by the directors' creditors. The return is not made to the company. It is made by the company. Nor is the return prepared for the use and consideration of the company. It is designed and prepared for the use of others. Moreover, even if all the directors of the company are under a personal obligation to ensure that the return is made out and filed, I do not consider that the return is expressive of an intention on the part of the directors to admit such of their debts to the company as are shown in the return and to have the return produced by the company and used for that purpose. Therefore, regardless of whether the return comes to the attention of the company, I am unable to see that it is an acknowledgment made to the company.
[109]	The plaintiff submits that that case should not be followed for the following reasons.
[110]	First, the company submits that the reasoning in [67] of the judgment is based on the propositions, inter alia, stated in paragraph [63] of the judgment relying on Hipworth, that:
… [A] document does not constitute an acknowledgement unless it is in substance expressive of the debtor’s intention to admit the debt and to have the document produced and used for that purpose. 
[111]	It submits that proposition is not supported by Hipworth.  The company respectfully submits that the proposition in VL Finance:
(a)	Misstates the purpose identified in Hipworth; which was “the purpose of enabling a compromise as between all creditor” not the purpose of admitting the debt; and
(b)	Treats reasoning which was confined to the issue of the “made to” requirement in the particular circumstances arising under the Adjustment Act as being reasoning of general application.
[112]	Second, the notion that for a document to be an acknowledgment it must express an intention by the debtor “admit such of their debts to the company”  and to have the document used for that purpose is inconsistent with Wilson J’s statement in The Stage Club.  The plaintiff asserts that, if a document is written and signed by the debtor (or the debtor’s agent), then that document will be an acknowledgment of the debt if it meets the criteria stated by Fry LJ in Green v Humphreys (1884) 26 Ch D 474, 481.  Those criteria are objective and do not rely on intention.  They are, whether the document, fairly construed, and read by the light of the surrounding circumstances, is an admission the debt is owed.  
[113]	Third, the company in effect distinguishes VL Finance.  It contends (echoing the test articulated in Campania and adopted in The Stage Club) that the Directors’ Declaration objectively communicates that the matters declared should be regarded as having been either: 
(a)	Delivered to the plaintiff by or with the authority of the defendant; or, 
(b)	Expressly or implicitly addressed to the plaintiff and actually received by the plaintiff.  
[114]	As to the latter, the company emphasises the duties of the director under s. 180(1) Corporations Act to, broadly, exercise powers with reasonable care and diligence. If a director contravened CA, s.180(1) by declaring that a balance sheet gave a true and fair view of a company’s financial position, and the company suffered loss as a result (for example, by continuing to trade in circumstances where, but for the declaration, it would not have), it is the company that can take action against the director to obtain compensation for that loss.  Looked at in that context, the 2016 declaration is necessarily addressed to the company. Further, the company contends, the 2016 accounts were also delivered to the company with the authority of the defendant.
[115]	Fourth, it is submitted that Nettle J’s binary analysis that the annual return in that case could not be made to the company because it is made by the company is incorrect.  There is no reason why the same document cannot be both a declaration by the individual director to the company and a document by the company, made by its agent the director.  Amongst other things, the company points to the dual role of Mr Walker in The Stage Club as a person receiving the balance sheet as member and as agent for Millers.
[116]	Commercial Images also emphasises that financial reports are necessarily prepared for the use of the company.  The plaintiff submits that financial records of a company that record and explain its financial transactions (see Corporations Act s. 286(1)) are essential for use by the company and officers of the company in carrying on the business of the company based on proper information: see Van Reesema v Flavel (1992) 7 ACSR 225 at 229.
[117]	Finally, the company contends that this Court is not bound by the analysis in VL Finance and that it is arguably inconsistent with Thomas J’s decision in Tapiolas v Tapiolas [1985] 2 Qd R 310, which the company says properly interprets the observations concerning intention and purpose in Hipworth.   The company submits that since delivery of the judgment, the reasoning in [67] of VL Finance has only been applied on one occasion and that was in Victoria and without challenge to the reasoning. 
[118]	The company also notes that the defendant also alleges waiver of the entitlement to the debt by the company because of its failure to take steps to recover the debt and that the acknowledgement relied upon occurred after the expiry of the limitation period.  The company submits neither matter provides any defence to the claim if the requirements of ss 35(3) and 36 LAA are met.  It is unnecessary to further refer to these points.  They were not pressed by Ms Manicaros at trial and in any event are plainly wrong.  As to the former, waiver cannot arise merely from the failure to recover the debt within time.  The statutory provisions are directly inconsistent with any such doctrine.  As to the latter, ss 35(3) and 36 contain no such condition and if such a limitation on the scope of the provision would be inconsistent with its express terms.  I will not further refer to these two points.
The defendant’s contentions 
[119]	The defendant’s contentions can be summarised as follows.
[120]	First, the defendant contends that on their face the 2016 accounts were prepared for the use of the directors and shareholders of the company.  The contention is that the 2016 accounts were therefore not acknowledgments made to the company.
[121]	Second, it is submitted that the 2016 accounts cannot be taken to admit the debts because the loans are dated and may be taken to be statute barred, the loans are unsecured, the debtors are the shareholders and directors and there is no evidence of any repayment and no mention of any interest being repaid.  
[122]	Third, the Notes to the 2016 accounts indicate that the accounts are prepared in such a manner that they communicate that no attempt has been made to verify current values.  In those circumstances no arm’s length recipient could conclude that they convey that the unsecured loans shown are due and payable, “let alone enforceable or recoverable”.   
[123]	Fourth, the defendant submits that that proposition is a fortiori when attention is focussed on the persons to whom the accounts were addressed: in effect the two persons who were directors and shareholders of the company.  It is submitted that they knew the true situation which was that there was no intention that the loans be repaid.  Ms Manicaros submits that the email communications in evidence demonstrate the directors never intended the loans to be repaid.  As developed in oral argument, the submission was summarised in this way:
the real-world sense being this is a company with two shareholders who happen to be siblings, the accounts are prepared by the accountants in order to produce a balance sheet that balances and recording loans or equity is a lot simpler than going through the process of ascertaining whether the – those loans are recoverable or irrecoverable or even turning their minds to that question.  And in my submission, when one is considering what the document meant, both to the person who generated it or signed it and to the person who received it, being, in theory, the company, that must make sense.  This wasn’t about, “I acknowledge and agree that I have an obligation to pay this much money”.  It was about “This is the state of the financial records.  These loans were made a decade and a half ago.  They’re still in the books because no one has bothered to do anything to take them out of the books”.  That’s the practical analysis. 
[124]	Fifth, the defendant relied on the reasoning in [67] of VL Finance and placed particular emphasis on the “intention and purpose” test stated and applied by Justice Nettle.  The defendant submitted that the proper test of whether the 2016 accounts comprise an acknowledgment of the debts is whether Ms Manicaros possessed the intention and purpose of admitting that the loans were lawfully enforceable and recoverable.  Tapiolas v Tapiolas is cited as authority for that proposition.  It is submitted that the 2016 accounts disclose no such intention and purpose.  It is submitted that compelling evidence would be needed to establish a director who signed financial statements qua director intended to acknowledge personal liabilities.  It was submitted that these particular directors would not be taken to have that intention for the reasons set out in the previous passage.
Analysis 
Preliminary observations  
[125]	It is convenient to begin by articulating some propositions that inform my approach.
[126]	First, applying ss. 35(3) and 36 LAA calls for an analysis of a purported acknowledgement that is in writing and signed by the debtor.  This requires the Court to construe a document.  As is the case with construction of written instruments in many areas of the law, construction of that document must, in my view, be carried out objectively, applying established principles of construction.  It may include consideration of extrinsic facts which are rationally probative of the objective meaning of the document.  However, in my view the precise articulation of the scope of extrinsic facts relevant to construction has not been authoritatively determined.  At the least it can include the statutory context relevant to the creation or purpose of the document: Hipworth  It can also include documents or facts which are referred to in the writing or which explain words used in the acknowledgment.  
[127]	Second, there is no dispute that the 2016 accounts relied upon by the company are in writing, nor is there any dispute that they are signed by Ms Manicaros.  The real issues are:
(a)	Whether the 2016 accounts contain an acknowledgment by Ms Manicaros of the debts; and
(b)	If so, whether that acknowledgment was made to the company.
[128]	Although these issues can be related, they are distinct and should be analysed separately.  It is common in the authorities for the word acknowledgment to be used in two senses: sometimes the word is used in a narrow sense to refer specifically to the first issue raised in the previous paragraph, i.e. an acknowledgment as an admission of liability.  In other cases it is used in a broader sense, i.e. whether there is an acknowledgment that meets all the conditions necessary to answer a limitations defence.  That broader sense encompasses both the requirement for an acknowledgment as an admission of the debt and also the requirement that the acknowledgment is made to the creditor.  While the two issues can in theory overlap, in my view, it is desirable to analyse the two issues separately, so as to avoid elision of principles separately applicable to the two issues.
[129]	Third, in Hepburn, the High Court defined an acknowledgment (in the narrow sense) by reference to the test in Green v. Humphreys: “an admission by the writer that there is a debt owing by him .... In order to take the case out of the Statute there must upon the fair construction of the letter, read by the light of the surrounding circumstances, be an admission that the writer owes the debt.”  Similarly, in Bucknell, Dixon J defined it as comprising a “distinct admission of the debt” or “a sufficiently clear or distinct acknowledgment of the existence of the liability”.
[130]	Those cases also establish that it is unnecessary that the debtor go further and  expressly state a promise to pay the debt. That was unnecessary prior to the enactment of modern statutes regulating acknowledgment (as was the position for Hepburn and Bucknell) and must be the case, a fortiori, under the modern statutes which do not require any such promise to be implied: see the observations of Gibbs CJ at [60] above.  Care must be taken not to read back into the statute that otiose requirement by a too expansive investigation of subjective intention of the debtor who distinctly and objectively acknowledges the existence of the debt.
[131]	Fourth, I agree with the company’s contention that the so called “intention and purpose” test for whether an acknowledgment (in the sense of an admission of the debt) arises from a document is not one which has the support of High Court authority.  As Mr Wilkins KC (who appeared for Commercial Images) correctly identified in his written submissions, the source of the intention and purpose test is Hipworth.  As I more fully explain in paragraphs [81] to [83], that proposition relates to whether a document containing an acknowledgment (in the sense of an admission of the debt) can be shown to be made to a creditor even where not directly addressed to that creditor.  To the extent it was relied upon in VL Finance (and by Ms Manicaros) as being a test supported by the High Court for determining whether an acknowledgement (in the sense of an admission of a debt) arises from a document, I respectfully consider that proposition to be wrong.   
The 2016 accounts contain an admission of the debts
[132]	Whether a document contains an acknowledgement of a debt is a question of construction.  Care must be taken in using decided cases as authority for facts rather than legal principles.  In my view, on the proper construction of the 2016 accounts, they contain an admission by Ms Manicaros of her liability to the company for the debts shown in the accounts. 
[133]	The admission of the debts arises objectively from the following features of the document:
(a)	First, Ms Manicaros signs the 2016 declaration which states that the 2016 accounts present fairly the financial position of the company as at 30 June 2016.  That declaration is in a formal form, objectively communicating that the matters declared are not casually stated but are, rather, the result of careful consideration;
(b)	Second, the 2016 accounts show that Ms Manicaros owed the company five specified debts totalling $686,797.  Those liabilities were included in the balance sheet as current assets of the company.  A current asset is defined in AASB 101 at paragraph 66 in this manner:
 An entity shall classify an asset as current when: 
(a) it expects to realise the asset, or intends to sell or consume it, in its normal operating cycle; 
(b) it holds the asset primarily for the purpose of trading; 
(c) it expects to realise the asset within twelve months after the reporting period; or 
(d) the asset is cash or a cash equivalent (as defined in AASB 107) 
unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period. 
An entity shall classify all other assets as non-current
(c)	Unsecured loans will ordinarily fall within 66(c) or 66(d).  The 2016 accounts are professionally prepared in relation to a company carrying on business.  In construing objectively whether the accounts (prepared for a commercial trading corporation) contains an acknowledgment, I consider that matters of commercial accounting can be taken into account.  In any event, the ordinary meaning of the expression “current asset” in relation to a loan is broadly consistent with its technical accounting meaning.  Both are consistent with identification of a current and enforceable liability (bearing in mind that it is not evident on the face of the accounts that the debts are repayable on demand and therefore prima facie statute barred).
(d)	Third, without the inclusion of the debts due from Ms Manicaros, the company would be barely solvent on a balance sheet basis, with net assets of just $51,000.  Accordingly, the accounts could not “fairly present the company’s financial position” unless Ms Manicaros was liable to the company for those debts.  Ms Manicaros’ declaration can only be correct if Ms Manicaros is liable for those debts;
(e)	Fourth, as both director (privy to the books and records of the company) and as debtor (with knowledge of the circumstances of the advances identified) she was in a unique position to know whether those particular liabilities (being her debts due to the company) were correctly recorded.  Her declaration that the accounts fairly represent the financial position of the company therefore has unique force in relation to these debts as compared to the other assets and liabilities shown.  Reading the document objectively, a reader would be justified in assuming the director was affirming her liability for her own disclosed debts; and
(f)	Fifth, there is nothing in the Notes which suggest otherwise.  The fact that the accounts were prepared on an accruals basis has no impact on a liability in debt, especially historic debts.  Similarly the warning that the accounts are based on historic costs and do not take into account changing money values has no impact on the liability in debt, which is a monetary asset unaffected by “changing money values”.  
[134]	I do not consider that any of the arguments of the defendant lead to a different conclusion.  The defendants second to fifth points are directed at this issue.  I deal with them seriatim.
[135]	As to the defendant’s second point (see [121] above), none of the matters listed answer the admission of the debt:
(a)	The mere fact that debts are dated and possibly statute barred cannot, of itself, be an answer to an apparent admission because that is the circumstance which will always exist where the law of acknowledgment applies.  It should be added that there is no basis on the face of the document to assume the debts are statute barred in any event as that depends on the terms of the loan; 
(b)	The mere fact that the loan is unsecured is not probative of any relevant issue;
(c)	The fact that the debtors are the directors and shareholders of itself tends to reinforce the conclusion that there is an admission of the debts, for the reasons in [133](e) above; and
(d)	Whether there is “record” or “mention” of repayments and/or interest payments is not probative of whether there is an admission of the liability.  The gravamen of this point seems to be that it indicates the debts are not “real” liabilities at all.  I deal with that further below.
[136]	The third point (see [122] above) is answered by the point at [133](f) above.  Those notes might give an objective reader cause to wonder about values given to non-monetary assets but are irrelevant to monetary assets like debts.  The defendant also relies on the accountant’s Compilation Report (see [20] above).  However, that report is concerned with the accountants communicating that they have prepared, but not audited, the accounts.  That is no basis to infer that the directors have not endeavoured accurately to instruct the accountants in a manner consistent with the 2016 declaration.
[137]	I refer next to the fourth argument made by the defendant (see [123] above).   That argument seems to be premised on the proposition that the 2016 accounts should be construed by reference to the intention of Ms Manicaros, inferred from the circumstances, that she would never repay the debts.  Indeed it was submitted that Ms Manicaros should be taken never to have turned her mind to whether the debts should be repaid.  However, that intention is not evident on the face of the 2016 accounts nor from any fact rationally probative of the construction of the 2016 accounts.  In my view, the defendant’s submission is really one which calls on the Court to seek to assume the subjective intention of Ms Manicaros in signing the 2016 accounts.  Although not advanced in this way by Mr Morris, it seems to me that the proposition amounts to an argument that I should infer she did not intend the objective meaning of the execution of the 2016 accounts.   Obviously, I reject that proposition.
[138]	Paragraph 49 of the defendant’s submissions suggest an alternative basis for the intention to be relevant to construction of the 2016 accounts.  There Ms Manicaros contends that the intention should be inferred that the debts were never contemplated for repayment and that this intention is disclosed by extrinsic email communications between the directors.  The argument is articulated in this manner:
The email communications between the directors (upon which the Company also seeks to rely) makes explicit what is implicit from the history of the loans disclosed in the “special purpose report”. It was never even contemplated that they would be repaid: the only significance which these loans had, so far as the directors were concerned, was as a record of how much each director had ‘drawn down’ from the Company, and the fact that Ms Manicaros had ‘drawn down’ less than her co-director. The only suggestion of repayment was by Mr Verschoyle as a means to “equalise the loan positions”, and even this was suggested only as an alternative to making a further advance to Ms Manicaros.
[139]	There are two flaws in this argument.  
(a)	The first is that it is unclear to me how email communications between the directors which are not referred to in the 2016 accounts and which do not directly address the meaning of the text of those accounts are relevant to construing whether those accounts contain an admission of liability, (quite apart from the fact that the email communications identified by Ms Manicaros postdate the signing of the 2016 accounts); and
(b)	More tellingly, however, I do not agree that the email communications show that it was never contemplated that the debts would be repaid. The example given by Ms Manicaros is the email at AB 88 to 90.  That email opens with the words “Directors’ loans remain and at this stage are not forgiven”.  This is consistent with the directors being liable for the debts until they are forgiven, not the contrary.  
[140]	The fifth argument of the defendant is summarised at paragraph [124] above.   The submission at [50] to [52] of the defendant’s submissions is a little ambiguous, but as I read it, the defendant relies on the “intention and purpose” test as informing whether the 2016 accounts contain an admission of the debts.  As I have explained, the ultimate source of that phrase is Hipworth and the High Court made use of it identifying in that particular case whether an undoubted acknowledgment contained in the Adjustment Act documents signed by Mr Hipworth was made to the third party creditor identified in those documents.    It was clearly understood in this way by Thomas J in Tapiolas v Tapiolas [1985] 2 Qd R 310 at 316.   The intention and purpose test is not applicable to whether there is an acknowledgment in the sense of an admission of the debt. That test provides no support for the defendant’s argument.
[141]	Ultimately, the defendant’s argument on the question of acknowledgment comes down to this: one would not infer that a director intended to make a personal acknowledgment of a personal liability by signing financial statements.   This seems to be a contention that on the proper construction of the 2016 accounts, they could not objectively be taken to include an acknowledgment of the liability for the director because a director would not be taken to have done intended to do so.  For the reasons I have given in relation to the 2016 accounts read as whole, I disagree.   To the extent is it suggested by paragraph 52 of the defendant’s submissions that subjective intention was relevant and should have been proved by evidence from the liquidator, subjective intention is relevant.  
[142]	Finally, the defendant relied on VL Finance.  I will deal with VL Finance separately below.
[143]	There is another compelling reason why the signing of the 2016 account objectively communicates an admission of the debts due by Ms Manicaros.  Ms Manicaros owed duties to the company both at general law and under the Corporations Act to exercise her powers with reasonable care and skill and in good faith and for the benefit of the company as a whole.  It was her, together with Mr Verschoyle, as directors, who had the power to cause the company to take steps to recover the debts.  Further, as the debtor, she was in the position to know when the debts were incurred and when they would be prima facie statute barred.  
[144]	There can be little doubt in my view that her duties required her to repay or take steps to recover those debts within the limitation period.  Those statutory and common law duties are well known.  In my respectful view they provide relevant context to the construction of the 2016 declaration.  In that context, the declaration that the accounts “present fairly the company’s financial position” read objectively supports in a compelling manner the conclusion that the director is affirming that the unsecured debts she is shown as owing to the company are admitted being due and owing.  In my view, a director who is shown as owing substantial debts to a company in accounts that director has affirmed as giving an accurate picture of the financial position of the company could not be taken to be doing anything but affirming the existence of those liabilities (absent some special circumstances), especially where those liabilities are of an amount which is fundamental to the financial position of the company which the accounts present.
The acknowledgment is made to the company 
[145]	The next question is whether the acknowledgment of the debt in the 2016 accounts is “made to” the company as required by s. 36(2).  The starting point is to identify the approach to be taken to this question.  High Court authority supports two approaches as assisting in determining whether an admission is made to a creditor. 
[146]	The first is the approach in Campania and adopted by the Court in The Stage Club.  On that approach, an acknowledgment is made to a creditor if:
(a)	It is expressly or implicitly addressed to the creditor and received by the creditor; or
(b)	It is not addressed to the creditor but is delivered to the creditor by or with the authority of the debtor.  
[147]	The second approach is that articulated by the Court in Hipworth.  On that approach, an acknowledgment is made to a creditor if it is not made directly to the creditor but is made with the intention it shall be communicated to the creditor and for the purpose of enabling a compromise of rights between the creditors and the debtor.  
[148]	These two approaches are not the same.  But that is because they are approaches which the High Court found useful in the differing factual contexts presented by the two cases.  Hipworth involved a situation where documents created pursuant to statute were under consideration.  There, the Court was concerned with considering the impact of that particular statutory context on the determination of the issue.  The Stage Club, on the other hand, was concerned with characterising the consequences of the balance sheets coming into the possession of an agent of the creditor.  To my mind, these cases reflect that the statute has to be applied in the factual context in which it arises.  The approaches in other cases may be of assistance depending on the facts of the particular case.
[149]	In my view, the acknowledgment of her debt by Ms Manicaros in the 2016 accounts was made to the company.  I hold that view for the following reasons.
[150]	First, I adopt the following submission by Mr Wilkins:  
..the argument that a company’s financial report is not a document prepared for the use or consideration of the company is, with respect, unencumbered by merit.  A company is required to keep financial records which correctly record and explain its transactions and its financial position and performance: CA, s.286(1).  Here, although, as a small proprietary company, the plaintiff was not obliged to do so, the plaintiff has discharged that obligation by, inter alia, the preparation of a financial report as described in CA, s.295(1).  The whole purpose of the statutory obligation in s.286(1) is to prevent an officer of a company “from flying the company blind and upon its crash, and without having any information capable of sustaining the opinion, from then saying that he thought he had more altitude”: Van Reesema v Flavel (1992) 7 ACSR 225 at 229 per King CJ, Bollen and Prior JJ concurring, referring with approval to Manning v Cory [1974] WAR 60 at 62 per Burt J.  A financial report is in every respect a document that is prepared for the use and consideration of the company.  The fact that a financial report is also prepared for other purposes does not mean that it is not prepared for the purpose of enabling the company, by its officers, to not fly blind.   
[151]	The 2016 accounts are expressly identified as being accounts of the company and were prepared on instructions of the company.  By declaring to the company that the 2016 accounts presented fairly the company’s financial position, Ms Manicaros as a director of the company was the human agent of the company.  She informed the company of the matters stated therein for use by the company in carrying on its affairs.  That conclusion is reinforced by having regard to the second declaration, which is also plainly made to and for use by the company and its board of directors so as to address the risk of impermissible insolvent trading.   
[152]	Second, the defendant relies on the express words in the 2016 accounts identifying to whom the accounts are addressed (see [120] above).  The relevant words are those in the first paragraph of Note 1: “The financial statements are a special purpose report prepared for use by the directors and the member [sic]”.  (It seems clear the singular was a typographical error, as there were two members, being the two directors).  However, in my view, this sentence assists the plaintiff not the defendant. As is observed in Ford, Austin & Ramsay's Principles of Corporations Law:     
Although a company is a discrete legal entity separate from its directors and members in the sense of having its own legal rights, privileges, duties and liabilities separate from theirs, it is in other respects not separate. After all, a company cannot act (for example, entering a contract or acquiring or disposing of property) unless its directors (or sometimes its members), or agents whom they appoint, act on behalf of the company. When it is the board of directors that acts on behalf of the company there is a fiction that the company itself is acting, the board of directors being considered an organ of the company rather than merely its agent. In some situations a general meeting of members can also be an organ of the company. When the person acting on behalf of the company is authorised by the board of directors to act for the company, that person does so as an agent of the company.
[153]	A financial statement prepared for use by the directors and members is prepared for use by all the natural persons who comprise the company.  To suggest that accounts prepared for use by the directors and members are not prepared for the company is meaningless, at least in the context of this case where there is nothing about the accounts which suggest they are prepared for some reason other than ordinary financial record keeping.   To adopt the observation of Brennan J in The Stage Club (at 577), “a balance sheet covered by an auditor's report and the directors' report in the usual form is not addressed, in the first instance, to creditors but to the company in general meeting.”  There is nothing which takes the 2016 accounts outside that statement of principle. Indeed the express words support that conclusion.
[154]	In my view, the above circumstances sustain the conclusion that the acknowledgment by the director was made to the company in the ordinary meaning of that phrase because it was included in accounts prepared for the company.  Using the language of Campania, it was addressed to the company and received by it.  As to the latter point, the 2016 accounts must have become part of the books and records of the company and thereby passed into the possession of the liquidator.  The reasonable inference, indeed the only rational inference, is that the 2016 accounts were received by the company.
[155]	Third, I reject the argument that the directors in signing the 2016 accounts were acting as the company (or on its behalf) and therefore cannot as a matter of law be acting also in their personal capacity.  I deal with that in the context of my analysis of VL Finance to which I now turn. 
VL Finance Pty Ltd v Legudi   
[156]	Central to the submissions of both parties on the 2016 accounts issue is the 2003 case of VL Finance Pty Ltd v Legudi (2003) 54 ATR 221.  In that case, Nettle J decided that in the circumstances of that case, an annual return signed by one of the directors did not constitute an acknowledgment of a debt shown in the annual return due from that director to the company.  
[157]	The defendant contends that the decision should applied to the 2016 accounts.  The plaintiff contends that the decision should not be followed.  Another possibility, of course, is that the decision does not apply to the particular facts of this case.  Understanding the parties’ submissions requires a precise understanding of what occurred in that case.
[158]	The arrangements that gave rise to the directors’ debts in that case were complicated.  The debts arose from a restructuring of the ladies’ wear business operated by Mr Legudi senior, his wife and his four sons.  All four sons came into the business in different roles.  In the 1970s, the business was structured into a corporate group with a non-trading holding company and various subsidiaries responsible for different parts of the undertaking.  During 1990, the business was in financial difficulties and there was a need for an injection of funds to improve the balance sheets, so as to avoid breaches of security documents. 
[159]	The solution developed by the group’s accountant need not be fully detailed.  In short, it sought to provide an improvement of the group’s balance sheets through a series of transactions which resulted ultimately in debts due from some of the directors and their families to one of companies in the group (called Properties in the case).  The scheme was carried out by various book entries in the accounts of the companies involved.  None of the family members paid, nor received, any funds as part of the transactions nor were any of the loans documented.  The loans were, however, ultimately recorded in the Properties accounts as current assets.  So far as I can infer, the idea seems to have been that the loans owed by the directors and their families represented current assets available to Properties which seemingly addressed the capital short fall which was the cause of concern.  
[160]	Subsequently, there were various further transactions recorded seemingly by book entry which resulted in consolidation of various of the debtors and changes in amount of the debts.  The result was that Anthony Legudi, one of the four sons, was indebted to Properties for an amount exceeding $700,000.  Focussing on the 1994 financial year, the position was summarised by his Honour as follows:
[19] Otherwise the 1994 Annual General Ledger and draft 1994 balance sheet are
consistent with the 1993 financial statements, in that they show the accrual of dividends
in Sons and the accrual of further interest on the family members' debts to Properties,
and hence that as at 30 June 1994 the total indebtedness of all family members to Properties stood at $3,096,083 as compared to $2,876,883 as at 30 June 1993.

[20] The 1994 Annual Return of Properties as lodged shows a different position again.
It states that the figure for current debtors is $2,876,883 (which is the same as the 1993
total figure) and therefore excludes the interest shown in the 1994 Annual General
Ledger as having accrued due during the 1994 year. It is not clear why that is so. One possibility is that the interest was waived, although that was not suggested in evidence.
Another possibility is that the figure was simply a mistake. The 1994 Annual Return
was not prepared by Mr Curwood, but rather by a firm called Maddisons. They had
taken over as Anthony Legudis' accountants by the time he lodged the return on 3 July
1995, and by that stage the group was in liquidation.
[161]	It is helpful to put his Honour’s observations into the context of the nature of Annual Returns at the time.  While this is not specifically explained in his Honour’s judgment, it was explained in a submission by Mr Wilkins provided for the company with Mr Morris’s consent after a query from me.
[162]	It will be noted that his Honour referred to three separate documents: the 1993 Financial Statements, the 1994 General Ledger and the 1994 draft balance sheet on the one hand, and the 1994 Annual Return on the other.  The acknowledgment was said by VL Finance to arise from the 1994 Annual Return.  The other documents were relied upon as providing evidence of relevant extrinsic facts explaining figures in the Annual Return.  As at 1994, s. 335 Corporations Law required companies to file Annual Returns with ASIC.  That required, relevant to Properties, that it include particulars as to current assets.  VL Finance relied on the 1994 Annual Return as an acknowledgment because it was signed by Anthony and stated the company’s total current debts at a certain sum.  VL Finance referred to the other documents to show that that total sum implied identifiable specific debts which were, inter alia, due from Anthony and his brother Frank Legudi.
[163]	Ultimately, the business failed and the companies in the group, including Properties, were wound up.  VL Finance (who was a financier of the group) took an assignment of the debts to Properties due by two sons, Anthony and Frank, and sued to recover the debts.
[164]	The defendants, perhaps faintly, argued that the debts did not exist or were incurred in circumstances of unconscientious conduct by Properties.  His Honour rejected both arguments.  The defendant also pleaded a limitations defence.  Much of the judgment is concerned with his Honour’s analysis of when the causes of action to recover the debts accrued.  Ultimately, his Honour concluded that the debts were payable on demand and were therefore immediately due, and were accordingly statute barred by about 1 year at the time the proceedings had been commenced to recover them.  VL Finance contended, however, that the debts had been acknowledged by the defendants in the 1994 Annual Return.  If correct, the proceedings would be within time.
[165]	The 1994 Annual Return was signed only by Anthony and was lodged with ASIC on 30 May 1994.  The 1994 Annual Return did not refer specifically to the debts to Properties owed by either Frank or Anthony. Rather it referred only to total member loans.  However, the breakup of that total by reference to individual member debts was able to be shown from the Properties 1994 General Ledger and draft balance sheet.  There was a further difficulty in that the 1994 Annual Return showed the figure for 30 June 1993, not the figure shown in the financial documents for 30 June 1994, which was some $200,000 higher.
[166]	His Honour summarised the law on acknowledgment in [60] to [63].  His Honour’s summary does not refer to the language of the statutory provisions in Victoria which governed (and still govern) acknowledgment (ss 24(3) and 25 Limitation of Actions Act 1958 (Vic)).  At [61] his Honour refers to the requirement that acknowledgment by “given to the creditor” (footnotes omitted):
[61] Of the criteria just mentioned, the requirement that an acknowledgment be
“given to the creditor'' is perhaps the most difficult to define precisely. As the
authorities now stand, it no longer necessary that an acknowledgment be sent or delivered to the creditor. But it remains that it must expressly or implicitly be “addressed to the creditor'', and it is here that problems arise. Thus, whereas in England it has been held that a list of a testator's debts in an executor's affidavit for probate is not an acknowledgment given to the testator's creditors (because it is not addressed to the creditors),  it has been held in Ireland that an acknowledgment in a will can be treated as an acknowledgment (because it is in substance expressive of the debtor's intention to admit the debt to the creditor).  Again, whereas early English authority has it that the recital of a debt in a deed between debtor and creditor is not an acknowledgment of the debt, later English authority is to the effect that facts stated in pleadings and affidavits in previous proceedings between debtor and creditor can constitute an acknowledgment (because, although they are made to the court, they are implicitly addressed to the creditor). 

[underlining added]

[167]	The Victorian statute applicable required (and still requires) that the acknowledgment in writing be “made to” the creditor, not that it be given to or addressed to the creditor.  Not much of substance might be thought to turn on the difference in language between the statute and that employed in the reasons.   However it is difficult, respectfully, to sustain the proposition that for an acknowledgment to be given to a creditor, it must be addressed to the creditor.  As a broad statement of principle, it is inconsistent in my respectful view with both Hipworth and more directly, The Stage Club.  In the latter case, the accounts were not addressed to Millers, directly or indirectly.  The majority judgments rather found that the accounts were provided to an agent of the creditor with the implicit authority of the debtor company.  That was an example of the application of the first limb of the test in Campania.
[168]	Central to his Honour’s reasoning, however, in my respectful view is his conclusion in [63]:
The reasoning throughout these cases is hardly constant and some of the earlier decisions may now be doubted in light of later decisions. It is probably also fair to say that the trend of authority is in favour of a relaxation of the requirements of an acknowledgment and therefore of treating as acknowledgments an increasing array of documents signed by or on behalf of a debtor. But while there is now high authority in Australia that a debtor need not intend to communicate an acknowledgment to the creditor or his agent (it is enough that the acknowledgment is actually communicated to the creditor), it remains the position in Australia as it is in England that a document does not constitute an acknowledgment unless it is in substance expressive of the debtor's intention to admit the debt and to have the document produced and used for that purpose.

[underlining added]

[169]	An immediate difficulty emerges with the underlined conclusion.  That passage seems to use the language of the court in Hipworth (see underlined passage cited in paragraph [82] above) when articulating a test for whether a document contains an acknowledgment rather than articulating a test which might be applied in some cases to determine if an acknowledgment is made to a creditor.  However, Hipworth was concerned with the “made to” issue, not the acknowledgment issue.   Alternatively, it might also be said that the analysis in that paragraph and its subsequent application elides the distinction between the two issues, as seems to emerge from the analysis at [173] below.  
[170]	VL Finance’s principal arguments were summarised as follows (the underlined argument being of direct relevance here):
[64] VL Finance Pty Ltd argued that in as much as a company's balance sheet may be regarded as an acknowledgment of the debts of the company shown in the balance sheet, an annual return signed by one director of the company should be regarded as an acknowledgment of the debts owed by the director to the company which are shown in the return. It was also submitted that the return should be treated as an acknowledgment by the other directors of the debts shown as owed by those directors to the company, on the basis that the directors as a whole were under an obligation to lodge the annual return and because the one director who signed the return should be regarded as impliedly authorised by each of the other directors to make the acknowledgment on his behalf. It followed, it was submitted, that the 1994 Annual Return which was signed and lodged by Anthony Legudi qualifies as an acknowledgment of the debt owed to Properties by Anthony Legudi and also of the debt owed to Properties by Frank Legudi.

[underlining added]

[171]	His Honour concluded that the 1994 Annual Return did not answer the limitations defence.  His Honour addresses VL Finance’s argument underlined in the previous paragraph as follows:
[67] I do not accept those submissions. In my opinion an annual return is not capable of constituting an acknowledgment by the directors of the company of debts which they owe to the company. It may perhaps be an acknowledgment by the company (in the same way that a balance sheet may be an acknowledgment by the company), because it may be supposed that the return is intended for use by the company's creditors. But I do not consider that it is an acknowledgment by the directors, because in my view it cannot be supposed that the return is made out to be used by the directors' creditors. The return is not made to the company. It is made by the company. Nor is the return prepared for the use and consideration of the company. It is designed and prepared for the use of others. Moreover, even if all the directors of the company are under a personal obligation to ensure that the return is made out and filed, I do not consider that the return is expressive of an intention on the part of the directors to admit such of their debts to the company as are shown in the return and to have the return produced by the company and used for that purpose. Therefore, regardless of whether the return comes to the attention of the company, I am unable to see that it is an acknowledgment made to the company.

[172]	As I understand the reasoning in this paragraph, the roman text is directed to whether an annual return is made to the company as creditor.  The italicised text appears to address whether an annual return can comprise an acknowledgment (as an admission) at all.  However, in my respectful view, the underlined text in the middle is a little hard to characterise and might be thought to elide the two issues. (His Honour did not find it necessary to decide the other arguments advanced by VL Finance, though plainly thought them unpersuasive, a view which I respectfully share.) 
[173]	As I have outlined, both parties made extensive submissions on VL Finance. It is to be remembered, however, that cases are not authorities for facts and as Nettle J observed, decided cases can be of little value as precedents in this area (that comment has been repeated by other Judges when dealing with acknowledgments).  One immediate difficulty with treating the reasoning in VL Finance as being applicable to this case is that the details of the Annual Return under consideration in that case are not set out in the judgment.  My analysis of the 2016 accounts is a function of the text of that document.  There is no similar detail available for the document before the Court in VL Finance.  For example, the first paragraph of the Directors’ Declaration is a relevant part of the 2016 accounts.  No similar statement in the Annual Return is identified.  The company’s case on the 2016 accounts is distinguishable from the facts in VL Finance.
[174]	However, there are aspects of the reasoning which are relevant to my analysis of the 2016 accounts, and it is desirable I express my reasons for respectfully disagreeing with His Honour’s reasoning, at least in the context of the facts in this case.  The key passage relevant here is that in [67] of the reasons set out above.  There are two key propositions advanced there:
(a)	First, an Annual Return is made by the company, not to the company. It is designed and prepared for the use of others, not the company; and
(b)	Second, an Annual Return is not expressive of an intention on the part of the directors to admit debts to the company and have the return produced and used by the company for that purpose.
[175]	As to the first proposition, I agree with Mr Wilkins’ submission that just because a financial document might be a document of the company, by its directors, that does not mean that the same document cannot also be objectively identified as a document provided to the company by its officers acting in their individual capacity.  Depending on the form and content of a financial document, it can be both.  That that is correct as a matter of principle emerges from Campania.  Financial accounts of a company certified by its directors can be (and in this case are) made to the company in the sense of being addressed to the company and received by it (Campania first limb).  They can at the same time be made to a creditor of the company if provided to the creditor with the authority of the company (Campania second limb).  An example of the latter in respect of a company balance sheet is Jones v Bellgrove Properties Pty Ltd [1949] 2 KB 700, summarised by Wilson J in The Stage Club as follows:
Jones was a shareholder and director of the company. He loaned moneys to the company in 1936 and 1937, and sued in 1947, whereupon the company pleaded the Statute of Limitations. The company had not traded during the years of the war. An annual general meeting was held on 31 December 1946, attended by the plaintiff, and balance sheets for the years 1939 to 1945 were presented and confirmed. They included the item “To sundry creditors £7638.8.10”, were signed by two directors, and also by accountants as agents for the company. No particular creditor was named, but evidence was given that the debt due to Jones was included. Evidence was also given that a director referred to the balance sheets in the presence of the plaintiff, saying “These are the accounts for five or six years. Would you care to look at them?” At first instance, Birkett J. found the debt to have been acknowledged on the date upon which the meeting was held. The Court of Appeal affirmed the decision. Lord Goddard said:
“Whether a document is or is not an acknowledgment must depend on what the document states; and a balance sheet presented to a shareholder creditor at a meeting of the company, as these balance sheets were presented to the plaintiff, fulfils all the requirements of ss. 23 and 24 of the Limitation Act, 1939.”
[176]	In my view, this analysis is directly supported by the observations of Brennan J in The Stage Club set out in paragraph [100] above.
[177]	As to the second proposition, in my respectful view, read in context, this proposition is based on a misapplication of the principle articulated in Hipworth.  His Honour’s reasons appear to use the language of intention and purpose to inform his approach to whether there is an acknowledgment in the sense of an admission of the debt.  That is not what the intention and purpose statement in Hipworth was concerned with, as I have already explained.   Nor for that matter, in my view, was Hipworth purporting to set out an exclusive test for whether an acknowledgment is made to a creditor which confines and defines the scope of that test.
[178]	I do not think VL Finance is applicable in the circumstances of this case but if it is, for the above reasons, I respectfully decline to follow it.
Conclusion 
[179]	The 2016 accounts comprised an acknowledgment made to the company by the defendant of her debts to the company shown in those accounts.  The limitations defence in respect of those debts fails.
Second alleged acknowledgment 
Initial observations 
[180]	My conclusion on the acknowledgment in the 2016 accounts means that it is strictly unnecessary for me to decide if the other acknowledgments alleged by the company are established.  However, in case I am wrong on the 2016 accounts issue, I now turn to analyse the other four alleged acknowledgments.
[181]	The second acknowledgment alleged by the company is contained in the 2 July 2017 email set out in paragraph [37] above.  Mr Morris conceded in oral argument that the 2 July email was signed by Ms Manicaros.  The email is obviously in writing.  The only two issues, therefore, are whether the email acknowledges her loans and if so, whether that acknowledgment is made to the company.
The plaintiff’s contentions
[182]	The plaintiff’s contentions are as follows.
[183]	First, Ms Manicaros’ statement that her withdrawal of company funds was to “normalise the loans we have with the company comprised an “acknowledgment of the existence of the liability” to the company.  Mr Wilkins submitted that that emerged from the words used.  He added that the conclusion gained further support from the fact that there was an undisputed relationship of lender and borrower between her and the company recorded in the 2016 accounts.  He submitted that those accounts can be used to construe the email because they were impliedly referred to by Ms Manicaros’ further observation that Mr Verschoyle would be “aware that your loans as of June 30th 2016 were higher than my loans.  I have brought us to even as at 1 July 2017”.  He submitted the amount of the debt admitted could be readily ascertained by reference to those accounts.  So much is confirmed by Ms Manicaros’ observation as to the difference in the loan accounts, which is demonstrable on the face of the 2016 accounts. 
[184]	Second, he submits that the 2 July acknowledgment was made to the company because the email was received for and on behalf of the company.  The submission was developed as follows:
Under CA, 286(1), a company must keep financial records that correctly record and explain its transactions. The email from the defendant did just that: it explained the transaction, being the withdrawal of $121,923.75 from the plaintiff’s account.  See also in this regard: ASIC v Rich (2005) 216 ALR 320 at [296] – [298] per Austin J.  What occurred in the emails is that Mr Verschoyle asked for an explanation of the transaction and the defendant provided it.  When the defendant provided it, she provided it to Mr Verschoyle, but she also provided it to the plaintiff to discharge its obligation under s.286(1).
[185]	It was submitted that while the communication was between the siblings as to their dispute about issues in the management of the company, it was also a communication by Ms Manicaros to her brother as agent of the company about the financial affairs of the company.
The defendant’s contentions 
[186]	The defendant’s submissions on the 2 July email were most fully developed in oral argument.  
[187]	As to whether the 2 July email admitted the debts of Ms Manicaros in the 2016 accounts, the gravamen of the argument was that, looked at objectively and in context, the 2 July email showed that:
What these parties were squabbling over was the fact that one of them had taken more money out of the company than the other.  Whether that was repayable or would ever become repayable just wasn’t the subject of discussion.  The only subject of discussion was, “You’ve got more out of this company than I have” and, indeed, the question is directly put.
[188]	And later:
My client is complaining that her brother’s liability is higher than hers, not because she is suggesting that either of them are going to repay it – if she was thinking about repaying it, she wouldn’t complain that her brother has to repay more than she does.  She is complaining because he has extracted more money from the company than she has and that’s all it’s about.  That’s all it could possibly be.
[189]	The submission was that looked at objectively, one could not conclude that reference to the loans could be an admission of the existence of the loan as a liability because the context dictates that Ms Manicaros did not consider the loans to be a liability, but rather a record of money taking out of the company by each director to their benefit.  
[190]	As to the question of whether the acknowledgment was made to the company, Ms Manicaros submitted that the email is not a communication made to the company at all but rather are communication between the two directors only.
Analysis 
Acknowledgment of the debt? 
[191]	At the heart of Ms Manicaros’ submission is the proposition that when she uses the word loan in the email, she is not using the word in its ordinary meaning: i.e. a debt.  Rather, she uses it to refer to records of the company showing how much each of the directors have taken out of the company for their own use; with the company being a piggy bank from which they could take money as they saw fit.   If one interpreted the 2 July email in that manner, it might well support the conclusion that the reference to the loans was not an acknowledgment of the existence of a liability, but of a record of withdrawals from the company’s funds. I accept Mr Morris’ argument that if one reached that conclusion as to the objective meaning of the use of the word in the 2 July email, it might give rise to other claims, but the email would not be an acknowledgment of the debts.
[192]	However, I do not accept that that is the objective meaning of the 2 July email.  It can be recognised that it is part of the squabble between the siblings about the affairs of the company.  However, neither the 2 July email, nor the preceding email which provides its context, state the proposition which Mr Morris submits should be extracted from the text.  Ms Manicaros uses the word “loan” to describe both her and her brother’s position.  It would take some clear words to persuade me to interpret loan as meaning, in effect, a gift or an irregularly recorded dividend.  There are none.  Further, the reference to the loans “as of June 30, 2016” calls up the 2016 accounts, finalised the previous November, which recorded those loans in the formal manner I have already identified.  Those words are inconsistent with the loans not being loans in the ordinary meaning of that word.
[193]	In addition, the objective of equalisation of loans does not necessarily communicate that the loans are not real obligations.  Ms Manicaros’ objective was to put her and her brother in the same position vis a vis the company as debtors.  That was an objective which could equally be explained as ensuring that her brother did not obtain any advantage over her from a mutual forgiveness of the debts as part of their settlement over the affairs of the company.  Indeed the idea of mutual forgiveness had already been contemplated: see [31] above.   
[194]	In my view, an objective reading of the 2 July email is that Ms Manicaros distinctly acknowledges the existence of her debts to the company in the form of her loans as at 30 June 2016.  The words “normalise the loans we have with the company” in terms do so.  Further, it is the existence of those debts, of both her and her brother, which are the foundation for her objective which was to bring them to even.   It must be remembered, it is not necessary to extract an implied or express promise to pay the debts to establish acknowledgment, just an acknowledgment of their existence. 
[195]	Ms Manicaros did not directly cavil with the company’s submission that the reference to the debts as at “June 30th 2016” could be objectively construed as being the debts shown in the 2016 accounts.  I consider that submission correctly made.  The precise amount of a debt does not need to be stated in an acknowledgment, so long as the amount may be established from extrinsic evidence or from documents expressly or impliedly identified in the acknowledgment.  Here the 2016 accounts identify the position as at the date specified in the 2 July email.  This is particularly compelling given the specific discussion of the difference in the loans and the amount required to equalise the parties’ positions are broadly consistent with the figures in the 2016 accounts.
Acknowledgment made to the company?  
[196]	I start by referring to the analysis of this issue in paragraphs [98] to [102] above.   The 2 July email is not addressed to the company, nor delivered to the company as such.  It is addressed to and delivered to Mr Verschoyle.  Does this mean that the acknowledgment in the 2 July email was made to the company?  For it to do so, I would have to conclude that looked at objectively, the acknowledgment was made to Mr Verschoyle as agent for the company.
[197]	Although the matter is not free from doubt, I am not satisfied that it was.  I accept that the preceding email from Mr Verschoyle could be characterised as being sent by him on behalf of the company and seeking information on behalf of the company.  It was sent as Managing Director and is couched in terms of unauthorised withdrawal of company funds.  To that extent I can accept that Mr Verschoyle’s email was an inquiry by him on behalf of the company.  However, I do not accept that the response can be characterised in the same way.  Ms Manicaros’ email is in my opinion, viewed objectively, addressed to Mr Verschoyle personally and concerned with their respective personal positions vis a vis the company in relation to loan accounts.  It is, from Ms Manciaros’ perspective, a continuation of the personal dispute between them about the affairs of the company.
[198]	Using the language of Campania, I do not consider that the 2 July email was either addressed to the company or delivered to the company by delivery to Mr Verschoyle.  It was addressed to Mr Verschoyle personally and delivered to him personally. 
[199]	I do not consider that reference to s. 286 Corporations Act has a role to play in this part of the company’s case.  The fact that a document might objectively be a financial record does not mean that the author of it has made an acknowledgment it contains to the company for which the document is objectively a financial record.  Put another way, just because the 2 July email could be characterised as a financial record and might indeed have been used by Mr Verschoyle as one on behalf of the company, does not of itself mean that looked at objectively, Ms Manicaros’ acknowledgment was made to the company.
Third alleged acknowledgment 
[200]	I refer to paragraphs [39] to [41] above which set out the circumstances leading up to the 18 August email.  The email itself appears at [42].  Both parties advanced extensive written submissions in relation to this email.  Those submissions were primarily concerned with what extrinsic facts were relevant to construction of the email.  To be fair to the company, much of the company’s submission was concerned with responding to matters pleaded in the defence but not pressed by counsel in writing or in oral argument.  With respect to both sets of submissions, I did not find many of the points raised of much assistance.  The surrounding circumstances referred to were generally of limited probative weight in the face of the express words in the 18 August email and the matters which were of immediate relevance to the sending of that email are as set out above. 
[201]	The primary focus must be on construing the words used in the 18 August email.  It is convenient for this alleged acknowledgment to first undertake that task, then deal with relevant arguments of the parties.
Acknowledgment of the debt?  
[202]	The starting point is to recognise that Mr Verschoyle’s email which precedes the 18 August email asks specifically about Ms Manicaros’ position on ‘Forgiveness of Loans’.  That reference does not spring out of nowhere.  It had been raised from time to time in the preceding months: see paragraphs [31] to [35] above.  (However, despite the defendant’s submissions, little weight can be placed on the unexecuted Deed in construing the 18 August email as there is no evidence it was ever received by Mr Verschoyle).  In any event, those documents do no more than explain where the phrase sprang from.  I do not think they do more than show that the forgiveness was one matter under discussion for the purposes of resolving the dispute between the siblings.
[203]	To my mind, the suggestion that a loan must be forgiven is consistent with the conclusion that such a loan is in existence.  Otherwise forgiveness is unnecessary. Admittedly, Mr Verschoyle’s email might have brought forth the response that Ms Manicaros’s position is that forgiveness is unnecessary because the debts are statute barred or not due or not recoverable or some such statement.  It is notable that no such response was given.  Rather Ms Manicaros says the opposite: the loans remain and at this stage are not forgiven.  To my mind that is a plain admission of the existence of the debts of both directors.  Indeed it goes beyond that.  The response impliedly asserts that the debts are recoverable absent forgiveness.  
[204]	The balance of the 18 August email only serves to reinforce that conclusion.  Ms Manicaros’ email goes on to reiterate her complaints about unequal loans, plainly referring back to the complaint in the 2 July email.  However she goes on to suggest the loans be equalised by Mr Verschoyle paying back part of his loan.  Although this refers to Mr Verschoyle’s loan not hers, it is consistent with an admission of the debts and indeed an admission they were repayable.
[205]	The observations about identification of the loans to which Ms Manicaros refers in the 2 July email set out in paragraph [195] above apply equally to the acknowledgment in the 18 August email.  Although the latter does not directly refer to the position as at 30 June 2016, it is plain that that is what Ms Manicaros is referring to, particularly when regard is had to her reference to Mr Verschoyle having approximately $64,000 more in loans than Ms Manicaros.  
[206]	I consider that the 18 August email contains an acknowledgment of Ms Manicaros’ loans from the company recorded in the 2016 accounts.
[207]	The principal point made in oral argument by Ms Manicaros contrary to this conclusion was to reiterate the argument in paragraphs [188] to [190] above. For the reasons given in relation to the 2 July email, I do not accept that argument.  It is even less compelling in relation to the 18 August email, given its clear admission discussed above from the statement that “the loans remain and are not forgiven”.  
[208]	For completeness, I observe that nothing in paragraph [69] or [70] of Ms Manicaros’ written trial submission persuades me to the contrary.  
Acknowledgment made to the company?
[209]	This can be shortly disposed of.  The contention by the company that the 18 August acknowledgment was made to the company mirrors that advanced for the 2 July email and summarised at [184] and [185] above: see paragraph [49(a)] of the company’s trial submission.
[210]	Again, I am not persuaded that the acknowledgment was made to the company.  The observation at [197] applies equally to the 18 August email.  However, the conclusion that the acknowledgment is not made to the company is more compelling in respect of the 18 August email than the 2 July email.  While it can be accepted that Mr Verschoyle’s preceding email is more clearly couched in terms of a Managing Director seeking information for company purposes, Ms Manicaros’ response goes to some lengths to reject expressly the suggestion that Mr Verschoyle is entitled to query her in that capacity: see her comment that “You are NOT the managing director and should cease holding yourself out as such”.  Later, she contends that Mr Verschoyle’s position in respect of the rent and terms of the lease is a personal position.  Even more than the 2 July email, looked at objectively the 18 August email is addressed to Mr Verschoyle personally and concerned with their respective personal dispute over the affairs of the company.   
[211]	Further, an email exchange about whether loans should be forgiven does not seem to me to be a financial record within the meaning of s. 286, even allowing for the broad interpretation given in ASIC v Rich (2005) 216 ALR 320 [296] – [298].  If there was an agreement to forgive the debts, they might fall into the category of projections discussed in [298] of that judgment.  But no resolution or agreement was reached, even in principle.    
Fourth alleged acknowledgment 
Acknowledgment of the debt?
[212]	The context of this issue is set out at paragraphs [44] to [46] above.   
[213]	The company relies on the affidavit read as a whole as containing an acknowledgment made to the company.  However, the words which are, in particular, relied upon as making the acknowledgment are those in the 2 July and 18 August emails.  I have already found that those emails contain acknowledgments by Ms Manicaros of her debts to the company in the 30 June 2016 accounts.
[214]	However, I should recognise the following aspects of the argument on this issue.  
[215]	Ms Manicaros contended that if the 2 July and 18 August emails were construed as not giving rise to acknowledgments, then including them in the affidavit with the description contained in paragraph 20 (see [45] above) of the affidavit could not convert those emails into documents which did contain acknowledgments.  The river cannot flow higher than its source, went the submission.
[216]	While recognising the force in that submission, Mr Wilkins did not concede it to be correct. His argument was that the company’s case was that the acknowledgment was contained in the affidavit, including the two emails and the text which propounded them, along with the apparent recognition of the demand for repayment of the director related loans in paragraph [24(a)] of the affidavit. Mr Wilkins submission was that read in that context, it might be that the words of acknowledgment relied upon in the two emails might be more compelling as admissions of the debts.  While theoretically possible, I did not find that submission compelling.  The words of paragraph 20 of the affidavit do not seem to assist in establishing that the language of a particular email is an admission and nor does paragraph 24(a) refer to those emails.  However, as I have already decided that both emails contain acknowledgments, I do not need to form a final view on this.
[217]	The live issue which arises in respect of the affidavit is whether the inclusion of the two emails in the affidavit leads to the conclusion that the acknowledgments they contain were made to the company in circumstances where, without such inclusion, I have found that they were not made to the company.
Acknowledgments made to the company?
[218]	In Blair v Nugent (1846) 3 Jo. & Lat. 668 at 677, Sir Edward Sugden LC observed:
The next question is whether it is an acknowledgment to the person entitled thereto or his agent.  The cases show that the Court has not, in that respect, restricted itself within narrow limits.  If it be made in a schedule, affidavit or answer, it is sufficient, though in these cases it is made to the Court and not to the party.  The decisions are, I think, right.  They proceed upon a liberal, but yet fair and just construction of the statute.

[219]	This statement has been cited with approval in the High Court in Hipworth and The Stage Club, (though not applied on the facts of either case).  The statute referred to in Blair was of course, quite different and less prescriptive than the statute under consideration here, though it was based on similarly principles.  There has been little elucidation since then of why an acknowledgment in a Court document is taken to be made to a party to the proceedings, nor what the outer limits of that principle might be.
[220]	Pleadings are probably the easiest to understand.  Where a party pleads facts in proceedings which comprise an acknowledgment and then file that pleading in proceedings involving the creditor, it involves a direct assertion of the correctness of those alleged facts against the creditor as another party to the litigation.  An example is Sexton Development v Yarrawonga Pty Ltd [2003] QCA 173 [6], where the alleged facts which gave rise to the acknowledgment were pleaded in a defence filed by the debtor in proceedings brought by the creditor.
[221]	The company identified cases where the proposition in Blair was referred to and applied, but none of those cases involved an analysis of the precise scope and nature of that proposition.  In Woo v Woo, Bryson AJ considered Blair and the judgments in The Stage Club and concluded that “a statement in an affidavit may be an acknowledgment to a party to the proceedings” and that “I regard the standing of a statement in an affidavit as an acknowledgement as open to further consideration, but perhaps only in the High Court of Australia.” 
[222]	It was also applied by Thomas J in Tapiolas v Tapiolas [1985] 2 Qd R 310, 317 who noted Blair and observed that “answers filed in Court although made to the Court, are also inevitably communicated to the adversary”.
[223]	In my respectful view, the decisions in Hipworth and The Stage Club do not of themselves compel the conclusion that any acknowledgment contained anywhere in any documentary exhibited to an affidavit is automatically to be considered to be made to a creditor if that creditor is a party to proceedings in which the affidavit is filed.  However, the premise of the proposition which underpins Blair is surely that if a party makes a statement in a Court document which acknowledges a debt, they cannot be heard to say that they made the statement only to the Court.  They also cannot be heard to say that, to the extent it is communicated necessarily to the creditor in proceedings, it was communicated only for the purpose of the proceedings, and not for the purposes of the limitations statute.
[224]	That premise is apt to apply easily to allegations in pleadings and sworn statements in affidavits.  However, what about the situation in this case, where the acknowledgment is said to be in a letter which is merely exhibited to the affidavit?  I do not accept that in that case, every acknowledgment in correspondence exhibited to an affidavit is automatically to be deemed made to a party to the proceedings.  It must require at least some consideration to be given to the reason that the document containing the acknowledgment is exhibited to the affidavit and what the deponent swears about that document.  However, that analysis must be undertaken against the background of the proposition of policy I have articulated in paragraph [223].  
[225]	This analysis reflects the submissions of the parties on this point.  The company contends that the two emails were exhibited in the following circumstances;
(a)	The affidavit was filed and served on the company;
(b)	The nature of the proceedings were the winding up of the company in circumstances of alleged oppression;
(c)	Ms Manicaros expressly swore that demands had been made on her for repayment of her company loans and that those were an example of oppression; and
(d)	The two emails were exhibited by her under cover of a statement that the emails were part of the correspondence with Mr Verschoyle and others “in relation to the operation of the Company”.
[226]	In that context, the company submits that the inclusion of the two emails in the affidavit involves making the acknowledgment they contain to the company. 
[227]	Ms Manicaros, on the other hand, characterises the inclusion of the correspondence differently.  She submits that the emails were included as correspondence showing why the company should be wound up.  The submission is also made that that is the intention and purpose of inclusion of the emails; there was no intention to communicate any acknowledgment.
[228]	I consider that the company’s contention is correct.  The factors identified by the company are such as to confirm that the communication of the acknowledgments contained in the emails should not be able to be read down to some narrow purpose when they are included in an affidavit relied upon in legal proceedings involving the company.  The characterisation by Ms Manicaros, in fact, takes the matter no further.  As she submitted, the correspondence is included to show why the company should be would up, but one of the reasons advanced in the text of the affidavit is that the company and Mr Verschoyle are making oppressive demands for payment of company loans which are acknowledged in the documents exhibited to the affidavit.  
[229]	In my view, by including the 2 July and 18 August emails as exhibits to the affidavit, Ms Manicaros’ acknowledgments in those emails were made to the company on the date that the affidavit was filed.
Fifth alleged acknowledgment 
[230]	This alleged acknowledgment is said to arise from the letter from Ms Manicaros’ solicitors dealt with in paragraphs [47] to [50].  As I understood the parties’ positions, the only issue in dispute in respect of this alleged acknowledgment is whether the letter contains an admission of the debts.  
[231]	I do not think that it does.  The liquidator’s solicitor’s letter calls for part repayment of Ms Manicaros’ loan account. The gravamen of the response is that the issue of the loan accounts should be dealt with later.  That does not expressly admit the debts.  Indeed, such language would be equally consistent with preserving the right to argue against the enforceability of the debts.  While reasonable minds may differ, I consider the language in the letter, taken in the context of the letter to which it is responding, to be too equivocal to amount to an acknowledgment of the loans by Ms Manicaros shown in the 2016 accounts.
Conclusion 
[232]	Ms Manicaros acknowledged the loans shown as due by her to the company in the 2016 accounts in writing signed by her and made to the company on two occasions:
(a)	By executing the 2016 accounts on 11 November 2016; and
(b)	By filing and serving her affidavit in the winding up proceedings on 24 October 2017.
[233]	Accordingly, pursuant to s. 35(3) LAA, the company’s right to sue for those loans is be deemed to have accrued on 11 November 2016 and again on 24 October 2017.  These proceedings were commenced on 19 December 2018.  They were therefore commenced within time and the defence based on the contention that the limitation period had expired in respect of those claims fails.  
[234]	As no other defence to the claims by the company to the recover the loans was advanced, I order judgment for the company in the amount of $631,276, the net amount due by Ms Manicaros to the company.  I will hear the parties as to interest and costs.