The applicant sought a bankruptcy order against the respondent arising from an admitted unpaid debt under a software distribution arrangement.
The respondent relied on a proposed but unissued counterclaim as a basis to deny effective indebtedness and resist bankruptcy.
The court held that the debt was liquidated and admitted, that special circumstances permitted a finding of an act of bankruptcy based on non-payment to the disclosed creditor, and that the proposed litigation was vague, unsupported, and appeared intended to hinder enforcement.
A bankruptcy order was granted and costs were awarded to the applicant.
