The Court held, firstly, that at the date of service of the s 255 notice, there was no debt due to the 2 non-residents by Virgin Blue by virtue of the combined effect of ss 254U and 254V of the Corporations Act 2001. A debt would only arise on the date for payment of the dividend. Secondly, on the basis that there was a valid equitable assignment of a future legal chose in action prior to the date for payment of the dividend, which assignment took effect eo instanti when the debt came into existence, there was no moment in time when the legal title to the debt (dividend) vested in the 2 non-resident shareholders free from the equitable interest of Bluebottle. Consequently, the Commissioner's s 255 notice was ineffective: Bluebottle UK Ltd & Ors v Deputy Commissioner of Taxation & Anor  NSWSC 706 (Supreme Court of New South Wales, Gzell J, 14 July 2006).
For a copy of the decision, go here