Ansell Ltd v Coco

Ansell Ltd, a company, appealed against a decision of the Federal Court of Australia, which found that the appellant, Coco, had provided a guarantee to the respondent, Ansell Ltd, for payment of all debts and monetary liabilities owed by the company to Ansell Ltd. The company had gone into liquidation before the litigation was commenced, and Ansell Ltd claimed for moneys owed under the contract. Coco counter-claimed for breach of warranty against Ansell Ltd and sought to set off the quantum of damages recoverable against his liability under the guarantee. The learned trial judge found that Coco had not established a breach of warranty. The legal issues that arose from this appeal were whether Coco could, by way of defence, rely on an asserted claim by the principal debtor against the creditor for unliquidated damages for breach of warranty, and whether a breach of warranty had been established.

The court held that the appellant, Coco, could not rely on an asserted claim by the principal debtor against the creditor for unliquidated damages for breach of warranty as a defence to a claim under the guarantee. The court found that the claim for breach of warranty was not a set-off that could be used to reduce the amount owed under the guarantee. The court also found that the claim for breach of warranty had not been established. The court held that the appellant had not established a breach of warranty and that the claim for damages for breach of warranty was not a valid defence to the claim under the guarantee. The appeal was dismissed with costs to be assessed on an indemnity basis.