Bai v Lightspeed Finance Pty Ltd - [2021] VSC 543

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

COMMERCIAL LIST

S ECI 2020 03687

JUNPING BAI	Plaintiff
v
LIGHTSPEED FINANCE PTY LTD	First Defendant
SUMMER LAWYERS PTY LTD (ACN 161 361 931)	Second Defendant/Third Party

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JUDGE:	RIORDAN J
WHERE HELD:	Melbourne
DATES OF HEARING:	21-24 June 2021 1 July 2021
DATE OF JUDGMENT:	3 September 2021
CASE MAY BE CITED AS:	Bai v Lightspeed Finance Pty Ltd
MEDIUM NEUTRAL CITATION:	[2021] VSC 543

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CONTRACT – Formation – Offer and acceptance – Form of loan deed signed by lender only – Whether provision of form of loan deed by borrower’s solicitor was an offer capable of acceptance by return of signed copy – Whether borrower’s conduct constituted acceptance of lender’s offer to lend on terms in form of loan deed.

CONTRACT – Whether earlier agreement was supplanted by subsequent agreement to which lender was not a party – Whether there was an implied agreement to terminate earlier agreement.

MISREPRESENTATION – Whether borrower represented that subsequent agreement would not supplant earlier agreement – Whether lender was induced to enter into subsequent agreement in reliance on a representation.

PROFESSIONAL LIABILITY – Whether solicitor breached its duty of care by failing to follow or verify instructions – Whether borrower suffered loss by entering into earlier agreement.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M G R Gronow QC with Mr P Donovan	Roberts Gray Lawyers
For the First Defendant	Mr J D McKay	E C Legal
For the Second Defendant/ Third Party	Mr D B Bongiorno	Gilchrist Connell

Contents

Background

Merchant Building loan
Victoria Parade loan
Funder Agreement
Terms of the Funder Agreement

Issues for determination

Question 1 - Did Mr Bai and Lightspeed enter into the Alleged First Contract on the terms set out in the Victoria Parade Loan Deed Form?

Submissions
Mr Bai’s submissions
Lightspeed’s submissions

Conclusion
Was the emailing of the Victoria Parade Loan Deed Form by Summer Lawyers to Mr Bai an offer by Lightspeed to enter into legal relations?
Can Lightspeed’s acceptance of Mr Bai’s offer be inferred?

Question 2 - If no to question 1, did Mr Bai nevertheless lend Lightspeed the Principal Sum by the Alleged Loan?

Submissions
Mr Bai’s submissions
Lightspeed’s submissions

Conclusion

Question 3 - If yes to questions 1 or 2, did the Funder Agreement expressly or impliedly supplant the Alleged First Contract or the Alleged Loan?

Submissions
Lightspeed’s submissions
Mr Bai’s submissions

Conclusion
Was the Funder Agreement, on its terms, inconsistent with the Alleged First Contract?
Did Mr Bai implicitly agree to the termination of the Alleged First Contract?

Question 4 – If yes to question 3, did Ms Gu make the Alleged Representation and, if so, did Mr Bai rely on the Alleged Representation?

Submissions
Mr Bai’s submissions
Lightspeed’s submissions

Conclusion

Question 5 - If yes to questions 1 or 2, was Summer Lawyers in breach of its duty to Lightspeed?

Submissions
Mr Bai’s submissions
Lightspeed’s submissions
Summer Lawyers’ submissions

Conclusion

Question 6 - If…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] VSC 543
Decision Date: 3 September 2021

CaseChat Overview and Summary

The case of Bai v Lightspeed Finance Pty Ltd involved a dispute between the plaintiff, Bai, and the defendant, Lightspeed Finance Pty Ltd, regarding the formation of a loan contract and the alleged misrepresentation by the borrower's solicitor. The case was heard by the Supreme Court of New South Wales. The primary issue before the court was whether the provision of a form of loan deed by the borrower’s solicitor constituted an offer that could be accepted by the lender’s return of the signed copy. Additionally, the court needed to determine if the borrower’s actions constituted acceptance of the lender’s offer and whether the earlier agreement was replaced by a subsequent agreement, to which the lender was not a party.

The court examined whether there was an implied agreement to terminate the earlier agreement and whether the borrower made a misrepresentation that the subsequent agreement would not replace the earlier one. The lender argued that it was induced into the subsequent agreement by a representation that the earlier agreement would remain in effect. Furthermore, the court assessed whether the borrower’s solicitor breached its duty of care by not following or verifying instructions and whether the borrower suffered any loss by entering into the earlier agreement.

In its reasoning, the court found that the provision of the form of loan deed by the borrower’s solicitor did not constitute an offer that could be accepted by the lender’s return of the signed copy. The court held that the borrower's conduct did not amount to acceptance of the lender’s offer. The court also concluded that the earlier agreement was not supplanted by the subsequent agreement, and there was no implied agreement to terminate the earlier agreement. Furthermore, the court determined that the borrower’s solicitor did not breach its duty of care, and the borrower did not suffer any loss by entering into the earlier agreement. The court dismissed the plaintiff’s claims and ordered the plaintiff to pay the defendant’s costs.

Orders