Barecall Pty Ltd v Hoban - [2010] NSWCA 269

New South Wales

Court of Appeal

CITATION: Barecall Pty Limited v David Hoban [2010] NSWCA 269
This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S): 12 October 2010

JUDGMENT DATE:
12 October 2010

JUDGMENT OF: Allsop P at 1; Macfarlan JA at 25; Handley AJA at 26

EX TEMPORE JUDGMENT DATE: 12 October 2010

DECISION: 1. Dismiss the appeal, subject to the following orders.
2. Dismiss the application made by the third respondent for the adducing of fresh evidence with no order as to costs.
3. Direct the parties, through the appellant, to file an additional Orange Book containing the costs judgment, costs orders, and all parties’ submissions on the appeal on costs, within seven days or such other extended time as the Court identifies if application be made.
4. Stand over the making of an order for costs of the appeal and of costs below until resolution of the appeal on costs.

CATCHWORDS: GUARANTEE AND INDEMNITY – enforceability – guarantee covenants in variation of lease – guarantees not signed by two of five guarantors - ESTOPPEL – estoppel by representation or convention – assurance that five personal guarantees would be executed – knowledge of solicitor that two guarantees not received imputed to client – no action taken by client with knowledge that assurance unfulfilled

LEGISLATION CITED: Real Property Act 1900

CATEGORY: Principal judgment

CASES CITED: Chan v Cresdon Pty Ltd [1989] HCA 63; 168 CLR 242

PARTIES: Barecall Pty Limited ACN 060 527 095 (Appellant)
David Hoban (First Respondent)
Deon Russell Harvey (Second Respondent)
Anthony Rossi (Third Respondent)
Radoslav Spadina (Fourth Respondent)
Jason Lussick (Fifth Respondent)

FILE NUMBER(S): CA 2006/257180

COUNSEL: Mr D E Baran (Appellant)
Mr G Blank (First Respondent)
Mr M Evans with Ms C Sclavos (Second, Third & Fifth Respondents)

SOLICITORS: Schreuder Partners Lawyers (Appellant)
Goodman Law (First Respondent)
Lathams Lawyers (Second & Third Respondents)
In Person (Fourth Respondent)
Medcalf Grant Lawyers (Fifth Respondent)

LOWER COURT JURISDICTION: Supreme Court - Equity Division

LOWER COURT FILE NUMBER(S): 2006/3278

LOWER COURT JUDICIAL OFFICER: Ward J

LOWER COURT DATE OF DECISION: 16 October 2009

LOWER COURT MEDIUM NEUTRAL CITATION: Barecall Pty Limited v Hobart [2009] NSWSC 1104

2006/257180

ALLSOP P
MACFARLAN JA
HANDLEY AJA
Tuesday 12 October 2010

BARECALL PTY LIMITED v DAVID HOBAN

Judgment

1 ALLSOP P: This is an appeal from orders made by a judge of the Equity Division (Ward J) dismissing proceedings seeking to enforce guarantees of the debts of a company pursuant to various instruments of lease, sub-lease and variation of lease: Barecall Pty Ltd v Hoban [2009] NSWSC 1104. The argument today has been directed to a limited foundation of the appeal. A full understanding of the facts and the issues raised in the written submissions can be taken from the detailed, careful and lucid reasons of the learned primary judge and the Notice of Appeal. respectively. The Court is in a position to dispose of the arguments today in…

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.

Continue reading Barecall Pty Ltd v Hoban

Details

AGLC: Barecall Pty Ltd v Hoban [2010] NSWCA 269
Case: [2010] NSWCA 269
Decision Date: 12 October 2010

CaseChat Overview and Summary

Barecall Pty Ltd (the appellant) appealed to the Court of Appeal of New South Wales against a decision concerning the enforceability of guarantee covenants in a lease variation. The dispute arose when the appellant sought to enforce these guarantees against the respondents, who were guarantors of a commercial lease. However, two of the five guarantors had not executed the guarantee documents, leading to the central issue of whether the guarantees were enforceable against all respondents.

The Court of Appeal was required to determine whether the appellant was estopped from enforcing the guarantee covenants against the respondents, notwithstanding the failure of two guarantors to sign. Specifically, the court considered whether the appellant, through its solicitor, had made an assurance that all five personal guarantees would be executed, and whether this assurance, if unfulfilled, could give rise to an estoppel. The court also had to consider whether the knowledge of the solicitor regarding the unfulfilled assurance was to be imputed to the appellant.

The Court of Appeal reasoned that an estoppel by convention could arise where parties conduct their affairs based on a shared assumption of fact or law, and one party seeks to depart from that assumption to the detriment of the other. In this instance, the court found that the appellant, through its solicitor, had represented that all five guarantees would be executed. The solicitor's knowledge that two guarantees had not been received was imputed to the appellant. As the appellant took no action despite this knowledge and the unfulfilled assurance, it was estopped from enforcing the guarantees against the respondents.

The appeal was dismissed. The application for the adducing of fresh evidence was also dismissed with no order as to costs. The parties were directed to file additional documentation concerning the costs judgment and submissions on the appeal on costs. The making of an order for the costs of the appeal and below was stood over until the resolution of the appeal on costs.

Orders

Orders of the court

1. Dismiss the appeal, subject to the following orders.

2. Dismiss the application made by the third respondent for the adducing of fresh evidence with no order as to costs.

3. Direct the parties, through the appellant, to file an additional Orange Book containing the costs judgment, costs orders, and all parties’ submissions on the appeal on costs, within seven days or such other extended time as the Court identifies if application be made.

4. Stand over the making of an order for costs of the appeal and of costs below until resolution of the appeal on costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Barecall Pty Limited v David Hoban [2010] NSWCA 269 This decision has been amended. Please see the end of the judgment for a list of the amendments.
HEARING DATE(S):	12 October 2010
JUDGMENT DATE:	12 October 2010
JUDGMENT OF:	Allsop P at 1; Macfarlan JA at 25; Handley AJA at 26
EX TEMPORE JUDGMENT DATE:	12 October 2010
DECISION:	1. Dismiss the appeal, subject to the following orders. 2. Dismiss the application made by the third respondent for the adducing of fresh evidence with no order as to costs. 3. Direct the parties, through the appellant, to file an additional Orange Book containing the costs judgment, costs orders, and all parties’ submissions on the appeal on costs, within seven days or such other extended time as the Court identifies if application be made. 4. Stand over the making of an order for costs of the appeal and of costs below until resolution of the appeal on costs.
CATCHWORDS:	GUARANTEE AND INDEMNITY – enforceability – guarantee covenants in variation of lease – guarantees not signed by two of five guarantors - ESTOPPEL – estoppel by representation or convention – assurance that five personal guarantees would be executed – knowledge of solicitor that two guarantees not received imputed to client – no action taken by client with knowledge that assurance unfulfilled
LEGISLATION CITED:	Real Property Act 1900
CATEGORY:	Principal judgment
CASES CITED:	Chan v Cresdon Pty Ltd [1989] HCA 63; 168 CLR 242
PARTIES:	Barecall Pty Limited ACN 060 527 095 (Appellant) David Hoban (First Respondent) Deon Russell Harvey (Second Respondent) Anthony Rossi (Third Respondent) Radoslav Spadina (Fourth Respondent) Jason Lussick (Fifth Respondent)
FILE NUMBER(S):	CA 2006/257180
COUNSEL:	Mr D E Baran (Appellant) Mr G Blank (First Respondent) Mr M Evans with Ms C Sclavos (Second, Third & Fifth Respondents)
SOLICITORS:	Schreuder Partners Lawyers (Appellant) Goodman Law (First Respondent) Lathams Lawyers (Second & Third Respondents) In Person (Fourth Respondent) Medcalf Grant Lawyers (Fifth Respondent)
LOWER COURT JURISDICTION:	Supreme Court - Equity Division
LOWER COURT FILE NUMBER(S):	2006/3278
LOWER COURT JUDICIAL OFFICER:	Ward J
LOWER COURT DATE OF DECISION:	16 October 2009
LOWER COURT MEDIUM NEUTRAL CITATION:	Barecall Pty Limited v Hobart [2009] NSWSC 1104