Brighton v Australia and New Zealand Banking Group Ltd

In *Brighton v Australia and New Zealand Banking Group Ltd*, the New South Wales Court of Appeal considered a dispute between guarantors and a bank concerning alleged breaches of confidentiality and unconscionable conduct. The guarantors sought to resist the enforcement of their guarantees, arguing that the bank had breached contractual obligations of confidentiality and engaged in unconscionable conduct in obtaining releases and confirmations of enforceability of securities.

The primary legal issues before the Court of Appeal were whether the bank owed the guarantors a contractual obligation of confidentiality, either express or implied, and whether any such obligation, if it existed, was a condition of the contract or an intermediate term, the breach of which would entitle the guarantors to terminate. Additionally, the court had to determine whether the bank's conduct in obtaining the releases and confirmations of enforceability of securities was unconscionable under the *Trade Practices Act 1974* (Cth) and the *Australian Securities and Investments Commission Act 2001* (Cth), and whether the *Contracts Review Act 1980* applied to the circumstances.

The Court of Appeal held that there was no express contractual obligation of confidentiality owed by the bank to the guarantors. Furthermore, the court found that no such obligation could be implied in fact, as the test from *BP Refinery (Westernport) Pty Ltd v Hastings Shire Council* was not satisfied; the obligation was not necessary for business efficacy nor so obvious that it went without saying. An implied obligation of confidentiality, which may arise in a banker-customer relationship, was not implied into the banker-guarantor contract. The court also determined that even if a breach of confidentiality had occurred, it did not amount to a breach of a condition or an intermediate term that deprived the guarantors of substantially the whole benefit of the contract. Regarding the unconscionability claims, the court found that the conduct did not meet the threshold for unconscionability under the relevant legislation, particularly given that the contracts were entered into in the course of business.

The appeal was dismissed, with the Court of Appeal ordering that the guarantors pay the bank's costs and dissolving the stay of orders made by the court below.