Delany Advertising & Media Pty Ltd (ACN 003 390 396) v Upper Hunter Solar Pty Limited (ACN 616 233 268)

The case before the Court involved Delany Advertising & Media Pty Ltd, the plaintiff, against Upper Hunter Solar Pty Limited and others, the defendants. The plaintiff had loaned money to the first defendant, and the second and fourth defendants had provided guarantees and indemnities for this loan. The second defendant claimed that an oral collateral agreement existed with the plaintiff, stating that the plaintiff would enforce guarantees from the other guarantors first. The primary legal issues revolved around the existence of this alleged oral agreement, its consistency with the written guarantee and indemnity contracts, and the conditions for enforcing the guarantees.

The Court examined whether the alleged oral collateral agreement was made and if it was consistent with the written contract. The Court found that the alleged agreement was not made and was inconsistent with the written terms of the guarantee and indemnity. Regarding the construction of the guarantee and indemnity, the Court held that the contracts correctly referred to the principal deed of loan. The Court also addressed the issue of whether the plaintiff's demand complied with the conditions for enforcing the guarantees, finding that the plaintiff's actions did not postpone its right to enforce the guarantees.

The Court determined that the plaintiff's demand complied with the requirements of the default notice and that the liability under the guarantee arose when the guarantor received the default notice. The Court further held that the plaintiff's purported demand complied with the terms of the guarantee and indemnity contracts. Therefore, the Court ruled in favour of the plaintiff, upholding the enforceability of the guarantees and indemnities provided by the second and fourth defendants.