Equuscorp Pty Ltd (formerly Equuscorp Financial Services Pty Ltd) v Bassat

In the matter of Equuscorp Pty Ltd (formerly Equuscorp Financial Services Pty Ltd) versus Bassat, the Full Court of the Federal Court of Australia deliberated on a number of significant issues pertaining to loan agreements, the limitation of recourse to borrowers, and the interpretation of release clauses. The case involved the interpretation and enforcement of agreements between Equuscorp and Bassat, focusing on the rights and obligations of the parties under the terms of their financial transactions.

The central legal issues before the court were whether the borrower's immunity from full recourse for the payment of principal and interest was lost due to late payments, and if a waiver of late payment had occurred. Additionally, the court needed to determine whether the borrower was released from their repayment obligations, and if the release was effectively executed by the lender. The matter also involved the construction of the release and whether the agreements were unenforceable due to prescribed interest rates in relation to offers made to the public.

The Full Court held that the borrower's immunity from full recourse was not lost due to late payments, and there was no waiver of the right to seek late payment. The court further found that the borrower was not released from their repayment obligations as the release was not executed by the lender. The court also ruled that the agreements were not rendered unenforceable due to prescribed interest rates in relation to offers made to the public. The court's decision hinged on a meticulous interpretation of the terms of the agreements, the intention of the parties, and the applicable law.

The court's final orders included a declaration that the borrower remained liable for the repayment of the loan and that the release did not affect the lender's right to pursue the borrower for the outstanding amount. The court also ordered that the agreements were not unenforceable due to prescribed interest rates and that the borrower's liability for the loan remained intact.