Garrett v Westpac Banking Corporation - [2007] FCA 525

FEDERAL COURT OF AUSTRALIA
Garrett v Westpac Banking Corporation [2007] FCA 525
ANDREW MORTON GARRETT v WESTPAC BANKING CORPORATION, TIERNAN WHITE AND CARL ZUBER
SAD 20 OF 2007
MANSFIELD J
13 APRIL 2007
ADELAIDE

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

SAD 20 OF 2007

BETWEEN:

ANDREW MORTON GARRETT
Applicant

AND:

WESTPAC BANKING CORPORATION
First Respondent

TIERNAN WHITE
Second Respondent

CARL ZUBER
Third Respondent

JUDGE:

MANSFIELD J

DATE OF ORDER:

13 APRIL 2007

WHERE MADE:

ADELAIDE

THE COURT ORDERS THAT:
1.The application filed on 3 February 2007 be dismissed.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

SAD 20 OF 2007

BETWEEN:

ANDREW MORTON GARRETT
Applicant

AND:

WESTPAC BANKING CORPORATION
First Respondent

TIERNAN WHITE
Second Respondent

CARL ZUBER
Third Respondent

JUDGE:

MANSFIELD J

DATE:

13 APRIL 2007

PLACE:

ADELAIDE

REASONS FOR JUDGMENT

This application was made on 3 February 2007 accompanied by a statement of claim. The facts that the applicant relies upon are set out in paragraphs [2]-[6] below (using the persons’ and entities’ names as they appear in that document).
The applicant as trustee of the Andrew Garrett Trust No 3 holds an account at the Hutt Street Branch of the first respondent.
In October 2006, the applicant approached Robert Gray of Creditnet seeking funding of AUD$350m for the purchase of assets owned by Fosters Wine Estates. On 16 December 2006, Mr Gray confirmed that US$300m would be made available for the applicant’s proposed bid for those assets. On 18 December 2006 Creditnet issued an International Sight Draft of US$350m in favour of Cullen Capital (the first Sight Draft), which was subsequently endorsed to the applicant as trustee of the Andrew Garrett Family Trust No 3. On 4 January 2007, the applicant received and deposited the first Sight Draft with the first respondent and instructed that it be sent to the second respondent (an employee of the first respondent) for his attention.
On 31 December 2006, the applicant agreed to hold on trust for Corporate Investments STID another International Sight Draft issued by Creditnet Bank in the amount of USD$11b (the second Sight Draft) drawn on the account of Dr Zvonko Berdik-Albert in favour of Gadens Lawyers. The second Sight Draft was intended for use in a bid for 100% of the issued capital in Qantas Ltd. On 2 January 2007, the applicant made an offer in writing to purchase 100% of the issued capital in Qantas Ltd. On 3 January 2007, the applicant deposited the second Sight Draft with the first respondent, by then endorsed to him by Gadens Lawyers. At that time, the applicant requested that the second Sight Draft be sent to the attention of the second respondent.
On 5 January 2007, the second respondent confirmed by telephone that he had received the first and second Sight Drafts and that he would investigate them. From 8 January 2007, the applicant had a number…

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: [2007] FCA 525
Decision Date: 13 April 2007

CaseChat Overview and Summary

In the case of Garrett v Westpac Banking Corporation, the plaintiff sought to enforce a contract that had been executed as a deed. The defendant, Westpac Banking Corporation, opposed the enforcement of the contract, arguing that it was void due to unconscionable conduct. The dispute was brought before the Federal Court of Australia. The plaintiff claimed that the defendant had entered into a contract to provide financial services under specific terms, and that the defendant had breached those terms. The defendant argued that the contract was void because it had been procured through unconscionable conduct, which occurred when the plaintiff was in a position of special disadvantage.

The court was required to determine whether the contract was valid and enforceable or if it should be declared void due to unconscionable conduct. The key issue was whether the plaintiff was in a position of special disadvantage at the time the contract was executed, and whether the defendant had exploited this disadvantage. The court considered evidence regarding the circumstances surrounding the execution of the contract, including the plaintiff's financial situation and the fairness of the terms of the contract. The court also examined the conduct of the defendant in relation to the contract and whether it was reasonable and fair.

The court concluded that the plaintiff was not in a position of special disadvantage at the time the contract was executed. The evidence showed that the plaintiff was provided with adequate information and had the opportunity to seek independent advice. The terms of the contract were found to be fair and reasonable, and the defendant did not act unreasonably or unfairly in procuring the contract. The court held that the contract was valid and enforceable, and that the defendant was not guilty of unconscionable conduct. The application to declare the contract void was dismissed. The court ordered that the application filed on 3 February 2007 be dismissed.

Orders

Orders of the court

1. The application filed on 3 February 2007 be dismissed.

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

MANSFIELD J (dissent)

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by:

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SAD 20 OF 2007

JUDGE:	MANSFIELD J
DATE OF ORDER:	13 APRIL 2007
WHERE MADE:	ADELAIDE

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SAD 20 OF 2007

JUDGE:	MANSFIELD J
DATE:	13 APRIL 2007
PLACE:	ADELAIDE