Grubic & Ors v Commonwealth Bank of Australia

This matter came before the High Court of Australia on an application for special leave to appeal. The applicants, Josko Grubic, Renate Grubic, and Peter Michael Walter Grubic, sought leave to appeal against a decision of an intermediate court. The respondent was the Commonwealth Bank of Australia. The dispute arose from a commercial bill rollover facility.

The applicants sought to raise three grounds for special leave. The first concerned the legal characterisation of a commercial bill rollover facility, specifically whether each rollover constituted a separate advance or a continuing advance. The second ground related to the existence of a fiduciary relationship between the parties, with the applicants arguing that the intermediate court applied too narrow a test by limiting its consideration to the provision of financial advice. The third ground concerned the application of section 87 of the Trade Practices Act, with the applicants contending that the intermediate court incorrectly equated the statutory test with common law requirements of reliance, thereby failing to consider a claim based on simple causation where a representation was not honoured.

The Court noted that the characterisation of a commercial bill rollover facility had previously divided the High Court in *Morris*. The applicants' argument regarding fiduciary duty was that the intermediate court erred by focusing solely on financial advice, thereby excluding other circumstances that might have created a relationship of trust and confidence. On the Trade Practices Act claim, the applicants argued that even if reliance was not established, loss could still be recovered if a representation was made and subsequently not honoured, leading to loss as a matter of causation. The applicants' case was that a representation was made that the Bank would move promptly upon default, but the Bank did not act until some months after a default occurred at the second rollover.