Gustin Group Pty Ltd and anor. v Phoenicia Trading Pty Ltd and Gilmour

In the matter of Gustin Group Pty Ltd and anor. v Phoenicia Trading Pty Ltd and Gilmour, the court was tasked with determining the validity of a loan agreement, a Deed of Forbearance, and the associated consent orders that had been made in the context of possession proceedings. The defendant, Phoenicia Trading Pty Ltd, sought to set aside these agreements and orders, claiming they were unjust, and filed a motion to stay the execution of the consent orders pending the outcome of their application. The plaintiffs, Gustin Group Pty Ltd, opposed the defendant's application on the basis that there was no serious issue to be tried and that the balance of convenience favoured them. The court was required to consider the circumstances in which the defendant had obtained independent legal advice regarding both the loan agreement and the Deed of Forbearance, and whether this advice negated any claim of unconscionability or unfairness.

The court examined the nature of the agreements and the process by which they were executed, noting that the defendant had not only entered into the Deed of Forbearance but had also actively participated in the consent orders that resulted in the issuance of a writ of possession. The court held that the defendant's claims of unconscionability were not supported by the evidence, given that the defendant had been advised by legal counsel at each stage of the proceedings. Furthermore, the court considered the impact of the defendant's actions in cancelling an auction of the property and the implications of such conduct on the balance of convenience. The court found that the defendant's application to set aside the agreements and orders was without merit and that there was no serious issue to be tried.

Consequently, the court dismissed the defendant's application to set aside the loan agreement, the Deed of Forbearance, and the consent orders. The motion seeking a stay of the consent orders was also dismissed. The court emphasised that the defendant had been fully apprised of the legal implications of the agreements and had proceeded with their signature, which precluded any claim of unfairness or lack of understanding. The court's decision underscored the importance of adhering to agreements entered into with the advice of independent legal counsel and the consequences of attempting to renege on such agreements. The court's ruling reinforced the principle that once consent orders are made, they are binding unless there is a compelling reason to set them aside.