Harplex Pty Ltd v Konstandellos

Harplex Pty Ltd brought proceedings against Konstandellos and two other defendants seeking payment of a debt owed under a building contract. After judgment was entered in default against the defendants, Harplex settled with one of the defendants. Harplex then sought to enforce the judgment against the remaining defendants. The defendants argued that the settlement with one defendant released them from liability. The court had to determine whether the settlement released the remaining defendants from liability and whether the common law rule that a release of one joint or joint and several debtor releases all had been abrogated by statute. The court considered the nature of the settlement agreement and whether it amounted to a release or a covenant not to sue. The court also had to decide whether the point of law raised on appeal could be considered in the interests of justice, given that it was not previously raised at trial.

The court found that the settlement did not constitute a release of the remaining defendants. The settlement agreement did not explicitly state that it was a release, and the terms of the agreement did not establish that it was a release. The court considered that the onus was on Harplex to establish that the settlement was a release, and Harplex had failed to do so. The court also found that the common law rule had not been abrogated by statute, and the rule remained applicable. The court considered the authorities on the issue and found that the rule was based on the unity in the underlying cause of action. The court concluded that the rule had not been abrogated by s 24AA of the Wrongs Act 1958. The court also found that the point of law raised on appeal could be considered in the interests of justice, as it was a matter of significant public importance and no party had been aware of the current status of the law at the time of the trial.

The court held that the settlement with one defendant did not release the remaining defendants from liability. The court also held that the common law rule that a release of one joint or joint and several debtor releases all had not been abrogated by statute. The court found that the point of law raised on appeal could be considered in the interests of justice. The appeal was dismissed, and the judgment in default remained enforceable against the remaining defendants.

The court made no orders as to costs.