Heriot Pty Ltd v Choe

Heriot Pty Ltd pursued legal action against Jeong Hwan Choe and Jian Ming Li, seeking enforcement of a guarantee related to a retail lease. The case was heard and determined by the Civil and Administrative Tribunal of New South Wales. The primary dispute centred on the enforceability of the guarantee and the respective obligations of the guarantors under the guarantee, particularly in the context of mitigating losses following a default by the tenant.

The court was required to address several key legal issues. Firstly, whether the guarantors were indeed liable under the terms of the guarantee. Secondly, whether the tenant had taken reasonable steps to mitigate its losses, which could affect the amount recoverable from the guarantors. The court also needed to determine the appropriate amount owed by the guarantors and the procedural steps for any subsequent costs applications.

In its reasoning, the tribunal found that the guarantors were indeed liable under the terms of the guarantee. It concluded that the tenant had not taken sufficient steps to mitigate its losses, thus impacting the amount recoverable. The tribunal held Jeong Hwan Choe and Jian Ming Li jointly and severally liable for the sum of $750,000.00, to be paid immediately. The tribunal further outlined the procedural steps for any subsequent costs applications, including the timeframes for lodging and responding to such applications, and the potential for the application to be determined on the basis of written submissions without a hearing, subject to the parties’ consent.