Kwiatkowski v Exportech Pty Ltd

[1995] QCA 90

IN THE COURT OF APPEAL	[1995] QCA 090
SUPREME COURT OF QUEENSLAND

Appeal No. 206 of 1993

Brisbane
[Kwiatkowski v. Exportech Pty. Ltd.]

BETWEEN:

EXPORTECH PTY. LTD.

(Plaintiff) Respondent

AND:

SIGMUND KWIATKOWSKI

(Second Defendant) Appellant

AND:

MAC 'N' ACTION PTY. LTD.

(First Defendant)

Davies J.A.
McPherson J.A.

White J.

Judgment delivered 07/04/1995

Judgment of the Court

APPEAL DISMISSED WITH COSTS.

CATCHWORDS:	GUARANTEE - s.56 of the Property Law Act; whether document constituted a promise or memorandum or note of the promise of guarantee; whether essential terms of the promise in the document; construction of document in context of surrounding circumstances; whether parol evidence admissible to identify terms; whether implied term need be included in the memorandum or note of guarantee.
Counsel:	Mr. R. Myers for the appellant
Mr. A. Morris Q.C. with him Mr. A. Philp for the respondent

Solicitors: Gilshenan & Luton as town agent for Bowen

Lagois for the appellant
Barwicks for the respondent

Hearing Date: 7 March 1995
IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 206 of 1993

Brisbane

Before Davies J.A.
McPherson J.A.
White J.

[Kwiatkowski v. Exportech Pty. Ltd.]

BETWEEN:

EXPORTECH PTY. LTD.

(Plaintiff) Respondent

AND:

SIGMUND KWIATKOWSKI

(Second Defendant) Appellant

AND:

MAC 'N' ACTION PTY. LTD.

(First Defendant)

REASONS FOR JUDGMENT - THE COURT

Judgment delivered the 7th day of April 1995

This is an appeal from a judgment in the District Court upon a guarantee. The sole ground of appeal is based on s.56 of the Property Law Act which provides:

" (1) No action may be brought upon any promise to guarantee any liability of another unless the promise upon which such action is brought, or some memorandum or note of the promise, is in writing, and signed by the party to be charged, or by some other person by the party lawfully authorised.

(2) A promise, or memorandum or note of a promise, in writing shall not be treated as insufficient for the purpose of this section merely because the consideration for such promise does not appear in writing or by necessary inference from a written document."

On 23 October 1991 the appellant told Mr. Raspotnik, who appears to have been the governing mind of the respondent, that he needed to raise a short term loan of $50,000, the amount of a finance broker's fee on a proposed expressed doubt as to his capacity to make a loan of that amount but added that, if it were made, he would require a guarantee from the appellant.

There was a further telephone conversation between those persons on 25 October. The appellant told Mr. Raspotnik that he now needed to raise only $42,500. Mr. Raspotnik said that he would have to think about the situation, that he would not have that sort of money himself but that if he did anything for the appellant it would come through his company Exportech, and again that the whole thing must be guaranteed by the appellant personally. He also said that the best that he would be looking at at that time was $30,000; that he certainly could not go any further than that.

25 October was a Friday. On Sunday 27 October the appellant sent Mr. Raspotnik a facsimile in which he relevantly said:

"In regard to my call on Friday I need your assistance for a short time if you can for an interim loan as part of the hotel acquisition. I confirmed acceptance of the lender's offer on Thursday as required and part of this was the payment of $42,500 which has to be paid on Monday 28th October 1991.

...

I appreciate your offer to assist and confirm that this payment will be reimbursed to you as soon as our transfer is received. In addition I personally guarantee payment of this.

I will call you on Monday morning to confirm that you can help with payment details. Payment will have to be made to Anthony Gunner Trust Account."

On Tuesday 29 October those persons had a further conversation in which Mr. Raspotnik told the appellant that he would loan him $30,000 from Exportech to pay the finance broker "provided it's a loan and a personal guarantee that comes along with it."

The learned District Court Judge held that the
facsimile constituted a promise in writing or a memorandum

or note of that promise sufficient for the purposes of s.56.

It was signed by the appellant.

In the Court below and in this Court the appellant submitted that there were essential terms of the promise which were not contained in the writing. In the Court below it was contended that these were the identity of the promisee and the amount of the loan. Before this Court the first of these contentions was no longer pursued. Indeed it was specifically abandoned. The second remained in issue although it is fair to say that it was no longer at the forefront of the appellant's submissions. Nevertheless we should deal with it.

In his oral submissions to this Court Mr. Myers for the appellant submitted that there were four essential terms of the promise which were not recorded in writing. They were that the loan of $30,000 would attract interest; that repayment would be effected as soon as the transfer was received, within a matter of days or two weeks at the outside; to the contrary, and presumably alternatively, that the loan would not be repayable until settlement of the purchase of the Grenada Hotel; and that if the sale is not settled repayment would be effected immediately. We will discuss these in turn.

The argument as to the amount of the loan ran as follows. The amount of the loan was $30,000. That sum was not mentioned in the facsimile. On the contrary the facsimile mentioned a sum of $42,500. Therefore neither the of the loan guaranteed.

To consider this argument it is necessary to see how the contract of guarantee, the existence of which was not disputed, was constituted. The facsimile which plainly offered a guarantee of payment, must be construed in the context of the conversation of 25 October. In particular the reference to "your offer to assist" was plainly a reference to Mr. Raspotnik's offer, on behalf of Exportech, to assist, to the extent only of $30,000, by means of a loan via Exportech. Consequently the reference in that same sentence to "this payment" was plainly a reference to reimbursement of the loan of $30,000 which Mr. Raspotnik had indicated might be available. Parol evidence was admissible to identify the offerer of the offer and the amount of the payment referred to in that sentence: Bateman v. Phillips (1812) 15 East 272; 104 E.R. 847; Sims v. Robertson (1921) 21 S.R. (N.S.W.) 246 at 252-3. The reference to the sum of $42,500 in the facsimile, read in context, was no more than a reference to the total amount of money which the appellant had to find to pay the finance broker's fee. The submission that the writing was deficient because it did not state the amount of the loan must be rejected.

The submission that a provision for interest was a term of the contract derives no support from the evidence. It is true that the respondent pleaded that the agreement was for loan of $30,000 plus interest but there was no evidence which proved this. It is the promise proved, not that alleged, which must be in or evidenced in writing. There is no substance in this ground.

As to the term for repayment of the loan, this was the sentence to which we have already referred: "this payment will be reimbursed to you as soon as our transfer is received." That was the offer which was accepted on 29 October. It is true that this term was not pleaded and it should have been. But that was the uncontradicted evidence of the term as to repayment, the evidence was tendered without objection and, not surprisingly, that is the term which the learned District Court Judge found as the term for repayment.

The final term said not to be included in the writing was one, alleged as an implied term of the agreement for loan, that if the appellant's company did not proceed with its contemplated purchase of the Grenada Hotel, repayment would be made immediately. One can see how such a term would be implied in any such agreement. But the fact that it is alleged as an implied term, and is one which might, in the circumstances, ordinarily be implied by law, is inconsistent with a requirement that it form part of the writing. There is no substance in this ground either.

The appeal must be dismissed with costs.