Lang & Anor v Asemo Pty Limited

The applicants, Kenneth Frederick Lang and Mr R.R. Boaden, sought special leave to appeal to the High Court of Australia concerning a dispute arising from a lease agreement and a subsequent transfer of the reversionary interest. The core of the disagreement involved whether the assignee of the reversion could enforce a guarantee provided by the respondent, Asemo Pty Limited, for the lessee's obligations, despite a lack of direct privity of contract between the assignee and the guarantor.

The legal issues before the Court were whether a guarantor's obligation, in the context of a lease where the reversion has been assigned, is considered a covenant that "touches and concerns" the land, thereby running with the reversionary interest. Specifically, the Court was asked to determine if the assignee of the reversion could sue the guarantor on the guarantee, even though the guarantor had no direct contractual relationship with the assignee at the time the guarantee was given.

The applicants argued that the guarantor's obligation, being secondary and personal, did not directly affect the land, drawing on conceptual guidance from the High Court's decision in *Consolidated Trust Co Ltd v Naylor*. This contrasted with later decisions in the Court of Appeal and the House of Lords, which had reached opposing conclusions. The Court noted that the case presented an interesting point of law but raised concerns about its suitability as a vehicle for resolving the issue, given that alternative grounds, such as questions of trusteeship or agency, could lead to a decision adverse to the applicants.