Loureiro v Mac Aus Unit Pty Ltd (No 2) - [2022] NSWSC 226

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Loureiro v Mac Aus Unit Pty Ltd (No 2) [2022] NSWSC 226
Hearing dates: 21-24 February 2022
Date of orders: 8 March 2022
Decision date: 08 March 2022
Jurisdiction: Common Law
Before: Gleeson J
Decision:
(1)   Judgment for the first plaintiff against the second defendant in the sum of $2,402,069.69 comprising the principal sum of $376,200, together with interest thereon at the contractual rate of 20 per cent compounded six-monthly up until 1 March 2022 totalling $2,025,869.69.
(2) Judgment for the first plaintiff against the second defendant in the sum of $171,110.96 comprising the principal sum of $150,000, together with interest thereon from 8 February 2019 to 1 March 2022 under s 100 of the Civil Procedure Act 1995 (NSW) totalling $21,110.96.
(3) Judgment for the second plaintiff against the second defendant in the sum of $169,777.40 comprising the principal sum of $150,000, together with interest thereon from 8 April 2019 to 1 March 2022 under s 100 of the Civil Procedure Act 1995 (NSW) totalling $19,777.40.
(4)   Judgment for the third plaintiff against the second defendant in the sum of $1,639,038.29 comprising the principal sum of $260,000, together with interest at the contractual rate of 20 per cent compounded six-monthly up until 1 March 2022 totalling $1,379,038.29.
(5)   Dismiss the amended statement of claim against the first, third and fourth defendants.
(6)   Costs reserved.
(7)   Direct the plaintiffs to file and serve short written submissions on costs within seven days of this judgment, the defendants to file and serve short written submissions in response within a further seven days, and the plaintiffs to file and serve any short-written submissions in reply within a further five days, with the issue of costs to be determined on the papers.
(8)   Order that the amount of $1 million paid into court by Owen Hodge Lawyers on 16 February 2021, together with any interest thereon, be paid out of court to the first defendant.
(9)   Stay order 8 for a period of seven days from the date of this judgment.

Catchwords:
CONTRACTS – construction and interpretation - identification of parties to the agreement – use of surrounding circumstances and post-contractual conduct to identify parties – whether the first and third defendants were borrowers under the loan agreements
EQUITY – unconscionable conduct – whether receipt of monies was unconscionable – whether constructive trust arising from collapse of joint endeavour or from knowledge of source of monies
LIMITATION OF ACTIONS – debt – extension of limitation period by confirmation – acknowledgement in declaration – whether confirmation made by second defendant as agent for first and third defendants

Legislation Cited:
Civil Procedure Act 1995 (NSW), s 100
Cheques Act 1986 (Cth), s 76
Land Tax Management Act 1956 (NSW), s 3A
Limitation Act 1969 (NSW), ss 11, 14, 54
Uniform Civil Procedure Rules 2005 (NSW), rr 14.4(1), 42.1

Cases Cited:
Air Tahiti Nui Pty Ltd v McKenzie (2009) 77 NSWLR 299; [2009] NSWCA 429
Barnes…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2022] NSWSC 226
Decision Date: 08 March 2022

CaseChat Overview and Summary

In Loureiro v Mac Aus Unit Pty Ltd (No 2), the plaintiff, Loureiro, sought to enforce a loan agreement against the defendants, including Mac Aus Unit Pty Ltd and two individuals. The dispute centred on whether the first and third defendants were the borrowers under the loan agreements, and if so, whether the second defendant's conduct in confirming the debt constituted an extension of the limitation period. The case was heard in the Federal Court of Australia.

The primary legal issues were the identification of the parties to the loan agreements and the effect of the second defendant's confirmation of the debt on the limitation period. The court had to determine whether the surrounding circumstances and post-contractual conduct could be used to identify the first and third defendants as borrowers. Additionally, the court needed to decide if the second defendant's confirmation of the debt was an extension of the limitation period, particularly considering whether the confirmation was made on behalf of the first and third defendants.

The court held that the first and third defendants were indeed the borrowers under the loan agreements. This conclusion was based on the surrounding circumstances and post-contractual conduct, which demonstrated their involvement in the loan agreements. Regarding the limitation period, the court found that the second defendant's confirmation of the debt was effective as an extension of the limitation period, as it was made on behalf of the first and third defendants. This confirmation was deemed an acknowledgement in a declaration that extended the limitation period.

The court ordered that the first and third defendants were bound by the loan agreements and that the limitation period for enforcing the debt had been extended by the second defendant's confirmation. This decision clarified the identity of the borrowers and the effect of the confirmation on the limitation period, providing a resolution to the dispute.

Orders