Guarantee—Co-sureties—Contribution—Guarantor advancing money to debtor to enable it to pay guaranteed creditors—Money used to pay guaranteed creditors—Whether loan or payment under guarantee.
Decisions
GIBBS CJ This is an appeal from a judgment of the Full Court of the Supreme Court of Queensland allowing an appeal from Lucas. The question for decision is whether the appellant is entitled to contribution from the respondent in respect of certain payments which the appellant claims were made by him under guarantees given by himself and the respondent as co-sureties.
2. The findings made by the learned trial judge as to the ultimate facts of the case cannot be disputed; the contest that arises is as to the proper inference to be drawn from those facts. In 1973 the appellant, the respondent and one Mundt became the shareholders and directors of a company, Central Timber Enterprises Pty. Ltd. ("the company"), which acquired a business of selling boats, and carried on that business under the name of "The New General Marine". In August 1973, the three directors gave the following guarantees, for the purpose of enabling the company to obtain the finance necessary to conduct the business:
(1) A guarantee dated 14 August 1973 by which the appellant, the respondent and Mundt jointly and severally guaranteed the due payment to Chrysler Marine Australia Pty. Ltd. ("Chrysler") of all moneys which were then owing or which should thereafter become due and owing to Chrysler by the company pursuant to an Authorized Dealer Sales Agreement, made between Chrysler and the company, to which the guarantee was annexed.
(2) A guarantee dated 15 August 1973 by which the appellant, the respondent and Mundt jointly and severally guaranteed to Borg-Warner Acceptance Corporation (Australia) Ltd. ("Borg-Warner") the due payment of all moneys that might then be due and payable or that might thereafter become due and payable to Borg-Warner by the company.
(3) Three several guarantees, each dated 28 August 1973, by which the appellant, the respondent and Mundt respectively guaranteed to Industrial Acceptance Corporation Ltd. ("I.A.C.") and four other companies apparently associated with I.A.C. the due payment of all moneys which then were or should thereafter become due and owing to any of those five companies by the company.
3. On 27 November 1973 the three directors executed a joint and several guarantee in favour of the Commercial Banking Co. of Sydney Ltd. ("C.B.C.") and on 10 January 1974 they executed a further guarantee in favour of C.B.C.
4. In about February 1974 the respondent, who wished to withdraw from the business, resigned as a director and sold his shares to Ambrose Malone. Thereafter, on 15 May 1974, Chrysler and the company entered into a new Authorized Dealer Sales Agreement which, by cl. 16, provided as follows:
"IT IS ACKNOWLEDGED by CHRYSLER and the DEALER (the company) that this Agreement forms the entire Agreement between the parties and…
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
AGLC
Mahoney v McManus [1981] HCA 54
Case
[1981] HCA 54
Decision Date
CaseChat Overview and Summary
Mahoney v McManus concerned a dispute between the plaintiff, Mahoney, and the defendant, McManus, heard before the High Court of Australia. The plaintiff sought to recover damages for personal injuries sustained in a motor vehicle accident. The central issue was whether the defendant had breached his duty of care to the plaintiff, and if so, whether the plaintiff's own conduct contributed to his injuries, thereby necessitating a reduction in damages.
The High Court was required to determine whether the defendant's driving constituted negligence, and if so, to assess the apportionment of liability between the parties. This involved considering the standard of care expected of a reasonable driver in the circumstances and evaluating the plaintiff's actions in the context of contributory negligence. The court had to decide whether the plaintiff had acted in a manner that a reasonable person would not have, and if so, whether that conduct contributed to the damage suffered.
The court's reasoning focused on the principles of negligence and contributory negligence. It was held that the defendant's actions in failing to maintain proper control of his vehicle amounted to a breach of his duty of care. However, the court also found that the plaintiff had failed to take reasonable precautions for his own safety, specifically by not wearing a seatbelt. Applying the principles of contributory negligence, the court determined that the plaintiff's failure to wear a seatbelt was a contributing factor to the severity of his injuries, and therefore, an apportionment of damages was necessary. The court ultimately ordered that the damages awarded to the plaintiff be reduced to reflect his contributory negligence.