Oliveri Legal Pty Ltd t/as Oliveri Lawyers v Cassegrain Tea Tree Oil Pty Ltd

Oliveri Legal Pty Ltd, trading as Oliveri Lawyers, commenced proceedings against Cassegrain Tea Tree Oil Pty Ltd seeking to enforce an indemnity agreement. The dispute concerned whether the managing director of Cassegrain Tea Tree Oil Pty Ltd had the authority to bind the company to the indemnity. The matter was heard in the Court of Appeal of New South Wales.

The Court of Appeal was required to determine whether the managing director possessed either actual or ostensible authority to enter into the indemnity agreement on behalf of Cassegrain Tea Tree Oil Pty Ltd. Further, the court had to consider whether the agreement constituted a guarantee and indemnity, or solely an indemnity, and whether principles of estoppel, including estoppel by convention and promissory estoppel, could be invoked to establish the company's liability.

The court found that the managing director had ostensible authority to bind the company, as the company had held him out as having such authority, and the nature of the indemnity was not outside the ordinary course of the company's business. The court also considered the managing director to be the alter ego of the company, which supported the finding of actual authority. The agreement was construed as an indemnity. The court determined that the elements of estoppel by convention were satisfied, as both parties proceeded on the mutual assumption that the company would indemnify the solicitors.

The appeal was dismissed with costs.