Osborne v Drive Park P/L (ACN 008 112 972) (T/A Austral Meat (Reg))
[2005] SASC 125
•6 April 2005
SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Leave to Appeal in Private)
OSBORNE v DRIVE PARK P/L (ACN 008 112 972) (T/A AUSTRAL MEAT (REG))
Judgment of The Full Court (ex tempore)
(The Honourable Justice Duggan, The Honourable Justice Besanko and The Honourable Justice Layton)
6 April 2005
APPEAL AND NEW TRIAL - NEW TRIAL - IN GENERAL AND PARTICULAR GROUNDS - IN GENERAL
Application for leave to appeal in private - application refused.
Ankar Pty Ltd v National Westminster Finance (Aust) Ltd (1987) 162 CLR 549, discussed.
OSBORNE v DRIVE PARK P/L (ACN 008 112 972) (T/A AUSTRAL MEAT (REG))
[2005] SASC 125
DUGGAN J, BESANKO AND LAYTON JJ. White J heard this matter on appeal from the decision of a magistrate who found the applicant liable to the respondent under the terms of a guarantee. White J dismissed the appeal and refused leave to appeal against his decision. This is a renewed application for leave to appeal to the Full Court.
The facts are set out in the applicant’s summary of argument. The respondent supplied meat to a company of which the applicant was the sole shareholder. The respondent agreed to extend credit to the company on condition that the applicant execute a guarantee for payment of the monies due for goods supplied. The form for the guarantee was printed on a credit application which was faxed to the applicant by the respondent.
The proposed notice of appeal contains an exhaustive list of complaints which are not set out in a well ordered form. We have attempted to identify the main topics raised by the grounds.
Some of the grounds of appeal relate to the credit application form faxed to the applicant. Part of the form was obliterated by reason of another document overlying the form in the course of transmission. This appears at the top of the second page of the form.
Grounds 1.2 to 1.6, 1.8, 1.14 and 1.15 complain that the credit application form was incomplete due to the obliteration. The grounds also refer to the applicant’s evidence that he could not read the remainder of the form.
The applicant signed the document in appropriate places and was obviously able to read it to that extent. White J dealt with the arguments that the applicant did not know he was signing a guarantee and that he could not read the document. In our view the learned judge was correct in upholding the magistrate’s decision on these issues.
An argument that the contract of guarantee was invalid because the name of the company to which credit was to be extended was omitted from the form was dealt with by White J in his reasons at [12] – [19]. In his Honour’s view the identity of the customer or creditor could be ascertained by inference or, alternatively, by extrinsic evidence. Again, we agree with this reasoning.
The consequences of the obliteration of part of the form are dealt with at [20] – [25] of the reasons of White J. His Honour pointed out that the obscured portion contained some of the terms of the trading agreement. Furthermore, the applicant appears to have decided to sign the document in that state. According to White J this gave rise to two alternatives: the agreement was as to those terms which are visible on the form or the applicant indicated acceptance of the respondent’s standard terms and conditions. White J preferred the latter answer to the appellant’s argument. In our view this inference was open on the evidence.
Ground 1.7 complains that the trial judge should have interpreted the contract of guarantee strictissimi juris and contra proferentum. In Ankar Pty Ltd v National Westminster Finance (Aust) Ltd (1987) 162 CLR 549 at 561 the court referred to the traditional view that “the liability of the surety is strictissimi juris and that ambiguous contractual provisions should be construed in favour of the surety”. There is an argument that a more liberal approach applies in relation to guarantees given in a commercial context: O’Donovan and Phillips, Modern Contract of Guarantee [5.100].
In any event, we do not think that the principle of interpretation referred to by the applicant would lead to a conclusion other than that reached by the magistrate and White J. We do not think this ground justifies leave to appeal.
Grounds 1.9 and 1.10 relate to the applicant’s argument that, as the respondent allowed the creditor to depart from the terms of trade as to payment, the applicant was relieved of his liability under the guarantee. Again, reliance was placed on Ankar’s case.
White J expressed the view that the seven day term was not an essential term of the contract because of the following waiver in the guarantee:
“I/we hereby further waive notice of default in payment of any of the said indebtedness, and I/we hereby consent that without notice to me/us the time of payment of such indebtedness or any portion thereof may be extended from time to time after the same becomes due and that such indebtedness may from time to time be converted from any particular form to any other form, all without releasing or affecting my/our liability hereunder.”
In our view the point raised by White J is decisive. There was an express agreement between the applicant and respondent that the time for payment by the debtor could be waived and that this would not affect the liability of the guarantor.
Grounds 1.21 - 1.26 relate to a pleading issue. Mr Potter, a director of the respondent, was called to give evidence. He deposed to a conversation he had with the applicant relating to the provision of a guarantee. After the evidence had been given counsel for the applicant objected to it on the grounds that the facts to which it gave rise should have been pleaded. The magistrate stated in her reasons that the evidence was relevant and admissible.
We agree entirely with White J’s assessment of this ground of appeal. The respondent (the plaintiff) was entitled to adopt a short form of pleading in accordance with the Magistrate’s Court (Civil) Rules 1992. In any event, there was no objection to the evidence at the time it was given and no application for an adjournment or other consideration; nor was there any prejudice suffered by the applicant.
Finally, we do not think it is arguable that White J erred in finding that the allegations of unconscionability advanced by the applicant were not made out (Grounds 1.18 and 1.19).
In our view leave to appeal on all grounds should be refused.
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