SUPREME COURT OF QUEENSLAND
CITATION:
St George Bank Limited v Wright & Ors [2009] QSC 337
PARTIES:
ST GEORGE BANK LIMITED ACN 055 513 070
(Plaintiff)v
RONALD JOHN WRIGHT
(first defendant)NERIDAH VALERIE WRIGHT
(second defendant)SANDRA LOUISE PEPI
(third defendant)SHARON LEE SCHOFIELD
(fourth defendant)KYLE WRIGHT
(fifth defendant)ELLIOTT HARVEY SECURITIES LIMITED
ACN 089 156 605
(second defendant by counterclaim)MICHAEL HARVEY
(third defendant by counterclaim)FILE NO/S:
BS 2786 of 2009
DIVISION:
Trial Division
PROCEEDING:
Hearing
ORIGINATING COURT:
Supreme Court at Brisbane
DELIVERED ON:
26 October 2009
DELIVERED AT:
Brisbane
HEARING DATE:
28 August 2009
JUDGE:
McMurdo J
ORDER:
The plaintiff have judgment against the defendants in the sum of $47,763,997.46.
CATCHWORDS:
CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – IMPLIED TERMS – GENERALLY – where the plaintiff bank had entered into a contract of guarantee and indemnity with the defendants – where the loan facility under the facility agreement could not be drawn down in full because certain conditions relating to valuation and the sale of units in time had not been fulfilled – where the guarantee and indemnity was entered into in consideration of the bank “continuing to provide financial accommodation to the [principal debtor]” – whether this constitutes a condition that the bank would advance all monies to which the primary debtor was entitled under the facility agreement and if so whether this discharges the defendants from performance of the contract of guarantee and indemnity
CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – OTHER MATTERS – where the contract of guarantee and indemnity provides that “[r]ights given to [the bank] under this guarantee and indemnity and [the guarantors’] liabilities under it are not affected … by anything else that might otherwise affect them under law or otherwise, including the fact [the bank] var[ies] or replace[s] any arrangement under which the guaranteed money is expressed to be owing, such as by increasing the credit limit or extending the term” – whether the omission by the bank to provide the financial accommodation in full falls within this clause
CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – IMPLIED TERMS – TERMS ESSENTIAL TO ENABLE PERFORMANCE – where the defendants submit that there are implied terms in the facility agreement under which the bank impliedly promised to follow normal banking procedures in relation to the facility, to make reasonable and prudent enquiries in relation to the offering of the facility and to act as a reasonable financier – whether these terms are necessary to give business efficacy to the agreement
CORPORATIONS – FINANCIAL SERVICES AND MARKETS – MARKET MISCONDUCT AND OTHER PROHIBITED CONDUCT – MISLEADING, DECEPTIVE OR UNCONSCIONABLE CONDUCT – where the bank made no representation that it would provide whatever funding was required for certain purposes irrespective of the terms of its facility including the terms for loan to value ratios – whether the bank has engaged in conduct in relation to financial services…
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- AGLC
- St George Bank Limited v Wright [2009] QSC 337
- Case
- [2009] QSC 337
- Decision Date
CaseChat Overview and Summary
The court found that the bank's decision to not draw down the entire loan facility did not constitute a condition precedent that discharged the Wrights from their obligations. It held that the clause in the guarantee and indemnity stating that the bank's rights and the guarantors' liabilities were unaffected by any changes to the arrangement, including an increase in credit limit or extension of the term, did not cover the omission of providing the full accommodation. Furthermore, the court rejected the Wrights' argument that there were implied terms in the facility agreement that the bank would follow normal banking procedures and act reasonably, as these terms were not essential to give business efficacy to the agreement. The court also dismissed the claim that the bank engaged in misleading or deceptive conduct under the ASIC Act, finding that the bank made no representations regarding the full funding of the facility and that the extent of the funds required was contingent on factors outside the bank's control.
The court's reasoning led to a judgment in favour of the bank, ordering the Wrights to pay the sum of $47,763,997.46. The court concluded that the bank had not breached any conditions or implied terms that would discharge the Wrights from their obligations under the guarantee and indemnity, and that there was no evidence of misleading or deceptive conduct. The Wrights were held liable for the full amount claimed by the bank.
Orders
Orders of the court
The plaintiff have judgment against the defendants in the sum of $47,763,997.46.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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