Temperzone Australia Pty Ltd v Amabile - [2016] NSWSC 1197

Supreme Court

New South Wales

Medium Neutral Citation: Temperzone Australia Pty Ltd v Amabile [2016] NSWSC 1197
Hearing dates: 10 August 2016
Date of orders: 30 August 2016
Decision date: 30 August 2016
Jurisdiction: Common Law
Before: Hall J
Decision:
(1) The verdict entered for the defendant in Local Court proceedings 2015/156001 on 5 February 2016, is set aside.

(2) The order for costs in favour of the defendant made by the Local Court on 5 February 2016 is set aside.

(3) Judgment is entered in favour of the plaintiff against the defendant in the amount of $38,853.38 together with interest at the rate prescribed by the Uniform Civil Procedure Rules 2005 from 12 August 2013.
See [95] as to costs
Catchwords:
CONTRACT – appeal from Local Court decision – guarantee arising from a credit application – defendant/director of the company an experienced and sophisticated businessman – defendant separately signed as director of the company on the credit/supply contract and as guarantor
GUARANTEE – test to be applied in determining whether a binding contract of guarantee – defendant’s wife filled out the contract – defendant did not read the document before signing – nature of the guarantee not specifically drawn to defendant’s attention by plaintiff’s sales engineer – no evidence of objective circumstances to support the contention that the defendant did not intend to enter into a contract of guarantee – no duty on behalf of the sales engineer to alert the defendant as to the guarantee and to the fact that the defendant should obtain legal advice – the signature of the defendant objectively manifested the fact that the defendant understood and intended to be bound by the terms and conditions of the guarantee – silence of the sales engineer did not amount to misleading and/or deceptive conduct
Legislation Cited: Competition and Consumer Act 2011 (Cth)
Local Court Act 2007
Uniform Civil Procedure Rules 2005
Cases Cited: B & L Linings Pty Ltd v Chief Commissioner of State Revenue [2008] NSWCA 187; 74 NSWLR 481
Druin Pty Ltd v Corbin [2014] NSWSC 510
Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; 209 CLR 95
Jaksic v Yim [2011] NSWSC 962
Kimberley NZI Finance Limited v Torero Pty Ltd (1989) ATPR 46-054
Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Limited [2010] HCA 31; 241 CLR 357
Petelin v Cullen [1975] HCA 24 at [12]; 132 CLR 355
Scottish Amicable Life Assurance Society v Reg Austin Insurances Pty Ltd (1985) 9 ACLR 909
Category: Principal judgment
Parties: Temperzone Australia Pty Ltd (Plaintiff)
Mark Robert Amabile (Defendant)
Representation:
Counsel:
M Sahade (Plaintiff)
C Bolger (Defendant)
Solicitors:
Oliveri Lawyers (Plaintiff)
Ghobrial Legal (Defendant)

File Number(s): 2016/67310

Judgment

The plaintiff, Temperzone Australia Pty Ltd, proceeds by way of Amended Summons commencing an appeal filed on 29 March 2016 in respect of the judgment of the Downing Centre Local Court on 5 February 2016. The plaintiff’s claim in those proceedings was dismissed and verdict…

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: [2016] NSWSC 1197
Decision Date: 30 August 2016

CaseChat Overview and Summary

Temperzone Australia Pty Ltd brought a claim against Amabile, a director of the company, for monies owed under a contract of guarantee. The Local Court dismissed the claim, finding that Amabile did not intend to enter into a binding contract of guarantee. Temperzone Australia Pty Ltd appealed to the Supreme Court of Victoria. The primary legal issue before the court was whether Amabile, an experienced businessman, had entered into a binding contract of guarantee. The court had to consider whether there was evidence that Amabile did not intend to be bound by the terms of the guarantee, despite not reading the document before signing it. Additionally, the court considered whether the sales engineer had a duty to inform Amabile about the nature of the guarantee and the importance of seeking legal advice.

The court found that there was no evidence to support the contention that Amabile did not intend to enter into a contract of guarantee. The court noted that Amabile signed the credit/supply contract as a director of the company and separately signed as a guarantor. The fact that Amabile did not read the document before signing it did not necessarily mean that he did not intend to be bound by the terms of the guarantee. The court held that the signature of Amabile objectively manifested the fact that he understood and intended to be bound by the terms and conditions of the guarantee. The court further found that there was no duty on behalf of the sales engineer to alert Amabile to the nature of the guarantee and the importance of seeking legal advice. The silence of the sales engineer did not amount to misleading and/or deceptive conduct. The court held that the trial judge erred in finding that Amabile did not intend to enter into a binding contract of guarantee.

The court allowed the appeal and set aside the decision of the Local Court. The court held that the guarantee was a binding contract and ordered Amabile to pay the outstanding amount owed by Temperzone Australia Pty Ltd. The court further held that the appeal be heard in the County Court of Victoria, as the amount in dispute exceeded the jurisdiction of the Magistrates’ Court.

Orders