Toyota Finance Australia Limited v Gardiner

Toyota Finance Australia Limited (Toyota Finance) appealed to the New South Wales Court of Appeal against decisions of the Local Court of New South Wales. The dispute concerned whether a guarantee and indemnity signed by Mr Gardiner was binding, given that it was allegedly incorporated by reference into a hire purchase agreement through a terms and conditions booklet that Mr Gardiner claimed he did not receive.

The Court of Appeal was required to determine two primary legal issues. First, whether leave to appeal was required given that two separate matters had been heard together in the Local Court without a formal consolidation order, but where the combined value of the claims exceeded $100,000. Second, and central to the appeal, the Court had to determine whether the terms and conditions contained within the booklet were effectively incorporated into the hire purchase contract, thereby rendering the guarantee and indemnity binding on Mr Gardiner.

The Court held that leave to appeal was required as the combined value of the claims exceeded the jurisdictional threshold for an appeal as of right. On the substantive appeal, the Court found that the evidence did not establish that the terms and conditions booklet had been incorporated into the contract. The Court reasoned that for terms to be incorporated by reference, there must be clear and unequivocal notice given to the party sought to be bound. In this instance, the evidence did not demonstrate that Mr Gardiner had been provided with the booklet or otherwise made aware of its contents at the time of entering into the agreement. Consequently, the guarantee and indemnity were not binding.

The Court of Appeal granted leave to appeal, but dismissed the appeal. Toyota Finance was ordered to pay the respondent’s costs as agreed or assessed.