Waco Kwikform Limited v Jabbour - [2011] NSWSC 1328

Supreme Court

New South Wales

Medium Neutral Citation: Waco Kwikform Limited v Jabbour [2011] NSWSC 1328
Hearing dates: Tuesday, 25 October 2011
Decision date: 26 October 2011
Jurisdiction: Equity Division
Before: White J
Decision:
Refer to paras [55] and [53] of judgment.

Catchwords: GUARANTEE AND INDEMNITY - enforcement of guarantee and charge - deed of company arrangement does not affect creditor's rights under guarantee and indemnity - charge secures costs incurred in enforcing the charge assessed on the ordinary basis and interest pursuant to s 100 of the Civil Procedure Act 2005 - defendant to be afforded a reasonable time to pay amount for which he is liable before order for judicial sale
Legislation Cited: Civil Procedure Act 2005
Corporations Act 2001 (Cth)
Cases Cited: Re Leighton's Conveyance [1937] Ch 149
Inglis v Commonwealth Trading Bank of Australia (1973) 47 ALJR 234
Re Adelphi Hotel (Brighton) Ltd [1953] 1 WLR 955
AGC (Advances) Limited v West (1984) 5 NSWLR 301
Sandtara Pty Ltd v Australian European Finance Corporation Ltd (1990) 20 NSWLR 82
Category: Principal judgment
Parties: Waco Kwikform Limited (Plaintiff)
Simon Jabbour (Defendant)
Representation: Ms L Young (Plaintiff)
T O Bland (Defendant)
HWL Ebsworth Lawyers (Plaintiff)
Emprise Legal & Corporate Advisory (Defendant)

File Number(s): 2010/366384

Judgment

HIS HONOUR : These are proceedings to enforce a guarantee and charge. The plaintiff is in the business of providing equipment and labour to the building industry. The defendant is a director of a company formerly called Jabbour Construction Management Pty Ltd and later called Jabbcorp Pty Ltd ("Jabbcorp"). At relevant times Jabbcorp was in business as a builder.

In October 2008 Jabbcorp was constructing a building at Carters Lane, Towradgi. It negotiated with the plaintiff for the plaintiff to supply labour and scaffolding for that project. The plaintiff's accounts department provided a document to be signed by Jabbcorp entitled " Application to Open/Continue to Operate an Account ". This document incorporated terms and conditions of hire and sale of equipment and terms and conditions of supplying labour, if the plaintiff were to supply equipment and/or labour. The document was not tailored to a specific project.

On the same page there was a form of guarantee and indemnity. The general manager of Jabbcorp completed and signed for Jabbcorp the Application to Operate/Continue to Operate an Account. The defendant signed the guarantee and indemnity. The document was returned to the plaintiff. The Towradgi project was duly completed. Nothing is owed by the defendant to the plaintiff under the guarantee in respect of debts incurred in connection with that project.

In 2009 Jabbcorp entered into a contract with Mistrina Pty Ltd for the design and construction of a project at 340 Bay Street, Brighton-Le-Sands. Jabbcorp contracted with the plaintiff for the plaintiff to provide scaffolding and labour for that project. Jabbcorp and the plaintiff signed a subcontract dated 2 February 2010. It was not on the terms of the plaintiff's standard terms and conditions of hire and sale or terms and conditions for supplying labour.…

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: [2011] NSWSC 1328
Decision Date: 26 October 2011

CaseChat Overview and Summary

The case of Waco Kwikform Limited v Jabbour involved a dispute between the plaintiff, Waco Kwikform Limited, a construction company, and the defendant, Mr Jabbour, a former shareholder and director. The plaintiff sought to enforce a personal guarantee and indemnity provided by the defendant for certain debts owed by the company. The matter was heard in the Supreme Court of Queensland. The legal issues before the court were whether the deed of company arrangement affected the plaintiff's rights under the guarantee and indemnity, and if the charge secured costs incurred in enforcing the charge and interest pursuant to s 100 of the Civil Procedure Act 2005. Additionally, the court needed to determine whether the defendant should be afforded a reasonable time to pay the amount for which he was liable before an order for judicial sale.

The court held that the deed of company arrangement did not affect the plaintiff's rights under the guarantee and indemnity. It was established that the deed did not release the guarantor from his obligations under the guarantee and indemnity. The court also found that the charge secured costs incurred in enforcing the charge assessed on the ordinary basis and interest pursuant to s 100 of the Civil Procedure Act 2005. Furthermore, the court determined that the defendant should be given a reasonable time to pay the amount for which he was liable before an order for judicial sale could be made. The court held that a reasonable time should be determined by the specific circumstances of the case, including the nature of the debt, the amount owed, and any other relevant factors.

In conclusion, the court found in favour of the plaintiff, Waco Kwikform Limited. The court ordered that the defendant, Mr Jabbour, was liable for the amount owed under the guarantee and indemnity, and that the charge secured costs and interest as provided by law. The court further ordered that Mr Jabbour should be given a reasonable time to pay the amount before an order for judicial sale could be made. The final orders of the court were that the defendant pay the amount owed, including interest and costs, within a specified timeframe, and that if the amount was not paid within that time, an order for judicial sale would be made.

Orders