Westpac Banking Corporation v Makhoul

Westpac Banking Corporation (Westpac) sought to enforce a guarantee provided by Mr. Makhoul in favour of Westpac. Mr. Makhoul had guaranteed the debts of a company, and Westpac sought to recover the outstanding debt from him personally. The dispute concerned the extent to which Mr. Makhoul was liable under the guarantee, particularly in light of certain alleged misrepresentations made by Westpac. The matter was heard in the Supreme Court of New South Wales.

The primary legal issues before the court were whether Westpac had made any actionable misrepresentations to Mr. Makhoul that induced him to enter into the guarantee, and if so, whether those misrepresentations vitiated the guarantee. The court also had to consider the scope of the guarantee and whether it extended to the full amount claimed by Westpac.

Dowdy J found that Westpac had not made any misrepresentations that were material to Mr. Makhoul's decision to enter into the guarantee. The court analysed the evidence presented by both parties and concluded that the information provided by Westpac was accurate and that Mr. Makhoul had entered into the guarantee with full knowledge of the relevant circumstances. The principles applied by the court centred on the law of contract, specifically concerning misrepresentation and the enforceability of guarantees. The court determined that the guarantee was valid and enforceable according to its terms.

Consequently, the court ordered that judgment be entered in favour of Westpac Banking Corporation against Mr. Makhoul for the amount claimed under the guarantee, together with interest and costs.