Westpac Banking Corporation v Upton - [2015] QDC 278

DISTRICT COURT OF QUEENSLAND

CITATION:

Westpac Banking Corporation v Upton [2015] QDC 278

PARTIES:

WESTPAC BANKING CORPORATION
(plaintiff)

v

JAMES SYDNEY UPTON
(first defendant)

&

SHAUN CHRISTOPHER MCKINNON
(second defendant by counterclaim)

&

GRAHAM ROBERT KILLER
(third defendant by counterclaim)

FILE NO/S:

D 1244/2015

DIVISION:

PROCEEDING:

Application for summary judgment

ORIGINATING COURT:

District Court of Brisbane

DELIVERED ON:

10 November 2015

DELIVERED AT:

Brisbane

HEARING DATE:

1 September 2015

JUDGE:

McGill SC DCJ

ORDER:

Judgment under rule 292 that the first defendant pay the plaintiff $617,440.17, in respect of the plaintiff’s claim other than the claim for enforcement costs and expenses. Judgment under r 293 that the first defendant’s counterclaim against the second and third defendants added by counterclaim be dismissed. Order that the first defendant’s amended counterclaim filed 5 June 2015 be struck out, but with liberty to re-plead in accordance with these reasons. The first defendant’s application is dismissed. Order the first defendant pay the costs of the plaintiff and second and third defendants added by counterclaim of both applications, to be assessed on the indemnity basis.

CATCHWORDS:

GUARANTEE AND INDEMNITY – Liability of guarantors – effect of winding up and dissolution of principal debtor – effect of variation of guaranteed obligation – construction of guarantee – whether enforcement unconscionable.

MORTGAGES – Remedies of mortgagee – appointment of receivers and managers – whether appointment valid – status of receivers and managers – liability for their actions in attempting to sell mortgaged land – whether guarantor can sue.

PRACTICE – Summary judgment for the plaintiff – whether need for trial of the action – whether the defendant has had a proper opportunity to contest a claim to recover various changes of lawyers and receivers, claimed as enforcement costs.

Land Title Act 1994 s 63.

Property Law Act 1974 s 85.

UCPR r 292.

Boz One Pty Ltd v McLellan [2015] VSCA 68 – cited.
Capital Finance Australia Ltd v Airstar Aviation Pty Ltd [2004] 1 Qd R 122 – cited.
Commonwealth Bank of Australia v Muirhead [1997] 1 Qd R 567 – considered.
Cuckmere Brick Co Ltd v Mutual Finance Ltd [1971] Ch 949 – not followed.
Downsview Nominees Ltd v First City Corporation Ltd [1993] AC 295 – cited.
Re Excel Finance Corporation (1993) 41 FCR 346 – cited.
Expo International Pty Ltd v Chant [1979] 2 NSWLR 820 – applied.
GE Capital Australia v Davis & Ors [2002] NSWSC 1146 – applied.
Higton Enterprises Pty Ltd v BFC Finance Ltd [1997] 1 Qd R 168 – considered.
Hindcastle Ltd v Barbara Attenborough Associates Ltd [1997] AC 70 - cited.
Leach v Commonwealth Bank of Australia [2014] QSC 295 – cited.
National Australia Bank Ltd v C & O Voukidis Pty Ltd [2015] NSWSC 185 – applied.
Sandtara Pty Ltd v Abigroup (1996) 42 NSWLR 491 – cited.
Standard Chartered Bank Ltd v Walker [1982] 1 WLR 1410 – not followed.
Star v Silvia (No. 1) [1994] 12 ACLC 600 – cited.
Upton v Tasmanian Perpetual Trustees Ltd

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: [2015] QDC 278
Decision Date: 10 November 2015

CaseChat Overview and Summary

The case of Westpac Banking Corporation v Upton involved a dispute over the liability of guarantors, the validity of a mortgagee's appointment of receivers and managers, and the enforcement of costs associated with multiple changes of lawyers and receivers. The court was asked to determine whether the enforcement of a guarantee and indemnity was unconscionable, and if the mortgagee's appointment of receivers and managers was valid. The first defendant, Upton, argued that the guarantors' liability should be discharged due to the principal debtor's dissolution, and that the receivers and managers' actions were invalid. The plaintiff, Westpac Banking Corporation, sought summary judgment for the amount claimed, excluding enforcement costs.

The court addressed several key legal issues, including the effect of the winding up and dissolution of the principal debtor on the guarantors' liability, and the enforceability of the guarantee in light of the principal debtor's dissolution. The court also considered the validity of the mortgagee's appointment of receivers and managers, and whether the guarantor could sue for the receivers' actions. Additionally, the court examined whether the plaintiff was entitled to summary judgment for the amount claimed, excluding enforcement costs, and whether the defendant had a proper opportunity to contest these costs.

The court found that the guarantors remained liable despite the principal debtor's dissolution, as the guarantee expressly stated that the guarantors' liability would not be affected by such events. The court also held that the mortgagee's appointment of receivers and managers was valid, and that the guarantor could not sue the receivers and managers for their actions. The court granted summary judgment to the plaintiff for the amount claimed, excluding enforcement costs, and dismissed the defendant's counterclaims and amended counterclaim. The court ordered the defendant to pay the plaintiff's and the second and third defendants' costs on an indemnity basis.

The final orders of the court were that the first defendant pay the plaintiff $617,440.17, excluding enforcement costs and expenses. The court dismissed the first defendant's counterclaim against the second and third defendants added by counterclaim, and struck out the first defendant's amended counterclaim filed on 5 June 2015, with liberty to re-plead in accordance with the court's reasons. The court also dismissed the first defendant's application and ordered the first defendant to pay the costs of the plaintiff and the second and third defendants added by counterclaim of both applications, to be assessed on the indemnity basis.

Orders

Orders of the court

Judgment under rule 292 that the first defendant pay the plaintiff $617,440.17, in respect of the plaintiff’s claim other than the claim for enforcement costs and expenses. Judgment under r 293 that the first defendant’s counterclaim against the second and third defendants added by counterclaim be dismissed. Order that the first defendant’s amended counterclaim filed 5 June 2015 be struck out, but with liberty to re-plead in accordance with these reasons. The first defendant’s application is dismissed. Order the first defendant pay the costs of the plaintiff and second and third defendants added by counterclaim of both applications, to be assessed on the indemnity basis.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Westpac Banking Corporation v Upton [2015] QDC 278
PARTIES:	WESTPAC BANKING CORPORATION (plaintiff) v JAMES SYDNEY UPTON (first defendant) & SHAUN CHRISTOPHER MCKINNON (second defendant by counterclaim) & GRAHAM ROBERT KILLER (third defendant by counterclaim)
FILE NO/S:	D 1244/2015
DIVISION:
PROCEEDING:	Application for summary judgment
ORIGINATING COURT:	District Court of Brisbane
DELIVERED ON:	10 November 2015
DELIVERED AT:	Brisbane
HEARING DATE:	1 September 2015
JUDGE:	McGill SC DCJ
ORDER:	Judgment under rule 292 that the first defendant pay the plaintiff $617,440.17, in respect of the plaintiff’s claim other than the claim for enforcement costs and expenses. Judgment under r 293 that the first defendant’s counterclaim against the second and third defendants added by counterclaim be dismissed. Order that the first defendant’s amended counterclaim filed 5 June 2015 be struck out, but with liberty to re-plead in accordance with these reasons. The first defendant’s application is dismissed. Order the first defendant pay the costs of the plaintiff and second and third defendants added by counterclaim of both applications, to be assessed on the indemnity basis.
CATCHWORDS:	GUARANTEE AND INDEMNITY – Liability of guarantors – effect of winding up and dissolution of principal debtor – effect of variation of guaranteed obligation – construction of guarantee – whether enforcement unconscionable. MORTGAGES – Remedies of mortgagee – appointment of receivers and managers – whether appointment valid – status of receivers and managers – liability for their actions in attempting to sell mortgaged land – whether guarantor can sue. PRACTICE – Summary judgment for the plaintiff – whether need for trial of the action – whether the defendant has had a proper opportunity to contest a claim to recover various changes of lawyers and receivers, claimed as enforcement costs. Land Title Act 1994 s 63. Property Law Act 1974 s 85. UCPR r 292. Boz One Pty Ltd v McLellan [2015] VSCA 68 – cited. Capital Finance Australia Ltd v Airstar Aviation Pty Ltd [2004] 1 Qd R 122 – cited. Commonwealth Bank of Australia v Muirhead [1997] 1 Qd R 567 – considered. Cuckmere Brick Co Ltd v Mutual Finance Ltd [1971] Ch 949 – not followed. Downsview Nominees Ltd v First City Corporation Ltd [1993] AC 295 – cited. Re Excel Finance Corporation (1993) 41 FCR 346 – cited. Expo International Pty Ltd v Chant [1979] 2 NSWLR 820 – applied. GE Capital Australia v Davis & Ors [2002] NSWSC 1146 – applied. Higton Enterprises Pty Ltd v BFC Finance Ltd [1997] 1 Qd R 168 – considered. Hindcastle Ltd v Barbara Attenborough Associates Ltd [1997] AC 70 - cited. Leach v Commonwealth Bank of Australia [2014] QSC 295 – cited. National Australia Bank Ltd v C & O Voukidis Pty Ltd [2015] NSWSC 185 – applied. Sandtara Pty Ltd v Abigroup (1996) 42 NSWLR 491 – cited. Standard Chartered Bank Ltd v Walker [1982] 1 WLR 1410 – not followed. Star v Silvia (No. 1) [1994] 12 ACLC 600 – cited. Upton v Tasmanian Perpetual Trustees Ltd