Williams Group Australia Pty Ltd v Crocker - [2015] NSWSC 1907

Supreme Court

New South Wales

Medium Neutral Citation: Williams Group Australia Pty Ltd v Crocker [2015] NSWSC 1907
Hearing dates: 23, 24, 25 February 2015; written submissions closed 16 March 2015
Date of orders: 23 December 2015
Decision date: 23 December 2015
Jurisdiction: Common Law
Before: McCallum J
Decision:
Proceedings dismissed; plaintiff to pay third defendant’s costs.

Catchwords: CONTRACT – guarantee – electronic signature – whether placed on document by alleged guarantor – whether estopped from concluding otherwise – ostensible authority – whether agreement ratified by guarantor.
Cases Cited: Greenwood v Martins Bank [1932] 1 KB 371
Heperu Pty Ltd v Morgan Brooks Pty Ltd [2007] NSWSC 1438
Pacific Carriers Limited v BNP Paribas (2004) 218 CLR 451
Petersen v Maloney (1951) 84 CLR 91
Pole v Leask (1863) 8 LT 645
Rowe v B & R Nominees Pty Ltd [1964] VR
Suncorp v Milano [1993] 2 Lloyd’s Rep 225
477
Category: Principal judgment
Parties: Williams Group Australia Pty Ltd (Plaintiff)
IDH Modular Pty Ltd (in liq) (First Defendant)
Calem Brooks (Second Defendant)
Lee Crocker (Third Defendant)
Mark Walsh (Fourth Defendant)
Representation:
Counsel:
D D Knoll AM (Plaintiff)
V F Kerr (Third Defendant)
Solicitors:
Results Legal (Plaintiff)
Broadley Rees Hogan Solicitors (Third Defendant)

File Number(s): 2013/212263
Publication restriction: None

Judgment

HER HONOUR: These are proceedings for the enforcement of a guarantee allegedly given by a director of a company to secure the terms of a trade credit agreement. The plaintiff, Williams Group Australia Pty Ltd, carries on the business of selling building materials. It is convenient to refer to that company by its trading name, JH Williams. The trade debtor was the first defendant, IDH Modular Pty Ltd (in liquidation). The three directors of IDH Modular were Mr Calem Brooks, Mr Lee Crocker and Mr Mark Walsh (the second, third and fourth defendants respectively).
The trading account was opened in July 2012. By July 2013, the debt stood at $889,534.35. The proceedings were commenced against the company to enforce that debt and against each of the three directors to enforce their guarantees. In October 2013 a liquidator was appointed to the company and the proceedings against it are accordingly stayed. Summary judgment was subsequently obtained against the second and fourth defendants. The third defendant, Mr Crocker, was successful in resisting the application for summary judgment. This judgment determines the claim against him.
The sum claimed by JH Williams is $995,059.62 consisting of the principal sum of $889,534.35 together with interest up to the first day of the hearing in the sum of $105,525.27 (as calculated in MFI 2). There was no contest as to the quantum of the amount claimed.

Circumstances in which the claim is brought

Mr Crocker is a builder. He was a director of a company called Image Designer Homes Pty Ltd established in 2010 for the purpose of manufacture, supply and installation of pre-manufactured building modules. IDH Modular was a related company established in June 2012 for the purpose of supplying building modules for a particular…

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] NSWSC 1907
Decision Date: 23 December 2015

CaseChat Overview and Summary

Williams Group Australia Pty Ltd sought to enforce a guarantee against Crocker. Crocker denied signing the guarantee or authorising anyone to sign on his behalf. The dispute was heard in the Federal Circuit Court of Australia. The central legal issue was whether Crocker had signed the guarantee or was estopped from denying liability due to ostensible authority, and whether the guarantor had ratified the agreement.

The court examined the evidence regarding the signature on the guarantee. It found that the signature was not placed by Crocker. However, the court also considered whether Crocker was estopped from denying the guarantee's validity due to representations made by Williams Group Australia. The court held that while there were representations, they did not amount to an estoppel. The court further considered whether there was an ostensible authority or ratification by Crocker. The court found that there was no evidence of either.

Consequently, the court held that Crocker was not liable under the guarantee. The court dismissed Williams Group Australia's claim, finding that there was no enforceable guarantee against Crocker. The court did not make any orders regarding costs.

Orders