Glandore Pty Ltd & Ors v Elders Finance & Investments Co. Ltd [1986] FCA 250

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DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALTA )

QUEENSLAND DISTRICT REGISTRY ) QLD G101 of 1984 GENERAL DIVISION )

BETWEEN : GLANDORE PTY. LTD.

First Applicant

AND: DAVID HENRY LETTCH

Second Applicant AND: ALMA MARGARET LEITCH

Third Applicant AND: GARY DAVID LEITCH

Fourth Applicant AND:

ELDERS FINANCE & INVESTMENT CO.,LTD.

Respondent

SPENDER J. 12 JUNE, 1986.

REASONS FOR JUDGMENT

This is an application by Glandore Pty. Limited ("Glandore") and others, principally under s.52 of the Trade

Practices Act 1974. The gravamen of the application 1s that

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"Glandore was induced by representations as to ongoing financial

accommodation to embark on certain ventures and, when the ongoing financial accommodation was not provided, contrary to promises

that had been made, it suffered considerable loss.

In February 1982, the respondent ("Elders") advanced to Glandore $1.5m upon terms and conditions contained in a loan facility document which was dated 2 February 1982. The advance was secured by certain securities. The case for the applicants 1s as follows: during negotiations leading to that advance and in order to induce Glandore to enter into that facility and to provide the securities. one Alistair Twigg, who was then the Corporate Lending Executive of the respondent, represented that the lending policy of the respondent would allow it to advance to Glandore funds totalling 60% of the nett value of the security

offered by the applicants and that the respondent was prepared to make further advances to the first applicant under the loan facility as and when requested by the first applicant so that the total sums advanced amounted to not more than 60% of the nett value of the securities. It was the assurance of continuing financial accommodation which induced Glandore to enter into the loan facility and to provide security, which it said was of a nett value of $3.7m. At some time after February 1982, the respondent changed its lending policy in that it ceased to make loans for purposes which included rural purposes or, alternatively, tried actively to reduce the extent to which it made loans for purposes which included rural purposes. The