Duggan v Thomas, in the matter of William Joseph Duggan [2002] FCA 830

FEDERAL COURT OF AUSTRALIA

Duggan v Thomas, in the matter of William Joseph Duggan [2002] FCA 830

BANKRUPTCY – applicant's company had interest in adjoining freehold and leasehold properties – Bank held first registered mortgage over freehold property – applicant guaranteed company's debt – Bank and holder of first registered mortgage over leasehold property entered into agreement to sell properties in "one-line" and distribute sale proceeds in fixed ratio – money received by Bank insufficient to discharge debt – whether Bank could recover shortfall from applicant guarantor – whether Bank breached obligations to applicant by entering into agreements – value of freehold property compared to leasehold property – applicant made bankrupt on own petition – whether Bank's proof of debt properly admitted – whether proof of debt should be expunged GUARANTEE – duty of mortgagee to guarantor – result of breach of duty Bankruptcy Act 1966 (Cth) s 99 Corporations Law s 420A s 423 Real Property Act 1900 (NSW) s 58(3) Tooth & Co Ltd v Lapin (1936) 53 WN (NSW) 224, referred to Yorkshire Bank Plc v Hall [1999] 1 WLR 1713, referred to Medforth v Blake [2000] ChD 86, referred to Taylor v Bank of New South Wales (1886) 11 App Cas 596, referred to State Bank of Victoria v Parry (1989) 7 ACLC 226, referred to O'Day v Commercial Bank of Australia (1933) 50 CLR 200, referred to Phillips and O'Donovan The Modern Contract of Guarantee 3rd ed. 1996 Tyler et al Fisher & Lightwood's Law of Mortgage Australian Edition 1995 WILLIAM JOSEPH DUGGAN v GAVIN FREDERICK CRICHTON THOMAS (AS TRUSTEE OF ESTATE OF WILLIAM JOSEPH DUGGAN) (IN THE MATTER OF WILLIAM JOSEPH DUGGAN) & ANOR N 7847 of 2000 STONE J 28 JUNE 2002 SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY N 7847 OF 2000

IN THE MATTER OF WILLIAM JOSEPH DUGGAN