JOHN BARRIE LOITERTON v ADVANCE BANK AUST LTD [1993] NSWCA 165

JOHN BARRIE LOITERTON v ADVANCE BANK AUST LTD SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL

CLARKE JA, MEAGHER JA and SHELLER JA 8 July 1993 [1993] NSWCA 165

FACTS: Documentation guaranteeing a loan by the respondent to the appellant was executed four days after the loan was drawn down. The appellant sought to rely on affidavit evidence to infer mistake. A certificate validating contravention of s 230(8) of the Companies Code, undated and drafted in the past tense, was relied upon by the appellant as insufficient to satisfy the requirements of such a certificate.

HELD: (per curiam)

(1) There was insufficient evidence to enable the inference alleged by the appellant in respect of the guarantee documentation and the certificate.

Taylor v Johnson (1983) 151 CLR 422 Clarke JA. I will ask Mr Justice Meagher to give the first judgment.

Meagher JA. In this matter the respondent, Advance Bank Australia Limited, advanced to a company called Statford Park Pty Limited, the sum of $871,525.00 on 18 September 1989. That advance was guaranteed by certain documents executed by Mr and Mrs Loiterton, the first defendants, Resort Management Services Limited, the second defendant and Leisuremark, the third defendant. The documents guaranteeing those advances were executed four days after the advances were made, namely on 22 September 1989.

The documents, if examined, are really documents of guarantee and indemnity, nor merely documents ofguarantee. That fact could hardly be disputed. They are the documents on which the plaintiff, Advance Bank, sued below.

It is first submitted that those documents must have been executed by mistake and therefore are, to that extent, unenforceable. The mistake is alleged to arise in this way, that the documents were executed after an offer of loan which was dated 4 August 1989. That document, the offer of loan, which is detailed in its terms, required guarantees to be given by the three sets of appellants. It does not require guarantees and indemnities to be given. Nonetheless, apparently pursuant to that offer of loan, which was accepted by everyone, documents of guarantee and indemnity were tendered for execution and executed by the present appellants. There was no oral evidence given. The appellant is therefore driven to ask us to infer that a mistake must have existed on the face of the documents.