BRADBURY v AUSTRALIAN GUARANTEE CORPORATION LTD and ORS [1997] NSWCA 47

BRADBURY v AUSTRALIAN GUARANTEE CORPORATION LTD and ORS

SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MEAGHER, BEAZLEY and STEIN JJA 8 May 1997, 1 July 1997 [1997] NSWCA 47

Contracts Review Act, — assignment of shares — guarantee — unconscionable conduct — Beneficial Finance Corporation v Karavas (1991) 23 NSWLR 256 — Commonwealth Bank of Australia v Mehta (1991) 23 NSWLR 84.

FACTS

Mrs Bradbury was the registered proprietor of two parcels of shares in The Astor Pty Ltd. Those shares entitled Mrs Bradbury to exclusive use and occupation of two units. Mrs Bradbury assigned and transferred the shares to AGC, by way of Deed of Mortgage, which was to secure all moneys owing or to become owing to AGC by Mr Bradbury according to an "all moneys" clause. Mrs Bradbury was guarantor for the liabilities of a company called International Rigging (Aust) Pty Ltd ("IRA"). IRA defaulted on instalments due under various loans and agreements and AGC made demand on Mrs Bradbury as

guarantor. AGC was successful, before Dunford J, in having its security enforced.

HELD

1. There was no unconscionable conduct.

2. AGC had no duty to provide Mrs Bradbury with commercial advice and that AGC did not, in fact, provide such advice means that they cannot have assumed any duty of care.

3. There is jurisdiction under the Contracts Review Act 1980, to make orders in favour of a party merely upon proof of a relevant disability irrespective of the knowledge of that disability on the part of the other contracting party, but the circumstances must be extraordinary for that jurisdiction to be exercised: Beneficial Finance Corporation v Karavas (1991) 23 NSWLR 256. No relevant disability existed and the circumstances of this case were not extraordinary.

Meagher JA This is an appeal from the decision of Dunford J, of 9 August 1996, enforcing the security of the first respondent ("AGC") over two units ("the Units") in a block of flats in respect of the indebtedness of the appellant as guarantor for the liabilities of International Rigging (Aust) Pty Ltd ("IRA").