Roadhound Electronics Pty Ltd No 1 v Cheihk [2006] NSWDC 144

New South Wales District Court

CITATION: Roadhound Electronics Pty Ltd No 1 v Cheihk [2006] NSWDC 144

HEARING DATE(S): 27 November 2006 EX TEMPORE JUDGMENT DATE : 11/28/2006

JURISDICTION: Civil

JUDGMENT OF: Sidis DCJ

DECISION: Matter adjourned to allow parties to address on issue of service of notice of demand.

CATCHWORDS: Guarantee of trading account - Notice of demand as precondition to recovery action.

CASES CITED: Bond v Hong Kong Bank of Australia Limited (1991) 25 NSWLR 286, Bradford Old Bank Limited v Sutcliffe [1918] KB 833, O'Day v All States Leasing System WA Pty Ltd (1983) 152 CLR 35

PARTIES: Roadhound Electronics Pty Ltd Anthony Cheihk

FILE NUMBER(S): Newcastle 1124/01

COUNSEL: Plaintiff - P S Brahm Defendant - K G Odgers

SOLICITORS: Plaintiff - Turnbull Hill Lawyers Defendant - Edwin Davey Commercial & Litigation Lawyers

JUDGMENT

HER HONOUR:

1 In this matter the plaintiff, Roadhound Electronics Pty Limited claims against Mr Cheihk the sum of $576,176.30. This sum represents amounts claimed to be owing to Roadhound for goods sold to Mobile Tron Pty Limited and for a service fee applied to Mobile Tron's account in accordance with the credit agreement entered into between Roadhound and Mobile Tron.

2 The claim is made against Mr Cheihk as guarantor of Mobile Tron's obligations to Roadhound under their trading arrangements.

3 The issues for determination in the proceedings were as follows: 1. Whether the goods were in fact supplied to Mobile Tron or to another related company named Nobull Fones Pty Limited. 2. Whether the terms of the guarantee and indemnity required that a demand be made on Mr Cheihk before a cause of action arose and whether a demand was in fact made. 3. Whether the account service fee applied to overdue amounts was a true pre-estimate of the loss or damage likely to be suffered by Roadhound in the event of default by Mobile Tron. If so, what amount would be reasonable to compensate Roadhound for delays in payment. 4. Whether the terms of credit extended by Roadhound to Mobile Tron allowed for the account service fee of 1.5 per cent, per month to be added in a compounding fashion.