Cole v. Kealey [2001] NSWCA 336

New South Wales Court of Appeal

CITATION : Cole v. Kealey [2001] NSWCA 336 FILE NUMBER(S) : CA 40922/00 HEARING DATE(S) : 14 September 2001 JUDGMENT DATE : 14 September 2001

PARTIES : Terry Cole - appellant John Kealey - respondent JUDGMENT OF : Heydon JA at 44; Hodgson JA at 1; O'Keefe J at 45

LOWER COURT JURISDICTION : District Court LOWER COURT DC4706/97 FILE NUMBER(S) : LOWER COURT Payne DCJ JUDICIAL OFFICER :

COUNSEL : Mr. T. Somers for appellant Mr. R.P. Greenhill SC with Mr. I. Mescher for respondent SOLICITORS : Clinch Neville Long, Sydney for appellant V. Gavdik & Co., Beecroft for respondent CATCHWORDS : CONTRACT - Loan - Whether to company or principal of the company - No appealable error by trial judge. ND DECISION : Appeal dismissed with costs.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

CA 40922/00 DC 6707/97 HEYDON JA HODGSON JA O'KEEFE J

Friday, 14th September 2001 COLE V. KEALEY

Judgment 1 HODGSON JA: On 30 October 2000 Payne DCJ gave judgment in favour of the respondent, John Kealey, against the appellant, Terry Cole, in the sum of $100,000 plus interest at 11 percent. Although this is not spelt out in the appeal papers, I assume this means interest at 11 percent per annum from 27 September 1996, the date of the relevant advance, and I assume that the primary judge either did or would have awarded the costs of the proceedings against the appellant in favour of the respondent. 2 Mr. Cole appeals from that judgment. Before considering the grounds of appeal, it is convenient to outline the relevant circumstances. 3 In September 1995, Mr Kealey took up an accounting position with Mr Cole's group of companies, one of which was the company CAV Australia Pty Ltd, which I will call CAV. 4 On 3 June 1996 Mr Kealey signed a letter addressed to one of CAV's suppliers, namely, NEC Australia Pty Ltd, which I will call NEC. That letter was in the following terms. The undersigned herewith Guarantees NEC Australia in the sum of ($100,000.00) One hundred thousand Dollars for on behalf of the Account namely CAV Australia Pty. Ltd. of 219 Beecroft Road, Cheltenham, NSW, 2119. This guarantee is secured on Term Deposit held by The Commonwealth Bank, Baulkham Hills, 2153 term deposit No.2279 50153058 commenced on 28/5/96. I hereby acknowledge that this guarantee to you shall stand as collateral should CAV Australia Pty. Ltd. fail in their Account obligations as Agreed by NEC Australia Pty. Ltd. and CAV Australia Pty. Ltd. As per their credit account.