Bank of Western Australia v Salmon [No 2] [2009] NSWSC 226

New South Wales Supreme Court

CITATION : Bank of Western Australia v Salmon [No 2] [2009] NSWSC 226

HEARING DATE(S) : 25/3/09 - 26/3/09

JUDGMENT DATE : 2 April 2009

JURISDICTION : Common Law Divisiion

JUDGMENT OF : Kirby J

DECISION : 1. There should be judgment for the plaintiff in the sum of $5,361,510.72. 2. The defendant should pay the plaintiff's costs.

CATCHWORDS : Civil Law - action by bank on a Guarantee - whether representation and collateral contract.

LEGISLATION CITED : Contracts Review Act 1980

CATEGORY : Principal judgment

CASES CITED : Bank of Western Australia v Salmon [No 1] [2009] NSWSC 224 Coady v J Lewis & Sons Ltd [1951] 3 DLR 845

PARTIES : Bank of Western Australia ACN 050 494 454 (Pl) Owen Salmon (Def)

FILE NUMBER(S) : SC 2007/13391

COUNSEL : P Dowdy (Pl) In Person (Def)

SOLICITORS : Gadens Lawyers (Pl) Unrepresented (Def)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

KIRBY J

Thursday 2 April 2009

2007/13391 BANK OF WESTERN AUSTRALIA (ACN 050 494 454) v Owen SALMON

JUDGMENT [NO 2] 1 KIRBY J: The Bank of Western Australia (the plaintiff) brings an action against Mr Owen Salmon (the defendant) to recover monies advanced to a company TCBS SPV Tomaree Pty Limited ("Tomaree"), which the bank alleges Mr Salmon guaranteed. 2 On the second day of the hearing, Mr Salmon sought leave to withdraw certain admissions made in an Amended Defence, affirmed on 8 April 2008 and filed on 13 May 2008. He foreshadowed that, if given leave, he would apply to further amend that defence. Leave, however, was refused in an extempore judgment given on 26 March 2009 (Bank of Western Australia v Salmon [No 1] [2009] NSWSC 224). That judgment set out the background to this claim and identified, by reference to the pleadings, the matters in contest. I will not repeat, in this judgment, that analysis. 3 I should, however, say something about one issue that arose during the course of the hearing. The bank sought to rely upon the failure of Mr Salmon, then represented by lawyers, to traverse that part of the Statement of Claim which asserted the Guarantee. Under the rules, the Guarantee had therefore been admitted. However, because the Amended Defence raised issues concerning the Guarantee in a number of other paragraphs, I ruled that the plaintiff should prove the Guarantee. The original document was then produced (Exhibit G), a copy having already been tendered (without objection) as part of Exhibit A. The Guarantee was in booklet form, with a spiral binding. Mr Salmon had signed the last page and identified his signature, and that of his solicitor, Mr Lucas, when giving evidence. The document was executed on 30 March 2008. At the same time, Mr Salmon provided a Statutory Declaration, which was in these terms: (Exhibit A: p 182)