Commonwealth Bank of Australia v IInvest Pty Limited (in liquidation) (No 9) [2018] NSWSC 1276

Supreme Court New South Wales

Medium Neutral Citation: Commonwealth Bank of Australia v IInvest Pty Limited (in liquidation) (No 9) [2018] NSWSC 1276 Hearing dates: 30; 31 January 2017; 1; 2; 3; 6; 7 February 2017; 26; 27; 28 April 2017; 25; 26 May 2017. Date of orders: 17 August 2018 Decision date: 17 August 2018 Jurisdiction: Common Law Before: Campbell J Decision: Judgment for the plaintiff Catchwords: CONTRACT – Formation – offer and acceptance - agreement – remedies – debt – lawful termination – no service of default notice – express right to possession

GUARANTEE AND INDEMNITY – guarantee agreement – maximum liability – whether the right to realise security is engaged – mortgage – finance agreement – terms and conditions – banks discretion – no obligation to loan If borrowers financial position has changed – act of default – winding up company – absence of financial default is irrelevant – without notice – bills matured account – obligation for borrowers to pay interest – banks remedies – amount due and payable and taking possession of property

LAND LAW – Seeking possession of rural properties – company liquidated – default – mortgaged to the bank – bank enforcing security – cross-claim – guarantee – alterations – maximum liability – extension

MEDIATION – Farm Debt Mediation Act 1994 (NSW) – loan was not in default – enforcement action – heads of agreement – no application to cross-claim Legislation Cited: Australian Securities and Investments Commission Act 2011 (Cth), ss 12CB, 12DA, 12DB, 12GF, 12GM Civil Procedure Act 2005 (NSW), s 100 Contracts Review Act 1980 (NSW), ss 6, 7, 8 Corporations Act 2001 (Cth), s 471B Farm Debt Mediation Act 1994 (NSW), ss 4, 9, 9B, 11 Real Property Act 1900 (NSW) Cases Cited: Buhr and Ors v Barclays Bank Plc [2001] EWCA Civ 1223; Bunnings Group Ltd v Asden Developments Pty Ltd & Ors (2013) 1 QDR 493; [2013] QCA 347; Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447; [1983] HCA 14; Commonwealth Bank of Australia v IInvest Pty Ltd (in Liquidation) [2014] NSWSC 1257; Commonwealth Bank of Australia v IInvest Pty Ltd (in Liquidation) (No 2) [2014] NSWSC 1640; Commissioner of Stamp Duties (NSW) v Carlenka Pty Ltd (1995) 41 NSWLR 329; DKLR Holdings Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) [1980] 1 NSWLR 510; DKLR Holdings Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431; [1982] HCA 14; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423; Federal Commissioner of Taxation v Park & Anor (2012) 205 FCR 1; [2012] FCAFC 122; Foss v Harbottle (1843) 2 HARE 461; 67 ER 189 Lamru Pty Ltd v Kation Pty Ltd (1998) 44 NSWLR 432; Mastronardo & Anor v Commonwealth Bank of Australia Ltd & Ors [2018] NSWCA 136; Mercedes Holdings Pty Ltd v Waters (No 2) (2010) 78 ACSR 118; [2010] FCA 472; Ipstar Australia Ltd v APS Satellite Pty Ltd (2018) 329 FLR 149; [2018] NSWCA 15; Parras Holdings Pty Ltd v Commonwealth Bank of Australia [1998] FCA 682; Provident Capital Limited v Szlasa [2010] SASCFC 65; Ramage v Waclaw (1988) 12 NSWLR 84; Rix v Mahony and Ors (No 2) [2012] NSWCCA 332; Watson v Foxman (1995) 49 NSWLR 315 Texts Cited: Code of Banking Practice Professor Sir Roy Goode, Goode's Legal Problems of Credit and Security (Sweet & Maxwell) Category: Principal judgment Parties: Commonwealth Bank of Australia (Plaintiff) IInvest Pty Ltd (in liquidation) (First Defendant) James Harker-Mortlock (Second Defendant) James Harker-Mortlock (First Cross Claimant) JHM Pty Ltd (Second Cross Claimant) Commonwealth Bank of Australia (First Cross Defendant) IInvest Pty Ltd (in liquidation) (Second Cross Defendant) Representation: Counsel: E Cheeseman SC with J White (Plaintiff) P King (Second Defendant)