Gideon Rathner as trustee for Garland Lot 4 Unit Trust v Bartlett [2023] NSWSC 1026

Gideon Rathner as trustee for Garland Lot 4 Unit Trust v Bartlett [2023] NSWSC 1026

The payment made by Garland Lot 4 after the sale of Lot 402 was not a payment made under its guarantee; rather, it was a result of the decision by the beneficiaries to sell the property to repay project debts and minimise losses. The parties' liabilities under the guarantee were not co-ordinate for the purpose of contribution because the intention, as objectively imputed from the corporate structure and relevant deed, was to exclude contribution rights between the project entities and the other guarantors. Accordingly, no right of contribution arises in these circumstances.

Jurisdiction
Australia
Judgment Date
29 August 2023
Procedural Posture
Principal Judgment / Final Decision After Hearing of Claim and Cross Claim
Outcome
Plaintiff's claim and amended cross-claim dismissed; costs awarded to defendants.
Legal Topics
['guarantee and Indemnity' 'rights of Guarantor Against Co Guarantors' 'right to Contribution' 'right to Interest']
['equity'] ['guarantee and Indemnity' 'rights of Guarantor Against Co Guarantors' 'right to Contribution' 'right to Interest']

Case Brief

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Procedural Posture

Principal Judgment / Final Decision After Hearing of Claim and Cross Claim

Legal Issues

  1. 1 ['Whether Garland Lot 4 has a right of contribution against co-guarantors (Mr Bartlett, Ms Pennington, and P&J Projects) after payment relating to a development loan guarantee' 'Whether payment was made under the guarantee so as to entitle right to contribution' 'Whether liabilities were co-ordinate between the parties for contribution purposes' 'Whether the plaintiff is entitled to interest despite delay']

Ratio Decidendi

The payment made by Garland Lot 4 after the sale of Lot 402 was not a payment made under its guarantee; rather, it was a result of the decision by the beneficiaries to sell the property to repay project debts and minimise losses. The parties' liabilities under the guarantee were not co-ordinate for the purpose of contribution because the intention, as objectively imputed from the corporate structure and relevant deed, was to exclude contribution rights between the project entities and the other guarantors. Accordingly, no right of contribution arises in these circumstances.

Court Disposition

Plaintiff's claim and amended cross-claim dismissed; costs awarded to defendants.

Orders

  • ['The proceedings (including the amended cross-claim) are dismissed' "The plaintiff pay the defendants' costs of the proceedings."]