In the matter of Elsmore Resources Ltd; Elsmore Resources Ltd v Ashley Grant Howard & 3 ors [2014] NSWSC 953

In the matter of Elsmore Resources Ltd; Elsmore Resources Ltd v Ashley Grant Howard & 3 ors [2014] NSWSC 953

Although Mr Fung's Contracts Review Act defence faced significant obstacles, it was arguable that the Settlement involved substantive unfairness because it exposed him to significant personal liability for relatively slight benefit, and procedural unfairness because he was brought to the mediation at short notice, was unrepresented, may have been pressured by Mr Howard, and may not have understood that he was giving a personal guarantee. It also could not be said on a summary judgment application that relief under the Act would inevitably be declined as a matter of discretion. The defence was therefore not so clearly untenable that it could not possibly succeed.

Jurisdiction
Australia
Judgment Date
18 July 2014
Procedural Posture
Interlocutory Application for Summary Judgment / Interlocutory Applications
Outcome
Application for summary judgment dismissed with costs.
Legal Topics
['summary Judgment' 'contracts Review Act Defence' 'unjust Contract' 'guarantee and Indemnity' 'independent Legal Advice' 'unfair Pressure or Unfair Tactics']
['civil Procedure' 'contract Law' 'equity' 'corporations'] ['summary Judgment' 'contracts Review Act Defence' 'unjust Contract' 'guarantee and Indemnity' 'independent Legal Advice' 'unfair Pressure or Unfair Tactics']

Case Brief

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Procedural Posture

Interlocutory Application for Summary Judgment / Interlocutory Applications

Legal Issues

  1. 1 ["Whether the third defendant's Contracts Review Act 1980 (NSW) defence was so clearly untenable that it could not possibly succeed on an application for summary judgment." 'Whether the Settlement, so far as it concerned the third defendant, was arguably unjust because of substantive unfairness, procedural unfairness, or both.' 'Whether relief under the Contracts Review Act 1980 (NSW) would inevitably be declined as a matter of discretion.']

Ratio Decidendi

Although Mr Fung's Contracts Review Act defence faced significant obstacles, it was arguable that the Settlement involved substantive unfairness because it exposed him to significant personal liability for relatively slight benefit, and procedural unfairness because he was brought to the mediation at short notice, was unrepresented, may have been pressured by Mr Howard, and may not have understood that he was giving a personal guarantee. It also could not be said on a summary judgment application that relief under the Act would inevitably be declined as a matter of discretion. The defence was therefore not so clearly untenable that it could not possibly succeed.

Court Disposition

Application for summary judgment dismissed with costs.

Orders

  • ['The application for summary judgment against the third defendant contained in paragraph 3 of the Interlocutory Process filed 17 April 2014 be dismissed with costs.']