Allcott Hire Pty Ltd v Silk [2016] NSWSC 1135

Allcott Hire Pty Ltd v Silk [2016] NSWSC 1135

The disputed clause, although inelegant, is sufficiently clear and certain to amount to a personal guarantee of liabilities arising from hire agreements entered into between Allcott and One Build Pty Ltd. The use of 'I/We' and 'my/our' in the clause does not require multiple sureties and does not void the guarantee if only one signs. Variations in the terms of hire agreements do not render the guarantee uncertain or discharged. The guarantee is not capped by the credit limit in the application. Proof of default by the principal debtor (One Build) was established by affidavit. The Local Court's decision dismissing the claim was set aside and the matter was remitted for determination of...

Jurisdiction
Australia
Judgment Date
17 August 2016
Procedural Posture
Appeal / Judgment on Appeal From Local Court
Outcome
Appeal allowed; judgment for the defendant in the Local Court set aside; matter remitted for further consideration.
Legal Topics
['guarantees and Indemnities' 'construction of Contracts' 'commercial Interpretation' 'suretyship' 'contra Proferentem Rule']
['contract Law' 'commercial Law'] ['guarantees and Indemnities' 'construction of Contracts' 'commercial Interpretation' 'suretyship' 'contra Proferentem Rule']

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Appeal / Judgment on Appeal From Local Court

Legal Issues

  1. 1 ['Whether a clause in a credit application constitutes an enforceable guarantee or indemnity' 'Whether the guarantee clause is void or unenforceable for ambiguity or uncertainty' 'Whether the obligations under the guarantee are limited to the credit limit specified' 'Whether proof was made of the primary obligation/default by the principal debtor']

Ratio Decidendi

The disputed clause, although inelegant, is sufficiently clear and certain to amount to a personal guarantee of liabilities arising from hire agreements entered into between Allcott and One Build Pty Ltd. The use of 'I/We' and 'my/our' in the clause does not require multiple sureties and does not void the guarantee if only one signs. Variations in the terms of hire agreements do not render the guarantee uncertain or discharged. The guarantee is not capped by the credit limit in the application. Proof of default by the principal debtor (One Build) was established by affidavit. The Local Court's decision dismissing the claim was set aside and the matter was remitted for determination of...

Court Disposition

Appeal allowed; judgment for the defendant in the Local Court set aside; matter remitted for further consideration.

Orders

  • ['Leave to appeal granted to the extent necessary.' 'Leave to raise the issue of the existence of an indemnity as distinct from a guarantee granted.' 'Leave granted to raise the issue relating to lack of proof of the primary obligation.' 'Appeal allowed.' 'Judgment of the Local Court of 15 May 2015 in Allcott Hire...