Commonwealth Bank of Australia v Thompson [2013] NSWSC 149

Commonwealth Bank of Australia v Thompson [2013] NSWSC 149

The guarantee imposed an independent obligation on the second defendant to pay the Bank without requiring the Bank first to demand payment from RHT Developments or realise the mortgaged properties, and the contractual terms preserved the Bank's rights despite any failure or delay in exercising remedies. Although the...

Source-derived case information.

Jurisdiction
Australia
Judgment Date
05 March 2013
Procedural Posture
Enforcement of Guarantee and Indemnity by Bank Against Guarantor / Principal Judgment After Hearing
Outcome
Judgment for the plaintiff against the second defendant; the second defendant's defences failed and the Bank was entitled to enforce the guarantee.
Legal Topics
['enforcement of Guarantee' 'mortgagee in Possession' 'power of Sale' 'unconscionable Conduct' 'asic Act and Australian Consumer Law']
['banking and Finance' 'guarantees and Indemnities' 'mortgages' 'consumer Protection'] ['enforcement of Guarantee' 'mortgagee in Possession' 'power of Sale' 'unconscionable Conduct' 'asic Act and Australian Consumer Law']

Source-derived case record

Summary, issues, holding and outcome

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Procedural Posture

Enforcement of Guarantee and Indemnity by Bank Against Guarantor / Principal Judgment After Hearing

Legal Issues

  1. 1 ["Whether the Bank's conduct after taking possession of the Biloela properties disentitled it from enforcing the guarantee against the second defendant." "Whether the Bank's failure to realise or adequately market the properties required refusal of judgment or a stay until sale." 'Whether the Bank engaged in unconscionable conduct under the Australian Securities and Investments Commission Act 2001 (Cth) or the Australian Consumer Law.']

Ratio Decidendi

The guarantee imposed an independent obligation on the second defendant to pay the Bank without requiring the Bank first to demand payment from RHT Developments or realise the mortgaged properties, and the contractual terms preserved the Bank's rights despite any failure or delay in exercising remedies. Although the Bank was dilatory after taking possession, it had belatedly commenced marketing the properties and had abandoned its claim for accrued interest during the period of delay, so the prejudice relied on by the second defendant was ameliorated. The Bank's conduct did not amount to unconscionable conduct and did not disentitle it from enforcing the guarantee.

Court Disposition

Judgment for the plaintiff against the second defendant; the second defendant's defences failed and the Bank was entitled to enforce the guarantee.

Orders

  • ['The second defendant is to pay to the plaintiff the sum of $1,900,000.' "The second defendant is to pay the plaintiff's costs." 'Interest is to run from today.']