Rankin & Anor v Morgan & Anor [2009] NSWCA 116

Rankin & Anor v Morgan & Anor [2009] NSWCA 116

The later Lammington Drive loan agreements did not replace Morgan Building’s liability for the original $200,000 loan and did not operate as a unilateral discharge of Morgan Building or the guarantors. They amounted, at most, to Lammington Drive accepting liability and providing additional mortgage security. The further $100,000 advance was an independent transaction, and any extension of time was permitted by cl 7 of the original guarantee. Accordingly, there was no material variation discharging the appellants as guarantors.

Jurisdiction
Australia
Judgment Date
21 May 2009
Procedural Posture
Guarantee Appeal / Appeal From District Court Decision
Outcome
Appeal dismissed with costs.
Legal Topics
['discharge of Guarantors' 'replacement of Guaranteed Loan' 'material Change in Borrower’s Obligations' 'loan Agreements' 'mortgage Security']
['contract Law' 'guarantees'] ['discharge of Guarantors' 'replacement of Guaranteed Loan' 'material Change in Borrower’s Obligations' 'loan Agreements' 'mortgage Security']

Case Brief

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Procedural Posture

Guarantee Appeal / Appeal From District Court Decision

Legal Issues

  1. 1 ['Whether the appellants were discharged from liability as guarantors because the guaranteed loan was replaced by a different loan.' 'Whether the appellants were discharged from liability as guarantors because there was a material change in the borrower’s obligations.' 'Whether the trial judge gave reasons for preferring the evidence of Mr Morgan over that of Mr Rankin.']

Ratio Decidendi

The later Lammington Drive loan agreements did not replace Morgan Building’s liability for the original $200,000 loan and did not operate as a unilateral discharge of Morgan Building or the guarantors. They amounted, at most, to Lammington Drive accepting liability and providing additional mortgage security. The further $100,000 advance was an independent transaction, and any extension of time was permitted by cl 7 of the original guarantee. Accordingly, there was no material variation discharging the appellants as guarantors.

Court Disposition

Appeal dismissed with costs.

Orders

  • ['Appeal dismissed with costs.']