Lissa v Browne [2009] NSWSC 1050

Lissa v Browne [2009] NSWSC 1050

The indemnity given by Mr Lissa to Zonie was conditional upon Mr Lissa's authority to instruct solicitors on behalf of Zonie. Zonie’s unilateral settlement of the proceedings without recourse to Mr Lissa constituted a breach of this essential term, thereby discharging Mr Lissa from his indemnity obligations. The principle in Ankar, although expressed in relation to guarantees, also applies to contractual indemnities in cases of breach of essential terms where the indemnifier's interests are prejudiced.

Jurisdiction
Australia
Judgment Date
02 October 2009
Procedural Posture
Appeal / Judgment After Appeal From Local Court
Outcome
Appeal upheld and judgment of the Local Court set aside as against Mr Lissa.
Legal Topics
['discharge of Surety' 'indemnity Versus Guarantee' 'essential Term or Condition' 'application of Ankar Principle to Indemnities' 'costs on Appeal']
['contract Law' 'guarantee and Indemnity' 'civil Procedure'] ['discharge of Surety' 'indemnity Versus Guarantee' 'essential Term or Condition' 'application of Ankar Principle to Indemnities' 'costs on Appeal']

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Procedural Posture

Appeal / Judgment After Appeal From Local Court

Legal Issues

  1. 1 ["Whether the indemnity given by Mr Lissa to Zonie was conditional upon Mr Lissa continuing to instruct Mr Browne and whether a breach of that condition discharges Mr Lissa's obligations under the indemnity." 'Whether the settlement of proceedings by Zonie without recourse to Mr Lissa amounted to a breach of an essential term of the indemnity.' 'Whether the principle in Ankar Pty Ltd v National Westminster Finance applies to indemnities as well as guarantees.']

Ratio Decidendi

The indemnity given by Mr Lissa to Zonie was conditional upon Mr Lissa's authority to instruct solicitors on behalf of Zonie. Zonie’s unilateral settlement of the proceedings without recourse to Mr Lissa constituted a breach of this essential term, thereby discharging Mr Lissa from his indemnity obligations. The principle in Ankar, although expressed in relation to guarantees, also applies to contractual indemnities in cases of breach of essential terms where the indemnifier's interests are prejudiced.

Court Disposition

Appeal upheld and judgment of the Local Court set aside as against Mr Lissa.

Orders

  • ['The appeal is upheld.' 'Set aside that part of the judgment of the Local Court of 14 December 2008 that found a verdict in favour of Zonie against Mr Lissa in the amount of $19,919 plus costs.' "In lieu of the judgment of the Local Court direct a judgment in favour of Mr Lissa with Zonie to pay Mr Lissa's costs of...