Lopwell Pty Ltd v Clarke & Ors [2009] NSWCA 165

Lopwell Pty Ltd v Clarke & Ors [2009] NSWCA 165

The guarantees and mortgages executed by the Clarkes were secured while they laboured under a special disability, being completely reliant on advice of their accountant who was not independent and whose personal interest in the transaction was undisclosed. Lopwell, through its agent, knew facts sufficient to put it on inquiry as to the Clarkes’ inability to protect their own interests: the haste of the transaction, exorbitant interest rate, lack of independent legal and financial advice, and no knowledge of adequate consideration for the Clarkes. Lopwell's failure to make inquiries and its acceptance of the benefit of the guarantees and mortgages in these circumstances was...

Jurisdiction
Australia
Judgment Date
14 August 2009
Procedural Posture
Appeal / Judgment
Outcome
Appeal dismissed with costs.
Legal Topics
['unconscionable Dealing' 'guarantor Special Disability' 'independent Advice' 'exorbitant Interest Rate']
['equity'] ['unconscionable Dealing' 'guarantor Special Disability' 'independent Advice' 'exorbitant Interest Rate']

Case Brief

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Procedural Posture

Appeal / Judgment

Legal Issues

  1. 1 ['Whether guarantees and mortgages should be set aside for unconscionable dealing' 'Whether the Clarkes were subject to a special disability' "Whether Lopwell had knowledge or should have had knowledge of the Clarkes' disability" 'Appropriate equitable relief to be granted']

Ratio Decidendi

The guarantees and mortgages executed by the Clarkes were secured while they laboured under a special disability, being completely reliant on advice of their accountant who was not independent and whose personal interest in the transaction was undisclosed. Lopwell, through its agent, knew facts sufficient to put it on inquiry as to the Clarkes’ inability to protect their own interests: the haste of the transaction, exorbitant interest rate, lack of independent legal and financial advice, and no knowledge of adequate consideration for the Clarkes. Lopwell's failure to make inquiries and its acceptance of the benefit of the guarantees and mortgages in these circumstances was...

Court Disposition

Appeal dismissed with costs.

Orders

  • ['The appeal is dismissed with costs.']