Noda Development Ltd v H & H Funding Pty Ltd [2023] NSWSC 305

Noda Development Ltd v H & H Funding Pty Ltd [2023] NSWSC 305

The alleged oral agreement or Forbearance Arrangement was not established. The plaintiff agreed to no more than a temporary forbearance while repayment options were considered, and it was not reasonable for the defendants to expect that the plaintiff would refrain from enforcement for so long as unit sales were pursued. The defendants also did not prove reliance to their detriment. Accordingly, no estoppel precluded enforcement of the Agreement, and the first defendant owed the outstanding debt while Mr Hu was liable as guarantor under cl 16(a) for the ultimate balance owing.

Jurisdiction
Australia
Judgment Date
31 March 2023
Procedural Posture
Commercial List Proceeding to Recover Amounts Owing Under a Loan Agreement and Enforce a Guarantee / Principal Judgment After Hearing
Outcome
Judgment for the plaintiff against both defendants for the outstanding amount under the Agreement.
Legal Topics
['loan Agreement' 'guarantee and Indemnity' 'default' 'estoppel' 'forbearance' "creditor's Voluntary Winding Up" 'leave to Proceed Against Company in Liquidation']
['contract Law' 'equity' 'corporations'] ['loan Agreement' 'guarantee and Indemnity' 'default' 'estoppel' 'forbearance' "creditor's Voluntary Winding Up" 'leave to Proceed Against Company in Liquidation']

Case Brief

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Procedural Posture

Commercial List Proceeding to Recover Amounts Owing Under a Loan Agreement and Enforce a Guarantee / Principal Judgment After Hearing

Legal Issues

  1. 1 ['Whether an oral agreement or Forbearance Arrangement was made in December 2018 by which the plaintiff agreed not to enforce its rights while sales of units in the Epping development were settled and repayments made from sale proceeds.' 'Whether the alleged oral agreement gave rise to an estoppel preventing the plaintiff from requiring repayment otherwise than in accordance with that alleged arrangement.' 'Whether the first defendant and the second defendant as guarantor were liable for the amount outstanding under the Agreement.']

Ratio Decidendi

The alleged oral agreement or Forbearance Arrangement was not established. The plaintiff agreed to no more than a temporary forbearance while repayment options were considered, and it was not reasonable for the defendants to expect that the plaintiff would refrain from enforcement for so long as unit sales were pursued. The defendants also did not prove reliance to their detriment. Accordingly, no estoppel precluded enforcement of the Agreement, and the first defendant owed the outstanding debt while Mr Hu was liable as guarantor under cl 16(a) for the ultimate balance owing.

Court Disposition

Judgment for the plaintiff against both defendants for the outstanding amount under the Agreement.

Orders

  • ['Judgment entered in favour of the plaintiff against the first defendant in the sum of $27,667,026.53.' 'Judgment entered in favour of the plaintiff against the second defendant in the sum of $27,667,026.53.' 'The judgments take effect from 27 March 2023.' "The first defendant is to pay the plaintiff's costs up to...