Roadhound Electronics Pty Ltd No 1 v Cheihk [2006] NSWDC 144

Roadhound Electronics Pty Ltd No 1 v Cheihk [2006] NSWDC 144

The Court found that the goods were purchased by Mobile Tron Pty Limited, so the defence that the goods were supplied to Nobull Fones Pty Limited failed. Clause 1 of the guarantee was to be read as a whole and required demand, while the plaintiff's reliance on the clause 2 indemnity failed because it was not specifically pleaded. The defence to the 1.5 per cent per month account service fee failed because the defendant did not establish that the rate was exorbitant and non-commercial, but the agreement required simple, not compound, calculation. The issue whether demand was served in accordance with the guarantee was left for further argument.

Jurisdiction
Australia
Judgment Date
28 November 2006
Procedural Posture
Civil Claim Against Guarantor for Amounts Allegedly Owing Under Trading Arrangements / Ex Tempore Judgment; Matter Adjourned to Allow Parties to Address Issue of Service of Notice of Demand
Outcome
Matter adjourned to allow parties to address the issue of service of notice of demand.
Legal Topics
['guarantee of Trading Account' 'notice of Demand as Precondition to Recovery Action' 'supply of Goods' 'account Service Fee' 'penalty Clause' 'simple Interest and Compound Interest']
['contract Law' 'guarantees' 'civil Procedure'] ['guarantee of Trading Account' 'notice of Demand as Precondition to Recovery Action' 'supply of Goods' 'account Service Fee' 'penalty Clause' 'simple Interest and Compound Interest']

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Procedural Posture

Civil Claim Against Guarantor for Amounts Allegedly Owing Under Trading Arrangements / Ex Tempore Judgment; Matter Adjourned to Allow Parties to Address Issue of Service of Notice of Demand

Legal Issues

  1. 1 ['Whether goods were supplied to Mobile Tron Pty Limited or to Nobull Fones Pty Limited.' 'Whether the guarantee and indemnity required a demand to be made on Mr Cheihk before a cause of action arose, and whether a demand was in fact made.' 'Whether the account service fee applied to overdue amounts was a true pre-estimate of loss or damage likely to be suffered by Roadhound in the event of default by Mobile Tron.' 'Whether the credit terms allowed Roadhound to add the account service fee of 1.5 per cent per month in a compounding fashion.']

Ratio Decidendi

The Court found that the goods were purchased by Mobile Tron Pty Limited, so the defence that the goods were supplied to Nobull Fones Pty Limited failed. Clause 1 of the guarantee was to be read as a whole and required demand, while the plaintiff's reliance on the clause 2 indemnity failed because it was not specifically pleaded. The defence to the 1.5 per cent per month account service fee failed because the defendant did not establish that the rate was exorbitant and non-commercial, but the agreement required simple, not compound, calculation. The issue whether demand was served in accordance with the guarantee was left for further argument.

Court Disposition

Matter adjourned to allow parties to address the issue of service of notice of demand.

Orders

  • ['Matter stood over to allow parties to address on the issue of service of notice of demand.']