Tambakis v Mead[1995] QDC 364

CIVIL JURISDICTION

JUDGE PRATT QC

and

BRISBANE

DATE 31/08/95

JUDGMENT

HIS HONOUR: This is a money claim founded on a guarantee. The money represents back rent of a commercial premises (the shop) in the Wallace Bishop Arcade.

In February 1990 Wallace Bishop Arcade Pty Ltd (B) leased the shop to the Tambakis and the Georges (T&G) for five years. In 1992 T&G assigned their interest in the shop to 0PM. They agreed to such assignment provided the Meads M guaranteed OPM's obligations as tenants. Of course T&G's obligations to B remained in tact for the term of the original lease which were reflected in a document styled “lease, deed of covenant and guarantee.”

In 1994 B purported to assigned interest to T&G, that is to say all of its “right” in the deed. An assignment of guarantee document was prepared. That was done on 24 October 1994. T&G gave notice of the assignment to M. T&G as plaintiffs now rely on that assignment from B and seek to recover arrears of rent due under the original lease, arrears of rent for which it was primarily liable to B and which is said to be due from 0PM.

T&G believing the matter to be black and white and clear cut brought this judgment summons seeking liberty to sign judgment on the guarantee in the sum of $135,450.36 plus costs. The defendant M resists such orders and submits that there are several issues of fact and law which should be litigated at trial. That being so, it was argued, the summons should be dismissed and the defendant should have leave to defend generally.

The helpful argument of counsel have been collected and placed in the file where they will remain.

Dealing first with the issue of fact, the possible reliance on a defence of misrepresentation. On this material, and having regard to the cases to which reference is made in the submissions I have concluded that it would be imprudent to rely implicitly on the proposition that here a surety cannot be said to have an arguable defence in an action on a guarantee by claiming a set off to the extent of loss suffered by M because of a misrepresentation by T&G made to OPM and M.

Indeed I was told that in regard to the question of such a misrepresentation OPM wishes to be joined as a counter-claiming defendant. In my view the hypothesis that a setoff for unliquidated damages cannot on these facts be maintained will not necessarily prevail in Queensland.

The submission that such a claim could only be maintained by OPM may perhaps have more force once the full facts are known. In any event, as I have noted, OPM wants to come into the action.

On the other hand M can hardly be held to be entitled to an opportunity to defend solely on this basis without having demonstrated the existence of sufficient facts from which an inference may be drawn that a relevant misrepresentation was made to OPM and M which was acted upon and/or intended to be acted upon. See Brisbane Unit Development Corporation Pty Ltd v Robertson [1983] 2 Queensland Reports 105.

If that were the whole of the matter I would probably have allowed the relief sought or at least allowed an adjournment so that proper material could be prepared and filed.

However there are other grounds and these are largely legal though the issues said to be apparent on the documentation may ultimately need to be clarified at trial by further testimony. I think these are the arguable issues posed in these questions:

I think those several points are at least arguable and I can see that opinions would differ as to the force of the arguments advanced so far by the defendants.

As to the strength of each of these points as regards prospects of success an assessment at this stage is premature and singularly unhelpful.

I will therefore dismiss the summons. I have no intention of allowing costs at this time. I am not satisfied on this material that I should do any more than I have already done. I will make costs of this application costs in the cause.

Counsel may submit a draft which will include an order for speedy trial and necessary directions.