DISTRICT COURT OF QUEENSLAND

1. [1]
   The Plaintiff seeks summary judgement pursuant to r. 292 of the Uniform Civil Procedure Rules 1999 (Qld).

2. [2]
   That rule provides that before a court may give judgement for the Plaintiff, it must be satisfied that the Defendant has no real prospect of successfully defending all or a part of the Plaintiff’s claim and there is no need for a trial of the claim or the part of the claim.

3. [3]
   As in any summary judgment application by a Plaintiff, the legal burden of proof always lies upon the Plaintiff to satisfy the court of the two requirements set out in r 292(2). That principle is well established: Deputy Commissioner of Taxation v Salcedo [2005] QCA 227

4. [4]
   Given that a notice of intention to defend must be filed prior to any summary judgement application being made, it follows that a Plaintiff will still need to address any grounds of the defence which have been raised in order to discharge that primary obligation.

5. [5]
   There is no particular requirement contained in r 292 as to what a Defendant needs to do in order to prevent a Court from being satisfied of the matters set in subsection (2) of that rule. However, as observed by Jones J in Qld Pork P/L v Lott [2003] QCA 271, once a prima facie case has been made out entitling an Applicant to judgement, an evidentiary onus then shifts to the respondent to persuade the court why judgement ought not to be given. His Honour also observed that in some circumstances, a respondent to a summary judgement application may well be able to convince the court that the onus of proof which lies on the party bringing the application has not been discharged, without the need to file any evidence at all.

6. [6]
   Mr Coveney, Counsel for the Plaintiff in this matter, submits that the Plaintiff has discharged the onus which rests upon it in establishing a prima facie entitlement to judgment. In support of that submission, Mr Coveney relied on the relevant pleadings and in particular, the affidavit of Mr Dettrick (contained in the arch lever folder tendered and now marked by me as Ex 2). He also relied on the fact that no affadavit material was placed before the Court by the Defence for its consideration in defence of the Plaintiff’s summary judgement application.

7. [7]
   Mr Coveney argued that the defendant has no real prospect of successfully defending the Plaintiff’s claim and as such, there is no need for a trial in view of the fact that the Defendant had given, when signing the Credit Application (Tab 8 Ex 2), a personal guarantee (incorporated into the credit application document) that the Defendant would become liable to the Plaintiff in the event that AB Waterproofing P/L defaulted under the relevant terms as agreed between the Plaintiff and AB Waterproofing P/L.

8. [8]
   Mr Coveney submits that, in the circumstances, the defendant has no real prospect of successfully defending the plaintiff’s claim against him personally for monies due and owing now by AB Waterproofing P/L for goods supplied and delivered to that entity by the Plaintiff as a consequence of the Defendant having given that guarantee to the Plaintiff and as such, the Plaintiff is therefore entitled to summary judgement.

9. [9]
   Mr Coveney also submitted that in light of the Plaintiff having demonstrated to the Court a prima facie entitlement to judgement, that an evidentiary onus then shifted to the Defendant to show why judgement ought not be given to the Plaintiff in all the circumstances. Mr Coveney submitted that as no affidavit evidence was placed before the court for its consideration by the Defendant discharging that evidentiary onus, it follows that judgement ought to be entered in the Plaintiff’s favour.

10. [10]
    Mr Coveney referred the court to case authorities which supports the proposition that once a prima facie entitlement arises, it is not sufficient for a respondent to simply plead an allegation which, if proved, would afford a defence or for a Defendant to make a mere assertion of a positive defence: Clyde Contractors Pty Ltd t/as Clyde Constructions v Northern Beaches Developments Pty Ltd [2001] QCA 314 and Min Lung Pty Ltd v Moonace Pty Ltd & Ors [2007] QDC 146.

11. [11]
    Each of those cases however specifically dealt with particular factual situations, neither of which arose here. In Clyde Contractors P/L, the Defendant, amongst other things, had simply denied that an amount was owing to a Plaintiff in his defence but had not provided any basis for that denial as alleged at all in the relevant pleading (paragraph [4]). In the latter case, the Defendant had simply made a bald allegation in its defence which was neither particularised or the subject of any counterclaim, which the court noted ought to have properly been done to support the allegation which had been made. (paragraph [15] and [16]).

12. [12]
    Even it if is accepted that an evidentiary onus shifts to a Defendant in circumstances where the Plaintiff has established a prima facie entitlement to judgement, the difficulty that faces the Plaintiff in this case is that the defence which has been filed has sufficiently particularised with the details of those matters which the Defendant seeks to rely upon at the trial of this matter, which on any view of it, goes directly to the heart of the issues yet to be determined between the parties. Those issues include the proper construction of the wording contained in the document headed Credit Application, whether or not that document incorporated a personal guarantee given by the Defendant and the extent of any liability (if any) arising under that guarantee.

13. [13]
    In his defence, the defendant has pleaded that the document which he was asked to fill out and sign by a representative of the Plaintiff on the 18^th April 2006 was in respect of an application for credit only, which he had then signed on behalf of AB Waterproofing P/L as its’ representative. He denies that the application for credit which he has signed in that capacity also incorporated a guarantee from him personally that he would be become liable for any monies that may subsequently became due and payable to the Plaintiff upon default by AB Waterproofing P/L under its’ credit  terms arrangement with the Plaintiff.

14. [14]
    The resolution of whether the Defendant signed the document as a representative of AB Waterproofing P/L in respect of the credit application only or whether he also signed a guarantee personally guaranteeing the debts of AB Waterproofing P/L is, in my mind, a matter that may only be ultimately resolved at trial.

15. [15]
    Additionally, the Defendant has pleaded in his Defence that even if that document was found to be a ‘guarantee’ by him, the credit limit provided to AB Waterproofing P/L under that arrangement was limited to $10 000. That limit was subsequently confirmed by correspondence dated the 26 April 2006 (Tab 7 Ex 2) sent by the Plaintiff to the Defendant to that effect. Further, there is a notation “Ok $10,000 20/4/06” that appears on the bottom of the Credit Application document, which is yet to be resolved as to its’ true effect and meaning. Those matters are significant insofar as the amount that is currently sought by summary judgement by the Plaintiff is in the order of $60,000. No evidence was placed before this court regarding any agreement which was reached between the parties in respect of any alleged ‘variation’ of the initial credit limit of $10,000 agreed to. In that regard, Mr Coveney argues that the terms of the document headed ‘Credit Application’ (Tab 8 of Ex 2) particularly the last line of the first paragraph of the fine print on that document, is sufficiently wide enough to incorporate any such variation of the credit limit without the need for any evidence of agreement from the parties.

16. [16]
    Mr Coveney also argued, in further written submissions which he provided to the court for its’ consideration at p 3 paragraph 7 to 14, that where a surety contracts, as in this case, to be a principal debtor, then he (the Defendant) has contracted out of his right to be discharged from liability if the principal contract (guarantee) is subsequently varied. Additionally, Mr Coveney argues that the guarantee given by the Defendant was a ‘continuing guarantee’ in any event, having regard to the wording as stated in the relevant document, and as such, any limit on liability, in the absence of any specific provision to the contrary, ought to be construed as ‘unlimited’. Mr Coveney referred to certain case authorities in support of those submissions, in particular Fletcher Organisation Pty Ltd v Crocus Investments Pty Ltd [1988] 2 Qd R 517; Coles v Pack (1869) LR 5 CP 65.

17. [17]
    Those submissions however seem to me to simply confirm that it is for a court to examine any relevant document and its’ wording in order that a proper construction might be made by it regarding its’ true effect and meaning. As discussed by Moynihan J in Bridgestone Australia Limited v G.A.H. Engineering Pty Ltd [1997] 2 Qd R 145 at page 158 (which distinguished Fletcher v Crocus), whether or not a clause in a guarantee is construed as making provision for a variation in the arrangements between a principal debtor and a creditor, is ultimately a matter for the court to determine. As such, I am satisfied that there is a need for a trial on this issue regarding the proper construction of the clauses contained in the document sought to be relied upon by the Plaintiff in light of the terms in which the wording has been expressed.

18. [18]
    At page 2, paragraph 5 of the further written submissions provided, Mr Coveney has helpfully set out relevant extracts from The Modern Contract of Guarantee (2^nd ed 1992) pp 17 -19. Those extracts in my mind however merely confirm to me that when determining whether a contract is in the nature of a guarantee, the court will be required to look to a variety of factors, but not limited to, the surrounding circumstances present at the time the instrument was executed in order to determine the true intention of the parties at the time when the arrangement was made in order to ascertain the true nature of the arrangement made between them. In this regard, Mr Coveney submits that the wording of the ‘Credit Application’ document is clear and unambiguous insofar as its’ incorporation of a personal guarantee, and as such, there is no issue to be tried between the parties on this point. That submission in my mind however overlooks the defence which has been particularised at paragraph 5, 6 and 7. Whether the Defendant’s evidence relating to those matters as pleaded will ultimately be accepted at the trial of this matter is yet to be determined by the trial judge.

19. [19]
    Mr Coveney also referred to the documentation issued by the parties (Order requests and Invoices – see ED 04 and ED05” of Mr Dettrick’s affidavit, in support of his submission that the court could be satisfied that AB Waterproofing P/L (as it appears in the ‘Credit Application’ document) is the same entity as All Building Waterproofing Pty Ltd (the entity upon which the Statement of Claim (as amended) is based). While the submissions made by Mr Coveney on this issue certainly hold some attraction, in light of the fact that I am already satisfied that there are issues to be tried as between the parties, it is not necessary for this court to resolve this point at this stage.

20. [20]
    Accordingly, the application for summary judgement is dismissed.

Costs

21. [21]
    Rule 299(1) of the Uniform Civil Procedure Rules 1999 allows for costs to be ordered against an unsuccessful party applying for summary judgement in certain circumstances. After careful consideration, I am not persuaded that the Plaintiff was or ought to have been reasonably aware that the Defendant would rely on a point that would have entitled him to have the application dismissed. As such, I consider that the appropriate order in respect of this matter should be Costs in the Cause and I make that order.