[1996] 2 VR 553
DOHERTY v MURPHY
SUPREME COURT OF VICTORIA APPEAL DIVISION
TADGELL, NATHAN and HANSEN JJ
6, 7 December 1994, 24 March 1995
Appeal — Appeal on point not raised below — Discretion to allow argument on
new point — Appeal from summary judgment — Extension of time to bring appeal
granted — New point based on evidence received below.
The appellants were guarantors of a loan from the trustee of a trust to a
company, which defaulted on the loan and was subsequently deregistered. The
respondents replaced the lender as trustees and sued the guarantors. Their
application for summary judgment was refused by a master but an appeal to a
judge succeeded and summary judgment was given. The guarantors obtained leave
to extend the time for bringing an appeal from the judge's decision. On
appeal, the guarantors sought to rely on arguments of equitable set-off
arising from the lender's alleged promise to provide a drawdown of funds to
the borrower and subsequent failure to do so. The arguments were not made
below. Three of these arguments were based on evidence received below but a
fourth was based on new evidence.
HELD, allowing the appeal: (1) A party was bound by the conduct of his case
and could not raise on appeal an issue not litigated below if that would
disturb the settled pattern of litigation. But an appeal court had a
discretion to permit a new point to be argued, to be exercised in the light
of all the relevant circumstances. In this case, the court should permit the
appellants to rely on those arguments not made below but based on evidence
received below because the appeal was from a summary judgment and an
extension of time to appeal had been granted.
Wickstead v Browne (1992) 30 NSWLR 1, followed.
University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481; Coulton v
Holcombe (1986) 162 CLR 1, distinguished.
(2) Notwithstanding a clause in the guarantee exempting the lender from
liability for the exercise or failure to exercise a discretion, the
guarantors' claim for equitable set-off based on the lender's failure to
provide the drawdown raised an arguable defence against the trustees,
provided the borrower company was joined as a defendant.
Murphy v Zamonex Pty Ltd (1993) 31 NSWLR, 439, followed.
Decision of Gobbo J (unreported, 9 March 1993) reversed.
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[1996] 2 VR 553
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