(Supreme Court of Victoria) A company (‘Castley Brothers’) in a group was in financial difficulties, and ten other companies in the group, one of which was A and K Holdings, executed a deed of guarantee which was expressed to be in favour of unsecured creditors of it. No unsecured creditors of Castley Brothers were parties to the deed, nor was an attempt made to establish a trustee for unsecured creditors and to join it as a party to the deed. Later a creditor of Castley Brothers sought to enforce the guarantee against A and K Holdings by petitioning for that company to be wound up. It was argued in opposition to the petition that the deed was ineffective, because it was addressed to no-one, nor could any intended beneficiary of the deed have been identified at the date when it was made.
Held: The guarantee was enforceable by a creditor of Castley Brothers directly against A and K Holdings. The deed took effect as ‘an immediately operative deed poll – a unilateral document made by each of the ten guarantor companies – but not intended to be executed by any other party’.
Judges:
Sholl J
Citations:
[1964] VR 257
Jurisdiction:
Australia
Cited by:
Cited – Moody and Another v Condor Insurance Ltd and Another ChD 3-Feb-2006
The claimants sought to enforce a deed of guarantee. The defendants argued that the claimant had no entitlement to enforce the deed, not being parties to it, and that they would be able to set aside the deed as against the company whose debts they . .
Lists of cited by and citing cases may be incomplete.
Contract
Updated: 10 May 2022; Ref: scu.238872
