The appeal
31The plaintiff's summons in this court identified three grounds of appeal. They each referred to various findings of the presiding Magistrate, and then asserted they were "contrary to law". It is far from obvious that they do raise questions of law. It is also unclear how those grounds relate to the submissions. In any case the focus of the appeal was on the matters raised in the written submissions.
32The first matter complained of concerned the finding that I have set out above (at [21]) in relation to the authority of William Creswick. Various points were raised which are not necessary to address. Allowing some latitude to the plaintiffs in this court, in my view it must follow from the observation I have made earlier that his Honour's finding, that the signature of William Creswick on that part of the document entitled "Credit Application (cont)" bound T2 Projects, was erroneous in law. As I have stated, the only indication on that document was that William Creswick was signing as a director. It was not stated either expressly or impliedly in that document that he was the sole director and sole company secretary.
33This conclusion leaves remaining the primary basis upon which Coast RV contended before the Local Court that T2 Projects became bound, namely by the affixing of John Creswick's signature to the document entitled "Credit Application/Declaration" in circumstances where he was the sole director and sole company secretary of T2 Projects. As I have stated, his Honour appears to have assumed or accepted that John Creswick did have authority to bind T2 Projects, and I will do likewise. Even if his Honour had not so found, it would not matter, because, given John Creswick's signature and position, no other conclusion was open as a matter of law.
34 Nevertheless, William and John Creswick contend that his signature on that document does not mean that Coast RV became bound for two reasons. The first reason is that, according to his Honour's findings, the declaration was signed after an account was opened. In my view, irrespective of whether that submission raises a question of law, fact or mixed law and fact, it has no substance.
35As appears to have been pointed out by his Honour in the passage extracted above (at [27]), the critical point is that the supply of credit the subject of the claim for recovery, took place years after these events. Although it is unclear, it appears that his Honour found that, in those circumstances, the fact that the account was identified as having been opened the day before John Creswick affixed his signature to the declaration was irrelevant. In my view, if that is what his Honour found, then his Honour was correct to so find. Even if that is not the proper construction of his Honour's finding, then, as a matter of law his Honour was bound to find that. From the date the declaration was provided by someone with the authority to bind T2 Projects, namely John Creswick, T2 Projects became bound by its terms.
36Second, it was submitted that the declaration did not operate to constitute an execution of the contract for the provision of goods upon credit. Instead it was submitted that only a proper execution of the credit application form (ie the form entitled "Credit Application Form (cont)") constituted execution. This argument appears to have been only raised obliquely in reply before the Local Court. It was not expressly pleaded. However, it does not appear that his Honour specifically addressed an argument in those terms. That is a matter to which I will return. In any event, as a matter of law I do not think it is correct.
37What is apparent from his Honour's findings of fact is that on 14 December 2006 the three pieces of paper that I have referred to were provided to Coast RV. They are all to be considered together. They included a document entitled "Credit Application/Declaration" which was on any view validly executed on behalf of T2 Projects. As stated, that document includes a number of warranties, acceptances, acknowledgments and agreements. Even if the "proper place" for signature of the credit application was at the bottom of the document entitled "Credit Application Form (cont)", nevertheless, objectively considered, the provision of that document, together with a document entitled "Credit Application/ Declaration" validly executed on behalf of T2 Projects, would as a matter of law bind T2 Projects.
38Under the heading "The Guarantees are Unenforceable" John and William Creswick's written submissions raise two further matters which they contend result in the avoidance by them of their obligations under their guarantee. The first submission contends that their guarantee was not supported by any proper consideration but instead was only supported by past consideration, as the "account" was opened by Coast RV on the day prior to the execution of the guarantee by them. The written submissions assert this argument was raised before his Honour, but I am not persuaded that this is so. It was certainly not raised on the pleadings. In any event the argument has no force.
39The terms of the guarantee recited that the consideration for the entering into of the guarantee was Coast RV "granting credit" to T2 Projects (see [9]). As at the date of the guarantee it is unlikely that any "credit", that is financial accommodation, had been granted. In any event, it is clear that after the date of the guarantee "credit" was granted in that Coast RV did not insist upon immediate payment by T2 Projects when the relevant goods in question were delivered. Hence, properly analysed, at least not all of the consideration for the entering into of the guarantee had already been provided by the time it had been executed.
40Secondly the written submissions contended that the guarantees were discharged because the original credit limit listed in the document entitled "Credit Application Form (cont)" faxed on 17 November 2006 was $4,000, whereas it is clear that credit in excess of $21,000 was provided.
41It was submitted that the increase amounted to conduct on the part of the creditor that materially altered the guarantor's rights so as to cause the discharge of the contract of guarantee (citing Ankar Pty Ltd v National Westminster Finance (Australia) Ltd [1987] HCA 15; 162 CLR 549 at 559). This point was not raised before the Local Court. There are formidable difficulties in asserting that a question of law arises from a Local Court judgment when the point in question was never taken below. At the very least it is fatal to any such contention if the relevant point could or would have been met by evidence (see Suttor v Gundowda Pty Ltd (1950) 81 CLR 418). On any view this point, if it had been taken, could have been met by evidence that indicated that either or both of William and John Creswick were aware that a greater amount of credit was being provided and approved of it.
42Otherwise there are two points that seem to me, without deciding, to make this proposition very difficult. The first is that it is by no means clear that the credit limit indicated in the office use only section of the "Credit Application Form (cont)" was a term of either the guarantee or of the principal debt. Secondly, it seems to me at least arguable that that part of the guarantee which states that the "[l]iability under it shall not be affected by granting time or any other indulgence" would appear to accommodate an increase in the amount of credit provided to the principal debtor.
43It suffices to state that I am not persuaded that any question of law wrongly decided by the presiding Magistrate is raised by this ground or any other ground.
44In oral submissions counsel for John and William Creswick, Mr Le Plastrier, submitted that his Honour's judgment gave an inadequate explanation for the basis of his Honour's decision. I will pass over the fact that this contention was not raised either in his clients' summons or in his written submissions. It has been accepted that an established complaint of a failure by a Magistrate to give adequate reasons is capable of being agitated on an appeal under s 39(1) of the Local Court Act (see for example ECS Services Pty Ltd v DGA Holdings Pty Ltd [2013] NSWSC 869). Further, it is obvious from what I have already stated that I have considerable misgivings about the adequacy of his Honour's reasons. However, ultimately I am satisfied that the findings that his Honour made about the "second set of documents", and the factual finding that the goods were delivered and not paid for, is just sufficient to disclose an adequate basis of reasoning to support the verdict.
45One particular complaint made in respect to his Honour's reasons is that the submission made concerning whether the execution of the declaration by John Creswick was not sufficient to constitute execution by T2 Projects of the credit application was not addressed. However, this argument was only raised in oral submissions in reply. It was not the subject of any express pleading. The authorities do not establish that his Honour was obliged to address every single matter that may have been tangentially raised.
46Further, and perhaps more controversially, even if the matter had been raised clearly but not addressed, I would not have granted relief to the plaintiffs. Such a complaint, if it had been established, would have merely demonstrated that the reasons were inadequate in exposing his Honour's reasoning on a matter of law as opposed to a matter of fact. Once his Honour found as a matter of fact that the goods were ordered and not paid for in 2011, and that the declaration was signed by John Creswick in circumstances where it was common ground that he was the sole director and sole company secretary, then in my view as a matter of law the liability of John Creswick and William Creswick had to follow.
47In those circumstances, even if it had been established that his Honour's reasons were inadequate, I would have refused the relief sought. The importance of Magistrates providing proper reasons for their decisions cannot be overstated. However, the underlying policy reasons for them to do so can, at least in some circumstances, be addressed when this Court considers the matter on appeal. The most obvious circumstance in which that will occur is where the Magistrate's reasons fail to properly disclose adequate reasoning on a question of law as that is a matter which this Court can nevertheless fully consider and explain. If this particular complaint about his Honour's reasons had been established, in my view this Court's explanation of why John and William Creswick's liability nevertheless followed would meet the need for proper reasons to be provided.