Toyota Finance Australia Ltd v State Corporation Pty Ltd

Background

1. The background to the present application was set out in my last judgment in the matter. By amended statement of claim filed on 3 April 2020 the plaintiff pleaded reliance on a Master Fleet Facility Agreement entered into with a company now in liquidation, PJM Fleet Management Pty Ltd (PJM Fleet Management). The plaintiff sued on a large number of finance agreements that were entered into pursuant to the terms of the Master Fleet Facility Agreement.
2. The claim against Ms Murphy is a claim brought against her in her capacity as a guarantor of PJM Fleet Management's obligations; and as an indemnifier of the plaintiff.
3. Pursuant to cl 39.1 of the Master Fleet Facility Agreement, Ms Murphy unconditionally and irrevocably guaranteed to the punctual payment to the plaintiff of moneys due from PJM Fleet Management. Pursuant to cl 39.2 of the Master Fleet Facility Agreement, Ms Murphy indemnified the plaintiff against all loss the plaintiff might suffer or incur as a result if for any reason it was unable to recover the guaranteed money from PJM Fleet Management or Ms Murphy under the guarantee clause, or if it was not paid to the plaintiff for any reason.
4. The terms "guaranteed money" and "loss" are defined in cl 1 of the Master Fleet Facility Agreement, as is the reference to "transaction documents".
5. Pursuant to the Master Fleet Facility Agreement, there is provision for what might be called a "sufficient evidence certificate" to be issued. It is principally upon a sufficient evidence certificate in this case that the plaintiff now relies for the assessment of damages.
6. Clause 36.4 of the Master Fleet Facility Agreement provides as follows: A certificate, statement or report given by or on behalf of [Toyota Finance] about any amount, interest rate or matter relating to a Transaction Document is sufficient evidence of the matters certified unless the contrary is proved.
7. Insofar as reliance is placed on the sufficient evidence certificate, reference is made by the plaintiff to what was said by the High Court in Dobbs v The National Bank of Australasia Limited (1935) 53 CLR 643; [1935] HCA 49 (Dobbs) in relation to "conclusive evidence" certificates; and in Permanent Trustee Company Limited v Gulf Import and Export Company [2008] VSC 162 (Permanent Trustee), which was in the context of a "sufficient evidence" certificate.
8. In Dobbs, the High Court said at 651: The eighth clause is as follows:-'A certificate signed by the manager or acting manager for the time being of your head office or of any other office of your bank at which the banking account of the customer shall for the time being be kept stating the balance of principal and interest due to you by the customer shall be conclusive evidence of the indebtedness at such date of the customer to you.' This clause does not purport to impose upon the bank the necessity of obtaining the certificate it describes. It is not a qualification of the undertaking to pay contained in the first clause. It does not make a certificate a condition precedent to recovery. The promise remains a promise to pay the amount owing; it does not become a promise to pay the amount owing if certified or a promise to pay only what is certified as owing. The bank could recover without the production of a certificate if, by ordinary legal evidence, it proved the actual indebtedness of the customer. But the clause, if valid, enables the bank by producing a certificate to dispense with such proof. It means that, for the purpose of fixing the liability' of a surety, the customer's indebtedness may be ascertained conclusively by a certificate.
9. In Permanent Trustee the Court said at [85]: The clause in Dobbs was different from that in the present case, in that it made the certificate 'conclusive evidence of indebtedness' whereas cl 18.1 merely states that the certificate is 'sufficient evidence' of the matter or sum stated in the certificate 'unless the matter or sum is proved to be false'. Nevertheless, it is clear from Dobbs that cl 18.1 should be read, and given effect, in accordance with its terms. The object of cl 18.1 was to provide a means by which the plaintiff could, by tendering a certificate, establish both the legal existence and amount of the guarantors' debt, unless it is proved that the matter or sum referred to in the certificate is false.
10. Reference is also made to the decision of the Victorian Supreme Court in Bank of Western Australia Ltd v Abdul [2012] VSC 222 at [27]: Consequently, I am of the opinion that when the certificates clauses are construed in light of these interrelated provisions in the security documents, it is clear that the parties intended to provide for Bankwest issuing certificates of an amount payable which would take into account the realisation proceeds actually remitted to Bankwest from the receivers and managers, and, it must follow, the costs and expenses of receivership. These costs and expenses are deducted from the proceeds of realising the securities in the accounts of the receivers and managers and never become part of the moneys remitted to Bankwest, being the realisation proceeds. Thus, the certificates certify the amounts paid by Bankwest to the defendants to each of the Abdul Companies, plus accrued interest, less money that has actually been received by Bankwest, being repayments by these companies by their agents, the receivers and managers. Accordingly, the certificates are sufficient evidence of the amount payable by the defendants.
11. There is evidence (see annexure A to the affidavit sworn on 18 November 2020 by Geoff Noble) that on 11 November 2020 the plaintiff issued a sufficient evidence certificate, bearing that date; which was expressed to be pursuant to cl 36.4 of the Master Facility Agreement, certifying the amount due by PJM Fleet Management, and for which PJM Fleet Management and Ms Murphy were liable to Toyota as being $5,239,431.60, as at the date of the certificate. Mr Lee has deposed to the circumstances in which, on 13 and 16 November 2020, the certificate was served on Ms Murphy, and payment of the amount in the certificate was demanded. There is also evidence (see annexure B to the affidavit of Mr Lee sworn 18 November 2020) that on 16 November 2020 Ms Murphy by email acknowledged receipt of the certificate.
12. Toyota Finance submits, and I accept, that by reason of the issue of the certificate the Court need not otherwise be satisfied in the usual way in relation to the quantum of damages; but Toyota Finance submits that in any event that there is more than sufficient evidence that justifies the amounts claimed by reference to the extensive material filed on the previous occasion (see the exhibits tendered on that occasion).
13. It is submitted (and I accept) that, by reference to: the existence of the sufficient evidence certificate, the amount there certified, the acknowledgement of receipt by Ms Murphy of the sufficient evidence certificate, and the lack of any dispute by Ms Murphy on this application in relation to the amount claimed, Toyota Finance has established both the legal existence and the amount of Ms Murphy's debt.
14. It is noted, as I have said earlier, that Ms Murphy in these proceedings has not sought to dispute the existence or amount of the debt.
15. I accept that, pursuant to cl 39.1 of the Master Fleet Facility Agreement, Ms Murphy unconditionally and irrevocably guaranteed to Toyota Finance payment of the guaranteed money and that the amount of the guaranteed money has been certified in the certificate in the sum of $5,239,431.60. In those circumstances it is appropriate that I make the orders sought by the plaintiff, namely: 1. Order that damages be assessed in the amount of $5,239,431.60 and that judgment be entered for that sum in favour of the plaintiff against the second defendant. 2. Order the second defendant to pay the plaintiff's costs of the application for assessment of damages.

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