Dunwoodie v Teachers Mutual Bank Ltd

[2014] NSWCA 24

NSW Court of Appeal

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Interrogate

Catchwords

1. Practice and Procedure
2. › Default judgment
3. › Setting aside default judgment
4. › Principles governing exercise of discretion
5. › Whether applicant has bona fide arguable defence
6. › Whether delay warrants refusal
7. › Uniform Civil Procedure Rules 2005 (NSW), r 36.16(2)(a)
1. Contract
2. › Account stated
3. › Nature of account stated
4. › Whether account stated can found cause of action where underlying transaction void
5. › Whether entries procured by fraud or duress vitiate account stated
1. Contract
2. › Vitiating factors
3. › Duress
4. › Third party duress
5. › Whether duress by third party can be relied on to avoid contract where other party had no knowledge of duress
1. Contract
2. › Vitiating factors
3. › Fraud
4. › Third party fraud
5. › Whether fraud by third party avoids contract as against innocent party

Quick Take

A bank's policy permitting unlimited drawdowns against uncleared cheques without enquiry may be arguable as an unjust contract under s 7 of the Contracts Review Act 1980 (NSW), even where the customer's loss was caused by third party criminal conduct facilitated by the policy. Third party duress (where the contracting party had no knowledge of the duress) cannot found a common law defence to avoid a contract. The question of whether such a banking policy is in fact unjust was left open for determination at trial.