National Australia Bank Limited v Dionys as Trustee for the Angel Family Trust

[2016] NSWCA 242

NSW Court of Appeal

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Interrogate

Catchwords

1. Contract
2. › Formation
3. › Time of contract formation
4. › Agreement between bank and customer to open account
5. › Whether contract concluded upon signing authority card or upon receipt of printed terms and conditions booklet
6. › Whether terms in unsigned booklet incorporated into contract formed before booklet provided
1. Contract
2. › Terms
3. › Incorporation of terms in unsigned documents
4. › Limiting or exclusion clauses
5. › Whether steps reasonably necessary to bring unusual or onerous clause to customer's attention
6. › Ticket cases
7. › 71-page booklet of banking terms and conditions
1. Banking and Finance
2. › Banker and customer relationship
3. › Duties of customer
4. › Clause requiring prompt review of statements and notification of unauthorised transactions
5. › Whether clause a 'limiting term'
6. › Burden of proof on bank to establish incorporation of limiting term
1. Agency
2. › Ratification
3. › Ratification by silence or acquiescence
4. › Whether customer ratified unauthorised withdrawals from bank account
5. › Whether conduct unequivocal
6. › Whether principal had full knowledge of material circumstances

Quick Take

A banking contract may be concluded when the customer signs the authority card, before receiving the bank's printed terms and conditions booklet, with the consequence that terms in the booklet are not incorporated into the contract. Even if the booklet is provided before contract formation, a bank must take steps reasonably necessary to bring unusual or onerous limiting clauses to the customer's attention; merely handing over a 71-page booklet is insufficient. The burden of proving incorporation of a limiting term falls on the party seeking to rely on it.