Challenger Managed Investments v Samardic [2010] NSWSC 908

In this case, the directors of a property development company guaranteed an $8 million loan for the purposes of refinancing an existing construction loan. The loan fell into arrears, a receiver was appointed, and after the security was sold there was a shortfall of $3.7 million. One director filed a spurious defence by himself and did not show up to trial, the other filed a comprehensive defence through lawyers but then announced he was not going to fight on. The judge gave the opinion that, “the case ought to be a salutary reminder to all parties, and members of the legal profession,” that delaying tactics would not be tolerated. However, despite noting he had the power to make orders against the solicitors His Honour did not do so meaning that there is nothing salutary at all about the decision that will deter lawyers in the future from assisting borrowers to delay the inevitable.

Click here to read the full judgment

Scroll to Top