Smurfs Childcare Centre -v- CBA [2013] WASC 49

The bank loaned to a child care operator. The operator was put into voluntary liquidation and the bank sued on the guarantees.

The guarantors denied liability alleging the liquidator represented that the liability of the guarantors would be paid out in full if the liquidator sold the businesses. The guarantors argued the representation constituted misleading and deceptive conduct and unconscionable conduct. They also claimed the bank was liable for the conduct of the liquidator.

The court found that the guarantors had failed to plead the necessary elements or factual basis of the various causes of action, which made the pleading embarrassing. The court struck out all causes of action pleaded in the statement of claim, which also formed the basis of their defence, apart from their claim for fees due under the fee agreement reached with the liquidator. The court gave the guarantors an opportunity to replead.

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