George 218 Pty Ltd V Bank Of Queensland Ltd Essay

George 218 Pty Ltd v Bank of Queensland Ltd [2015] WASC 434; BC201511125 This decision was handed down on 16 November 2015 by Mitchell J. Facts of the case In this case, Success Assets Pty Ltd (Success) borrowed money from Statewest Credit Society Ltd (Statewest) to purchase land, and the land was mortgaged as security. The plaintiff entered into a guarantee in favour of Statewest which secured the loan and all future loans from Statewest to Success. Success used money borrowed from Home Building Society Ltd (Home) to pay the loan from Statewest. Statewest’s rights under the guarantee (which includes those relating to future loans) and Home’s rights under the were transferred to the defendant, Bank of Queensland (BOQ). BOQ then agreed to lend Success money to pay out its existing facilities secured by mortgages over properties, and the plaintiffs signed a deed of consent where the parties agreed that the guarantees originally provided to Statewest operated in respect of the BOQ loan. Success defaulted on the BOQ loan. The mortgage property was sold, with a shortfall of over $2,000,000. The plaintiffs commenced proceedings, and (among other things) sought a declaration that the defendant was not entitled to payment under guarantees. Practical lessons from this decision 1. The Code of Banking Practice (COBP) only applies to guarantees by individuals. As such, the COBP could not apply in this case as the guarantor was not an individual. 2. The COBP is incorporated into the