What does it mean to ‘ratify’ an agent’s breach of authority? And what might the consequences of ratification be for the principal, including in terms of the principal’s ability to later litigate a related claim? This case note explores those issues in light of the New South Wales Supreme Court decision in Shao v Crown Global Capital Pty Ltd [2023] NSWSC 820.

The Victorian Supreme Court has recently clarified an area of law otherwise ‘not highly defined or clearly stated’: the equitable doctrine of ‘marshalling by apportionment’. In the case of Callisi Pty Ltd v Sterling & Freeman Advisory Pty Ltd [2023] VSC 300, M Osborne J addressed competing arguments regarding the application of the rule of equity capable of impacting the ability of a first-ranking secured interest-holder to realise its security across multiple assets.

The Full Court of the Federal Court has ruled on the question of whether or not a person seeking to trace money or property must first establish the existence of a fiduciary relationship. In analysing the divergent views evident in a number of cases, the Court in RnD Funding Pty Ltd v Roncane Pty Ltd [2023] FCAFC 28 unanimously held that a fiduciary relationship is not a precondition.

Typically, a plaintiff suing for breach of trust or breach of fiduciary duty must elect between different and inconsistent equitable remedies: either equitable compensation or an account of profits. The New South Wales Court of Appeal has considered the question of whether a plaintiff can overcome this need for choice when suing multiple defendants, and the Court’s decision in Xiao v BCEG International (Australia) Pty Ltd [2023] NSWCA 48 sets out the guiding principles for when a plaintiff may make a ‘split election’.

In the case of Pugwall Pty Ltd v Arthur McKenzie Investments Pty Ltd [2022] VSCA 272, the Court of Appeal ruled on the question of whether a director of a company, in signing a guarantee on the company’s behalf, was personally bound by that guarantee. More broadly, the Court considered the question of whether, and in what circumstances, a person objectively has intended to be bound by a contract even if — and the Court’s decision serves as a potent reminder of this — that person may not (subjectively) have intended so.

The decision in Break Fast Investments Pty Ltd v Sclavenitis [2022] VSC 288 involved a plaintiff, as corporate trustee in liquidation, claiming to be assignee of a right to recover a debt paid for by a guarantor and seeking to enforce that right. In ruling on the question of whether or not the plaintiff had standing to bring its action, the Court addressed the law governing the power of a former trustee as bare trustee to deal with trust assets and the powers of a liquidator of a bare trustee in similar respects.

Stubbings v Jams 2 Pty Ltd [2022] HCA 6, a case involving asset-based lending, a finding of unconscionable conduct at trial, a reversal on intermediate appeal and, ultimately, a decision by the High Court to uphold the trial judgment, provides some valuable lessons for those involved in consumer lending. The case also features a number of clear developments in the law of unconscionable conduct, even if incremental, which are capable of applying to a variety of situations.

In a case where a purchaser sought to terminate a contract for the sale of land and recover a deposit paid, the Court of Appeal in Willis v Crosland [2021] VSCA 320 has construed what it means to be ‘in default’ under a particular type of standard form contract. The Court also has set out clearly the interaction between two key doctrines of contract law: repudiation and termination for breach. These are principles of relevance not only to conveyancing matters but also to contractual disputes generally.

The dispute in Kennedy v Proctor [2021] VSC 521 involved, at its heart, a simple question: had a competition horse, purchased by one friend for another and claimed to have been a gift, in fact been a gift? Of greater significance to appellate practice, however, the case demonstrates the difficulty in seeking to overturn a court’s decision on grounds of its assessment of trial evidence. The decision is illustrative, therefore, of the tasks parties face either in prosecuting or in defending against such an appeal.

Harris v Harris [2021] VSCA 138 involved a claim of proprietary estoppel arising from a series of promises made by a father to bestow land on his sons. The issues on appeal focused on whether the trial judge’s decision to declare a promisee’s entitlement to inherit the land was disproportionate in satisfying the requirements of conscientious conduct. In answering that question, the Court of Appeal identified and applied a number of key principles guiding the award of remedies for proprietary estoppel.

The case of Baba v Sheehan [2021] NSWCA 58 involved a challenge to the validity of an exercise of power of removal and appointment of a trustee. In dismissing a claim that the power had been exercised for a foreign or extraneous purpose, the New South Wales Court of Appeal has provided guidance on the scope of trust powers and the importance of intention and good faith when ascertaining the validity of the exercise of a power.

The Australian Consumer Law contains provisions prohibiting unconscionable conduct in the course of trade or commerce. Chief amongst those are sections 20 and 21. In Good Living Company Pty Ltd as trustee for the Warren Duncan Trust No 3 v Kingsmede Pty Ltd (Good Living Company) [2021] FCAFC 33, the Full Court of the Federal Court described not only the principles relating to unconscionable conduct generally but also the different approaches to determining contraventions of sections 20 and 21.