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Tutorial 1: History and Nature of Equity, and Undue influence and unconscionable dealing This tutorial has two components. We will first discuss the case of

Tutorial 1: History and Nature of Equity, and Undue influence and unconscionable dealing

This tutorial has two components.

We will first discuss the case of Harris v Digital Pulse (2003) 56 NSWLR 298, to clarify the distinction between common law and equitable claims and remedies, and to better understand the debate about the role of Equity in our contemporary legal system.

Come to the tutorial prepared to discuss these questions:

  • Explain the decision of Palmer J at first instance that the appellants (the former employees) were appealing in Harris v Digital Pulse.
  • Why did Spigelman CJ find that the appeal should be allowed?
  • Why did Mason P find that the appeal should be dismissed?
  • What do you understand by the concept 'fusion fallacy' from these judgments?
  • Which of the three different views of Equity's capacity for evolution (expressed in the reasons of Spigelman CJ, Mason P, and Heydon JA) do you find most persuasive?

We will then clarify our understanding of the topics of Undue Influence and Unconscionable Dealing by considering a hypothetical problem. Consider the following facts, and frame advice for Anna. Remember to identify the authorities that assist you in explaining the principles to be applied, and the appropriate remedies. Remember too that there may be more than one way to resolve this problem.

Facts:

In June 2021 Marco visited his mother at her Earlwood home and asked her to guarantee a bank loan that he wanted to take out for his video business. Marco was always telling his parents "how well the business was doing", and they were very proud of him. Marco assured his mother that that the guarantee "would only be for six months and that his business debts would not exceed $40,000". Anna wanted to help her son and accepted his request. The following week, Marco brought home the bank's loan manager and a bank guarantee form for Anna to sign.

Anna does not speak or read English well; therefore, she relied upon Marco to briefly explain the relevant guarantee forms to her. The bank manager introduced himself to Anna, did not engage in any other discussion with Anna at the time. Anna proceeded to sign the documents in front of the bank's loans manager, believing the loan was a "short term loan limited to $40,000". In fact, the bank guarantee was unlimited and secured "all debts" of Marco's business against the Earlwood family property.

By January 2022, Marco had not made several of the required repayments under the loan. Therefore, the lender bank is now moving to sell the Earlwood house in order to pay Marco's accumulated debts of $750,000.

Advise Anna.

It's a bit urgent, many thanks

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