Signed on the dotted line? Proving execution of personal guarantees

This week's TGIF considers Singh v De Castro [2017] NSWCA 241, where the New South Wales Court of Appeal held that five directors of an insolvent corporate borrower had executed and were bound by personal guarantees.

BACKGROUND

The decision was an appeal from a decision of the District Court of New South Wales finding that five directors of an insolvent corporate borrower had executed and were bound by personal guarantees.

The lenders, a husband and wife, advanced $300,000 to a business providing education services. When the company defaulted and the guarantors refused to pay, the lenders commenced proceedings.

The lenders tendered a copy of the brief five-page loan agreement. On its face, the agreement contained clear guarantee provisions, it identified each of the alleged guarantors by name, and it appeared to be signed by each the guarantors.