Federal Court of Australia

Ramoo v Grow Trade Finance Pty Ltd [2026] FCA 286

ORDERS

THE COURT DECLARES THAT:

1.    The personal guarantee provided by Ms Rani Ramoo to Grow Trade Finance Pty Ltd (Formerly Grow Business Funding Pty Ltd) (ACN 602 951 342) (Grow Trade) pursuant to the Trade Finance Facility Agreement entered in February 2019, as amended by the Letter of Variation dated 26 September 2022 (Agreement) has not been discharged.

2.    Section 123 of the Personal Property Securities Act 2009 (Cth) operates such that Grow Trade (whether directly or by any agent or by any receiver appointed under clause 13(c) of the Agreement) may seize the personal property of Ms Ramoo:

(a)    in the exercise of rights conferred by the Agreement construed in accordance with the reasons for judgment published today; and

(b)    in any event, by any method permitted by the law, including any method authorised by an order of the Court.

3.    For the purposes of paragraph 2 the persons presently appointed as receivers are Mr Richard Albarran and Mr Brent Trevor-Alex Kijurna.

THE COURT ORDERS THAT:

1.    The applicant’s originating application filed 5 March 2025 is dismissed.

2.    The respondents’ cross-claim filed 25 July 2025 is allowed to the extent provided for in the Declarations.

3.    For the purpose of paragraph 2(b) of the Declarations the parties have liberty to apply to re-open this proceeding for the purpose of seeking an order authorising a method of seizure (or declaratory relief as to lawful methods of seizure otherwise permitted by law) such liberty to be exercised on or before 30 June 2026.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

Charlesworth J

Introduction

1    Medoc International Pty Ltd operates a timber wholesale business across four Australian States. By a Trade Finance Facility Agreement made on 6 February 2019, Grow Trade Finance Pty Ltd agreed to provide trade finance to Medoc by way of a credit facility, limited to $100,000.00. On 26 September 2022 Medoc and Grow Trade agreed in writing to vary the facility limit to $250,000.00 (Variation).

2    Ms Rani Ramoo (Medoc’s sole director) executed the Agreement in her personal capacity and in her capacity as director. Under the Agreement, she is defined as the “Guarantor,” Medoc as the “Buyer” and Grow Trade as the “Credit Provider”.

3    Clause 19 of the Agreement contains terms in the nature of a guarantee and indemnity. It is as follows:

19.    Guarantee, Charge & Indemnity

19.1    In consideration of the Credit Provider entering into this Trade Finance Facility Agreement at the request of the Guarantor the Guarantor jointly and severally:

(a)    guarantees to the Credit Provider all amounts owing by the Buyer to the Credit Provider;

(b)    guarantees to the Creditor Provider all of the obligations that the Buyer has to the Credit Provider pursuant to this Trade Finance Facility Agreement;

(c)    guarantees to the Creditor Provider all costs or charges incurred by the Credit Provider in recovering any amounts payable to the Credit Provider from the Buyer or any other related Person (including, without limitation, costs of legal proceedings) including but not limited to legal or other professional fees on a full dollar-for-dollar/indemnity basis; and

(d)    indemnifies and agrees to hold and keep harmless the Credit Provider from all fees, costs, charges, expenses or other amounts for which the Credit Provider is or may be liable as a result of a failure by the Buyer to meet any of its obligations under this Trade Finance Facility Agreement, including but not limited to legal or other professional fees on a full indemnity basis;

(e)    charges all of its Property with the performance of the Guarantor’s obligations under this Trade Finance Facility Agreement;

(f)    shall, if requested, provide the Credit Provider with a written mortgage, charge or other appropriate security, in registrable form, over any Property of the Guarantor, in favour of the Credit Provider and at the Guarantor’s sole cost; and

(g)    do all things necessary to enable any such written document to be registered.

4    As contemplated by that clause, on 6 February 2019, Grow Trade registered security interests over all of Ms Ramoo’s “present and after-acquired property” on the Personal Property Securities Register (PPSR) maintained under the Personal Property Securities Act 2009 (Cth) (PPSA). In addition, Grow Trade lodged a caveat over the title of real property owned by Ms Ramoo, situated in the Adelaide suburb of Frewville (Freville Land).

5    Medoc is in default of its obligation to make repayments of money drawn from the credit facility, as extended by the Variation.

6    On 27 November 2024 Grow Trade (by its own receivers and managers) appointed Mr Richard Albarran and Mr Brent Trevor-Alex Kijurina as Receivers, over Medoc’s property. On the same day, a Notice of Appointment was issued to Ms Ramoo in her capacity as Guarantor, advising that the Receivers had been appointed over all of her “present and after acquired consumer and commercial property (no exceptions)”. The right to appoint Receivers over that property was said to be sourced in the PPSR, the Agreement and the Variation.

7    Section 123(1) of the PPSA relevantly provides:

123    Secured party may seize collateral

(1)    A secured party may seize collateral, by any method permitted by law, if the debtor is in default under the security agreement.

Note: For seizure of accessions, see sections 95 to 97.

Seizing intangible property

(2)    For the purposes of this Act, unless subsection (3) applies, a secured party may seize intangible property only by giving a notice, stating that the giving of the notice constitutes seizure of the property, to the following persons:

(a)    the grantor;

(b)    if the intangible property is a licence—either:

(i)    the licensor; or

(ii)    the licensor’s successor.

8    The parties are in dispute as to their respective rights and obligations under the Agreement, the Variation and s 123 of the PPSA.

9    The following issues arise:

(1)    whether the security Ms Ramoo granted under clause 19.1(e) was a charge that did not, of itself, confer upon Grow Trade the right to appoint the Receivers to her property without first obtaining a court order;

(2)    relatedly, whether there is at present no method permitted by law for the seizure of Ms Ramoo’s property within the meaning of s 123 of the PPSA;

(3)    whether Ms Ramoo is bound (in contract or by estoppel) to guarantee Medoc’s indebtedness incurred under the increased facility limit provided for in the Variation in circumstances where she alleges that she did not sign that document in her personal capacity as guarantor;

(4)    whether the contract of guarantee is discharged by reason of the Receivers’ conduct in asserting rights in Ms Ramoo’s personal property by reference to the Variation;

(5)    whether, for the purposes of the PPSA or otherwise, it is necessary for a demand to be made of Ms Ramoo before resort may be had to her personal property to meet Medoc’s obligations under the Agreement and, if so, whether a demand has in fact been made;

(6)    whether the Receivers can take possession of money standing in Ms Ramoo’s bank accounts without first complying with the requirements of s 123(2) of the PPSA; and

(7)    whether the Receivers have been appointed in respect of the Frewville Land and, if so, whether the requirements of s 55A(1) of the Law of Property Act 1936 (SA) (LP Act) have been fulfilled.

10    These issues arise both on Ms Ramoo’s originating application and on a cross-claim commenced by Grow Trade and the Receivers in the exercise of leave granted to them in the course of the hearing.

11    Following the conclusion of the hearing Ms Ramoo raised a new argument (without leave) to the effect that the property to which the Receivers were appointed was not property to which the PPSA applied at all because of the exclusory operation of s 8.

Summary of outcome and relief

12    Claims for costs aside, the relief sought on both the claim and the cross-claim is limited to declarations of right under s 21 of the Federal Court of Australia Act 1976 (Cth). I am satisfied that the declarations sought fairly reflect the parties’ controversy with respect to their rights and obligations arising out of the Agreement, such that the questions are not merely hypothetical.

13    The declaration sought by Ms Ramoo is to the effect that the Receivers were not validly appointed. It remains unclear how some of the arguments raised by Ms Ramoo have a bearing on that limited issue. I have nonetheless resolved those arguments as no issue was taken by Grow Trade or the Receivers as to their relevance on Ms Ramoo’s originating application.

14    Grow Trade and the Receivers seek declarations as follows:

1.    A declaration that:

a.    the personal guarantee provided by the Cross-Respondent to the First Cross-Applicant pursuant to the Trade Finance Facility Agreement entered in February 2019, and as amended by the Letter of Variation dated 26 September 2022, (together, the Finance Arrangement) has not been discharged as at the date of this Cross-Claim; and

b.    section 123 of the Personal Property Securities Act 2009 (Cth) operates such that any of the Cross-claimants may seize any of the personal property of the Cross-Respondent in the exercise of the rights conferred by the Finance Arrangement.

15    As discussed below, that claim for declaratory relief was introduced after Counsel for Ms Ramoo announced at the beginning of the hearing that some of her arguments were withdrawn and that she purported to reserve a right to pursue them at a later time. The cross-claim agitates the position of Grow Trade and the Receivers in respect of those arguments so as to ensure that they are finally resolved.

16    I have concluded that:

(1)    The Receivers were validly appointed in accordance with the Agreement in respect of that part of Ms Ramoo’s property mentioned in the Notice of Appointment, which includes her personal property subject to the PPSR registration.

(2)    The PPSA applies to the Security Interest created by clause 19.1(e) of the Agreement.

(3)    For the purposes of the PPSA, Ms Ramoo is a debtor in default irrespective of whether a demand for payment has been made of her. If that conclusion is wrong, a demand has in fact been made of Ms Ramoo sufficient to support a conclusion that she is in default of her obligations under the Agreement.

(4)    For the purposes of s 123(1) of the PPSA, the Receivers may seize Ms Ramoo’s personal property by any method permitted by law.

(5)    Money standing to Ms Ramoo’s credit in her bank accounts is not “intangible property” as defined in the PPSA and, accordingly, s 123(2) does not apply.

(6)    Ms Ramoo consented to the increase of the credit facility recorded in the Variation notwithstanding her contention that she did not sign the document recording its terms in her personal capacity. She is bound by the promises in clause 19 in their application to the increased credit facility.

(7)    The question of whether Ms Ramoo would otherwise be estopped from denying that she is so bound does not arise; and

(8)    Grow Trade has not appointed (or purported to appoint) the Receivers with respect to the Frewville Land and, accordingly, no occasion to comply with s 55 of the LP Act has arisen.

Receivers validly appointed

17    I will later explain why Ms Ramoo is bound by the Agreement as amended by the Variation, construed in accordance with its terms, notwithstanding her claim not to have executed the Variation in her personal capacity. My references below to the guarantee are to be understood to include a promise to guarantee the performance of all of Medoc’s obligations to repay money advanced via the credit facility, as originally limited and as later increased under the Variation.

18    Ms Ramoo’s promise was to guarantee the payment of all amounts owing by Medoc (clause 19.1(a)) together with the payment of costs and charges (clause 19.1(c)) as well as the performance of all of Medoc’s obligations (clause 19.1(b)). In addition, Ms Ramoo promised to indemnify and hold Grow Trade harmless from fees, charges and other amounts for which it may be liable as a result of Medoc’s failure to meet any of its obligations, the indemnity extending to legal and other professional fees (clause 19.1(d)).

19    By clause 19(e), Ms Ramoo charged all of her property with the performance of her own obligations. Necessarily, that charge attached to her obligations under clause 19.1(a) and clause 19.1(c) to pay amounts owing by Medoc, to perform all of Medoc’s obligations under clause 19.1(b) and to indemnify and hold harmless Grow Trade from the liabilities referred to in clause 19.1(d). The security provided by Ms Ramoo personally was in respect of all of her property, including property that may be acquired in the future. That follows from the definition of “Property” in clause 1:

Property means, all of the Buyer’s or Guarantor’s property (including real and chattel property), privileges, rights and other assets whether:

(a)    owned at present or acquired in the future; or

(b)    held legally or beneficially; or

(c)    joint or severally with another party; or

(d)    beneficially or on trust; or

(e)    any combination of these; and

includes PPSA Personal Property

20    The phrase “PPSA Personal Property” is defined in clause 1, relevantly as follows:

PPSA Personal Property means:

(a)    All the Buyer’s or Guarantor’s present and after-acquired property in which the Buyer or Guarantor can be a grantor of a PPSA security interest (as defined under the Personal Property Securities Act 2009 (Cth) (PPSA)) …

21    Clause 12 of the Agreement contains a list of the events that fall within the expression “Event of Default”. They include any failure by Medoc to pay or repay any invoice issued to it by Grow Trade when due (clause 12.1(a)) or a failure of Medoc to comply with any of its obligations under the Agreement.

22    By clause 11 of the Agreement, Medoc separately granted a charge over all of its property (as defined) with the performance of its obligations under the Agreement.

23    The Agreement contains two sources of right to appoint receivers in respect of property. The first is found in clause 13:

13.    Enforcement (Rights of Secured Party following default)

In addition to any other rights provided by law, at any time after an Event of Default has occurred:

(a)    each Security Interest arising under this Trade Finance Facility Agreement becomes immediately enforceable;

(b)    the Credit Provider may at any time, by notice to the Buyer, declare all or any part of the Trade Finance Fee due and payable immediately, on demand or at a later date as the Secured Party may specify in the notice; and

(c)    the Credit Provider may appoint one or more Receivers and may do anything that a Receiver may do under clause 15.

(emphasis added)

24    The phrase “Security Interest” is defined in clause 1 as having the same meaning as in s 12 of the PPSA. It relevantly provides:

12    Meaning of security interest

(1)    A security interest means an interest in personal property provided for by a transaction that, in substance, secures payment or performance of an obligation (without regard to the form of the transaction or the identity of the person who has title to the property).

Note: For the application of this Act to interests, see section 8.

(2)    For example, a security interest includes an interest in personal property provided by any of the following transactions, if the transaction, in substance, secures payment or performance of an obligation:

(a)    a fixed charge;

(b)    a floating charge;

…

25    Importantly, the power of Grow Trade to appoint one or more Receivers under clause 13(c) is in addition to any rights it might otherwise have as the grantee of a Security Interest arising under the Agreement upon each of them becoming “immediately enforceable” in accordance with clause 13.1(a).

26    Under clause 14, Grow Trade and the Receivers may exercise any right under the Agreement or conferred by law without first giving notice to the Buyer or allowing the lapse of any period of time.

27    Clause 15.1 provides:

15.1.    Appointment of Receiver

(a)    In addition to the powers under clause 13 the Credit Provider may appoint any one or more persons as Receiver to any part of the Property in addition to and without prejudice to any of its other rights:

(i)    if the Buyer requests the Credit Provider to do so;

(ii)    at any time after an Event of Default occurs; or

(iii)    if the Buyer, in its sole discretion, believes that any Property is at risk of being seized, becoming subject to a Security Interest or otherwise being dealt with in a manner inconsistent with the terms of this Trade Finance Facility Agreement.

(b)    In exercising the power to appoint a Receiver, the Credit Provider may:

(i)    appoint a Receiver under subclause (a) either before or after it has taken possession of the Property and either before or after any order has been made or a resolution passed for the winding up of the Buyer,

(ii)    appoint a different Receiver for different parts of the Property;

(iii)    if more than one person is appointed as Receiver of any part of the Property, empower them to act jointly or jointly and separately;

(iv)    remove the Receiver, appoint another in substitution if the Receiver is removed, retires or dies; and

(v)    fix the remuneration of the Receiver.

(c)    The Credit Provider may appoint any person or any 2 or more persons jointly or jointly and separately as its agent to exercise any of its rights under this Trade Finance Facility Agreement, in which case the provisions of clause 13 apply as if the agent was a Receiver.

(emphasis added)

Ms Ramoo’s submissions

28    Ms Ramoo’s primary contention is that the alternate powers to appoint one or more receivers in clause 13 and clause 15 are confined to the property of Medoc and do not attach to her personal property subject to the charge granted in clause 19.1(e). That was said to be for the structural reason that the guarantee in clause 19 is a “collateral contract” such that she ought not be considered privy to the terms in clause 13 and clause 15. In addition, she submitted that properly construed, the text in clause 13 and clause 15 does not refer to her property or the security interest created by the charge granted under clause 19(e).

29    It was then submitted that the charge over Ms Ramoo’s property granted by clause 19.1(e) did not carry with it any authorisation to appoint a receiver to the property so charged, absent an order of a court authorising such an appointment, or otherwise authorising possession by seizure or other means. She further submitted that the charge in clause 19, construed in a manner “divorced” from clause 13 and clause 15, was no more than an “equitable charge” having no powers of possession or sale attached to it. It was submitted that the situation was as Blue J described in Johnson v Synnex Australia Pty Ltd (No 2) [2017] SASCFC 165 (at [56] – [60], Kourakis CJ and Evans J agreeing):

Equitable charges

56    An equitable charge over an interest in land (or other property) can be created by the owner charging the owner’s interest in the land in favour of the chargee to secure a debt.

57    An equitable charge is a species of property because it is enforceable against the owner and also against any subsequent owner except a person deriving title from the owner for value and without notice of the equitable charge or becoming the registered proprietor of land under the Real Property Act 1886 (SA) other than by forgery or in certain circumstances fraud.

58    If the owner of property the subject of an equitable charge sells the property and converts it into money (the proceeds of sale) or other property, the charge attaches to the substituted property in accordance with the equitable rules of tracing.

59    If there is a contest between two or more equitable charges or more generally between two or more equitable interests, priority is determined between the holders of the competing equitable interests in accordance with equitable rules of priority. The first rule and the starting point is that, absent circumstances giving rise to an exception, priority is afforded to the equitable interest created first in time. There are several exceptions each comprising recognised circumstances in which it would be inequitable as between the competing interest holders to afford priority by reference to time. For example, if the first equitable interest holder engages in conduct that leads a subsequent interest holder to believe that there is no relevant prior equitable interest, the latter acts to his or her detriment by reason of the conduct and it would be unconscionable for the former to assert priority based on time, the equitable interest of the latter will have priority over the former to the necessary extent (a form of estoppel).

60    Unlike a mortgage in respect of which a power of sale of the mortgaged property by the mortgagee in certain circumstances upon default by the mortgagor is conferred by the terms of the mortgage or by statute, a chargee has no power to sell the charged property upon default by the chargor. However a court of equity has power on application by a chargee to order the sale of the charged property with the proceeds of sale paid into court and to give directions concerning the disposition of the proceeds.

(footnotes omitted)

30    To similar effect, the Full Court in Morris Finance Ltd v Brown (2017) 252 FCR 557 said (at [38]):

Apart from statutory charges, charges are creatures of equity and enforceable only in equity (see Young PW, Croft C and Smith M, On Equity (Lawbook Co, 2009) at [9.180]). An equitable charge usually arises by agreement between the parties under which the property charged is made liable for or is ‘appropriated’ to securing the performance or discharge of the relevant contractual obligation. In relation to the charged property, there is no transfer of title or any possessory interest conferred by an equitable charge, although an order for possession may be a necessary adjunct to an order for sale if the equitable charge is sought to be enforced. Moreover, unlike a mortgage, there is no right or power of foreclosure (Tennant v Trenchard (1869) LR 4 Ch App 537 at 542 per Lord Hatherley LC). The principal right or remedy of the chargee to enforce its equitable charge is by a judicial order for sale (with an ancillary order for possession) or the appointment of a receiver (Swiss Bank Corporation v Lloyds Bank Ltd [1982] AC 584 at 595 per Buckley LJ). The chargee has no self-help remedy (see Melbourne Tramways Trust v Melbourne Tramway & Omnibus Company Ltd (1887) 13 VLR 487 at 490) but must obtain the assistance of a court of equity to realize or enforce the charge. Usually, upon default a chargee is entitled to an order for sale, although given that an equitable jurisdiction is being invoked there may be discretionary aspects to the exercise of that jurisdiction. We have described a court’s power to order a sale (including any ancillary orders) to enforce an equitable charge as being in the court’s equitable jurisdiction, although such a jurisdiction may be supplemented by the conferral of other statutory powers.

31    Ms Ramoo submitted that to characterise the guarantee in clause 19 as a collateral contract “divorced” from other provisions contained in the Agreement would do no violence to the wording of clause 13 and clause 15, as both were capable of operating exclusively upon the security interest granted by Medoc in clause 11.

32    In oral submissions, Counsel for Ms Ramoo submitted that clause 19 was “collateral” in the sense that it was an agreement between Grow Trade and Ms Ramoo, whereas “the balance of the agreement, including clause [13(a)], is an agreement as between [Grow Trade] and Medoc”. Counsel submitted that clause 13 was expressly concerned with rights and obligations under “this Trade Finance Facility Agreement”, a phrase that described the terms of the credit facility provided by Grow Trade to Medoc, but not the collateral contract found in clause 19.

33    The characterisation of the guarantee in clause 19 as a “collateral contract” was said to find support in the reasons of Mason CJ in Sunbird Plaza Pty Ltd v Maloney (1988) 166 CLR 245 (at 254). His Honour there said:

Discussion of the question must begin with the proposition, established by the cases on s.4 of the Statute of Frauds 1677 (U.K.) that a contract of guarantee is, subject to any qualifications made by the particular instrument, a collateral contract to answer for the debt, default or miscarriage of another who is or is contemplated to be or to become liable to the person to whom the guarantee is given  …

34    Next, it was submitted that clause 13 and clause 15 must be construed as relating only to Medoc’s property because to find otherwise would give the word “or” in the definition of Property no meaningful work to do. It was further submitted that to the extent that clause 13 and clause 15 were capable of an interpretation conferring a power on Grow Trade to appoint receivers to Ms Ramoo’s property, that construction should be avoided because a contract of guarantee must be construed in a manner beneficial to the guarantor.

35    The rule of construction derives from what the High Court said in Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549. There, a surety guaranteed a hirer’s performance under a contract for the hire of machinery. The owner of the machinery breached two clauses of the guarantee, first by failing to inform the surety of a proposal that the hirer had purported to sell or assign its interest in the machinery and then by failing to notify the surety that the hirer had defaulted on its obligation to pay rent. The question before the High Court was whether the breached clauses should be characterised as conditions such that the breach would go to the root of the contract and give rise to a right in the surety to rescind the contract and so discharge all of the obligations owing under the guarantee. In the course of resolving that issue, Mason ACJ, Wilson, Brennan and Dawson JJ said that when construing a surety contract, regard must be had to its special character and the relationship it created between the parties. Their Honours continued (Ankar, at 561):

At law, as in equity, the traditional view is that the liability of the surety is strictissimi juris and that ambiguous contractual provisions should be construed in favour of the surety. The doctrine of strictissimi juris provides a counterpoise to the law’s preference for a construction that reads a provision otherwise than as a condition. A doubt as to the status of a provision in a guarantee should therefore be resolved in favour of the surety and so the provision should be interpreted as a condition, or perhaps as an innominate term, instead of a mere warranty. If the surety is to be discharged for breach of a promissory term in the suretyship contract, the justification for the discharge must be that the creditor has failed to comply with a provision that, as a matter of interpretation, requires strict performance as a condition precedent to the surety’s obligation or at least requires substantial performance of the promise such that the surety would not have entered into the contract if it had not been assured that there would not be a breach such as the breach which in fact occurred. If on its true interpretation the term is not intended so to operate, it is not easy to understand why the surety should be discharged by its breach. Of course, in construing the contract the court is entitled to look to the general setting in which the contract has come into existence …

36    I have mentioned that Ms Ramoo’s submissions raise both structural and textual considerations. Whilst I deal with them separately below my view as to the proper construction of the Agreement is formed having regard to both.

The structural argument

37    The question with which Mason CJ was concerned in Sunbird was whether the guarantor in that case could be called upon to discharge an obligation to pay a settlement sum for the purchase of land in circumstances where the principal obligation of the purchaser of the land had not yet arisen. In the passages that follow, his Honour discussed at some length the sometimes blurred distinction between a promise in the nature of a guarantee and a promise in the nature of an indemnity. In the present case, no party suggested anything turned on that distinction. The discussion in Sunbird otherwise confirms that the contractual obligation to guarantee the performance of a principal debtor’s obligation to pay is conditioned upon breach of the debtor’s primary obligation. That is the case here. Ms Ramoo is correct in her submission that the events that constitute an “Event of Default” are all acts, omissions, or matters relating to the affairs of Medoc. It is only in a defined “Event of Default” that clause 13 and clause 15 can operate. An Event of Default has occurred. None of that is in issue.

38    Ms Ramoo’s central proposition is that where an instrument contains promises as between a debtor and creditor, as well as a promise to guarantee the debtor’s obligations to pay, the rights and obligations of the guarantor are to be found within the clause in which the guarantee is given, as that is where the “collateral contract” between the guarantor and credit provider resides. No other clause, she submitted, may be construed as affecting or enlarging upon those rights or obligations. That proposition was neither considered nor resolved by Mason CJ in Sunbird, nor was it considered or resolved in the cases to which his Honour referred: see Re Conley; Ex parte Trustee v Barclays Bank Ltd [1938] 2 All ER 127 (at 130–1); Yeoman Credit Ltd v Latter [1961] 2 All ER 294 (at 296); Total Oil Products (Australia) Pty Ltd v Robinson [1970] 1 NSWR 701 (at 703).

39    A contract containing a promise in the nature of a guarantee may be described as “collateral” where consideration for the contract is (or includes) an agreement to extend finance to another person. A contract of guarantee may also be described as “collateral” in the sense that it contains secondary obligations, being obligations that are not enlivened unless a primary obligation owed by (for example) a debtor is first breached.

40    However, the circumstance that a contract of guarantee may be labelled as “collateral” in either of those senses does not mean that the rights and obligations of the guarantor are to be ascertained only by reference to a specific clause in which the guarantor’s promise to perform the debtor’s obligation is contained. Nor does it mean that the guarantor is not or cannot be a party to the whole of a contract in which promises between the creditor and debtor are also contained.

41    There is nothing in legal principle to warrant an approach to interpretation that precludes a survey of the whole of the instrument for terms that, properly construed, affect the rights and obligations as between the grantor and grantee of a guarantee. Nothing in Sunbird or Ankar warrants such an approach.

42    Ms Ramoo placed reliance on references throughout the Agreement to “this Trade Facility Agreement”. Her submission was that those words indicated that there were two contracts: a contract for the provision of a guarantee contained clause 19 (to which she is a party) and a contract containing all other clauses of the Agreement (to which she was not). It was submitted that the phrase indicated that the obligations in clause 19 were “divorced” (for interpretation purposes) from all other terms, including those contained in clause 13 and clause 15. I do not accept that submission. The phrase “this Trade Facility Agreement” appears throughout the instrument, including in clause 19.1(e) itself. It is not used in a manner intended to delineate between a contract contained in clause 19 and a separate contract comprised of all other clauses. The phrase is to be understood as a reference to the whole of the instrument. The relevant instrument is titled “GROW BUSINESS FUNDING PTY LTD ACN 602 951 342 TRADE FINANCE FACILITY AGREEMENT” and is executed by the three parties to it, including Ms Ramoo.

43    A contract may contain terms creating a contractual obligation as well as terms creating an interest in property securing the performance of that obligation, and additional terms governing when and how that proprietary interest may be enforced. The terms may be contained in more than one clause of a written contract. The structure of the Agreement is such that each of Medoc and Ms Ramoo charged their property with the performance of their respective obligations. Those charges are contained in clause 11 (in the case of Medoc) and clause 19.1(e) (in the case of Ms Ramoo). As discussed below, there is then separate provision made in (at least) clause 13 identifying when those securities become enforceable and the rights of Grow Trade in those events. There is nothing unconventional or unusual about that structure.

The textual argument

44    Clause 13(a) operates in the “Event of Default”. Of its own force, it renders immediately enforceable “each Security Interest arising under this Trade Finance Facility Agreement”. By clause 19.1(e) and clause 19.1(f) Ms Ramoo granted a Security Interest (being a term defined to include a fixed or floating charge). For the purposes of clause 13, that is a Security Interest that arose under “this Trade Finance Facility Agreement” (being the same instrument which contains clause 19.1(e)). That conclusion does not involve any strained interpretation. It results from the ordinary application of the text of clause 13. In its natural meaning, the phrase “each Security Interest” captures the charge in clause 19.1(e) which, as contemplated by clause 19.1(f), is an interest that has been notified on the PPSR.

45    The phrase “immediately enforceable”, properly construed, means that in an “Event of Default” (and not before) Grow Trade has an immediate right to enforce a right to apply Ms Ramoo’s property to the discharge of her contractual obligations owed under clause 19. That is consistent with the obligations of Ms Ramoo being secondary in the sense that they arise upon the default of the primary debtor, Medoc.

46    Clause 13(c) authorises Grow Trade to appoint a receiver. When read in conjunction with clause 13(a), nothing in that wording is ambiguous. The appointment of a receiver is a contractual mechanism for the immediate enforcement of the Security Interest arising under clause 19.1(e), but it is not the only mechanism. If an appointment is made, it has the effect of authorising the Receivers to enforce Grow Trade’s proprietary interest created by the charge. It is therefore necessary to identify the rights inhering in the proprietary interest itself.

47    The interest created by clause 19.1(e) is an interest that authorises Grow Trade to have resort to the relevant property to discharge Ms Ramoo’s promise to guarantee Medoc’s obligation to pay all money owing to Grow Trade under the Agreement. That is what is meant by Ms Ramoo charging her property with her contractual obligation.

48    Importantly, Grow Trade may exercise that proprietary right whether or not it appoints a receiver. At general law it may exercise its contractual and proprietary rights directly or by the actions of an agent, howsoever described.

49    Contrary to Ms Ramoo’s submission, the word “or” in the definition of “Property” does not require that a binary choice be made between any competing interpretations available within clause 13. In my view, the word “or” in the definition is intended to give the word “Property” a changeable meaning, such that the question of whether it is the property of Ms Ramoo or the property of Medoc (or both) that is operated upon will depend on the context in which the defined word “Property” is used. The word “Property” does not appear in clause 13 at all.

50    Unsurprisingly, the word “Property” is used in clause 19 in a way that is confined to Ms Ramoo’s property (as in the phrase “its Property” in clause 19.1(e) or “Property of the Guarantor” in clause 19.1(f)). Similarly, clause 11 contains a reference only to Medoc’s Property. Considered in their proper context, those phrases recognise that an interest in property (including an interest created by a charge) cannot be created by a person having no interest in it. The inclusion of the phrases “its Property” or “Property of the Guarantor” in clause 19 do not support the limited construction of clause 13 for which Ms Ramoo contends. It is the phrase “each Security Interest” in clause 13(a) that points to the charge over Ms Ramoo’s property granted in clause 19. The power in clause 13(c) to appoint a receiver may therefore be construed as including a power to appoint a receiver to enforce Grow Trade’s rights in Ms Ramoo’s property created by the charge.

51    Having regard to its text, I accept Ms Ramoo’s submission that clause 15 of the Agreement relates solely to Medoc’s property. Clause 15.1 is extracted at [27] above. Clauses 15.2 and 15.3 provide:

15.2.    Receiver as agent

(a)    Subject to subclauses (b) and (c) below, a Receiver will be the agent of the Buyer who alone will be responsible for the Receiver’s acts and omissions and remuneration.

(b)    The Credit Provider may appoint a Receiver as the agent of the Credit Provider and delegate to a Receiver any of the Credit Provider’s rights under this Trade Finance Facility Agreement.

(c)    To the extent that as a result of any order being made or a resolution being passed for the winding up of the Buyer, a Receiver ceases to be the agent of the Buyer, the Receiver will immediately become the agent of the Credit Provider.

15.3.    Powers

(a)    General

A Receiver has the right in relation to any property in respect of which the Receiver is appointed to do everything that the Buyer may lawfully authorise an agent to do on behalf of the Buyer in relation to that property and, without limitation, a Receiver may in relation to that property exercise:

(i)    the rights capable of being conferred on receivers and receivers and managers by the PPSA and the laws of any relevant jurisdiction;

(ii)    the rights of the Buyer and the directors of the Buyer;

(iii)    if the Buyers not [sic] a corporation to which the Corporations Act applies, the rights that the law would allow a Receiver to do if the Buyer was a corporation incorporated under the Corporations Act; and

(iv)    any other rights the Credit Provider may by notice to a Receiver give to a Receiver.

(emphasis added)

52    Clause 15.2(a) provides that a receiver will be an agent of the Buyer, being Medoc. And the general powers described in clause 15.3(a) are all concerned with the property of the Buyer, not the property of the Guarantor. I accept that the text in clauses 15.2 and 15.3 provides a contextual basis to read clause 15.1 as relating only to the rights of Grow Trade vis a vis the security interest granted by Medoc. In terms, clause 15.2(a) does not operate so as to give the Receiver the status of Ms Ramoo’s agent in relation to her property. Nor can the appointment of the Receivers as Medoc’s agent have any operative effect on Ms Ramoo’s personal property, as Medoc has no rights in that property. For those reasons, I conclude that the separate power to appoint a Receiver contained in clause 15.1 is to be construed as confined to Medoc’s property. That conclusion is supported by the text of clause 15.1 itself and the numerous references to Medoc’s affairs contained within it. For example, clause 15.1(a)(i) ought not be interpreted to authorise the appointment of a receiver to Ms Ramoo’s property at Medoc’s request, as Medoc has no interest in her property.

53    However, I do not consider the exclusive references to the Buyer in those clauses to be a sufficient reason to read down the separate contractual right in clause 13. As I have already observed, clause 13 is expressed in terms that put beyond doubt that the rights conferred by that clause are in addition to any other right Grow Trade may have. The phrase in clause 13(c) “may do anything that a Receiver may do under clause 15” should not be read as limiting the things that Grow Trade may do upon the charge arising in clause 19.1(e) becoming immediately enforceable. At general law, anything Grow Trade may do in its own name and right anything that may be done on its behalf by a duly authorised agent. No contractual provision to that effect is necessary. The things that Grow Trade or its agents may do are discussed below.

54    On the facts, the Notice of Appointment does not in terms purport to appoint the Receivers to act as Ms Ramoo’s agent in relation to her property under clause 15. I accept Ms Ramoo’s submission that a power of sale cannot be sourced in clause 15.2 or clause 15.3, given their express focus on Medoc as “the Buyer”. But that does not mean that Grow Trade has no power of sale exercisable by it personally or by the action of an agent acting on its behalf.

The immediately enforceable charge

55    As to Ms Ramoo’s reliance on Johnson and Morris Finance, I do not accept Ms Ramoo’s argument to the effect that the charge in clause 19.1(e) is a creature of equity that is unenforceable unless the subsistence of an equitable interest in the charged property is first recognised by a Court in Equity. Nor do I accept her argument that the charge in clause 19.1(e) is otherwise unenforceable in the absence of judicial orders facilitating possession and sale.

56    The charge granted in the present case is one that is immediately enforceable by virtue of clause 13.1(a) of the Agreement. In addition, I have concluded that Grow Trade has the contractual right to appoint a receiver under clause 13(c). Furthermore, Grow Trade’s rights are regulated by the PPSA and the notice based system for which it provides.

57    That the isolated passages extracted from Johnson and Morris Finance should not be applied uncritically to the present contractual and statutory context. Equitable charges relating to real property may well require judicial orders to facilitate the enforcement of a chargee’s rights, given the need in such cases for the legal owner of the title to execute a written instrument in order for a transfer of title to be legally effective. That is not necessarily the case with respect to personal property.

58    In the present case, there exists a remedy within the clause 19.1(e) itself, namely Ms Ramoo’s contractual promise that her personal property is charged with the performance of her obligations under the Agreement. Resort to the personal property for that purpose was the mode of performance expressly agreed upon. It does not depend on anything a Court in Equity might have to say on the topic, other than to recognise that Grow Trade has rights in property in respect of which it is not the legal owner. By charging her property with the performance of her obligations, Ms Ramoo promised that the property may be applied by Grow Trade to the extent necessary to discharge all of her obligations under clause 19, irrespective of her status as legal owner. Judicial pronouncement of Grow Trade’s rights is not a precondition to their existence, nor a precondition to their exercise.

59    The time for Ms Ramoo’s performance of her obligations under clause 19 has passed and she is presently in breach. It is inconsistent with the contractual promise in clause 19.1(e) for Ms Ramoo to erect her status as legal owner of the property as an obstacle to the rights she granted by charging the property with the performance of those obligations.

60    To the extent that it is necessary for Grow Trade (through the agency of the Receivers or otherwise) to seek any further clarification of the lawful methods by which it may seize and apply the property, it may apply for relief under the PPSA: see by illustration Mercedes-Benz Financial Services Australia Pty Ltd v RPO Pty Ltd (in liq) [2025] FCA 714.

THE VARIATION

61    It is necessary to explain how issues relating to the Variation come to form a part of the cross-claim.

62    The issue was positively raised by Ms Ramoo in her affidavit evidence and in written submissions filed in advance of the hearing. In her affidavit Ms Ramoo denied having executed the Variation in her capacity as Guarantor. The written submissions were to the effect that Ms Ramoo was not bound to guarantee Medoc’s performance of the Agreement as varied by the Variation, and that Grow Trade had breached a condition of the Agreement by “purportedly appointing the Receivers as receivers over the property of Ms Ramoo in reliance on inter alia the Variation”. The alleged “material breach” was Grow Trade’s conduct in asserting rights in Ms Ramoo’s property valued above the indebtedness arising under the initial credit facility limit. The breach was said to have had the effect of discharging Ms Ramoo from all of her obligations under clause 19, in respect of all amounts owing by Medoc. That was one of several reasons put forward in support of her application for a declaration that the Receivers had not been validly appointed.

63    At the commencement of the hearing, Counsel for Ms Ramoo told the Court that the contentions concerning the alleged discharge were withdrawn. It was then said that Ms Ramoo reserved her right to raise at any later proceeding the same questions of fact and law relating to the discharge. Grow Trade had not been informed of Ms Ramoo’s instructions to “withdraw” that part of her case, nor of her contention that she could reserve a right to resurrect the withdrawn arguments at any later time at which Grow Trade may seek to enforce the guarantee or the security interest created by it.

64    In those circumstances, Grow Trade made an oral application to commence a cross-claim so as to encompass the controversy concerning the discharge and the related question as to whether Ms Ramoo was bound to guarantee Medoc’s performance of the Agreement as varied by the Variation. Leave was granted, for the principal reason that it would constitute an abuse of process for Ms Ramoo to bring complaints surrounding the guarantee in a piecemeal fashion. The respondents had prepared for the hearing on the basis that the dispute concerning the discharge (as articulated in Ms Ramoo’s affidavit and original submissions) would be tried and resolved. I rejected Ms Ramoo’s submission that she would be prejudiced if the issue were to be tried in this action by way of a cross-claim for declaratory relief brought by the respondents.

65    The Court read the whole of Ms Ramoo’s affidavit, including her assertion that she had not executed the Variation in her capacity as Guarantor. It was in those circumstance that Ms Ramoo came to be cross-examined on that evidence in respect of an issue then arising on the cross-claim and in respect of which Grow Trade and the Receivers bear an onus of proof.

66    The Variation is recorded in a document titled “LETTER OF VARIATION dated 26/09/2022”. It defines Medoc as “Client”, Ms Ramoo as “Guarantor” and Grow Trade as “GTF”. The operative terms are as follows:

1    INTRODUCTION

1.1    The Client, the Guarantor and GTF entered into a Trade Finance Facility Agreement (the ‘Trade Finance Agreement’).

1.2    The Client, the Guarantor and GTF (the ‘Parties’) agree to the matters set out In this document.

2    AGREEMENT

2.1    The Parties agree to amend the Schedule of Terms to the Trade Finance Agreement as follows:

(a)    The Facility Limit is amended to ‘$250,000’

2.2    The amendment set out in clause 2.1 above take effect from the date of this document.

2.3    All other terms and conditions of the original agreement remain in effect.

67    There follows an execution page. It has three execution blocks, one for each of Grow Trade, Medoc and Ms Ramoo. Ms Ramoo executed the block for Medoc. However, she did not execute the block making provision for her to sign in her capacity as Guarantor. In circumstances described below, the only signature appearing in that block is that of her son, who (according to Ms Ramoo) signed in his capacity as a “witness”.

68    The stance taken by Ms Ramoo in her correspondence preceding this action was that there had been a fundamental change in the rights and obligations between Grow Trade and Medoc brought about by the Variation, to which she was not a party. She argued that the circumstances enlivened the “special rule” discussed in Ankar (at 570):

…  That special rule is that, in the ordinary case where a surety agrees to be liable for the default of another upon the terms of the contract of suretyship, a significant departure by the creditor from the terms of that contract will, in the absence of agreement to the contrary, operate to preclude the existence or continued existence of the circumstances in which the surety has agreed to be bound.  …

69    The underlying principle is that stated by Cotton LJ in Holme v Brunskill (1877) 3 QBD 495 (at 505 – 506) (cited with approval in Ankar at 558 – 559):

The true rule in my opinion is, that if there is any agreement between the principals with reference to the contract guaranteed, the surety ought to be consulted, and that if he has not consented to the alteration, although in cases where it is without inquiry evident that the alteration is unsubstantial, or that it cannot be otherwise than beneficial to the surety, the surety may not be discharged; yet, that if it is not self-evident that the alteration is unsubstantial, or one which cannot be prejudicial to the surety, the Court, will not, in an action against the surety, go into an inquiry as to the effect of the alteration, or allow the question, whether the surety is discharged or not, to be determined by the finding of a jury as to the materiality of the alteration or on the question whether it is to the prejudice of the surety, but will hold that in such a case the surety himself must be the sole judge whether or not he will consent to remain liable notwithstanding the alteration, and that if he has not so consented he will be discharged.  …

70    It follows from those principles that a guarantor who has consented to the alteration of rights and liabilities as between the relevant creditor and debtor is not discharged:  Westpac Banking Corporation v Schwerdtfeger [2016] QSC 173. That is a question of fact, to which I now turn.

Facts

71    The sources of evidence are the contemporaneous correspondence passing between the parties, Ms Ramoo’s affidavit evidence that she did not execute the Variation in her capacity as Guarantor, and additional evidence given by Ms Ramoo, including oral evidence-in-chief (adduced with the leave of the Court) and in cross-examination. I have not had regard to some documentary evidence annexed to an affidavit originally relied upon by the respondents (now cross-claimants) as their reliance on that evidence was withdrawn and Ms Ramoo did not seek to adduce it in the presentation of her own case.

72    I have already mentioned that Ms Ramoo’s affidavit evidence on this topic was very brief. She stated only that she did not execute the Variation in her capacity as Guarantor. It is not disputed that Ms Ramoo did not in fact apply her signature to the Variation in the execution block where there is provision for her signature to be applied in that capacity.

73    However, the circumstance that Ms Ramoo’s signature does not appear in that place is not determinative of the question of whether she is bound to guarantee Medoc’s performance under the Agreement as amended by the Variation.

74    On its face, the document itself states that Ms Ramoo as Guarantor had agreed to the matters set out in it. The document is capable of evidencing her consent, irrespective of whether the formalities of signing have been attended to. There is no term in the Agreement requiring that variations to its terms can only be made in writing, let alone by the formality of the execution of a Deed.

75    In cross-examination Ms Ramoo acknowledged that she had made a request on Medoc’s behalf for the credit limit under the Agreement to be increased. That request is referred to in an email of 19 September 2022 from Ali Belbaraka of Grow Trade, confirming that the request for the increase was being assessed. Ms Ramoo also acknowledged that the Variation was binding upon Medoc. Ms Ramoo not only knew that the credit facility had been increased, she was instrumental in bringing about that very amendment by causing Medoc to request it.

76    The conduct of Ms Ramoo is further illuminated by the communications that followed.

77    By an email of 21 September 2022, Grow Trade exchanged correspondence with Medoc to confirm that the increase of the facility limit to $250,000.00 had been approved. That email was addressed to “Rani”, and was expressed as follows:

From:  Ali Belbaraka

Sent:  21 September 2022 14:40

To:  Medoc International

Subject:  Facility Limit Increase

Hi Rani,

Good news, the facility limit increase has been approved.

Please see attached letter of variation noting the facility limit increase to 250k.

Can you please have it signed and returned.

Regards

78    The attachment to that email was a document in the same terms described at [66] above, with blank execution blocks.

79    On 23 September 2022 there was an email exchange in which Ms Ramoo sought confirmation that Grow Trade would provide finance to pay a new supplier’s invoice. Three minutes later, Ali Belbaraka responded as follows:

From:  Ali Belbaraka

Sent:  23 September 2022 10:16

To:  Medoc International

Subject: RE:

Hi Rani,

Can you reply to the email for signature of the deed of variation, so we can increase your limit to 250k?

Thanks

80    The Variation (executed in the manner described above) was then returned to Grow Trade by a further email on 26 September 2022. I find that that email was sent either by Ms Ramoo or in any event with her knowledge and on her instructions.

81    In cross-examination, Ms Ramoo asserted that she told the author of Grow Trade’s emails (Ali Belbaraka) that she did not want to personally guarantee Medoc’s obligation to make repayments under the increased facility. Questioning on that topic went as follows:

COUNSEL:    How did you tell Ali?

MS RAMOO:    Sorry?

COUNSEL:    How did you tell Ali?

MS RAMOO:    How did I?

COUNSEL:    How did you tell Ali?

MS RAMOO:    I don’t understand. I’m sorry, I can’t hear you.

COUNSEL:    You just gave evidence that you clearly told Ali that you weren’t going to sign as a guarantor. Yes?

MS RAMOO:    Yes.

COUNSEL:    When?

MS RAMOO:    During our conversation when I was seeking funding.

COUNSEL:    What conversation?

MS RAMOO:    I can’t remember the conversation at that time.

COUNSEL:    If you can’t remember the conversation, how do you know it occurred?

MS RAMOO:    I had a conversation with him.

COUNSEL:    And you’ve put on no evidence about any of that?

MS RAMOO:    Sorry?

COUNSEL:    You’ve put on no evidence about any conversation with anyone. Correct?

MS RAMOO:    I had a conversation with him because when I sought funding, I spoke to him about it.

COUNSEL:    You’ve put on no evidence about any conversation with anyone from Grow Trade Finance. Correct, Ms Ramoo?

MS RAMOO:    No. I had a conversation with Ali.

82    I do not accept that Ms Ramoo had any such conversation with anyone from Grow Trade of the kind alleged at or around the time that the extended facility was requested or at all, for five reasons.

83    First, the alleged conversation is difficult to reconcile with the correspondence by which Grow Trade confirmed that the increased facility would be provided at Medoc’s request, being a request Ms Ramoo herself had communicated. The correspondence attached the document which stated on its face that an agreement between Grow Trade, Medoc and Ms Ramoo as Guarantor had been reached and the author then requested that the document be signed and returned. In response to that email, Ms Ramoo said nothing at all about any supposed conversation with the email’s author in which she had stated she would not guarantee Medoc’s obligation to make repayments under the extended facility. It is inherently implausible that Grow Trade would communicate in the terms evidenced in the correspondence if an alleged refusal to be party to such an agreement had earlier been communicated by Ms Ramoo. It is equally implausible that Ms Ramoo would do nothing to remind Grow Trade of any such conversation, assuming it to have occurred, given the wording of the document she was asked to sign and the wording of Ali Belbaraka’s email of 23 September 2022 to the effect that the credit limit would be increased once the signed Variation was returned to Grow Trade.

84    Second, Ms Ramoo gave no adequate explanation for her failure to say anything about the alleged conversation in the affidavit she had filed in advance of the hearing and at a time when she was positively alleging (as part of her own case) that she was not bound to guarantee Medoc’s extended indebtedness. That failure extended to a failure to file any affidavits in reply to evidentiary material (filed by Grow Trade and the Receivers in advance of the hearing) relating to the circumstances in which the Variation came into existence. That failure persisted beyond the time when Grow Trade and the Receivers filed written submissions dealing with issues relating to consent and estoppel based on that evidence.

85    Third, the Court granted leave to Ms Ramoo to adduce additional evidence-in-chief. The leave was granted in response to an application to ask questions concerning the appearance (or non-appearance) of signatures on the Variation. Counsel for Ms Ramoo did not seek leave to adduce evidence-in-chief of any conversation by which Ms Ramoo positively stated that she did not consent to be bound to guarantee Medoc’s obligations to make repayments under the Variation. It may be inferred that Counsel acted on Ms Ramoo’s instructions when he made the application for leave.

86    Fourth, there is no reference to any such conversation in written submissions filed on Ms Ramoo’s behalf, specifically that part of the submissions alleging that the guarantee had been discharged.

87    Fifth, I found Ms Ramoo’s responses in cross-examination to be performative and unconvincing both generally and on this topic. Her inability to furnish the alleged conversation with convincing particulars was especially concerning. In one instance she prevaricated when asked when an email sent in her name had in fact been sent by her, first suggesting that it may have been sent by her son, then reluctantly acknowledging that she had likely sent it. When questioned about the signature block on the Variation, Ms Ramoo said that her son had signed in his capacity as a “witness”. However, she could not explain precisely what her son had witnessed, given that there was no provision on the document for any person to witness the signature of Ms Ramoo in her capacity as Medoc’s director. In combination, those matters so affect Ms Ramoo’s credibility that I am not prepared to accept her evidence of the alleged conversation at face value.

88    After the Variation was returned to Grow Trade, Ms Ramoo caused Medoc to draw down on the extended facility by signing invoices for payment by Grow Trade. Indeed, she had prompted Grow Trade to fund an invoice after the Variation had been sent to her for signing. In light of the correspondence of 23 September 2022, I find that she returned the document knowing that Grow Trade requested her to sign the Variation as Guarantor, before it would increase the facility amount. She knew that Grow Trade increased the facility upon the Variation being returned to it on 26 September 2022. Medoc, under her directorship and to her knowledge, then exhausted the increased facility. Ms Ramoo did not draw Grow Trade’s attention to the fact that it was her son’s signature appearing on the document in the signature block where her own signature was missing.

89    In cross-examination, Ms Ramoo otherwise acknowledged that she had requested the increased facility, that she had caused Medoc to enter into the Variation, that Medoc was bound by the Agreement as so varied and that Grow Trade had extended additional finance in response to a request that she had made on Medoc’s behalf. She expressly acknowledged that this statement in clause 1.2 of the Variation was true:

1.2    The Client, the Guarantor and GTF (the ‘Parties’) agree to the matters set out in this document.

90    Considering her testimony as a whole, I find that Ms Ramoo was aware of the content of the Variation at the time that it was returned to Grow Trade and that she understood its meaning. Whether or not Ms Ramoo was subjectively unwilling to guarantee Medoc’s increased obligations is not to the point. I find that any such unwillingness was not communicated to Grow Trade and that her outward conduct toward Grow Trade was inconsistent with that state of mind in any event.

All monies guarantee

91    By clause 19.1(a) of the Agreement Ms Ramoo guaranteed to Grow Trade “all amounts owing by [Medoc] to [Grow Trade]”.

92    As I understood it, the principal argument on this part of the cross-claim is that the guarantee given in clause 19.1(a) of the Agreement is, on its terms, an obligation to pay “all amounts owing” by Medoc to Grow Trade such that no further consent was required in order for the guarantee to extend to the amounts now claimed. I do not accept that submission. The promise in clause 19.1(a) is to be fairly construed as extending to Medoc’s obligation to pay money owing to Grow Trade under the Agreement. The maximum extent of the credit facility is recorded in the Schedule. For the guarantee to apply to additional money, it would be necessary for Ms Ramoo to consent to a variation to the facility limit recorded in the Schedule, given its importance in limiting the extent of the potential guaranteed indebtedness.

Actual or implied consent

93    By the conduct described above, Ms Ramoo expressly consented to the increase in the maximum limit of the credit facility provided by Grow Trade to Medoc under the Agreement as varied.

94    She communicated consent to the Variation by returning the document containing clause 1.2 to Grow Trade without any expression of disagreement. Clause 1.2 is itself evidence of Ms Ramoo’s agreement, communicated to Grow Trade in the circumstances I have described. Ms Ramoo’s agreement (recorded in writing) may readily be inferred in the absence of her signature. The consent was to all of the terms of the Variation, with the consequence that the promise in clause 19.1(a) extends on its terms to all amounts owing under the extended credit facility.

95    The circumstances resonate with what Menzies J said in Wren v Emmett Contractors Pty Ltd (1969) 43 ALJR 213 (at 220) (as cited in Hickory Developments v Brunswick Retail & Ors [2012] VSC 224 at [47]):

…  It seems to me that if the defendant as controlling director of Celebrity Theatres Pty Ltd arranged an extension of time for the payment of what was due by the company under its contract with the plaintiff he cannot be heard to say, when sued upon the guarantee, that the extension was given without his consent. Mere knowledge of the variation of a contract or the giving of time does not of itself amount to consent, but for a guarantor on behalf of the principal debtor to bespeak time to pay what is owing betokens his concurrence with the giving of time to pay. Were this not so the law would be out of touch with reality.  …

96    On similar facts, Mahon J in Winstone Ltd v Bourne [1978] 1 NZLR 94 drew the following conclusions (at 96):

…  Here the defendants as directors of the company desired to implement the proposed overdraft arrangements with the Commercial Bank of Australia. They could only do so by concurring as directors in the deed of modification, otherwise the increased overdraft facilities could no doubt not be obtained. It is true to say, as Mr Saunders points out, that the functions of the defendants as directors and their functions as sureties for the company’s debt must, as a matter of law, be kept distinct. But this is not a conceptual question as to personal legal status. This is a question as to the existence of factual knowledge and consent of a variation in the principal contract in respect of which the defendants were sureties. On the facts, bearing in mind the clear knowledge of the defendants of their liabilities as guarantors, I cannot hold that their informed and endorsed assent as directors of that company to the alteration in the debenture was not also an informed though unrecorded assent as guarantors of the plaintiff’s debt to that same part-surrender of priority which would inevitably increase their personal liability. Knowledge is, of course, a different thing from consent, but for the reasons which I have indicated I find it impossible to say that knowledge of the reduction in the value of the plaintiff’s debenture was not also knowledge of the increase or potential increase in the defendant’s liability under the contract of guarantee, and both those species of knowledge being present I think it inevitable that on the facts the defendants did not only know but also impliedly assented on or about 1 October 1971 to the effect of the modification executed on that date which brought about the ultimate result of potential variation in their own liability.  …

97    It follows that there is no basis upon which Ms Ramoo may argue that the guarantee has been discharged by reason of any wrongful assertion of rights by the Receivers relating to the Variation. Declaratory relief will be granted on the cross-claim to give effect to those findings.

Estoppel

98    The elements of an estoppel by encouragement or acquiescence are summarised by Brennan J in Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 (at 428 – 429); see also Kramer v Stone (2024) 281 CLR 484 (at [36] – [41], [54] – [59]). It is unnecessary to restate them here.

99    Given the facts as I have found them, consideration of the case founded in estoppel is not only unnecessary, but would involve a hypothetical exercise based upon different facts. To the extent that Grow Trade extended additional finance to Medoc on an assumption that the promises in clause 19 of the Agreement applied to those advances, it was not mistaken in that belief. Accordingly, there is no occasion to enquire into whether a mistaken belief as to legal rights was encouraged by Ms Ramoo. Nor is it appropriate or necessary to enquire into whether an estoppel by acquiescence arises by reference to any such mistake.

THE PPSA

100    Section 123 of the PPSA authorises the seizure of the “collateral” (being Ms Ramoo’s personal property) by any method permitted by law. Those methods include the methods legally binding on Ms Ramoo by virtue of her entry into the Agreement. Ms Ramoo’s contention that the Receivers were not validly appointed in respect of the property forming the subject of the PPSR registrations has been rejected. Section 123(1) of the PPSA operates in accordance with its terms whether or not receivers have been appointed in a particular case in any event.

101    Ms Ramoo then submitted that the essential conditions for s 123 of the PPSA to operate have not been fulfilled because she is not a “debtor” who is in “default” of the relevant security agreement. She submitted that she cannot be in breach of her obligations under clause 19.1 of the Agreement unless and until Grow Trade made a demand that she make good on the promise to guarantee Medoc’s obligations. I do not accept that submission. Ms Ramoo charged all of her property with the performance of her obligations, promised to do all things necessary to secure the registration of the security so granted, and agreed (in clause 13.1(a)) that the security so granted would become immediately enforceable upon an Event of Default.

102    Further on that topic, there can be no doubt that Ms Ramoo is a debtor as defined in s 10 of the PPSA. It relevantly provides:

(a)    a person who owes payment or performance of an obligation that is secured by a security interest in personal property (whether or not the person is also the grantor of the security interest); ...

103    It is important to identify the relevant obligations that are secured by the grant of an interest in Ms Ramoo’s personal property. The relevant obligations include Ms Ramoo’s obligation under clause 19.1(a) to guarantee to Grow Trade “all amounts owing by [Medoc] to [Grow Trade]”. It is that secondary obligation, owed personally by Ms Ramoo, that is secured by the charge granted in clause 19.1(e). She did not directly charge her property in the performance of Medoc’s primary obligation. I accept that part of Ms Ramoo’s submissions.

104    When those circumstances are imported in s 123 of the PPSA Ms Ramoo is a debtor (being a person who owes an obligation to make the payment promised under clause 19.1(a)) who is in default of that agreement. For the purposes of the PPSA, the relevant “default” is her personal failure to pay to Grow Trade the amounts owed by Medoc.

105    On Ms Ramoo’s case, there could be no default until there was a demand for payment, and no demand had been made. I reject that submission. Grow Trade’s contractual right to appoint the Receivers to Ms Ramoo’s personal property did not depend upon an inability or unwillingness of Ms Ramoo to meet her obligations under the guarantee in response to a demand. In accordance with clause 13(a), the security interest granted under clause 19 became immediately enforceable by virtue of Medoc’s default. No demand was necessary.

106    If I am wrong in those conclusions, I would find in any event that a demand has in fact been made of Ms Ramoo and that she has failed or refused to comply. The demand was contained in a letter dated 1 October 2024. After withdrawing an objection to its admissibility, Ms Ramoo argued that the letter could not be construed as a demand for payment because it contained an offer of compromise. I reject that submission. The circumstance that the letter also contained an offer did not denude it of its character of a demand for payment. It served the purpose of notifying Ms Ramoo of the extent of her obligation (as it then existed) and informing her that Grow Trade’s rights to enforce payment of the whole of the amount owing would be exercised. That is sufficient to overcome any requirement that notice must be given to a “debtor” in order for there to be a “default” for the purposes of s 123 of the PPSA.

107    I do not consider it necessary to resolve the respondents’ alternate construction of s 123 of the PPSA, which proceeded from the premise that Medoc (and not Ms Ramoo) is the defaulting debtor for the purposes of the provision. It is enough to find that, on the facts, Ms Ramoo is the debtor in default of the security agreement pursuant to which her own personal assets were charged.

Seizure of money

108    Questions concerning the Receivers’ powers of seizure had a factual focus on their asserted entitlement to money standing in Ms Ramoo’s bank accounts held with ANZ. Ms Ramoo argued that the money was intangible property within the meaning of s 123(2) of the PPSA. It provides:

(2)    For the purposes of this Act, unless subsection (3) applies, a secured party may seize intangible property only by giving a notice, stating that the giving of the notice constitutes seizure of the property, to the following persons:

(a)    the grantor;

(b)    if the intangible property is a licence—either:

(i)    the licensor; or

(ii)    the licensor’s successor.

109    Ms Ramoo’s originating application does not directly require the Court to resolve that question, confined as it is to questions relating to the validity of the Receivers’ appointment. However, the issue arises on the cross-claim given the breadth of the second of the two declarations sought.

110    I reject the submission that money standing in a bank account must be “seized” by a secured party by the particular method prescribed in s 123(2) of the PPSA.

111    Section 10 of the PPSA defines “intangible property” to exclude “financial property”. The phrase “financial property”, in turn, includes “currency”. The word “currency” is defined to mean:

… currency authorised as a medium of exchange by the law of Australia or of any other country.

112    The definition encompasses the Australian dollars standing in Ms Ramoo’s bank accounts, authorised under Australian law as a medium of exchange. That is enough to reject Ms Ramoo’s contention that the Receivers are bound to comply with s 123(2) of the PPSA before accessing the money standing in the account. As the Receivers correctly submit, if there remains any doubt as to Grow Trade’s entitlement to possess and apply the money standing in Ms Ramoo’s personal bank accounts (whether directly or by an agent) or any doubt about the lawfulness of their remonstrations to ANZ, then an affected party (or non-party) may apply to this Court for orders specifying the methods by which property may be seized and applied. Any such application would be determined in the context of my findings about Ms Ramoo’s obligation to put up her property as the agreed method for the performance of her obligations, irrespective of her legal title in that property.

113    I should add that the parties did not directly address the operation of s 123(3)(a) of the PPSA, which provides that intangible property may be seized by another method, if so agreed between the parties to the security agreement.

Section 8 of the PPSA

114    By an argument raised for the first time in responsive written submissions, Ms Ramoo contended that the PPSA did not apply at all because the charge over her property was an “equitable charge” that fell within an exclusion in s 8. It relevantly provides:

8    Interests to which this Act does not apply

(1)    This Act does not apply to any of the following interests (except as provided by subsection (2) or (3)):

…

(c)    a lien, charge, or any other interest in personal property, that is created, arises or is provided for by operation of the general law;

115    It is unacceptable that Ms Ramoo should now seek refuge in that provision, given that her prior submissions proceeded from an assumption that the PPSA applied. However, the argument was dealt with by the respondents in yet further submissions transmitted by email and it may be shortly disposed of on a limited basis.

116    The assumption underlying the argument was that the charge created by clause 19.1(e) of the Agreement arose “by operation of the law” in that it depended for its subsistence on the intervention of a Court in Equity. I have already denounced that assumption. I reject the new argument for the same reason.

117    In any event, Ms Ramoo’s submissions failed to address how s 8 and the definition of a “security interest” in s 12 interrelate. I have no difficulty concluding that the present case concerns an interest in personal property arising out of a consensual transaction for the purposes of s 12:  see the discussion in Dura (Australia) Constructions Pty Ltd (in liq) v Hue Boutique Living Pty Ltd (2014) 49 VR 86 (at [110] – [128]). It was for Ms Ramoo to explain how such an interest could be one to which the PPSA is excluded because of s 8. She has not done so and it is neither necessary nor appropriate to call for further submissions on the point.

THE FREWVILLE LAND

118    Section 55A of the LP Act imposes formal requirements for the possession of land in the enforcement of rights against a mortgagor. It applies where the mortgagee is a natural person and the land is appropriated for domestic use.

119    It has not been shown that Grow Trade has appointed or purported to appoint Receivers over the Frewville Land.

120    The Notice of Appointment is confined to all of Ms Ramoo’s “present and after acquired consumer and commercial property (no exceptions)”. Real property is not captured by that expression. On the material before me, there is no reason to anticipate that the requirements of the LP Act would not be complied with should Grow Trade proceed to exercise any rights it may have in the Freville Land, whether by the appointment of receivers or otherwise.

DECLARATORY RELIEF

121    There will be an order dismissing Ms Ramoo’s originating application.

122    On the cross-claim, there will be declarations substantially to the effect sought by Grow Trade and the Receivers. The second of those declarations is to the effect that s 123 of the PPSA operates such that any one of Grow Trade or the Receivers may seize Ms Ramoo’s personal property in the exercise of rights conferred by the Agreement. Lest there be any doubt about the extent of those rights, they include a contractual right in Grow Trade to seize the property, being a right inherent in clause 19.1(e) identified in these reasons, irrespective of the appointment of any receiver. Ms Ramoo’s legal title is not an obstacle to the exercise of that right. The same right is exercisable by the Receivers in their capacity as Grow Trade’s agents. Those rights exist notwithstanding my conclusion that clause 15 of the Agreement does not provide an additional source of rights in relation to Ms Ramoo’s property.

Associate:

Dated:    18 March 2026

SCHEDULE OF PARTIES