Victorian Consolidated Legislation

Fair Trading Act 1999 - SECT 32SA

Limit of liability of guarantors

32SA. Limit of liability of guarantors



(1) If there is a contract of guarantee in relation to the performance of the
obligations of a purchaser under a contract of supply of goods or services,
the liability of the guarantor in relation to the performance of those
obligations does not include liability in respect of an amount exceeding the
sum of-

   (a)  the amount for which the purchaser is liable by reason of the breach
        of the contract of supply; and

   (b)  the reasonable costs of and incidental to enforcing the contract of
        guarantee.

(2) Subject to subsection (3), a guarantor of the obligations of a purchaser
under a contract of supply of goods or services where the purchaser is a minor
is liable under the contract of guarantee to the same extent as the guarantor
would be liable if the purchaser had not been a minor when the contract of
supply was made.

(3) Subsection (2) does not apply with respect to a contract of guarantee
unless, when it was made, it included a prominent statement immediately above
or below the place where the guarantor signed the contract to the effect that
a person who enters into a guarantee in respect of the obligations of a
purchaser who is a minor may not have a right to recover from the purchaser
amounts that the guarantor is liable to pay under the contract of supply.

(4) In this section-

domestic partner of a person means-

   (a)  a person who is in a registered relationship with the person; or

   (b)  an adult person to whom the person is not married but with whom the
        person is in a relationship as a couple where one or each of them
        provides personal or financial commitment and support of a domestic
        nature for the material benefit of the other, irrespective of their
        genders and whether or not they are living under the same roof, but
        does not include a person who provides domestic support and personal
        care to the person-

   (i)  for fee or reward; or

   (ii) on behalf of another person or an organisation (including a government
        or government agency, a body corporate or a charitable or benevolent
        organisation); guarantee includes indemnity; guarantor means a person
        who enters into a contract of guarantee in respect of the performance
        of the obligations of a purchaser under a contract of supply of goods
        or services or of a person who enters into a contract of indemnity in
        relation to a contract of supply of goods or services but does not
        include-

   (a)  a person who is the supplier, or spouse or domestic partner of the
        supplier of goods or services to which the contract relates; or

   (b)  if the supplier is a body corporate, a person who is a director or an
        officer of the body corporate or is a related body corporate within
        the meaning of the Corporations Act or a director or an officer of a
        related body corporate or spouse or domestic partner of that director
        or officer; or

   (c)  a person who enters into a contract of guarantee or a contract of
        indemnity in respect of the obligations, under a contract of supply of
        goods or services, of a person who deals in goods or services of the
        kind to which the contract of supply relates; spouse of a person means
        a person to whom the person is married.

(5) For the purposes of the definition of domestic partner in subsection (4)-

   (a)  registered relationship has the same meaning as in the
        Relationships Act 2008; and

   (b)  in determining whether persons who are not in a registered
        relationship are domestic partners of each other, all the
        circumstances of their relationship are to be taken into account,
        including any one or more of the matters referred to in section 35(2)
        of the Relationships Act 2008 as may be relevant in a particular case;
        and

   (c)  a person is not a domestic partner of another person only because they
        are co-tenants.