by Tim O’Dwyer M.A., LL.B
During 2008 the Commonwealth Bank made loans totalling $13.5 million to Matthew Perrin, his wife Nicole and their family company. Among other securities, the bank relied on guarantees and mortgages apparently signed by Nicole. Some of these encumbered Perrins’ (previously unencumbered) sprawling Cronin Island family home held in Nicole’s name.
Within six months Matthew, but not Nicole, was bankrupt. When the bank eventually sued Nicole under the guarantees and mortgages for $10.7 million outstanding, she claimed her signatures were forgeries.
After the bank had delivered various sets of documents to Matthew for execution by him and Nicole, he returned the signed documentation and Nicole’s title deed (which he collected from their solicitors). All signatures were apparently witnessed by Bill’s brother, Fraser, who later asserted his signatures were forged. (The bank offered no explanation for these undisputed forgeries consistent with its claim that Nicole had signed personally.)
The bank’s case rested on several bases: Firstly, the signatures were Nicole’s. Secondly, if Matthew signed instead, he had authority under a Power of Attorney. Thirdly, Matthew signed under an implied authority. Fourthly, Nicole ratified the transactions and documents. Fifthly, the bank claimed an equitable mortgage by receiving Nicole’s title deed.