Written by A recent NSW Supreme Court decision highlights the importance of precision in contract variations and clarifies the legal status of email communications in commercial transactions. In PF 473 Pty Ltd v Qasim [2024] NSWSC 874, the Court considered whether email exchanges between parties and their respective solicitors could amend the terms of an existing loan agreement and mortgage.
The case involved a $2.8 million loan from PF 473 Pty Ltd to Rohailla Holdings Pty Ltd, secured by a registered mortgage over properties. After the loan agreement and mortgage were executed, the parties sought to adjust repayment schedules and interest rates via email. Ms Qasim, the guarantor of Rohailla Holdings Pty Ltd, argued that the email communications did not reflect her instructions and that formal requirements under the Conveyancing Act 1919 (NSW) were not satisfied.
The Court disagreed, finding that the emails clearly demonstrated a mutual intention between the parties to vary the agreement. Importantly, the email correspondence was deemed “in writing” and “signed” under the Interpretation Act 1987 (NSW) and the Electronic Transactions Act 2000 (NSW). Justice Faulkner confirmed that clauses in contracts requiring variations to be in writing do not invalidate an otherwise enforceable amendment, even those made by email. He also emphasised that the registered mortgage remains the key document in defining the lender’s rights, and that its terms will prevail over any informal variations.