Page 4938 - Week 15 - Thursday, 8 December 1994

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MOREOVER, BEFORE A GUARANTORS OBLIGATIONS UNDER A CREDIT CONTRACT ARE INCREASED, THE GUARANTOR MUST RECEIVE WRITTEN NOTICE OF THE PROPOSED CHANGES, AND BEFORE THEY BECOME BINDING, THE GUARANTOR MUST FIRST ACCEPT THEM IN WRITING.

I MUST DRAW YOUR ATTENTION TO PART 4 OF THE CODE WHICH DEALS WITH CHANGES TO OBLIGATIONS UNDER CREDIT CONTRACTS, MORTGAGES AND GUARANTEES, AND, IN PARTICULAR, DIVISION 3 WHICH FOCUSES ON CHANGES ON GROUNDS OF HARDSHIP AND UNJUST TRANSACTIONS. IN RELATION TO HARDSHIP, THE CODE PROVIDES AS A GENERAL PRINCIPLE THAT A DEBTOR WHO IS UNABLE REASONABLY, BECAUSE OF ILLNESS, UNEMPLOYMENT OR OTHER REASONABLE CAUSE, TO MEET HIS OR HER OBLIGATIONS UNDER A CREDIT CONTRACT, AND WHO REASONABLY EXPECTS TO BE ABLE TO DISCHARGE HIS OR HER OBLIGATIONS IF THE TERMS OF THE CONTRACT ARE CHANGED BY EITHER EXTENSION OR POSTPONEMENT, CAN APPLY TO A CREDIT PROVIDER FOR SUCH A CHANGE. THIS FACILITY DOES NOT APPLY WHERE THE CREDIT PROVIDED EXCEEDS $125,000.

THE CODE ALSO EMPOWERS THE CREDIT TRIBUNAL TO REOPEN

UNJUST TRANSACTIONS. A COURT MAY REOPEN A TRANSACTION

IF SATISFIED ON THE APPLICATION OF THE DEBTOR, MORTGAGOR

OR GUARANTOR THAT IN THE CIRCUMSTANCES RELATING TO THE

CONTRACT, MORTGAGE OR GUARANTEE, AT THE TIME THE

TRANSACTION WAS ENTERED INTO OR CHANGED, THE

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