The Supreme Court of Queensland has disallowed one Bank of Queensland borrower's defence that BOQ was negligent in providing a loan to him, but has allowed his wife the chance to run a defence of negligence, provided she indemnifies BOQ for loss of interest foregone. Starting with Paul Wright, the first defendant to an action by BOQ, the court ruled in favour of the bank - in effect giving the bank one part of the summary judgment it sought against the Wrights for almost A$5.6 million, the amount said by BOQ to be owed to it for a loan secured by valuable property. Citing a number of recent cases in other Australian courts, the court said this application should be determined on the law "as it stands". In so doing the court said the law of contract, as it applies to the guarantor of a loan, was "clear" and overrides any provisions in the Code of Banking Practice (specifically, clause 3.2) which seek to impose a duty banks to act "fairly and reasonably". The Code "… is a vague obligation and an uncertain base for a defence on these facts", the judge observed. The court ruled, however, in favour of the other defendant, Faye Wright, who argued that she was not a guarantor of the loan and that her husband dealt with all their financial issues. While expressing doubts over "the fundamental weakness" of any defence that "the female defendant" may be able to rely on, suggesting it was "[not] particularly promising for her, allowing for her having been involved in a series of transactions, and the fundamental point that she was, with him, the owner of the borrower company", the court conceded that her case "does just pass the threshold where the facts should be explored at a trial".This may, however, prove to be a pyrrhic victory as the judge also agreed with BOQ's lawyer that Mrs Wright should pay $200,000 into court. This was to cover the estimated amount of the interest which will fall due in the four month lead-up to the trial, set down for five days from 25 August 2014.The Wright's lawyer pointed out that the imposition of such a condition would "stifle the litigation, given their financial position".The judge said the right to run what seems to be a weak defence "should come at a price which will afford the plaintiff some relief should the defence fail at trial", as the bank has been "denied a right to immediate judgment". As the case currently stands, if the indemnity is not paid into the court by 24 April, BOQ has a summary judgment in its favour and can move to claim the valuable land given as security by the Wrights for the loan.