AOC Finance Pty Ltd v Veritas Marketing Pty Ltd

Representation: Solicitors:
HFK Lawyers (Plaintiff)

File Number(s): 2024/00368164

Publication restriction: N/A

ex tempore JUDGMENT

1. By notice of motion dated 19 January 2026 and filed in Court this afternoon, 21 January 2026, the second and third defendants seek, relevantly, orders as follows:

2. Execution of the Writ of Possession and Notice to Vacate for Certificate of Title 131/12782 known as 51 Alan Street, Yagoona, NSW, 2199 (“the property”) due to be executed on Thursday 22 January 2026 at 9am be stayed until further order;

3. That Judgment entered against the Second Defendant and Third Defendant be stayed pending further order.

4. Initially, it was sought that the motion be heard ex parte, but as events transpired, the plaintiff was able to get its solicitor here and I heard the matter at around 3:30pm this afternoon.

5. The principles guiding the exercise of the discretion in determining a notice of motion such as the present are well settled, and they were explained in helpful terms by Johnson J in GE Personal Finance Pty Ltd v Smith [2006] NSWSC 889.

6. His Honour referred to three categories of case where such a stay might be ordered. The present case falls within the third category. That is, it is a case where the defendants seek to sell the property on their own terms. It is not a case where the defendants seek to be, as his Honour put it, “let in” to defend the proceedings. That is, the defendants do not dispute the debt in question, which was the first category referred to by his Honour. The second category is where there is a realistic attempt to refinance the debt. There was some suggestion in the course of argument that there were attempts late last year to refinance, but the attempts to do so seem to have failed and were not pressed as an option this afternoon.

7. There was also mention, largely in the nature of explanation for the delay in bringing this application, of an attempt to obtain money from the sale of gold said to be in Kampala, Uganda. The amount of gold in question and the amount it would yield if sold would not come close to covering the total debt in question. There is also little hard evidence to support the proposition that such a sale is imminent. The second defendant told the Court:

“SECOND DEFENDANT: I had money organised to come in for the gentleman, as I have been doing it for a wee while. It never arrived. So when that didn't arrive and in December‑‑

HIS HONOUR: What is the nature of that money?

SECOND DEFENDANT: I do some business overseas and there is supposed to be $4,000, $5,000 coming in on that part.

HIS HONOUR: What sort of business?

SECOND DEFENDANT: I do - I'm involved with gold.

HIS HONOUR: With what?

SECOND DEFENDANT: With gold selling from Kampala, to Dubai, to Iraq and the next part I need to get a licence to do here in Australia, but that didn't eventuate. The money, the gold, wasn't sold. And that's when I decided that I have to sell the property. And you know yourself, your Honour, in December, in January, very hard to sell.

HIS HONOUR: No, don't worry about what I know. What I know are the facts before me and what I know is that Justice Pike made these orders, relevantly, in October and November and what I don't know is just quite what this sale of gold was really about. Is there material about that in your affidavit?

SECOND DEFENDANT: No, I didn't use that, because all I said was money was coming in for me in a business deal. I wasn't going to put that in and make it all look rosy for everyone. That's what I was waiting for to come in to pay the bill.

I had the bill for $724,000, the bill that was originally in there. When that didn't eventuate, that delayed the sale, so it was late in December/January I knew that's when I took the measured steps to sell the property. And with holidays between, as you know yourself, between January 24 ‑ December 24 until last week, with everyone started coming back to work, it was a bit hard to start move it any earlier to do any sales. HIS HONOUR: Did you communicate with the mortgagees?

SECOND DEFENDANT: No, I didn't communicate, because I was still hoping that the money would come in and when the money never came in, then I went straight to the agency and got the best agency I believe that can do the right thing by me and my family, to pay the bill that I owe them, the ANZ bank.

HIS HONOUR: Just what has happened, in the terms of the gold and the sale and the money?

SECOND DEFENDANT: The gold part has been stalled. The people who were supposed to buy the gold didn't come to buy it. So the gold is still sitting in Kampala at the moment, in Uganda, and I am hoping still that goal [sic] can get sold within the period of the sale of the house ‑ then I have got both ways to go ‑ but that's why I decided to sell the house, your Honour.”

6. The defendants also rely on what Johnson J described as “hardship grounds”. In particular, it is not disputed that the second defendant’s mother is very sick. She generally lives in a downstairs bedroom at the property and is currently an inpatient at the Royal Prince Alfred Hospital. She is expected to be discharged in the coming days, although precisely when is not clear, but the plaintiff does not dispute that she is sick and there is a brief letter from the Local Health District dated today which does establish that she was admitted to the hospital on 19 January 2026.

7. The second defendant and no doubt his wife, who is the third defendant, are concerned that there will be no appropriate accommodation when his mother is discharged if the writ is executed tomorrow. Further, the family itself, including their two dogs, will be without accommodation.

8. Where the property in question is valued at significantly more than the amount of the debt that the mortgage or mortgages are calculated to cover, relief from hardship grounds is far more likely to succeed. Johnson J put it as follows, at [22]:

“Ordinarily, if a Defendant is not in a position to demonstrate a reasonable foundation for a stay in one of the three circumstances referred to in paragraph 13 above, then there could be no reasonable expectation of an extended stay on hardship grounds only. If it is inevitable that the Plaintiff will obtain possession of the property for the purpose of exercising the power of sale, then it will be necessary for the Defendant to vacate the property.”

9. His Honour also referred to the relevance of the level of indebtedness against the value of the property later in the judgment, and specifically at [24].

10. In the present case, the judgment of this Court by Pike J sitting in the Equity Division was delivered on 20 June 2025. Then on 8 October 2025, his Honour made the following orders:

“1. A declaration that the property known as the whole of the land in certificate of tile Folio Identifier Lot 131 in DP 12782 (“the Property”) is the subject of an equitable mortgage in favour of the plaintiff pursuant to the Mortgage dated 24 October 2019 between the plaintiff and the first defendant.

2. An order for the judicial sale of the Property with the plaintiff to be appointed as the trustee for that sale.

3. As an aid to enforcement of order 2 above:

(a) An order that the second and third defendant provide vacant possession, to the exclusion of any party, of the Property to the plaintiff within 30 days from the date of this order.

(b) An order that a writ of possession be issued in relation to the Property in favour of the plaintiff forthwith, but that the writ is to lie in the Registry for a period of 30 days from the making of this order.

4. The Property be sold by the plaintiff as trustee for sale, either by public auction, or if, not sold at public auction by private contract, and to pay the proceeds of sale of the Property in the following order:

(a) first, for all the proper costs and expenses relating to the sale of the Property, including council rates, water rates, any statutory duties and charges and the plaintiff’s proper costs and expenses relating to the sale;

(b) secondly, as to any remaining proceeds of sale after payment in accordance with order 4(a), the whole of the amount due to the Fourth Defendant pursuant to registered mortgage AK254911;

(c) thirdly, as to any remaining proceeds of sale after payment in accordance with order 4(b), the whole of the amount due to the Plaintiff pursuant to the judgment, interest and costs of these proceedings;

(d) fourthly, as to any remaining proceeds of sale after payment in accordance with order 4(c), to be paid into court.

5. An order that the plaintiff shall, with respect to the sale of the Property, act in the following fashion:

(a) The plaintiff is to act at all times in relation to the sale of the Property in accordance with the duties owed by a mortgagee exercising a mortgagee’s power of sale;

(b) The plaintiff shall consult with the fourth defendant with respect to the sale of the Property and ascertain from the fourth defendant the amount owing to the fourth defendant pursuant to registered mortgage AK254911;

(c) Unless the court otherwise orders, the plaintiff shall not sell the Property at less than the amount sufficient to repay the amount owing to the fourth defendant pursuant to registered mortgage AK254911.

6. An order that at the settlement of the plaintiff’s sale of the Property, the fourth defendant provides to the plaintiff a discharge of the fourth defendant’s registered mortgage and any other documents of title (including, but not limited to, the Certificate of Title) in the fourth defendant’s possession or under the fourth defendant’s control relating to the Property as may be properly required for the completion of any such sale, in exchange for payment of amount owing to the fourth defendant pursuant to registered mortgage AK254911.

7. An order that the plaintiff be empowered to transfer the legal title of the Property to any purchaser(s) to effect the sale of the Property.

8. Liberty to apply to the court in relation to any matter arising in relation to the judicial sale of the Property and/or the distribution of the proceeds from that sale.

9. An Order that the second defendant and third defendant, jointly and severally, pay the costs of these proceedings of the plaintiff.”

11. Finally, on 26 November 2025, the writ of possession was issued to enforce the judgment debt. Going back a step or two, the debts that are to be secured by the forced sale of the property are, first, a registered mortgage to the ANZ bank covering what is now a debt of, in rough terms, $1,150,000. The present and relevant judgment debt owed to the plaintiff in these proceedings was $724,067.49, and with the addition of the generous interest rate stipulated by Pike J, is calculated to be, as of today, $816,202.83.

12. The second defendant, both in Court this afternoon but also in his affidavit, estimates the property will sell at approximately $1.8 million. As things unfolded this afternoon, there is some dispute between the parties as to precisely what the sale might yield. The plaintiff suggests that the sale may yield no more than $1.6 million, and indeed, even in the contract of sale annexed to the second defendant’s affidavit, there is an estimate of the current estimated selling price based on the agent’s opinion, and there is a range from $1.65 to $1.8 million.

13. Again, I quote Johnson J in GE Personal Finance Pty Ltd v Smith at [20]:

“The third category involves a stay application where the Defendant wishes to sell the property. It might be thought that the orderly preparation and presentation of the property for sale, with the Plaintiff and Defendant co-operating in this regard, would maximise the prospect of a favourable sale price. This would serve the interests of the Plaintiff and the Defendant.”

14. I note parenthetically that a submission to that general effect was made by Mr Jonoski this afternoon when he said that it is in the interests of both parties that such an orderly sale be made and he would be in the best position to attract the highest sale price, but his Honour, Johnson J, went on (at [20]):

“A Defendant may encounter difficulties on a stay application if the decision to sell the property, and to make necessary arrangements for this to be done, is left until the last minute when the Writ of Possession is about to be executed.”

15. Again, at [24], his Honour said:

“It is a relevant factor, in the exercise of discretion on a stay application, to have regard to the level of indebtedness under the mortgage and the extent to which the Defendant has made payments and attempted generally to comply with the conditions of the mortgage.”

16. I have significant sympathy for the second and third defendants. However, the reality is that delaying the sale further now, would simply be to delay the inevitable. Further, leaving the matter to the last few days before the writ was to be executed has placed the Court, and indeed the plaintiff, in a difficult position.

17. As Johnson J explained in GE Personal Finance Pty Ltd v Smith, this is a discretionary decision. I regret to say that in the circumstances prevailing here, where there is a real doubt that the sale price obtained (even if the second defendant arranges the sale with his preferred agent) will cover the entirety of the debt both to the ANZ bank, which will come out first, and then be subject to the judgments of Pike J last year.

18. In those circumstances, the discretion must be exercised against the defendants.

19. Accordingly, I decline to make the orders sought in the notice of motion and the motion is dismissed.

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