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Capital Securities Mortgages Pty Ltd v Events By Lush Pty Ltd [2026] NSWSC 387 | Case summary | Zoe

NSWNSWSC

Capital Securities Mortgages Pty Ltd v Events By Lush Pty Ltd [2026] NSWSC 387

[2026] NSWSC 387

Supreme Court of NSW|2026-04-17|Before: Sirtes J

View on NSW Caselaw

At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2026-04-17

Before

Sirtes J

Catchwords

CIVIL PROCEDURE - default judgment - setting aside - whether bona fide defence on merits - no issue of principle

Source

Original judgment source is linked above.

Catchwords

CIVIL PROCEDURE - default judgment - setting aside - whether bona fide defence on merits - no issue of principle

Judgment

Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.

Medium Neutral Citation: Capital Securities Mortgages Pty Ltd v Events By Lush Pty Ltd [2026] NSWSC 387

Hearing dates: 13 April 2026

Date of orders: 17 April 2026

Decision date: 17 April 2026

Jurisdiction: Common Law

Before: Sirtes J

Decision: See [75]

Catchwords: CIVIL PROCEDURE – default judgment – setting aside – whether bona fide defence on merits – no issue of principle
CIVIL PROCEDURE – pleadings – whether Defence has tendency to cause prejudice, embarrassment or delay – whether leave to replead

Legislation Cited: Australian Securities and Investments Commission Act 2001 (Cth)
Civil Procedure Act 2005 (NSW) ss 56, 98
Contracts Review Act 1980 (NSW)
Real Property Act 1900 (NSW) s 57
Uniform Civil Procedure Rules 2005 (NSW) rr 7.1, 14.28, 36.16

Cases Cited: Dunwoodie v Teachers Mutual Bank Ltd [2014] NSWCA 24; 9 BFRA 433
Kirby v Sanderson Motors Pty Ltd (2001) 54 NSWLR 135; [2002] NSWCA 44
Kyabram Property Investments Pty Ltd v Murray [2005] NSWCA 87
Macquarie International Health Clinic Pty Ltd v Sydney South-West Area Health Service (No 3) [2010] NSWSC 1139
Magnate Projects Pty Ltd v Youma Constructions (No 2) Pty Ltd [2005] NSWCA 331
National Australia Bank Ltd v Mellander [2023] NSWSC 1171

Category: Procedural rulings

Parties: Capital Securities Mortgages Pty Ltd (Plaintiff)
Events By Lush Pty Ltd (First Defendant)
Christine Anne Perry (Second Defendant)
Ian Robert Perry (Third Defendant)

The Plaintiff seeks relief against the First Defendant for possession of land at Rosemeadow (Rosemeadow Property), as well as an order for leave to issue a writ of possession concerning that land. As against the Second and Third Defendants, the Plaintiff seeks judgment for possession of a different parcel of land at Ambarvale (Ambarvale Property), as well as leave to issue a writ of possession in relation to that land.
The First Defendant owns the Rosemeadow Property. The Second and Third Defendants own the Ambarvale Property as tenants in common in equal shares.
The claim relates to a Loan, Security and Guarantee Deed dated 1 May 2025 (the Deed) under which the Plaintiff advanced to the First Defendant the sum of $1,555,000 (the Loan).
Paragraph 6 of the Statement of Claim pleads that, pursuant to the Deed, the Defendants agreed to a number of terms concerning the repayment of all advances outstanding as at the Termination Date, which is pleaded as being on whichever date that was the earlier of the termination of the Facility by the Plaintiff or 12 months from the date of the Initial Advance (as those terms are defined in the Statement of Claim). There are further terms pleaded in relation to interest payable and other terms common in such documents.
The Second and Third Defendants executed the Deed as guarantors. It is pleaded that, in that capacity, they agreed to guarantee the obligations and performance of the First Defendant thereunder.
Two mortgages were granted to secure the Loan. One was granted by the First Defendant over the Rosemeadow Property. The second mortgage was granted by the Second and Third Defendants over the Ambarvale Property.
Paragraph 14 of the Statement of Claim contends that the First Defendant failed to pay interest in advance on the first day of each calendar month at the applicable interest rate, commercial line fees at the rate of 0.1% per month, and default administration fees. These defaults caused a letter to be sent to the First Defendant on or about 15 August 2025. The letter demanded payment of $111,326.04 pursuant to the Deed. A similar demand was also made against the Second and Third Defendants on the same date pursuant to the guarantee. On that date, the Plaintiff also issued a s 57(2)(b) notice under the R**eal P**roperty A**ct 1900 (NSW) in respect of the Rosemeadow Property and Ambarvale Property.
The Plaintiff pleads that the failure by the Defendants to pay the monies alleged to be due and payable, “individually, jointly or in combination” constitute Events of Default such that, on or about 24 September 2025, the Plaintiff’s solicitor, by letter, informed the First Defendant that it had cancelled the Facility, terminated the Deed and demanded payment of the sum of $1,725,622.90. A cognate demand was also made upon the Second and Third Defendants as guarantors for the same sum.
On or about 24 September 2025, the Plaintiff gave the First Defendant a further s 57(2)(b) notice in relation to the Rosemeadow Property and gave such a notice to each of the Second and Third Defendants in relation to the Ambarvale Property.
The monies loaned by the Plaintiff have not been repaid which, the Plaintiff pleads, entitles it to enforce the two mortgages.

When the matter came before the Court on 13 April 2026, the First and Second Defendants were required to seek the Court’s leave to file two Notices of Motion, namely:
the First Defendant’s Notice of Motion to set aside the default judgment entered against it on 12 December 2025 (and ancillary orders); and
the Second Defendant’s Notice of Motion to set aside the default judgment entered against her on 27 March 2026 (and ancillary orders).
In support of the application for leave, Ms Clare Perry, who also sought leave to appear for the Second Defendant, read four affidavits in relation to the Application and the two motions, namely:
the affidavit of Clare Margaret Perry sworn on 16 March 2026;
the affidavit of Christine Anne Perry sworn on 26 March 2026;
the affidavit of Christine Anne Perry sworn on 30 March 2026; and
the affidavit of Ian Robert Perry Sworn on 17 December 2025.
The application for leave was not opposed by the Plaintiff. Shortly stated, the First and Seconds Defendants relied on a combination of factors including the medical circumstances surrounding the birth of Ms Clare Perry’s child, difficulties in attempting to file documents through the Court’s “Lawlink” portal, the absence of funds to pay the necessary filing fees, and the significant health issues caused by the Second Defendant’s age. The Second Defendant deposed that these issues have impacted her ability to independently manage her affairs, including these proceedings.
Although it is important for parties to faithfully comply with orders made by the Court, I am satisfied that the Defendants here have sought to do so and have not acted with any contumacious disregard for the Court’s orders. Accordingly, I granted leave to the First and Second Defendants to file their respective motions in Court and have made a recommendation to the Registry to waive filing fees in relation to them. Accordingly, those motions are before the Court.
The Plaintiff opposes the First and Second Defendants’ applications. It also seeks, albeit without a Notice of Motion before the Court, an order that the Defence filed by the Third Defendant be struck out and judgment for possession be entered against him.
It is necessary for the First and Second Defendants to persuade me that there is a justifiable basis for the judgments presently entered against them to be set aside. If I am not persuaded that there is such a basis, it follows that the orders for writs of possession sought by the Plaintiff should be made.

Against those motions, the Plaintiff relies upon two affidavits of Mr Justin James Mathews sworn on 9 February 2026 and 10 April 2026. The affidavits, which are not contested, reveal the following.
In applying for the Loan, the Second and Third Defendants provided to the Plaintiff forms that verified their identities. These forms included their addresses and email addresses. The Second Defendant also provided to the Plaintiff a copy of her government-issued photo card. The Third Defendant provided a copy of his driver licence.
The Plaintiff’s solicitor has corresponded with the Defendants since 15 August 2025 in relation to the defaults. This correspondence culminated in the letter the Plaintiff’s solicitor sent to the First Defendant’s registered office on or about 24 September 2025 cancelling the Facility, terminating the Deed and demanding immediate repayment of $1,725,622.90.
None of the Defendants in their correspondence with the Plaintiff’s solicitors appear to have raised the circumstances on which the Defendants now seek to rely in defence to the claim. Rather, Mr Mathews records in his 9 February 2026 affidavit that the Defendants stated on 10 September 2025 that their circumstances had changed. Mr Mathews states, in that affidavit, that the Defendants sought time to refinance the Loan with a new lender, subject to the sale of the Ambarvale Property. This was followed by correspondence on 16 September 2025 in which the Defendants stated that they anticipated having the Ambarvale Property ready for a (profitable) sale by the end of September 2025 and that a new lender was willing to refinance upon that sale.
In his 9 February 2026 affidavit, Mr Mathews records that the Statement of Claim was served on the First Defendant on 3 November 2025, the Third Defendant on 24 November 2025, and the Second Defendant on 27 November 2025.
The First Defendant annexed to its 18 December 2025 Notice of Motion a document styled “Defence”. On 19 January 2026, Mr Mathews requested that the Second and Third Defendants provide by 30 January 2026 particulars of any unfair and unconscionable conduct alleged in that document. He continued that the Plaintiff would rely on any response, or lack thereof, at the hearing of the application to set aside default judgment. Mr Mathews notes that the Defendants did not respond.
Not only were no particulars provided to the Plaintiff, but the affidavits on which the Defendants rely do not articulate adequate or sufficient facts informing the First and Second Defendants’ draft proposed Defences. Those draft proposed Defences form the foundation of the First and Second Defendants’ applications.

The First Defendant (and, as I shall address below, the Second and Third Defendants) raises a defence based on alleged facts. It was served with the Statement of Claim in early November 2025. It is irrefragable that ample time has passed to prepare evidence which provides some factual support for the assertions contained in the draft proposed Defence. No such evidence has been provided.
At no point since August 2025, when the First Defendant defaulted under the Deed, has it issued any correspondence raising contentions which would support the draft proposed Defence. In addition, the Plaintiff’s request for particulars (albeit to the Second and Third Defendants) has not been answered in circumstances where the Defendants are family members and would presumably share knowledge of the facts that would support the existence of a bona fide defence on the merits.
The Court is left with nothing more than unsupported assertions. As the Court of Appeal noted in Magnate Projects, quoted at [33] above, it was incumbent upon the First Defendant, as a judgment debtor seeking the exercise of the Court’s discretion, to set aside a default judgment, to introduce some evidence of facts that show a bona fide defence on the merits.
In addition to these matters, the Plaintiff submits that the facts contradict the First Defendant’s assertions. The Plaintiff points to the Finance Application in which the Defendants stated that the Second and Third Defendants had income of $405,000 per annum and that the First Defendant had income of $370,000 per annum. The Plaintiff is entitled to rely upon this information in its attempt to persuade the Court that the Plaintiff was not engaging in asset-based lending. This information also points to the fact that documentation provided to the Plaintiff as lender indicated that the Defendants obtained independent legal advice from a solicitor, Mr Craig Reeve, before executing the Deed and other loan documents. Mr Reeve also witnessed the Defendants’ signatures.
Apart from the deficiencies in the facts said to inform the First Defendant’s claim, as was explained in Dunwoodie at [45], it must be bona fide in seeking to rely upon its proposed Defence. I am not satisfied that it is. The effect of the proposed Defence is that the First Defendant is not liable to the Plaintiff. Yet as set out at [36] above, that Defence pleads that the Plaintiff remains “fully secured”, the First Defendant is attempting to sell the property, and that, in truth, what it seeks is a “stay of proceedings to allow for an orderly sale”. I consider that the First Defendant is seeking to rely on the proposed Defence for the ulterior purpose of attempting to delay the proceedings, rather than to obtain the relief to which it says it is entitled.
In the light of the Plaintiff’s evidence and the absence of any relevant evidence from the First Defendant, I am not persuaded that the First Defendant has, or is seeking to rely upon, a bona fide defence. I therefore dismiss the First Defendant’s motion to set aside the default judgment.

I am required to assess, in light of the Second Defendant’s affidavit evidence and the draft proposed Defence, whether I accept that the draft proposed Defence is bona fide on the merits. The lacunae in the facts sworn to by the Second Defendant present a significant challenge to my making that finding.
For example, the Second Defendant fails to address the circumstances in which she came to sign the Deed. Not only does that document bear her signature in numerous places, her signature was witnessed by Mr Reeve. The executed documents include:
an “Important Notice to Guarantor” which warned of the serious nature of the guarantee obligation and the right to refuse or limit liability;
a statutory declaration by each individual guarantor declaring that they understood the terms of the Deed, signed freely and voluntarily without undue influence, obtained independent legal advice and that the Facility would not cause financial hardship; and
a “Declaration by Third Party Mortgagor” which confirmed receipt of independent legal advice and voluntary execution of the Deed and mortgage documents.
The statutory declaration was made in the presence of a solicitor. There is no evidence from the Second Defendant suggesting that the statutory declaration was falsely declared. In those circumstances, I am not prepared to find that the statutory declaration was falsely declared. Much of that statutory declaration contradicts the Second Defendant’s affidavit. Specifically, it states that:
the Second Defendant was a guarantor;
she understood the terms of the Deed;
she freely and voluntarily executed the Deed without undue influence or pressure from any third party;
she had the opportunity to obtain, and did obtain, independent legal advice before signing the Deed;
she had considered and understood the “nature and effect” of the documents and transactions contemplated by the Deed; and
the Plaintiff entered into the Deed at the Second Defendant’s request and in reliance upon her statutory declaration.
The Second Defendant also signed a declaration that she is a “Third Party Mortgagor, Guarantor, Surety Mortgagor or Indemnifier” for the Plaintiff for the Loan as it related to the Ambarvale and Rosemeadow Properties and that she had received independent legal advice from Mr Reeve.
The Second Defendant does not address these matters in her 26 March 2026 affidavit. In the face of a statutory declaration witnessed by an independent solicitor, the contents of the Second Defendant’s 26 March affidavit are difficult to accept.
In an application of this kind I must be persuaded that the Second Defendant has a bona fide defence on the merits. The Second Defendant’s failure to address these matters, especially in circumstances where these proceedings have been on foot for many months, is a strong factor in my consideration of whether I am persuaded that she has a bona fide defence on the merits. I am not so persuaded.
For those reasons, the Second Defendant’s motion to set aside the default judgment is dismissed.

The Third Defendant’s position is different from that of the First and Second Defendants. He complied with the Court’s orders to file his Defence and so no judgment has been entered against him. He does not need to persuade the Court of anything.
The Plaintiff acknowledges that there is no default judgment against the Third Defendant but states that the Defence should be struck out for essentially the same reasons that inform its attack on the existence of a bona fide defence on the merits contained in the First and Second Defendants’ draft proposed Defences. The Plaintiff submits that the Third Defendant, in addition to matters raised by the First Defendant, claims to have relied on the mortgage brokers and says that the default notices were sent to the wrong addresses. The Plaintiff responds that there is no dispute that the Third Defendant has been on notice of the default for months, and there is no evidence that any incorrect service of the default notices has had any effect.
The Third Defendant’s Defence is deficient in a number of ways. First, and most significantly, it fails to articulate any material facts which give rise to a proper defence beyond mere assertions that the Plaintiff’s conduct was “unconscionable” and the Deed, the Loan and attendant securities were “unjust”.
Secondly, the Third Defendant’s Defence seeks to “adopt” the First Defendant’s draft proposed Defence “insofar as it is applicable”. The Plaintiff should not have to intuit which parts of a Defence apply and which do not.
Thirdly, I do not see the relevance of the speed at which the transaction took place, nor why the Third Defendant’s reliance on brokers or other parties has any bearing on the enforceability of the Loan and mortgage.
I consider that that the Third Defendant’s Defence as pleaded is embarrassing in the sense articulated by Hodgson JA (with whom Mason P and Handley JA agreed) in Kirby v Sanderson Motors Pty Ltd (2001) 54 NSWLR 135; [2002] NSWCA 44 at 142 [20] – 143 [21], and that it will inevitably fail. For these reasons, as well as the reasons given in relation to the First and Second Defendants, I will order the Third Defendant’s Defence be struck out pursuant to UCPR r 14.28.
However, I will grant the Third Defendant an opportunity to replead his Defence, subject to one major qualification.
In addition to filing a further Defence, I require the Third Defendant to file an affidavit of ‘facts and circumstances’, whereby he must explain the circumstances in which he entered into the Loan and the Deed, as well as his execution of his statutory declaration as guarantor and the declaration of receipt of independent legal advice. These are matters which the Plaintiff is entitled to know at this stage of the proceedings in order to assess whether there is, in fact, a bona fide defence on the merits. At present it is not apparent to me that one exists, but I am prepared to allow the Third Defendant one further opportunity to demonstrate that one is available to him.