First Appellant v Respondent

1 The appellants appeal the orders of an Associate Judge in favour of the Respondent.

2 This appeal concerns two proceedings heard before an Associate Judge.[1] The respondent in both matters, as plaintiff ('Westpac'), claimed it provided the appellants with two loans secured by mortgages over two properties.

3 On 23 September 2003, the respondent granted an equity access loan with a limit of $420,000 on 23 September 2003 ('the first loan agreement'). Subsequently, Westpac varied the loan agreement by increasing the credit limit to $496,000 on 24 March 2004. There were terms of the loan agreement that applied to the variation. In proceeding S CI 2010 06772, Westpac sought possession under a mortgage that secured the loan following default by the appellants.

4 On the same day, 23 September 2003, the respondent granted an equity access loan with a limit of $384,000 ('the second loan agreement'). Subsequently, Westpac varied the loan agreement by increasing the credit limit of the second loan agreement to $409,000 on 24 August 2005 and the limit was again increased on 23 November 2007 to $434,000. There were terms of the loan agreement that applied to the variation. In proceeding S CI 2010 6774, Westpac sought possession under a mortgage that secured the loan following default by the appellant.

5 Broadly speaking, the terms of the loan agreements[2] dealt with the rate and payment of interest, the repayment of the outstanding principal and notices of demand.

6 The terms also required the appellants to provide security by a first registered mortgage given as registered proprietors over properties. The first loan agreement was secured by a property at 349 Nepean Highway, Brighton East[3] ('the first mortgage'). On 27 September 2003 the appellants provided the mortgage. On 20 November 2007 the appellants transferred the land into the name of the first appellant only, Ms Hou, subject to the mortgage. The second loan agreement was secured by a property at 308 Ferrars Street, South Melbourne[4] ('the second mortgage') given on 23 September 2003. That property is in the name of Ms Hou.

7 Westpac alleged Ms Hou exceeded the credit limit of the first and second loan and failed to make good the sum due under the loans and the mortgages .[5]

8 Westpac commenced proceedings claiming possession of both properties under the first and second mortgages against Ms Hou. Westpac also sought the monies due under the first loan against both Ms Hou and Mr Kanakaridis and the monies due under the second loan against Ms Hou.

9 In their defences[6] the appellants admitted the loans and their terms and the mortgages. The admissions proved to be significant. Otherwise in their defences the appellants did not admit (ie did not deny) the amounts alleged to have been advanced or borrowed or the service of notices by Westpac pursuant to the loan agreements. The appellants were represented by lawyers at the time and who filed the defences for the appellants.

10 On 6 September 2011, Westpac filed two summonses seeking summary judgment in both proceedings. The summonses were supported by two affidavits of John Pasto, Collections Officer of Westpac ('the affidavits'). The affidavits exhibited and purported to provide the necessary proofs namely business and computer records of Westpac, the statement of the debts alleged, the first and second loan agreements, the terms and conditions of the loan, letters of variation, a reproduction of the first and second mortgages, the transfer of the land to the first appellant (in relation to the first loan agreement), the relevant loan accounts, the relevant statements and default notices and details of the calculation of interest.

11 The summonses and affidavits were not served until February 2014, that is, almost 18 months later as the appellants filed a dispute with the Financial Ombudsman Service. The dispute delayed matters until January 2014.[7] Then, between February and April 2014 there were various adjournments. Finally, the matter came before the Associate Judge on 2 April 2014. Westpac relied on the summonses, the affidavits of Mr Pasto and other formal affidavits.[8] On 2 April 2014, with leave,[9] Westpac filed an amended statement of claim in both proceedings then including the terms of the loans and particulars of the relevant variations and advancement of monies to the appellants.

12 The non-admissions[10] were then said by the appellants to be based on their assertion that they lost many of their financial books and accounts when packing to move their residence around 3 or 4 March 2011.

13 At the outset of the hearings on 2 April 2014 for summary judgment, the appellants applied for an adjournment on the ground of the ill-health of the first appellant, Ms Hou. The appellants were represented by counsel for the purpose of that application. The adjournment application was refused by the Associate Judge for four reasons. First, the fact that the appellants had been on notice of the summary judgment applications since early February 2014, when the Financial Ombudsman Service dispute was resolved, a period of some two months beforehand. Secondly, the defence filed did not advance any positive defence, together with the fact that there was no affidavit material before the court in support of the possible ventilation of any defence to the application for summary judgment. Thirdly, the weight of a medical certificate relating to the alleged ill-health of the first appellant was outweighed by the preceding factors. Further, in this regard her Honour noted that the medical certificate was not deposed to on affidavit, the first appellant in fact had been treated by the same doctor for some time and the medical certificate was at odds with the first appellant's previous instructions to her lawyers and counsel. Fourthly, the appellants asked for an adjournment as the second appellant, Mr Kanakaridis asserted he had unspecified business dealings that may have enabled him to pay the subject debt. Her Honour considered that in light of the age of the matter and the lack of sufficient explanation, the justification for the adjournment was insufficient.

14 Counsel who had appeared for the appellants before the Associate Judge on the adjournment application then withdrew. The summary judgment applications proceeded unopposed - the appellants did not appear.

15 At the commencement of the unopposed summary judgment applications, Westpac made an application to amend the statement of claim in both proceedings as described already. The proposed amended statements of claim had been exhibited to the two affidavits of Mr Pastro sworn on 2 September 2011 (one for each proceeding) and were served on the appellants' lawyers on 6 February 2014, that is, upon the completion of the dispute before the Financial Ombudsman Service and two months before the summary judgment hearing.

16 In her judgment in relation to the second loan and second mortgage the Associate Judge explained her reasons for granting leave to file an amended statement of claim. Her Honour said:

I gave leave to amend the statement of claim for the following reasons:

(1) Notice of the application to amend had been given by the summons and the affidavit in support of the summons exhibited the proposed amended statement of claim;

(2) The amendments were sought to bring the statement of claim in line with the evidence which had also been served at that same time; and

(3) I was satisfied that to the extent there was any substantive difference to be effected by the amended statement of claim it was only to provide particulars that the defendant herself had requested.[11]

17 I note from the transcript[12] that her Honour went through the proposed amended statements of claim very carefully and, also, scrutinised the affidavits in support including satisfying herself through questions to counsel. Indeed, having heard counsel at length, her Honour took advantage of the luncheon adjournment to read and consider the amended statements of claim and other documents before announcing her decision.

18 Her Honour made orders on 2 April 2014 in favour of Westpac. In the matter regarding the first loan and first mortgage she made orders:

(a) for possession of the land against the first appellant;

(b) the first appellant pay $737,224.27 together with statutory interest;

(d) the appellants pay the costs of Westpac on an indemnity basis.

19 In the matter regarding the second loan and second mortgage she made orders:

(a) for possession of the land against the first appellant;

(b) the first appellant pay $627,424.65 together with statutory interest;

(c) the appellants pay the costs of Westpac on an indemnity basis.

20 In reasons for judgment[13] the Associate Judge traversed and was satisfied as to the formal proofs of the debt and the mortgages. In particular, her Honour noted that the loan agreements, the mortgages, the change of ownership of land and the advances were admitted in the defence drawn and filed by lawyers then acting for the appellants. Her Honour considered and was satisfied as to the formal proofs of the debt the subject of the loan agreements and the mortgages. On 15 April 2014, the appellants lodged a notice of appeal against her Honour's orders in each proceeding.

21 On 21 July 2014,[14] the appellants filed an amended notice of appeal in each proceeding.[15] The appellants seek to appeal against all orders made by the judge on 2 April 2014, in both proceedings, including the refusal of an adjournment application, the granting of leave to Westpac to file an amended statement of claim, the ordering of the service of the amended statement of claim within seven days, the orders for possession of the land, the judgment debt and costs.

22 The appellants notices of appeal and submission in relation to each proceeding were, for all intents and purposes, identical. I shall deal with them together. The questions of law relied on by the appellants were not properly formulated in that they do not articulate questions of law, rather, they make assertions of fact. Nevertheless, at their highest, questions 1 to 9 make the following assertions of fact presumably to demonstrate that the associate judge wrongly decided the matter. Those questions of law assert the loan agreement was null and void because:

(a) the Bank of Melbourne was unregistered (question 1), unlicensed (questions 2, 3 and 4) and was acting illegally (question 5); and

(b) the mortgage and memorandum of common provision are unenforceable (questions 6,7,8 and 9).

23 There were nine questions of law recited in the amended notice of appeal. However, these may be condensed into first, the invalidity question and, secondly, the conflict of interest submission. There are three grounds of appeal proposed which I encapsulate:

1. the refusal to grant the adjournment constituted a denial of natural justice;

2. there was no enforceable contract between the appellants and Westpac; and

3. the evidence relied on by Westpac in support of the summary judgment application was deficient.

24 With the agreement of the first appellant, Ms Hou, the second appellant Mr Kanakaridis appeared to speak for both appellants. Upon inquiry in court, Ms Hou expressly agreed to that course. At the end of oral argument I raised with Mr Kanakaridis whether he would be assisted by access to legal advice. He embraced the opportunity and subsequently was provided access to the Victorian Bar Pro Bono Scheme. As a consequence, I reserved my judgment on 19 August 2014. Arrangements were made thereafter by the Supreme Court registry and Mr Kanakaridis was given access to a barrister under the Scheme. The Court was asked by the barrister (through correspondence) for access to the court file and some time to consider and advise Mr Kanakaridis. This occurred. In the meantime, Mr Kanakaridis purported without notice of leave to file an affidavit over 40 pages in length sworn and filed on 28 August 2014. The affidavit was in part a further written submission and in other parts inadmissible. Westpac was served with the document and given the opportunity for submissions in reply but did not file any submissions. Westpac objected to the receipt of the affidavit I will describe as the third affidavit.[16]

25 In addition to the notices of appeal the appellants issued a subpoena[17] ('the first subpoena') returnable on the same day as the notices of appeal seeking that Westpac's lawyers, Gadens, produce:

1. an original power of attorney from Westpac to its lawyers, Gadens, authorising the latter to act, including filing the writs in this and other proceedings;

2. the Legal Practitioner's Certificate held by Gadens; and

3. the admission by this court under the Legal Profession Act 2004 (Vic) ('Legal Profession Act') permitting Gadens to practise.

26 Further, the appellants served a second subpoena ('the second subpoena') on Westpac's lawyers, Gadens,[18] returnable on the same day as the appeal seeking production of:

1. a 'certified' list of all loan and mortgage securities which Westpac and Westpac Securitization Management Proprietary Limited had 'sold, assigned, securitized, transferred, since 1 August 2003 to 12 August 2014' and details as to which parties the listed activities had passed to;

2. 'certified evidence' as to the authority by which the Bank of Melbourne claimed to be a division of Westpac after 3 May 1998 and related information; and

3. 'certified evidence' by which the Bank of Melbourne was permitted by 'APRA' to use the title 'bank' and related matters.

27 Westpac filed a summons[19] also returnable on the same day as the appeal seeking the setting aside of both subpoenas and an order restricting the appellant from filing further subpoenas without court approval. On 19 August 2014 after hearing oral submissions, I set aside the subpoenas and ordered:

1. Pursuant to r 42.04(1) of the Supreme Court (General Civil Procedure) Rules 2005 (the Rules):
   1. the subpoena directed to Susan Sumars of Gadens Lawyers (Ms Sumars) issued on 5 August 2014 to produce documents on 19 August 2014 be set aside; and
   2. the subpoena directed to Ms Sumars issued on 12 August 2014 to produce documents on 19 August 2014 be set aside.
2. For the purposes of r 42.02(a) of the Rules, no further subpoenas be issued at the request of the appellants (or either of them) without the court first granting leave after satisfying itself that any proposed subpoena is properly framed and appropriate to the proceeding.
3. The appellants pay the respondent's costs of the application on an indemnity basis. [20]

28 I indicated I would publish my reasons as a later time which I now do.

29 Pursuant to rule 42.04(1) the court may set aside a subpoena in whole or in part or grant other relief if a subpoena:

(1) The Court may, of its own motion or on the application of a party or of any person having a sufficient interest, set aside a subpoena in whole or in part, or grant other relief in respect of it.

30 The appellant supported the first subpoena on two bases. First, the basis that the lawyers, Gadens, did not have the authority or link with Westpac so as to be able to act in the Supreme Court or take steps under the Transfer of Land Act 1958 (Vic). The argument ran that Gadens must be proved to have standing, recognition and authority to do things as lawyers and in the name of Westpac. Secondly, the appellants submitted that as a corporation Westpac must be represented by a lawyer in any Supreme Court proceeding, hence, it was essential that Gadens and the instructing lawyers prove they were permitted to so act, that is, under the Legal Profession Act. Thus, it was argued, the writs in these proceedings signed by Gadens would not have been validly issued. I reject the submissions. First, Westpac and the lawyers conducting these proceedings deposed as to Gaden's authorization and the lawyers holding of a current practising certificate under the Legal Profession Act.[21] Secondly, Gadens is a longstanding firm recognised for filing purposes under the Supreme Court (General Civil Procedure) Rules 2005 (Vic) (the 'Rules'). Thirdly, the submission is a nonsense and a distraction. There are law firms conducting litigation in the Supreme Court daily who are recognised by the Prothonotory. If they were required to established their status each time they filed a writ or pleading the administration of justice would be unnecessarily delayed and distracted. Assertions of this type should be emphatically rejected and I do. The documents sought in the first subpoena are irrelevant but in any event are rendered otiose by the affidavits filed by Westpac on point.

31 The appellant supported the second subpoena on the basis that the original loan had been provided by the Bank of Melbourne, not Westpac. As the Bank of Melbourne had ceased to trade in 1998 (so it was said) the first and second loans were invalid; they contended that Westpac did not trade as the Bank of Melbourne. It was also submitted that under the Banking Act 1959 (Cth) it was an offence to trade as a bank unless authorised to do so. Hence, the appellants submitted, Westpac needed to prove it was an authorised bank. Next, on the second subpoena, it was submitted that Westpac and/or the Bank of Melbourne - it was not clear which - was prohibited from dealing with financial services without displaying an Australian Financial Services Licence. It seemed to be asserted that this had not occurred and thus neither Westpac nor the Bank of Melbourne were licensed. Lastly, the appellants said that Westpac had sold off all mortgages and it therefore had no authority to prosecute the first and second mortgage. In this regard the appellants alleged they had received no notice of the transfer of either mortgage.

32 In addition, the appellants alleged that Westpac had acted fraudulently. However, no submission beyond the bald assertion was made nor was any evidence produced to substantiate such serious allegation.

33 At the outset I note that the appellants responded to and admitted the validity of the writs by the filing of the defences and, in particular, in not seeking to strike out the writs before entering an appearance.[22] Further, in the defences the appellants admitted the incorporation of Westpac, the first and second loan and the first and second mortgage. In order to resile from the admissions the appellants would need to seek leave to amend their defence. Such a grant of leave, after a trial has begun, is not given lightly and the party seeking the amendment must demonstrate good reason.[23] In this case, the appellants have not provided any evidence to the Court to support such an application. The defences were drafted by solicitors and have stood for a significant period of time.[24] To allow such an amendment would prejudice the position of the respondent. Furthermore, this proceeding is an appeal from an Associate Judge, it is not a trial at first instance. What the appellants have sought to do is to run a different case on appeal that is in conflict with its position at trial. The Court will only allow such a departure in exceptional circumstances[25] and only where the Court is satisfied that it is 'expedient in the interests of justice'.[26] The same factors listed above stand against allowing the appellants to change their position on appeal. Thus, at this point, it is not open to the appellants to make the assertions as to validity and illegality as they do to underpin the second subpoena. Thus, the reasons put forward to support the second affidavit are baseless. The documents sought are not relevant in the circumstances.

34 In any event, I note further that the first and second loan agreements expressly refers to the 'Bank of Melbourne' as a 'division of Westpac Banking Corporation ABN 33 007 457 141' and the mortgage refers to 'Westpac Banking Corporation ABN 33 007 457 141' as the mortgagee and lender. Thus, it is clear the proper entity commenced the proceedings. There is no sound basis to the appellants' submissions and the second subpoena should not stand.

35 Furthermore, in my view there is no legitimate forensic purpose made out for either subpoena. There was no material before the court to make it appear likely that the documents sought would materially assist the appellants[27]. In the words of Derham AsJ in Matthews v SPI Electricity Proprietary Limited and Others (No 12)[28] 'there is nothing shown to demonstrate it is 'on the cards' that the documents would materially assist the appellant'[29]

36 Both the first and second subpoenas should be set aside.

37 The appeals are brought under rule 77.06 which permits an appeal from any judgment or order of an Associate Judge. They are appeals in the strict sense. Hence, the appellants must demonstrate error of law.[30]

38 The appellants filed a written submission in support of both of their appeals. In summary the points made were:

1. The appellants sought a stay (presumably of prosecution by Westpac of the two proceedings).

2. Westpac had engaged in misleading and deceptive conduct (with reference to the affidavit of Mr Kanakaridis of 15 July 2014 - the first affidavit).

3. The appellants denied seeing the terms and conditions of the loans and the Memorandum to the mortgages.

4. The power of attorney provisions under the mortgages were not complied with.

5. The judgments were 'harsh and excessive' because if the disputed accounts had been settled the judgments and surrounding events would not have occurred.

6. Full payment of the debt had occurred (with reference to the affidavit of Ms Hou of 25 July 2014).

7. The loans and mortgages were illegal, unenforceable and unregulated.

8. Westpac engaged in unconscionable conduct in breach of the Fair Trading Act 1999 (Vic).

9. Westpac had not complied with the Trade Practices Act 1974 (Cth) (now the Australian Consumer Law 2010 (Cth), the Uniform Credit Code (the 'Code') and the Australian Securities and Investments Commission Act 2001 (Cth).

39 I note at the outset that none of the matters in the questions of law were put to the Associate Judge (the appellants not appearing). The appellants rely on the affidavits of Mr Kanakaridis sworn 15 July and 28 August 2014, self-evidently filed after the judgments of her Honour. Rule 77.06.9 permits the receipt of further evidence on an appeal on the question of fact. The appellants did not properly explain why the affidavits and/or their contents were not put to her Honour other than to indicate they were not present at the hearing, were distracted by financial matters and that Ms Hou was ill. The explanation is inadequate, even allowing for the fact the appellants are representing themselves. They were aware of the applications for summary judgment given their application on 2 April 2014 for an adjournment of the summary judgment applications.

40 The affidavit of Mr Kanakaridis of 15 July 2014 is largely a submission containing unsubstantiated assertions. I will describe the document as 'the first affidavit'. The only relevant statements of fact are:

• the 'association' between the Bank of Melbourne and Westpac was not disclosed to the appellants;
• Westpac unlawfully used the Bank of Melbourne to entrap and intimidate clients - presumably the appellants - to steal their properties and funds;
• Westpac did not commence trading as the Bank of Melbourne until 25 July 2011 whilst the relevant loan contracts were entered into in September 2003;
• if the appellants had been aware of the 'predatory intent' of either Westpac or the Bank of Melbourne they would not have dealt with them;
• Westpac harassed and intimidated the appellants; and
• various searches revealed that Westpac and the Bank of Melbourne were unregistered, unlicensed or otherwise acted in breach of their statutory obligations.

41 The first affidavit of Mr Kanakaridis was filed out of time.[31]

42 Westpac objected to the filing of the first affidavit on the basis that no leave to do so had been granted. After the hearing of the appeal the appellants forwarded to the court a supplementary affidavit of Mr Kanakaridis sworn 28 August 2014. No leave was sought or obtained by the appellants. No explanation was given for the purported filing save it was 'in the interest of justice' to do so and the appellants needed to 'set the record straight'.[32] Westpac objected to the filing of the supplementary affidavit.[33]

43 The supplementary affidavit again contained largely submissions and purported to expand on the matters in the first affidavit. In summary, the facts deposed to were:

• other proceedings issued by Westpac were settled with the appellants;
• the appellants were served with a total of three writs[34] which they forwarded to their lawyers;
• the appellants' lawyers were incompetent and negligent because:

(a) the admissions in the defences were wrong and negligently made and were contrary to the appellants' position;

(c) the lawyers filed defences that were in fact only a draft document not a final (and approved) defences;

(d) the lawyers entered an appearance not a conditional appearance (on the basis that VCAT had exclusive jurisdiction to determine the dispute);

• the appellants have continuously maintained that they had not entered into an agreement with Westpac, rather with the Bank of Melbourne;
• the appellants did not sign any agreements;
• they received no more than an informal offer from the Bank of Melbourne;
• the documents received from the Bank of Melbourne were only pre-contractual disclosures;
• the mortgages were obtained by fraud because:

(a) they were not original documents - presumably a reference to those documents produced to the Associate Judge on the summary judgment applications which were copy documents the status of which were confirmed in the affidavit in support of the judgment application;

(b) the mortgage documents were falsified and the loan contracts were never signed by the appellants;

(d) the signing of the mortgage was out of character for the appellants - the appellants made an offer to Westpac to settle the matters which was rejected by Westpac;

• Mr Kanakaridis contacted one Ms Parking of Westpac on 26 July 2014 (after orders of the Associate Judge on 2 April 2014) concerning these proceedings and she had no knowledge of the loans or mortgage which demonstrated the need for the appellants to view the actual authority for Gadens to act for Westpac; and
• the appellants required Westpac to send the final bills for payout of their loan accounts on 27 July 2014, they were received and paid out in cash on 25 July 2014.

44 Otherwise, for the most part, the supplementary affidavit addressed the legality and standing of Westpac and the Bank of Melbourne; asserted non-compliance with the documentary requirements of the Code; asserted problems with the mortgage documents, namely, that the documents tendered in evidence by Westpac were only photocopies, not originals or certified documents. The affidavit also asserted there was no evidence by Westpac that:

• the appellants saw the mortgage documents;
• the appellants researched the memorandum of common provisions of the mortgages;
• the appellants were given the opportunity to read or understand the memorandum or to obtain legal advice;
• there was no evidence of any witnessing of the loan agreements or the memorandum.

45 Finally, the supplementary affidavit asserted that Westpac has sold off its residential loans and mortgages and therefore cannot enforce the relevant loan or mortgage relating to the appellants.

46 Examination of the first and second loan agreements[35] and the first and second mortgages[36] reveals that the instruments were signed and there is no evidence to the contrary save the assertion in Mr Kanakaridis' affidavit. For example, there is no forensic evidence to support the appellants' assertion. Further, the mortgages appears to be witnessed by one 'Lino Di Petta'. This individual was not questioned. If the appellants challenge the efficacy of the execution of the documents they bear the onus.[37]

47 The Associate Judge in her reasons went through each of the proofs of Westpac. Her Honour noted that the loan agreements were admitted, by the defence, but also proved by the affidavit of Mr Pasto.[38] The judge considered the variations and was satisfied they were proved.[39] Her Honour was also satisfied that insofar as the loans were regulated loans under the Code notice requirements were satisfied.[40] Her Honour considered the mortgages and was satisfied they were proved together with their Memorandum of Common Provisions.[41] In addition the judge considered each of the other proofs relating to the advance,[42] the fact of default[43] and notice.[44] Further, her Honour considered that if the Code applied then necessary notice of 30 days was sufficient.[45]

48 To repeat, it is for the appellants to make out the questions of law and to demonstrate error of law. None of the findings of her Honour are challenged save to assert that the loan documents were 'pre-contractual' and therefore not final. Plainly they were not. Examination of the relevant exhibits to Mr Pasto's affidavit reveals they were the relevant loan documents. It is not suggested by the appellants that those documents were forged. With respect to the mortgage itself, there is nothing revealed from her Honour's consideration of the documents to suggest forgery. In any event, as I already observed, there is no evidence to support the assertion. Furthermore, it is apparent that the appellants had the benefit and enjoyment of the monies provided under the loan agreements and the properties secured by the mortgages. If they believed the documents underpinning the loan agreements, including as varied, were as they put it 'pre-contractual' it beggars belief that Westpac (through the Bank of Melbourne) would just give the appellants the money. The argument is a nonsense.

49 The matter of the standing of Westpac was not raised and therefore not expressly considered by the Associate Judge, save in one respect. The loan and mortgage documents were drawn and executed in the name of the Bank of Melbourne.[46] Nonetheless it was plain from the loan documents that the lender is 'The Bank of Melbourne a division of Westpac Banking Corporation (the lender)';[47] in the loans terms and conditions, there is a reference to the Bank of Melbourne as 'a Division of the Westpac Banking Corporation' on the cover page and the reference to the Westpac Banking Corporation in clause 25 concerning marketing;[48] the confirmation letter in relation to the first loan referring to the Bank of Melbourne as a division of the Westpac Banking Corporation on the front page[49] and signed by the manager 'for and on behalf of the Bank of Melbourne a division of Westpac Banking Corporation';[50] the two variation letters in relation to the second loan appear on Westpac letterhead;[51] the mortgage documents themselves expressly recite 'Westpac Banking Corporation' as the mortgagee;[52] the Memorandum of Common Provisions reciting at the top of the front page 'Westpac Banking Corporation'; and, finally, the bank statements for the loans were from 'Westpac Banking Corporation' plainly recited at the top of each page.[53]

50 The appellants complained that their lawyers wrongly entered an appearance and made admissions in the defence as to the mortgages, the loan agreements and the standing of Westpac. Nothing was put to the Associate Judge to support these assertions. Furthermore, no evidence was submitted to demonstrate why the admissions should not stand or why Westpac could not rely on them. The non-admission was then said by the appellants to be based on their assertion that they lost many of their financial books and accounts when packing to move their residence around 3 or 4 March 2011. If the appellants have a grievance with their lawyers their remedy lies elsewhere.

51 There is a further aspect of the mortgages and the monies they secured not considered by the appellants. The mortgaged were registered, hence, under indefeasibility of title principles, absent fraud, the mortgages stands and prevails.[54] Absent some valid reason in law or equity to the contrary, a registered mortgage is enforceable upon default. There was no evidence of fraud led by the appellants, merely an assertion and complaint about Westpac and the Bank of Melbourne. These allegations were embarrassing and ought not have been made. It is a significant and important reason why the affidavits of Mr Kanakaridis should not be received and leave for their filing ought be refused. I will deal with the affidavits and the matter of leave later in these reasons.

52 In my view no new matter has come to light to show that the Associate Judge failed to consider the standing of Westpac. It was entirely appropriate to be satisfied on the proofs submitted that Westpac was entitled to pursue the loan and mortgage.

53 Turning then to the specifically articulated questions, I assess them as follows:

The invalidity of the mortgages and loan agreements were not made out. The mortgages and the loan agreements as varied are enforceable by Westpac. No question of law arises.

Westpac is the correct party and entitled to prosecute the claim. No question of law arises.

The mortgages and the loan agreements were admitted as was the standing of Westpac in the appellant's defences. There was no evidence that Westpac was not the holder of any necessary license to enter into the mortgages or the loan agreements as varied. No question of law arises.

No error is demonstrated. No question of law arises.

No illegality or improper conduct on the part of Westpac has been made out; no evidence was produced to support the allegations. No question of law arises.

The mortgages and the consequential debt arising from the loan agreement were enforceable. No question of law arises.

There was no evidence filed by the appellants to support the assertion that they had not seen or witnessed the mortgages or its terms including the memorandum of common provisions. Page one of the loan agreements incorporated the standard terms and conditions. The mortgage instruments incorporated the memorandum of common provisions by reference.[55] Furthermore, the mortgages and hence their terms were admitted by the appellants' defence. They are not permitted to resile from those admissions. No question of law arises.

There was no evidence filed by the appellants to support the claim that there was a serious conflict of interest between the Donor of the Power of Attorney and the Power of Attorney. No question of law arises.

There is no evidence that the mortgages were not witnessed. In any event, the mortgages were admitted in the defence. Further, Westpac is entitled to rely on the indefeasibility of its title. No question of law arises.

54 In summary, with respect to the questions, no error of law has been demonstrated. However, there is a threshold issue that arises. The appellants elected not to appear to defend the applications for summary judgment. As observed already, no adequate explanation was provided as to why they did not appear. All, or most, of the matters they sought to rely on in the appeals were not put before the Associate Judge. It would be quite wrong, indeed an erroneous exercise of discretion and contrary to legal principle[56] for the appellants to be permitted to run all the matters they purport to do, absent adequate explanation, as if the appeals were the first hearings. To permit them to do so would be to disregard the nature of the appeal. These matters also go to the question of whether leave should be granted to the appellants to rely on their affidavits.

55 For completeness, I note that the matters in Mr Kanakaridis' affidavits suggest estoppel and/or accord and satisfaction or at least payment of the debt. There is no evidence to support the assertion. Mr Kanakaridis deposed in an affidavit of 1 August 2014 as to the alleged payment of the debt with Westpac. I note Westpac relied on an affidavit of Alexia Falie Schar of 31 July 2014 that the amounts owing to Westpac were current. There was a further affidavit filed by Westpac of Susan Sumars of 19 August 2014 as to a chain of emails from Mr Kanakaridis alleging the subject debt was paid out which Westpac denied. I also note that in his affidavit Mr Kanakaridis relied on provisions of the Bills of Exchange Act 1909 (Cth). I perceive these references were tantamount to an assertion that Westpac was bound by the alleged payment of the subject debt. I found the assertions to be confused and indecipherable and, in any event, not substantiated. Hence, Westpac denied that the debts had been discharged. Thus, the onus lay on the appellants and was not discharged. In any event, any transactions after 2 April 2014 relate to matters after the orders were made by the Associate Judge. There is also an assertion of disadvantage in the nature of an Amadio defence.[57] Again, there is no evidence to support such an assertion in so far as it is made. The mere fact that Ms Hou had a limited grasp of English is insufficient. More must be demonstrated to establish a 'real' defence to the necessary standard.[58]

56 The appellants also made reference to the Code. It was not entirely clear as to how they applied the Code. The Associate Judge was satisfied the requirements of the Code were met. As best I may identify the submissions, they were twofold. First, that the proceedings should have been filed at the Victorian Civil and Administrative Appeals Tribunal. The submission is misconceived. The proceedings involved a mortgage and related borrowings not subject to the Code. Secondly, that there was non-compliance with the Code. As noted by the Associate Judge, the respondent's actions nevertheless complied with the Code. The only difference she found was that the Code would have changed the specification of the amount in the default notice. Her Honour held:

I have accepted the plaintiff's submission that the only area where there may have been a difference in outcome as to whether or not the loan was a UCCC loan was in relation to specification of the amount of the default in the notice. I accept his submission that if the amount was misstated (which the defendant had not alleged) if anything it would be an understatement and so would not affect the validity of the notice.[59]

57 As to how the Associate Judge was in error was not explained. No issue arises.

58 So far as is necessary I turn to the grounds of appeal.

59 First, the adjournment application. There was no error of law demonstrated by her Honour refusing the adjournment. She correctly applied the principles in AON Risk Services v Australian National University.[60] Further, the matter of the adjournment involved a discretion and no error or impropriety has been demonstrated in accordance with legal principle.[61] Secondly, the matter of the enforceability of the loan agreement has been considered.[62] Thirdly, the matter of the alleged efficiency of the evidence in support of the summary judgment applications has been considered also.[63] In my view, if it were necessary, none of the grounds of appeal are or would be capable of being made out and succeeding. In that respect, for completeness, I observe that the appropriate test for determining a summary judgment is whether the respondent to the application has a 'real' as opposed to a 'fanciful' chance of success.[64] The Associate Judge applied the correct test. No error has been demonstrated in that respect

60 Finally, I turn to the matter of leave to file the appellant's affidavits.[65] I refuse leave for three reasons. First, no adequate explanation for the very late filing was proffered. Secondly, the affidavits canvassed matters never put to the Associate Judge notwithstanding that this hearing was an appeal in the strict sense. Thirdly, the affidavits contained allegations of fraud against both the Bank of Melbourne and Westpac which were unsubstantiated. The allegations were embarrassing and scandalous and ought not have been made. The Court will not facilitate the prosecution of such matters through allowing them to go onto the court file.[66] So far as the respondent filed affidavits on the appeal it did so in response to the appellants' affidavits. Logically and as a matter of fairness, if necessary, it should be granted leave to file its affidavits. However, as leave to file is refused to the appellants it is unnecessary for any leave to be granted.

61 For completion I note that Ms Hou's affidavit referred to clause 23 of the loan agreements which invoked and included the Code of Banking Practice as a term of the agreement. There is authority that in such circumstances clause 25 of the Code of Banking Practice is incorporated into a loan agreement.[67] However, again the appellants face the difficulty that no submission was made to the Associate Judge on point; no error in this respect has been alleged; and, finally and importantly, putting mere assertion to one side there was no evidence or arguable case put forward by the appellants to demonstrate breach of the Code, in particular, clause 25.

62 Finally, I allow for the fact that the appellants have represented themselves. In accordance with the proper approach,[68] I have examined the appellants' affidavits (and the exhibits thereto) and written submissions extensively together with those of Westpac.

[1] Note that as these proceedings involved similar claims and documents, reference to an affidavit should be taken as reference to the affidavit filed in both proceedings unless otherwise noted.

[2] See amended statement of claim dated 3 April 2014 for S CI 2010 06772 and S CI 2010 06774 ('the amended statements of claim'); the terms as alleged were described in paragraph 3 of the amended statements of claim.

[3] Being the land at Lot 14, Plan of Subdivision 008133, and more particularly described in Certificate of Title Volume 04861 Folio 124.

[4] Being the land at Lot 1 on Title Plan 019744G, and more particularly described in Certificate of Title Volume 10557 Folio 867.

[5] Amended statements of claims paras [10]-[11].

[6] Filed 8 June 2011 in response to the original statement of claim filed 15 December 2010.

[7] See Financial Ombudsmen Services, Terms of Reference (1 January 2010), clause 13, http://www.fos.org.au/about-us/terms-of-reference/.

[8] The affidavits of Colin Candy sworn 25 August 2011; Alexia Falie Schar sworn 21 February and 27 March 2014; Matthew David Johnson sworn 25 February and 5 March 2014.

[9] Granted by Lansdowne AsJ on 2 April 2014.

[11] Westpac Banking Corporation v Hou [2014] VSC 329 [11]; her Honour provided similar reasons in granting leave to amend the statement of claim in the first loan and first mortgage proceeding, see Westpac Banking Corporation v Hou & Anors [2014] VSC 330 [10].

[12] Her Honour heard the proceedings together.

[13] Westpac Banking Corporation v Hou [2014] VSC 329; Westpac Banking Corporation v Hou & Anors [2014] VSC 330.

[14] Though both notices of appeal were dated 21 April 2014, they were not lodged until 21 July 2014.

[15] Leave to file the amended notices of appeal was granted by Vickery J on 9 May 2014.

[16] The document is headed 'The Supplementary Affidavit of Savvas Kanakaridis' sworn 28 August 2014.

[20] This order was made in relation to the proceeding S CI 2010 06772 as the subpoenas were issued under that matter; I made a similar order repeating orders 2 and 3 in the proceeding S CI 2010 06774.

[21] Affidavit of Maria Giorgatzis sworn 13 August 2014 as to the authorisation by Westpac of Gadens; affidavits of Annette Gaber sworn 13 August 2014 and Susan Sumars sworn 19 August 2014 as to authorisation and eligibility to act as lawyers for Westpac.

[23] Collie v Merlaw Nominees Pty Ltd (2001) 37 ASCR 361, 379; Cooper's Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738.

[24] See Collie v Merlaw Nominees Pty Ltd (2001) 37 ASCR 361, 379; Langdale v Danby [1982] 3 All ER 129, 138-9; Tony Sadler Pty Ltd v McLeod Nominees Pty Ltd (1994) 13 WAR 323, 331.

[25] Metwally v Universoty of Wollongong (No 2) [1985] HCA 28; (1985) 59 ALJR 481, 483.

[26] Multicon Engineering Pty v Federal Airports Corporation (1997) 47 NSWLR 631, 645; see also Equity-One Mortgage Fund Ltd v Stoyanov [2014] VSC 70.

[27] See Shaw v Yarranova Proprietary Limited 2011 VSCA 55 [26].

[28] [2014] VSC 131 [14].

[29] Ibid; see also R v Saleam [1999] NSW CCA 86 [11].

[30] See Schreuders v Grandiflora Nominees Pty Ltd [2014] VSC 310; Oswal v Carson [2013] VSC 355.

[31] The orders of Lansdowne AsJ were made on 2 April 2014 the notice of appeal was filed on 15 April 2014, orders for the filing of submissions were made on 9 May 2014 by Vickery J to be filed by 28 July 2014.

[32] Email of Mr Kanakaridis to the court on 28 August 2014 (placed on the court file).

[33] Email of Ms Sumars of Gadens to the court on 28 August 2014 (placed on the court file).

[34] In proceedings 2010 06772, 2010 26774 and 2010 06797.

[35] Affidavit of J Pastro sworn 2 September 2011, JP-1 (signed loan offer) and JP -2 (terms and conditions) and JP-3 (letter of acceptance of variation).

[36] Ibid exhibit JP-4 in S CI 2010 06772 (signed mortgage); Ibid exhibit JP-5 in SCI 2010 06774 (signed mortgage).

[37] See for example Petelin v Cullen [1975] HCA 24; (1975) 132 CLR 355, 360; Re Barned's Banking Co; Ex parte Contract Corporation (1867) LR 3 Ch App 105, 116; Edwards v Skyways Ltd [ 1964] 1 All ER 494, 499-500.

[39] Ibid exhibit JP-3 in S CI 2010 06772; JP-3 and JP-4 in S CI 2010 06774.

[40] Westpac Banking Corporation v Hou & Anors [2014] VSC 330 [14]; Westpac Banking Corporation v Hou [2014] VSC 329 [21].

[41] Westpac Banking Corporation v Hou & Anors [2014] VSC 330 [15]-[16]; Westpac Banking Corporation v Hou [2014] VSC 329 [14]; also the affidavit of J Pasto exhibit JP-4 and JP-5 in S CI 2010 06772 and JP-5 in S CI 2010 06774; the affidavit of A F Schar sworn 21 February 2014, exhibit AFS-2.

[42] Westpac Banking Corporation v Hou & Anors [2014] VSC 330 [17]; Westpac Banking Corporation v Hou [2014] VSC 329 [40].

[43] Westpac Banking Corporation v Hou & Anors [2014] VSC 330 [18]; Westpac Banking Corporation v Hou [2014] VSC 329 [40]

[44] Westpac Banking Corporation v Hou & Anors [2014] VSC 330 [19]-[23] Westpac Banking Corporation v Hou VSC 329 [45]-[47].

[45] Westpac Banking Corporation v Hou & Anors [2014] VSC 330, [21]; Westpac Banking Corporation v Hou Anors [2014] VSC 329, [45].

[47] Loan offer, affidavit of Mr Pastro, exhibit JP-1 p 1.

[51] Ibid exhibit JP-3 and JP-4 in S CI 2010 06774.

[52] Ibid exhibit JP-4 in S CI 2010 06772; JP-5 in S CI 210 06774.

[53] Ibid exhibit JP-7 in S CI 2010 06772; JP-8 in S CI 210 06774.

[54] See s 42 Transfer of Land Act 1958(Vic); Breskvar v Wall (1971) 126 CLR 376**;** Pyramid Building Society (in liq) v Scorpian Hotels Ltd [1993] VicRp 74; [1993] 2 VR 316; Horvath v Commonwealth Bank of Australia [1998] VSCA 51; [1999] 1 VR 643.

[55] See s 91B Transfer of Land Act 1958 (Vic).

[56] House v The King [1936] HCA 40; (1936) 55 CLR 499.

[57] Commercial Bank of Australia v Amadio [1983] HCA 14; (1983) 151 CLR 447.

[58] Ibid; also Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158; also s 63 Civil Procedure Act 2010 (Vic).

[59] Westpac Banking Corporation v Hou & Anors [2014] VSC 329 [45]

[60] [2009] HCA 27; (2009) 239 CLR 175.

[61] See House v The King [1936] HCA 40; 1936) 55 CLR 499, 505.

[64] Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158 [29].

[65] The affidavits of Qin Qin Hou sworn 15 July 2014; Savvas Kanakaridis sworn 15 July & 28 August 2014.

[66] See r1.14 of the Rules; Cracknall v Janson (1879) 11 Ch D 1, 13; Warner v Warner [1881] WN 69; Macpherson v Kerr; Ex parte Lewis [1893] VicLawRp 9; (1893) 19 VLR 23; Panozzo v Worland [2009] VSC 206.

[67] Commonwealth Bank of Australia v Doggett [2014] VSC 423 [101]ff; also, Sam Management Services (Aust) Pty Ltd v Bank of Western Australia Ltd [2009] NSWCA 320.

[68] See for example Downes & Anor v Maxwell Richard Rhys & Co Pty Ltd (in liq) [2014] VSCA 193 [23] (Osborn JA), [123] (Beach JA).