Murdaca v Accounts Control Management Services Pty Limited [2006] NSWSC 68 | Case summary

JUDGMENT 1 His Honour: The plaintiff obtained a loan from Avco Financial Services Limited (Avco). A copy of the relevant documentation is Exhibit A. It describes itself as a "Credit contract", having an account no. 40281. It was signed and accepted on 6 November 1997. It contained the following provision:- 12.4 If AVCO becomes entitled to demand payment under clause 12.2 it may then (subject to the Credit Code or any other legislation applicable) enforce its rights over the mortgaged property, including repossessing and selling the Goods and applying the sale proceeds towards satisfaction of your liability under this contract. 2 The loan was secured by a motor vehicle. The plaintiff defaulted. The motor vehicle was repossessed and sold. There was a shortfall. 3 Avco effected an assignment in favour of the defendant. The defendant then took steps to recover the debt. 4 The defendant sued the plaintiff in the Local Court to recover what remained owing under the loan. The sum claimed was less than $10,000. The proceedings were defended. The plaintiff appeared in person. 5 There seems to be some confusion as to whether or not the proceedings were in the Small Claims Division or the General Division of the Local Court. In any event, it seems as though they were dealt with on the basis that the proceedings were in the General Division. 6 Initially, the dispute was referred to arbitration. As I understand the position, the plaintiff was unsuccessful in the arbitration and sought a rehearing. Because the claim was for less than $10,000, the plaintiff had no entitlement to a rehearing. Despite this, a rehearing took place. It appears that the question of lack of jurisdiction was overlooked. This was a matter that the defendant intended to agitate if the proceedings were remitted back to the Local Court. 7 The rehearing came before Deputy Chief Magistrate Syme. A contested hearing took place. Judgment was delivered on 29 July 2005. The defendant was successful in obtaining a judgment in respect of the sum of $9,104 plus interest and costs. 8 On 26 August 2005, the plaintiff filed an appeal in this court. The summons lists the appeal grounds as follows:- 1. The learned Magistrate erred in finding that there was a valid and effective assignment of an alleged debt by Avco Financial Services Limited to the defendant such as to give the defendant standing to sue the Plaintiff 2. The learned Magistrate erred in finding that there was a debt owing by the Plaintiff to the defendant at all 3. The learned Magistrate erred in his finding that the Plaintiff was indebted to the defendant in a sum of $13255.45 4. The learned Magistrate erred in ordering the Plaintiff to pay the defendant's costs of the whole of the proceedings in circumstances where the original Statement of Claim claimed from the Plaintiff an incorrect sum of money and where an amendment to the Statement of Claim was made only at the hearing and the effect of which was to reduce the defendant's claim

The court has been informed that these grounds had been drafted by the plaintiff himself. 9 The appeal was heard on 17 February 2006. Both parties were legally represented. At the commencement of the hearing, the plaintiff sought leave to file an amended summons. The application was not opposed. 10 The effect of the amended summons was to reduce the grounds of appeal to two issues. The two grounds that were argued are as follows:- 1.5. The learned Magistrate erred in finding that Avco Financial Services Limited ("Avco") had assigned its interests and rights and entitlements under the contract it had with the Plaintiff to the Defendant, in circumstances where: (a) there was no evidence of any such assignment before her; (b) there was no evidence that notice of any such assignment had been given to the Plaintiff prior to the commencement of the proceedings; and (c) the only evidence of notice of any such assignment consisted of a document which, on its face, referred by number and content to an alleged debt which the Plaintiff did not have to Avco. 1.6. The learned Magistrate erred in her construction of clause 12.4. of the agreement made between the Plaintiff and Avco in that her Honour should have found that on a proper construction of that clause, the Plaintiff had no further obligation to Avco after the sale by it of the motor vehicle over which it held security for the repayment of the moneys lent under the agreement. 11 An appeal lies as of right where there is error in point of law. The plaintiff bears the onus of satisfying the court that there is such error and that it justifies the disturbing of the decision of the Local Court. It may be added that if the appeal had come from a decision heard in the Small Claims Division, there would not have been any appeal on the basis of error in point of law. 12 The first ground of appeal concerns a question of assignment. It was not a matter placed in issue by the plaintiff during the hearing in the Local Court. 13 In the Local Court, the defendant proceeded on an amended statement of liquidated claim. It pleaded an assignment of the interest, rights, claims and entitlements under the loan agreement which was alleged to have taken place on or about 18 November 2000. It did not plead the giving of notice of that assignment. 14 The notice of grounds of defence relied on a non-admission of an allegation of default under the loan agreement and a plea that the true amount owed to Avco had been fully satisfied by the taking of possession of the motor vehicle. It did not traverse the allegation of assignment. It did not allege that notice of the assignment had not been given. 15 Before this court, there was small and inconclusive debate concerning the matter of whether or not it was necessary to plead the giving of notice of assignment. Mr Annis-Brown (who appeared for the plaintiff) was unable to assist the court by providing authority that supported the assertion that it was necessary to plead the giving of notice. He was not in a position to assist the court as to the content of the relevant Local Court Rules. However, precedent 41 in Bullen and Leake and Jacob's Precedents of Pleadings (12th edition) supports the view that it is a matter to be pleaded. Whatever the position may be, in my view, the failure to plead the giving of notice is of no significance in this case. 16 The plaintiff conducted his case before the Local Court on the basis that there was no issue concerning the assignment. At the commencement of her judgment, the Magistrate made a finding that the interests, rights and entitlements under the agreement for loan had been assigned. In my view, she did not fall into error in making that finding. 17 The plaintiff now complains that there was no evidence of the assignment before the court and that there was no evidence of service of notice of the assignment. The defendant disputes that contention. It looks to admissions, the documentary material that was before the court and to evidence given by the plaintiff during his cross-examination. The transcript records the following:- Q. Did the plaintiff or anyone from AVCO ever contact you after they sold your vehicle to advise that you were still responsible for the outstanding balance on the loan? A. There was communication, I can't recall all the conversation. Q. What was the substance of that communication? A. There was an assignment of the debt to ACM. [Tr 29.07.05 p26] 18 There is a contest between the parties as to what inferences may be drawn from all of the material. It is unnecessary to enter into that debate. It suffices to say that the material leads to the conclusion that the plaintiff was aware of the assignment and was not concerned to make any challenge in relation to it. 19 Leaving that consideration aside, it seems to me that it was unnecessary to tender the assignment, or any notice of it, in the light of the admissions that arise from the pleadings and the manner in which the plaintiff conducted his case in the Local Court. 20 It should be added that, at the time of the rehearing, the conduct of the proceedings was governed by the Local Court (Civil Claims) Rules 1988. Part 9 rule 1(4) thereof was as follows:- A defendant shall not, at the hearing of an action, except by consent of the plaintiff or by leave, given on terms, of the court, set up any ground of defence not included in a notice of grounds of defence filed by the defendant under this rule. 21 The defendant had relied on a statement of Cassandra Vieira. Paragraph 5 thereof purported to annexe a copy of a letter dated 18 November 2000 which was said to indicate that the debt had been assigned. The annexure had as one of its headings, "Notice of assignment of debt". The plaintiff places reliance on this document because another part of the heading refers to an account number that is different from the account number had by the loan agreement. The plaintiff also relies on this document because it refers to the assignment of a credit card debt. For these reasons, the plaintiff seeks to now challenge the adequacy of the notice. 22 Mr Annis-Brown has invited the attention of the court to a number of authorities. These may be found in the written plaintiff's outline of submissions (they include Rajski v Scitec Corporation Pty Limited (unreported, NSWCA, 16 June 1986) and Chouman v Margules (1993) 17 MVR 144). 23 It would seem from the record of proceedings that neither the parties nor the court noticed the discrepancies in the purported notice. No doubt, this was because the assignment and notice thereof were not seen as matters in issue. 24 In the circumstances, I do not consider that there is any substance in the submission made by Mr Annis-Brown that the Magistrate should have observed the discrepancies and acted upon them. In my view, the circumstances of this case are distinguishable from the situation that was the subject of observation by Kirby P in Chouman [at p149]. 25 If the matters of assignment and notice had been in issue, the parties and the court would be expected to look at these matters and the relevant evidence could have been placed before the court. 26 I do not consider that any significance can be placed upon the discrepancies in the purported notice. From what was said from the bar table by Mr Annis-Brown, it appears that the plaintiff had a number of debts with Avco. The likely inference seems to be that there may have been a number of assignments and that, by error, the wrong notice of assignment was placed in evidence. It may be added that the plaintiff did not challenge the admission of the document into evidence. He did not contend that he had not been given notice. It would seem that the contents thereof did not in any way mislead him. 27 Leaving those matters aside, the plaintiff is confronted with the significant obstacle that he is now seeking to agitate a ground of appeal in respect of a matter that was not ventilated in the Local Court. 28 The relevant principles are well settled (see, inter alia Chilcotin Pty Ltd & Anor v Cenelage Pty Ltd & Ors [1999] NSWCA 11). 29 Where a point is not taken in the court below and evidence could have been given there, which by any possibility, could have prevented the point from succeeding, it cannot be taken afterwards. Generally, parties must be bound by the course they adopted at the trial. A party does not have a right to insist that a new point be decided on appeal simply because all the facts have been established beyond controversy or the point is one of construction or of law. The test is whether the appellate court may find it expedient and in the interests of justice to entertain the point. 30 In my view, the plaintiff should be bound by the course adopted during the hearing before the Local Court. It is conceded that it is a case where, had the matters been placed in issue, the defendant may have led evidence which had the possibility of defeating the point. Further, in the circumstances of this case, I do not consider it to be either expedient, or in the interests of justice, to entertain the new point in this appeal. 31 The purport of the appeal is to have the proceedings remitted back to the Local Court so that the case can be reheard. This would seem to be a pointless exercise. From what has been said from the bar table, it appears that the defendant may be in a position to prove all issues concerning the assignment and the plaintiff is faced with an insurmountable jurisdictional problem. 32 It may be further observed that what is in dispute has been described as not being a significant sum. There has already been an arbitration, a purported re-hearing and an appeal. Neither the parties nor the public interest would be well served by a further hearing. 33 I should add that changing times have seen the court adjusting the approach to be taken to cases where parties appear in person. No longer is it a rare event. It is now approaching an event of almost daily occurrence. Many are litigants in person because they choose so to be. Many have become experienced litigants running numerous cases before the court. The transcript of the Local Court proceedings presents a picture of this plaintiff conducting himself with skill. 34 The second ground of appeal is one which was argued by the plaintiff before the Magistrate. She rejected the argument (see Tr p30). In my view, she correctly did so. 35 The plaintiff's argument relies on the language used in clause 12.4 of the credit contract. This is a provision which appears under the heading "Default and its consequences". The alleged construction is one that would bring about a result which would render this loan agreement as a somewhat unique beast. A reading of the loan agreement as a whole does not throw up any suggestion that there was an intention to bring about the result intended for by the plaintiff. Indeed, the language of clause 12.4 itself renders the contention unarguable. As the Magistrate observed, what the provision does do is enable the lender to apply sale proceeds towards satisfaction of the liability under the contract. 36 The appeal fails. The summons is dismissed. The plaintiff is to pay the costs of the summons. **********

Murdaca v Accounts Control Management Services Pty Limited

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