NAB v Meyers

Associated Dominions Assurance Society Pty Ltd v Balmford (1950) 81 CLR 161 CASES CITED : General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 Goodlen Pty Ltd v BP Australia Pty Ltd (2004) 183 FLR 323

National Australia Bank Limited (Plaintiff) PARTIES : John Meyers (First Defendant) Marilyn Margaret Meyers (Second Defendant)

COUNSEL : J E Thomson (Plaintiff) L E Judge (Second Defendant)

SOLICITORS : Dibbs Abbott Stillman (Plaintiff) Demaine & Associate (Second Defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

14775/2007 - NATIONAL AUSTRALIA BANK LIMITED v JOHN MEYERS

JUDGMENT (Strike out defence; summary judgment) 1 HER HONOUR: By notice of motion filed 31 January 2008, the plaintiff seeks judgment on the statement of claim pursuant to Part 13.1 of the Uniform Civil Procedure Rules 2005; or in the alternative, that the defence of Mrs Meyers be struck out pursuant to Part 14.28 of the Uniform Civil Procedure Rules. 2 The plaintiff is the National Australia Bank Limited (the Bank). The first defendant is John Meyers (Mr Meyers). Mr Meyers has not taken any active role in these proceedings. The second defendant if Marilyn Margaret Meyers (Mrs Meyers). The Bank relied upon the affidavit of Joseph Ritchie sworn 24 January 2008. Mrs Meyers relied upon her affidavit sworn on 13 March 2008. 3 The Bank seeks firstly, possession of the whole of the land comprised in Certificate of Title Folio Identifier xxxxxx and known as xx xxxx, xxxxxx; secondly leave to issue a writ of possession to enforce the judgment; and third costs on a solicitor and client (or indemnity) basis. 4 At para [8] of the statement of claim the Bank pleads that on about 25 June 2007, it served on the Mr and Mrs Meyers a default notice dated 19 June 2007 demanding payment within 31 days in the sum of $19,893.10, being the total amount of repayments outstanding under the home loan agreement. The notice served of Mr and Mrs Meyers also constituted notice under s 57(2)(b) of the Real Property Act 1900. It is common ground that the Meyers have defaulted in making loan repayments. 5 At [6] of the defence, Mrs Meyers pleads that para [8] of the statement of claim is not admitted, save that she admits and says that the Bank served a demand for payment which was not in conformity with the terms of the mortgage and/or memorandum. The defence says that Clause 20.1 of the memorandum provided that the Bank must give a default notice that allowing a "period of at least 31 days" from the giving of the default notice to remedy the default and contrary to the provisions of Clause 20.1 of the memorandum, the Bank only gave default notice requiring the default to be "remedied within 31 days" from the giving of the default notice.

Summary judgment and strike out defence 6 Rule 13.1(1) of the Uniform Civil Procedure Rules 2005 provides: 13.1(1) If, on application by the plaintiff in relation to the plaintiff's claim for relief or any part of the plaintiff's claim for relief: (a) there is evidence of the facts on which the claim or part of the claim is based, and

(b) there is evidence, given by the plaintiff or by some responsible person, that, in the belief of the person giving the evidence, the defendant has no defence to the claim or part of the claim, or no defence except as to the amount of any damages claimed,

the court may give such judgment for the plaintiff, or make such order on the claim or that part of the claim, as the case requires." 7 Rule 13.4(1) of the Uniform Civil Procedure Rules provides that the court may dismiss proceedings generally, or in relation to any claim for relief, in three circumstances. These are, if the proceedings are frivolous or vexatious; or, if no reasonable cause of action is disclosed; or, if the proceedings are an abuse of the process of the court. 8 Rule 14.28(1) of the Uniform Civil Procedure Rules provides that the Court may at any stage of the proceedings order that the whole or any part of a pleading be struck out if the pleading firstly, discloses no reasonable cause of action or defence or other case appropriate to the nature of the pleading, secondly, has a tendency to cause prejudice, embarrassment or delay in the proceedings, or thirdly, is otherwise an abuse of the process of the court. 9 Rule 14.28(2) provides that the court may receive evidence on the hearing of an application for an order under sub-rule (1). 10 In the well known passage in General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125, Barwick CJ at 129 stated: "It is sufficient for me to say that these cases uniformly adhere to the view that the plaintiff ought not to be denied access to the customary tribunal which deals with actions of the kind he brings, unless his lack of a cause of action - if that be the ground on which the Court is invited, as in this case, to exercise its powers of summary dismissal - is clearly demonstrated. The test to be applied has been variously expressed; 'so obviously untenable that it cannot possibly succeed'; 'manifestly groundless'; 'so manifestly faulty that it does not admit of argument'; 'discloses a case which the Court is satisfied cannot succeed'; 'under no possibility can there be a good cause of action'; 'be manifest that to allow them' (the pleadings) 'to stand would involve useless expense.'"

Whether the notice was in accordance with Clause 20.1 of the mortgage 11 Clause 20.1 of the mortgage reads: "If you are in default for more than one day and: (a) The Bank has given You a default notice allowing you a period of at least 31 days from the date of the notice to remedy the default; and (b) The Bank has given you (and any other persons entitled) any other notice required by any provision of any law relating to the enforcement of this mortgage; …" [my emphasis added] 12 On 19 June 2007, the Bank issued a notice (the notice) which relevantly states: "If the Default is not remedied within 31 days from the date this notice is taken to be given (which is the date on which it would have been delivered in the ordinary course of the post), …" 13 The Bank's counsel submitted that the letter conformed with Clause 20.1 of the mortgage and referred to the definition of the words "least" and "within" from the Macquarie dictionary. Least is defined as - "adjective 2. smallest; slightest - pronoun 4. that which is least; the least amount, quantity, degree etc", "within" is defined as 8. "in the compass or limited of; not beyond, 9. "at or some point not beyond, as in length or distance; not farther than", 11. "in the course or period of, as in time within one's lifetime or memory", 12. "inside the limits fixed or required by; not transgressing: within the law, within reason". 14 Mrs Meyers' counsel submitted that Clause 20.1(a) of the memorandum varies the minimum requirement of a calendar month to require "at least 31 days" from the date of the notice to remedy default. According to Mrs Meyers the notice should have allowed "at least 31 days" from the date of the notice to remedy the default and a notice require compliance "within 31 days" after service of the notice is one day shorter than a notice allowing compliance "at least 31 days" after service of the notice. 15 Mrs Meyers's counsel gave an example, if a notice is effectively served on the first day of the month (a) if it required compliance "within 1 day" after service of the notice it would require compliance by the close of business on the second day; and (b) if it required compliance within "at least 1 day" after service of the notice it would require compliance by the close of business on the third day, as at the close of business on the second day is not "at least 1 day" after the first day. 16 While Mrs Meyers's written submissions refer to a s 57(2)(b) notice, that notice only comes into play when the mortgagee intends to exercise its power of sale over the property not when possession of the property is sought. The oral argument was focussed on the default notice reproduced earlier in the judgment 17 Mrs Meyers's counsel referred to Associated Dominions Assurance Society Pty Ltd v Balmford (1950) 81 CLR 161, that concerns the calculation of time in relation to a notice issued under s 55 of the Life Insurance Act 1945. 18 Section 55(1) relevantly reads: "If it appears to the commissioner that - (a) a company is, or is likely to become, unable to meet its obligations; … or … (e) the rate of expense of procuring, maintaining and administering any life insurance business of a company in relation to the income derived from premiums is unduly high; … the commissioner may serve on the company a notice in writing calling upon it to show cause, within such period, not less than fourteen days from the date of the notice, as is specified in the notice, why he should not, on the grounds so specified, investigate the whole or any part of the business of the company or appoint a person (in this Division referred to as 'the Inspector') to make such an investigation and report to the commissioner the results of his investigations." 19 In Balmford, Fullagar J stated at 182-183: 4. Some argument took place as to the minimum number of days which must, if s 55 is complied with, be allowed after "the date of the notice" (whatever that may mean) for showing cause. It was common ground that the date of the notice itself must be excluded in calculating the time (see Acts Interpretation Act 1901-1947 s 36(1)). But it was argued on the one hand that the time to be allowed expired at the end of the fourteenth day after the date of the notice, so that the commissioner could commence an investigation on the fifteenth day. It was argued on the other hand that the Act required that fourteen clear days should elapse between the date of the notice and the first day on which the commissioner could commence an investigation. On this view the period would not expire until the end of the fifteenth day after the date of the notice, and the first day on which the investigation could commence would be the sixteenth day after that date. In the view which I take of the case the question does not really arise, but I may say that, in my opinion, the former view is clearly the correct view. There is some authority for saying that the use, in a statute prescribing a time limit, of such expressions as "at least" and "not less than" indicate an intention that the specified number of "clear days" must elapse between two acts or events (see R v Justices of Shropshire (1838) 8 Ad & E 173 (112 ER 803); Young v Higgon (1840) 6 M & W 49 (151 ER 317); Chambers v Smith (1843) 12 M & W 2 (152 ER 1085); Re Railway Sleepers Supply Co (1885) 29 Ch D 204 and Ex parte McCance; Re Hobbs (1926) 27 SR (NSW) 35; 44 WN 43). But it is clear, I think, that significance is attached to such expressions as "at least" or "not less than" only in cases where the immediate purpose of the prescription of a time is to define a period on the expiration of which an act may be done, and not in cases where the immediate purpose is to define a period within which an act must be done. In the former class of case the prescribed number of days must elapse between two acts or events. In the latter class of case the act must (unless a contrary intention appears) be done before the expiration of the last of the prescribed number of days (see, eg Radcliffe v Bartholomew (1892) 1 QB 161 and Armstrong v Great Southern Gold Mining Co (1911) 12 CLR 382). In the latter case Griffith CJ said - "When you talk of doing a thing within a period of a certain number of days, it is quite clear that the end of the last day is the furthest limit. It is impossible to say that a thing required to be done within seven days is done within seven days if done on the eighth day, and it is impossible to make any alteration of the limit by adding the word 'clear'" (1911) 12 CLR, at p 388. In the case of s 55 of the Life Insurance Act it is plain that the immediate purpose of the prescription of a period is to fix a time within which cause must be shown. It follows that the last day on which cause may be shown is the fourteenth day after the date of the notice." 20 In Goodlen Pty Ltd v BP Australia Pty Ltd (2004) 183 FLR 323 at 326 Gzell J referred to Balmford and stated: " Clear days are usually understood to be reckoned not only excluding the day of the event but also excluding the last day of the period ( Armstrong v Great Southern Gold Mining Co NL (1911) 12 CLR 382 at 387-388). The plaintiff submitted that the specified time in the first termination notice was to be reckoned on this basis.

In Associated Dominions Assurance Society Pty Ltd v Balmford (1950) 81 CLR 161 at 183, Fullagar J drew a distinction where such phrases as "at least" and "not less than" are used in reckoning time. If the purpose is to define a period of time at the expiration of which an act might be done, clear days are required: the prescribed number of days must elapse between the two events. If the purpose is to define a period within which an act might be done, clear days are not required: the act must be done before the expiration of the last of the prescribed number of days." 21 Clause 20.1 of the mortgage stipulates that the Bank has given a default notice allowing a period of at least 31 days to do an act, that is, to remedy the default. 22 The notice says, "If default is not remedied within 31 days from the date of the notice". Hence, there is a reference in the mortgage to at least 31 days and in the notice the reference is to within 31 days. The immediate purpose of the prescription of a period in both the mortgage and the notice is to fix a time within which the default may be remedied. In my view it follows that the furthest limit is the last day on which the default can be remedied, namely the 31st day after the date of the issue of the notice. In my view the Bank's interpretation is correct and beyond doubt. Mrs Meyers's interpretation is incorrect. This issue is not one which would rely on any further facts, nor would any further legal argument improve Mrs Meyer's submission. The second defendant's argument fails. The defence should be struck out. There was no application to amend the defence. I enter judgment that the plaintiff is entitled to possession of the property as set out in paragraph [1] of the statement of claim. 23 So far as the issue of a writ of possession is concerned, Mrs Meyers finds herself in an unfortunate position which is deserving of sympathy. Mrs Meyers has lived in the property since 1995. On 10 November 1999, an order was made that her husband, the first defendant, was to pay the mortgage on the property. He has not done so. Mrs Meyers is experiencing difficulties in ascertaining the first defendant's financial situation. She still has current proceedings in the Family Court She is aged 65 years and does casual work as an Avon representative earning on average $10 per week and receives a part aged pension. She still lives in the property with her son, who contributes $50 per week to cover his expenses. Her husband is currently in default of his spousal maintenance obligations and the payments including mortgage instalments which he must pay in respect of the property. She suffers from asthma, arthritis, depression and an under active thyroid. She is being treated by various specialist and is on medication for depression being Aropax, Oryxine for her thyroid and Symbocort for asthma. She also receives counselling. 24 Mrs Meyers has sought more than six weeks to try and find a place to rent and move. In the exercise of my discretion, I grant a period of eight weeks for her to move in an orderly manner. I grant leave to issue a writ of possession such writ not to issue for eight weeks. 25 Costs are discretionary. Costs usually follow the event. The second defendant is to pay the plaintiff's costs of the proceedings.

(2) I enter judgment that the plaintiff is entitled to possession of the property as set out in paragraph [1] of the statement of claim.

(3) A writ of possession is to issue, such writ not to issue before 22 May 2008.

(4) The second defendant is to pay the plaintiff's costs of the proceedings. **********

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