Westpac Banking Corporation v Lahood

The Plaintiff's Applications 11The Plaintiff's primary application is for summary judgment. Although the Defendant has filed a Defence in the proceedings, the Plaintiff submits that this case is so clear cut that it is proper that the Court proceed to summary judgment. For that purpose, it is submitted that the Court may have regard to what is asserted in the Defence to reach the level of comfortable satisfaction that summary judgment is appropriate in the circumstances of the case. 12In the alternative, as I have said, the Plaintiff submits that if the Court was not satisfied that summary judgment ought be granted, the Court would be well satisfied that the Defence filed by the Defendant is entirely defective on pleading grounds, and ought be struck out, leaving the Plaintiff in a position to obtain default judgment. 13The helpful written submissions of counsel for the Plaintiff have developed both legs of the Plaintiff's argument and identify relevant matters of law and fact which are pertinent to the alternative claims for relief. 14I am satisfied that the appropriate orders to be made in the case are in accordance with the primary claim for relief, namely summary judgment. In reaching that view, I have had regard to the evidence which is before the Court, primarily the affidavit of Wayne Jol sworn 7 July 2011 and the documents contained in Exhibit WJ1. The other affidavits before the Court recite the procedural history of the matter which I have outlined already in this judgment. 15The applicable principles on a summary judgment application are clear. Before a Court will give summary judgment to a plaintiff it is necessary for the Court to reach a high level of satisfaction that the order should be made. The principles are well known and a very clear case is required before summary judgment is granted, and the power to order summary judgment should be sparingly employed: Dey v Victorian Railways Commissioners [1949] HCA 1; 78 CLR 62 at 91, General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; 112 CLR 125 at 129; Webster v Lampard [1993] HCA 57; 177 CLR 598 at 602-3 and Cosmos E-C Commerce Pty Limited v Bidwell & Associates Pty Limited [2005] NSWCA 81 at [37]-[38]. 16Rule 13.1(b) UCPR also requires evidence to be adduced by the Plaintiff from a responsible person of a belief that the Defendant has no defence to the claim. There is evidence to that effect in the affidavit of Mr Jol sworn 7 July 2011. 17The nature of the claim may be summarised relatively briefly. The Plaintiff's case is based upon the Defendant's obligation to pay monies owing on facilities providing financial accommodation from the Plaintiff for him and the company he controlled, Edras No 2 Pty Limited. 18The evidence demonstrates that the Defendant is in default, and that requisite letters of demand and notices have been issued and not answered. 19Whilst the Defendant, in his filed Defence, seeks to deny the relief sought by the Plaintiff, the Defendant does not deny executing the facility documents pleaded. At no point in the Defence is an attempt made to plead a basis on which it can be said that the factual matters (asserted imprecisely and vaguely in the Defence) have the result in law that the Defendant is not liable under the facilities as pleaded and under the mortgage. 20The Defendant, in his Defence, does not identify any statutory provision or principle of common law or equity or any remedy that would entitle him to resist, even on an arguable basis, the Plaintiff's claim to possession of the Yagoona property and for payment of the sum sought in the Statement of Claim. 21The evidence demonstrates that, in August 2001, the Defendant provided to the Plaintiff a guarantee and indemnity in written form to support any financial accommodation given by the Plaintiff to Edras No 2 Pty Limited, a company of which the Defendant was the sole director and secretary. 22By written agreement dated 10 October 2005, as later amended, the Plaintiff provided Edras No 2 Pty Limited with financial accommodation in the form of a commercial bill facility and related accounts. In breach of the facility agreement, on about 21 October 2009, voluntary administrators were appointed to Edras No 2 Pty Limited. 23By written agreement dated 14 April 2006, the Plaintiff provided the Defendant with financial accommodation in the form of an investment property loan. On and from 11 October 2010, in breach of the agreement, the Defendant failed to repay to the Plaintiff the arrears owing under the agreement in an amount of $13,601.57 and he remains in default. 24On 12 October 2005, the Defendant executed a mortgage in favour of the Plaintiff over the Yagoona property. That mortgage was an "all moneys" mortgage that secured all the current and future indebtedness of the Defendant to the Plaintiff. 25On 19 October 2010, the Plaintiff made a written demand on the Defendant pursuant to s.57(2)(b) Real Property Act 1900 for the sums of $13,601.57 and $3,486,428.12 respectively, being the amounts in arrears under the investment property loan and the guaranteed obligations of the Defendant in respect of the monies owed by Edras No 2 Pty Limited. 26Since service of that notice, payments totalling $1,935,677.03 were realised and subsequently applied by the Receivers and Managers of Edras No 2 Pty Limited to the commercial bill facility, in reduction of the amount owed by the Defendant to the Plaintiff. 27On 26 November 2010, a second written demand pursuant to s.57(2)(b) Real Property Act 1900 was made for the sum of $1,961,747.14, being the amount then owing under the facilities. The Defendant has failed to make payment on that demand at the time of the commencement of the proceedings, when the sum of $2,102,778.20 was owed. 28Since commencement of the proceedings, payments totalling $195,000.00 were realised and subsequently applied by the Receivers and Managers of Edras No 2 Pty Limited to the commercial bill facility in reduction of the amount owed by the Defendant to the Plaintiff. 29I have mentioned the Defence filed on 23 March 2011 by the Defendant. The Defendant does not deny, in that pleading, executing the various agreements to which I have referred. The only substantive allegations of fact made in the Defence are as follows. 30At paragraph 12 of the Defence, it is asserted that the Plaintiff and its solicitors convinced the Defendant to put Edras No 2 Pty Limited into voluntary administration without advising him of the consequences to the facilities of doing so. No particulars are provided with respect to this allegation. The Plaintiff has made clear that this allegation is denied. The Plaintiff submits that, even if this was true, it would not form the basis for any defence known to law. I accept that submission. 31At paragraph 13 of the Defence, it is asserted that certain actions were taken by the Receivers and Managers appointed by the Plaintiff that resulted in assets of Edras No 2 Pty Limited not reaching their full value. Once again, the Plaintiff denies this assertion but submits that, in any event, it would not form the basis for any defence known to law to monies owed. The Plaintiff submits that there is no cross-claim, nor is there a basis for one, where some reduction in the monies owed is claimed as opposed to a denial of the obligation under the facilities as pleaded. Once again, I accept this submission. 32I observe that even if it be the case that the Defendant had sought to rely in some fashion upon a form of set off by way of defence or cross-claim, then a cross-claim or set off would not be a defence to that part of the Plaintiff's claim that is a claim for possession of land: Inglis v Commonwealth Trading Bank of Australia [1972] HCA 74; 126 CLR 161 at 165-167, 169 and Horrobin v Australia & New Zealand Banking Group Limited (1996) 40 NSWLR 89 at 99-100. 33At paragraph 10 of the Defence, it is alleged that the Plaintiff commissioned some inaccurate financial review of Edras No 2 Pty Limited. Once again, the Plaintiff denies this allegation but, in any event, it is submitted by the Plaintiff that it is not pleaded how this has any possible impact on the Defendant's obligations, other than what is said to be a vague assertion that Edras No 2 Pty Limited only defaulted on its agreements because assets were devalued. Once again, I accept this submission of the Plaintiff.

The Plaintiff's Strike-Out Application 34My decision on this application is based upon acceptance of the Plaintiff's evidence, and an acceptance that the Plaintiff has made out the stringent test for summary judgment. I observe, however, that if the point had been reached where the Court was considering the strike-out application concerning the Defence, then an order to that effect would have been made. The Defence as pleaded has a number of fundamental deficiencies. It fails to plead a specific response to critical parts of the Statement of Claim so that those matters would constitute an admission of the allegations of facts in the Statement of Claim. 35Further, there are portions of the Defence which are, in my view, clearly embarrassing, applying the relevant principles of pleading summarised in the judgment in McGuirk v University of New South Wales [2009] NSWSC 1424 at [21]-[35].

Conclusion 36I am well satisfied that the stringent test applicable on a summary judgment application is satisfied in this case. I have reached the high level of satisfaction required for summary judgment to be given. This is a very clear case where the power should be employed. The Court has had regard to the content of the filed Defence in reaching the conclusion that summary judgment ought be given. I accept that the Defence does not reveal any reasonable Defence to the Plaintiff's claim. 37I do propose to give summary judgment being an order for possession, leave to issue the writ and an order for payment in a sum which will need to take into account the fact there has been a payment, and interest. I am prepared to order costs on an indemnity basis having regard to the fact that the mortgage so provided and that the Statement of Claim and Notice of Motion placed the Defendant on notice that indemnity costs would be sought. [Short minutes were provided containing the precise orders sought by the Plaintiff] 38Consequent on the delivery of judgment earlier today in which I foreshadowed a preparedness to make orders by way of summary judgment and consequential orders, counsel for the Plaintiff has provided the Court with the orders sought to give effect to the reasons of the Court. I am satisfied that the orders sought by the Plaintiff reflect orders which flow from the reasons of the Court delivered earlier today. 39I make Orders 1, 2, 3, 4 and 5 in accordance with the form of Judgment/Order which I have signed and dated today.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 09 September 2011