and Elliot Daniel Sgargetta v National Australia Bank Ltd (ACN 004 044 937)
[2014] VSCA 159
•30 July 2014
SUPREME COURT OF VICTORIA
COURT OF APPEAL
| S APCI 2014 0029 | |
| ELLIOT DANIEL SGARGETTA | Appellant |
| v | |
| NATIONAL AUSTRALIA BANK LTD (ACN 004 044 937) | Respondent |
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| JUDGES | WHELAN and SANTAMARIA JJA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 27 May 2014 |
| DATE OF JUDGMENT | 30 July 2014 |
| MEDIUM NEUTRAL CITATION | [2014] VSCA 159 |
| JUDGMENT APPEALED FROM | National Australia Bank v Sgargetta [2014] VCC 48 (Judge Cosgrave, 7 February 2014) |
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EVIDENCE – Application to adduce fresh evidence on appeal – Principles in Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd [2013] VSCA 237 restated – Application granted.
MORTGAGES AND SECURITIES – Possession proceedings – Deed of settlement – Appellant failed to comply with obligation under the deed to provide a conditional letter of approval for finance on terms acceptable to the respondent for specified sum – Attempted performance by appellant of obligation to pay respondent the specified sum did not overcome failure to comply with obligation to provide a conditional letter of approval – Respondent entitled to continue with proceedings as provided under deed of settlement.
MORTGAGES AND SECURITIES – Unconscionability of conduct of the respondent with respect to deed of settlement under s 21 of the Australian Consumer Law – Attorney-General (NSW) v World Best Holdings Ltd (2005) 63 NSWLR 557 and Director of Consumer Affairs Victoria v Scully (2013) 96 ACSR 455 applied – Respondent’s conduct not unconscionable as did no more than rely on entitlement under deed of settlement.
MORTGAGES AND SECURITIES – Request by appellant for statement of pay out figure for loan under s 83 of National Credit Code – Respondent did not contravene s 83 – In any case, compliance with s 83 is not a condition precedent to the institution of proceedings for possession – Monas v Perpetual Trustees Victoria Ltd (2011) 80 NSWLR 739 applied – Observation on ‘determinations’ under s 84 of National Credit Code.
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| Appearances: | Counsel | Solicitors |
For the Appellant | Mr P J Hayes with Mr J A Silver | (Victorian Bar pro bono scheme) |
| For the Respondent | Mr S D Hay | Gadens Lawyers |
WHELAN JA
SANTAMARIA JA:
In 2007 the respondent (‘NAB’) made a home loan to the appellant, Mr Sgargetta. A dispute between them began in October 2008 in relation to the payout figure on that loan. In 2012 NAB took proceedings in the County Court to recover possession of the property securing the home loan. In February 2013 the parties entered into a deed of settlement. There was then a dispute between the parties as to whether the appellant had complied with that deed.
In August 2013 NAB’s recovery proceeding went to trial. On 17 February 2014 Judge Cosgrave in the County Court made orders for possession in favour of NAB, ordered the appellant to pay NAB the sum of $440,441.19 together with interest accruing from 12 February 2014 at the rate of $64.81 per day, dismissed a counterclaim by the appellant, and ordered that the appellant pay NAB’s costs, including costs on an indemnity basis for the period after an offer of compromise had been made.[1]
[1]Reasons for judgment on the substantive issues were delivered on 7 February 2014: National Australia Bank Ltd v Sgargetta [2014] VCC 48 (‘Reasons’). Reasons for the costs ruling were delivered on 17 February 2014: National Australia Bank Ltd v Sgargetta [2014] VCC 113.
The appellant appealed to this Court and issued a summons seeking a stay of execution. When the application for the stay came on for hearing, the Court indicated that an expedited date for hearing of the appeal could be fixed and counsel for NAB advised that in those circumstances NAB would not seek to enforce the County Court orders before the appeal hearing. The hearing of the appeal was fixed for 27 May 2014.[2]
[2]The President determined that two judges could exercise all the jurisdiction and powers of the Court of Appeal under s 11(1A) of the Supreme Court Act 1986 in relation to this matter.
The appellant sought leave to rely on fresh evidence on the hearing of the appeal. NAB opposed that application. In the course of hearing the appeal the Court granted leave to the appellant to rely on fresh evidence and indicated that reasons would be given subsequently. Those reasons are incorporated into this judgment.
The appellant appeared for himself at the County Court trial. He personally filed his notice of appeal (although it appears to have been prepared with some professional assistance) and personally filed written submissions dated 2 May 2014 in support of that appeal. On 14 May 2014 NAB filed written submissions in opposition to the appeal and filed a notice of contention. By 26 May 2014 the appellant had secured legal representation through the pro bono scheme of the Victorian Bar and on that day his pro bono counsel filed supplementary submissions. Counsel appeared on behalf of the appellant on the hearing of the appeal.
At the hearing of the appeal counsel for the appellant was asked about the relationship between the written submissions filed personally by the appellant on 2 May 2014 and the supplementary submissions filed by his pro bono counsel on 26 May 2014. The Court was advised by the appellant’s counsel that some of the grounds of appeal addressed in the appellant’s personal submissions were to be abandoned; where the appellant’s personal submissions and his counsel’s submissions dealt with the same issue, the Court should have regard to counsel’s submissions; and, where matters were neither abandoned nor the subject of counsel’s submissions, the Court was to have regard to what the appellant had said in his personal submissions.
One ground of appeal that was expressly abandoned by the appellant’s counsel on the hearing of the appeal (after the matter was raised) was that one of the clauses in the deed of settlement, which required the appellant to provide a conditional letter of approval of finance on terms acceptable to NAB, was void for uncertainty and was severable. We have accordingly given no further consideration to that ground.
On the day after the appeal was reserved for judgment, the appellant personally attempted to file further written submissions. He was referred to Frugtniet v Law Institute of Victoria Ltd.[3] We have not had regard to those submissions.
[3][2012] VSCA 178, [44]–[47].
Relevant facts prior to institution of proceedings
By a facility agreement dated 10 December 2007, NAB provided the appellant with a $300,000 home loan where the interest rate was fixed for a period of five years. The loan was secured by a mortgage over a property at 92 Old Coach Road, Kalorama, Victoria (‘the property’). As the trial judge observed, at that time Mr Sgargetta was conducting his own business as a mortgage broker.[4]
[4]Reasons [121].
On 8 October 2008, the appellant entered into a contract of sale in respect of the property. The sale price was $385,000. Settlement was due on 1 December 2008. The purchaser of the property was Cybil Nickett Waldron, the appellant’s wife.
In mid to late October 2008, the appellant verbally sought a payout figure from NAB in respect of the mortgage.
By a letter dated 6 November 2008, Damien Colella (‘Colella’) of NAB, who the trial judge described as the appellant’s ‘personal banker’, wrote to Mr Sgargetta as follows:
I can confirm that upon release of above-mentioned property NAB will be looking to receive funds to pay out home loan in name of Mr Elliot Sgargetta. Home loan account number is 75-128-9802, the bank will require approximately $299,000.
(‘the Colella letter’)
By a faxed letter dated 12 November 2008, Home Conveyancing Reservoir Pty Ltd (‘Home Conveyancing’) advised the discharge manager at NAB that they acted for the appellant in relation to the sale of the property and that settlement of the sale was due on 1 December 2008. In addition, the letter stated:
Please provide the following details to enable us to prepare the section 27 deposit release statement:
1 Amount secured by the mortgage.
2 Amount required to discharge the mortgage.
3 Amount of instalments and when payable.
4Does the mortgage provide for further advances? If so, please provide the details.
5 Lower interest rate p.a. & default interest rate p.a.
6 Date by which the amount secured by the mortgage is to be repaid.
7 Is the vendor in default under the mortgage? If so, please give details.
PLEASE NOTE that section 76 of the Consumer Credit Code requires you to provide written payout within 7 days after receipt of this request.
Should you have any queries, please do not hesitate to contact our office.
Accompanying the faxed letter was a standard form NAB document entitled ‘Discharging Security over a Loan with National Australia Bank Ltd’ which the appellant or his conveyancer had marked in the appropriate boxes. One page of the facsimile received by NAB was incomplete as it was substantially covered or obscured by another page.
By a facsimile dated 14 November 2008, NAB returned to Home Conveyancing the incomplete faxed document and asked that it be fully completed and re-submitted.
On 25 November 2008, Home Conveyancing faxed some materials to NAB, including the contract of sale for the property and a completed discharge authority.
On 28 November 2008, an NAB officer gave Home Conveyancing verbal advice that the payout figure was $323,089.99. The difference between that figure and the amount referred to in the Colella letter was a result of the inclusion in the later figure of ‘economic costs’, being the costs of an early termination of the fixed rate home loan. Thereafter NAB refused to waive the ‘economic costs’. There has never been any contention that NAB was not contractually entitled to recover the ‘economic costs’.
The settlement due on 1 December 2008 was cancelled by either Home Conveyancing or Mr Sgargetta himself[5] because NAB was demanding a higher payout figure than previously advised, and the sale of the property did not proceed. The appellant reported NAB to the Financial Ombudsman Service (‘FOS’). Thereafter, the appellant made no further payments of interest or principal in respect of the loan facility.
[5]The Reasons at [16] state that Mr Sgargetta cancelled the settlement. In an affidavit sworn on 18 March 2013, Lydia Maric, the principal of Home Conveyancing, had sworn that she cancelled the settlement ‘because the bank was demanding a higher payout figure than that previously communicated in writing to Mr Sgargetta’. In his evidence in chief, the appellant said: ‘Lydia had to – she made contact – tried to make contact on the Monday with National Australia Bank, and they had confirmed that they weren’t going to alter or change the payout amount given to me verbally on that Friday, 28 November 08, and she proactively had to cancel that settlement because it just obviously wasn’t going to happen.’.
NAB’s practice was that, until the FOS completed its investigation of a complaint, it would take no action to pursue claims against its customer.
In March 2010, the FOS closed its file.
On 11 April 2012, NAB notified the appellant of alleged default and demanded payment of $96,032.34 by 18 May 2012.
By a letter dated 21 May 2012, NAB demanded payment of $409,210.23 pursuant to the loan agreement and mortgage. The letter referred to the earlier notice and the fact that the account was still in arrears. It advised that, in the circumstances, NAB was entitled to require the appellant to pay the full amount owing, being the principal, interest, costs, charges and expenses.
Proceedings in County Court prior to settlement
On 7 June 2012, NAB commenced proceedings in the County Court seeking possession of the property. In August 2012, default judgment for possession was entered in the County Court. On 28 September 2012, that default judgment was set aside, the proceeding was set down for trial on 20 March 2013, and directions as to pleadings, discovery and other matters were made. On 13 December 2012, NAB issued a summons seeking summary judgment or, alternatively, that the appellant’s defence be struck out. On 24 January 2013, Judge Anderson ordered the parties to attend a mediation on 5 February 2013 and fixed the hearing of NAB’s application for summary judgment for 1 March 2013.
Deed of settlement and events prior to 20 March 2013
On 5 February 2013, the parties entered into a deed of settlement (the ‘deed’). The deed contained the following provisions:
Background
…
G.NAB has filed a Summons seeking to have the Defence and Counter Claim struck out and for summary judgment to be entered in favour of NAB in the Proceedings …
H. NAB’s Summons is listed for hearing on 1 March 2013.
…
Operative Provisions
…
2.0 Refinance
2.1NAB will agree to adjourn the hearing of its Summons, provided the following conditions are complied with, time being of the essence:
(a)By 5.00 pm on 25 February 2013 Mr Sgargetta must provide to NAB’s solicitors, Gadens Lawyers, a conditional letter of approval for finance on terms acceptable to NAB and for an amount equal to or greater than $299,000;
(b) by 5.00 pm on 15 April 2013 Mr Sgargetta must:
(i) pay NAB the sum of $299,000 in cleared funds; and
(ii)withdraw his Defence and Counter Claim in the Proceedings; and
(c)Mr Sgargetta must otherwise comply with the terms and conditions of this Deed.
2.2Provided the conditions in clause 2.1 above are complied with, NAB will:
(a)accept $299,000 in full and final satisfaction of the amount owed by Mr Sgargetta under the Home Loan Facility, the Mortgage and any claims in the Proceedings;
(b)discontinue the Proceedings on the basis that each party pays its own costs; and
(c) provide to Mr Sgargetta:
(i)an original and duly executed discharge of the Mortgage in registrable form; and
(ii) the original Certificate of title for the Property.
3.0 Consequences of any default by Mr Sgargetta
If Mr Sgargetta defaults under clause 2 above, or any other terms of this Deed, time being of the essence, NAB will immediately be entitled to proceed with the hearing of its Summons and the Proceedings generally.
On 19 February 2013, the appellant emailed the bank seeking a copy of the deed signed by NAB and asserting that the appellant needed ‘flexibility on the dates’ because of NAB’s delay in returning a signed copy to him. Later that day, NAB’s solicitors sent the appellant an executed copy of the deed, and advised that the timeframes provided for by the deed remained as agreed and that no additional time would be agreed to.
On 25 February 2013, the appellant sent to NAB and its solicitors what he described as a ‘conditional loan offer from Red Rock Mortgages’ to pay out the loan facility, purportedly in accordance with the deed.
It is obvious, on the most cursory inspection, that what was forwarded to NAB on 25 February 2013 could not properly be described as a ‘conditional loan offer from Red Rock Mortgages’, still less could it be characterised as ‘a conditional letter of approval for finance … for an amount equal to or greater than $299,000’. Most obviously, the letter is not ‘an approval’. It is headed ‘loan proposal’. It is not signed by the ‘lender’, nor is it signed by Mr Sgargetta. It is signed by Mr Sgargetta’s wife. The proposal is for a minimum loan amount of $200,000 and a maximum loan amount of $1 million. Accordingly, it is not for an amount equal to or greater than $299,000. These shortcomings require a conclusion that the provision of that document could not constitute compliance with cl 2.1(a) of the deed, even before addressing the issue of whether the document provided for terms ‘acceptable to NAB’. When these matters were put to the appellant’s counsel in the course of argument on the appeal, the Court was told there was no submission they could make to the contrary.
By an email of 26 February 2013, NAB’s solicitors advised Mr Sgargetta that the document provided did not satisfy his obligation to provide a conditional letter of approval under cl 2.1(a) of the deed. The email indicated that NAB intended to proceed on 1 March 2013 with the summary judgment application but then advised that, if ‘an acceptable letter of approval’ was received before Friday 1 March 2013, further instructions would be sought.
Later that same day, Mr Sgargetta forwarded to NAB and to its lawyers another version of the Red Rock Mortgages document. That further version did not relevantly alter the position. It was still a ‘loan proposal’. The applicant was Mr Sgargetta’s wife. The minimum loan amount was $200,000. It was unsigned. Mr Sgargetta’s covering email suggested that this was Red Rock Mortgage’s ‘legitimate and formal loan offer approval to clients’ and that it was ‘the best they can state on their system’.
By an email the same day, NAB’s solicitors advised Mr Sgargetta that the documents provided did not comply with the deed and concluded:
Accordingly we are instructed to continue with the Court proceedings on Friday 1 March 2013.
A further document was forwarded to NAB and its solicitors the following day, 27 February 2013. This was a letter of offer to Mr Sgargetta’s wife by an entity named ABNZ Investments Pty Ltd (‘ABNZ’) for a loan of $299,000. It was unsigned. Evidence was given at the trial by an officer of NAB that this letter was unacceptable. We will return to that evidence.
NAB’s solicitors immediately advised that the letter was unacceptable. They advised that an acceptable conditional letter of offer would be signed by the lender, on letterhead, addressed to the borrower, and be from a recognised and licenced lending institution. NAB’s solicitors advised that, in the circumstances, Mr Sgargetta had failed to comply with the terms of the deed, and that they were instructed to proceed with the summary judgment application on Friday 1 March 2013.
It is necessary to interrupt the sequence of events at this point in order to address the fresh evidence application and the material relied upon as a result of leave being granted to rely on that fresh evidence.
The fresh evidence application
When the proceeding went to trial in the County Court Mr Sgargetta argued, amongst other things, that the clause of the deed concerning the obligation to provide a conditional letter of approval for finance (cl 2.1(a)) was void for uncertainty, that NAB did not honestly believe that the terms of the documents provided were unacceptable, and that Mr Sgargetta was entitled to specific performance of the deed of settlement because on 20 March 2013 he had tendered a bank cheque for the sum of $299,000, payable under the deed by 15 April 2013, to NAB. Mr Sgargetta asserted in his evidence in the trial that the tender of the cheque had occurred in open court and that that tender had been rejected. The trial judge had a copy of the transcript of the hearing that day before Judge Anderson. He could not identify in the transcript any formal tender of a cheque for $299,000 or its rejection by NAB. As the trial judge observed, reference was made in the course of the hearing to the fact that there was a bank cheque in court that day for $299,000 but what occurred in open court did not go beyond a statement of that fact.[6] The fresh evidence upon which Mr Sgargetta wished to rely was to the effect that the tender of the bank cheque occurred not in court but in the corridor outside court.
[6]Reasons [105]–[107].
The principles which apply when considering whether this Court will grant leave to permit reliance upon fresh evidence in an appeal were reiterated in Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd.[7]The Court said:
The principles applicable to the question of whether the Court will grant leave to allow fresh evidence in an appeal were not in contest between the parties. Leave should be given only if three prerequisites are satisfied. First, if by the exercise of reasonable diligence such evidence could not have been discovered in time to be used in the original trial. Secondly, if it is reasonably clear that if the evidence had been available at the trial, and had been adduced, an opposite result would have been produced. Thirdly, if the evidence proposed to be adduced is reasonably credible.
All parties referred to the Court of Appeal decision in Apostolidis v Kalenik, which cited with approval the judgment of Chernov JA in Foody v Horewood:
the question of whether to admit fresh evidence is largely one of discretion and degree bearing in mind the public interest in finality of litigation and, at the same time, the requirements of justice of the case in hand. Generally speaking, fresh evidence ought not to be admitted when it bears upon matters falling within the field or area of uncertainty in which the trial judge’s estimate has previously been made. Exceptionally, however, it may be admitted, if some basic assumption, common to both sides, has been falsified by a subsequent event. More precisely, as Lord Wilberforce observed in Mulholland v Mitchell, courts will allow fresh evidence where to refuse it would affront common sense, or a sense of justice, always keeping in mind that it should be an exceptional event.[8]
[7][2013] VSCA 237.
[8]Ibid [522]–[523] (citations omitted).
Mr Sgargetta’s initial application sought to rely on affidavits by himself, his father (Dennis Sgargetta), and one of his counsel on the day (Daniel Cole). On the hearing of the appeal, the only affidavit upon which the appellant’s counsel sought to rely was the affidavit of Mr Cole sworn 26 May 2014.
Mr Cole’s affidavit relevantly deposes to the fact that a bank cheque for $299,000 was offered to NAB outside court on 20 March 2013.
In the particular circumstances of this case, the requirement concerning the exercise of reasonable diligence and the capacity of the evidence to have been discovered in time for the original trial, had to be addressed in the context of the fact that the appellant had appeared for himself. It was fairly clear that he had a misconception that the bank cheque was offered to NAB during the hearing on 20 March 2013. He was mistaken about that. The evidence upon which he wishes to rely indicated that the offer was made, although it was not made in open court.
The evidence proposed to be relied upon could have resulted in an opposite outcome, but only if the appellant’s submissions concerning compliance with the provision of the deed requiring a conditional offer of finance (cl 2.1(a)) were accepted.
The evidence of Mr Cole was credible.
Mr Sgargetta’s counsel wished to rely upon the fact that the bank cheque had been offered to NAB, as deposed to by Mr Cole, in support of a submission that Mr Sgargetta had complied with cl 2.1(b) of the deed. It seemed to us that, put that way, the fresh evidence was not evidence of an attempt to negotiate settlement of a dispute which could not have been adduced because of s 131 of the Evidence Act 2008.
By reason of those circumstances, the Court determined during the hearing to exercise its discretion so as to permit the fresh evidence constituted by the affidavit of Mr Cole sworn 26 May 2014 to be relied upon. NAB sought to rely upon affidavits of Kevin Pringle sworn 26 May 2014, Nora Minassian sworn 26 May 2014 and Adam Segal sworn 26 May 2014, in order to put before the Court the full context of what occurred between the parties, and the Court gave NAB leave to do that. This meant a good deal of ‘without prejudice’ material was put before the Court on the basis that the Court would otherwise be misled, as provided for by s 131(2)(g) of the Evidence Act 2008.
Events between 1 March 2013 and 20 March 2013
On 1 March 2013, a directions hearing was held before Judge Anderson in the County Court. Mr Segal (of counsel) appeared on behalf of NAB and Mr Sgargetta appeared in person. The order made that day noted that the proceeding had been set down for trial on 20 March 2013 and that the plaintiff’s summary judgment application was returnable on 1 March 2013. The settlement which had been reached at mediation was noted as was the fact that ‘the plaintiff contended that the terms of the settlement agreement had not been satisfied because the letter of offer of finance was not in a form required by the settlement agreement and had not been received by the date set out in the agreement’. The order referred Mr Sgargetta to the Victorian Bar pro bono scheme and adjourned the summary judgment application to 8 March.
On 8 March 2013, Mr Segal again appeared on behalf of NAB. Mr Dennis Sgargetta was given leave to represent his son and Mr Cole appeared following a request by Judge Anderson to the Victorian Bar pro bono scheme. NAB’s summary judgment application was adjourned to the trial of the proceeding on 20 March and directions were made in relation to the filing of affidavit material. According to the affidavit of Mr Segal, the judge was told that day by Mr Dennis Sgargetta that the deed remained valid and that ‘the $299,000 payment’ would be made, whereas Mr Segal submitted that the deed had not been complied with and could no longer be complied with by a payment of $299,000.
The appellant maintains that the deed of settlement remained on foot on 20 March 2013 and that on that day at the court there was a ‘tender’ of a bank cheque for the sum of $299,000. On the appeal his counsel submitted that what occurred was ‘equal to performance’ of the remaining obligation under cl 2.1(b) of the deed, as explained in City Motors (1933) Pty Ltd v Southern Aerial Super Service Pty Ltd[9] and Young v Queensland Trustees Ltd.[10]
[9](1961) 106 CLR 477, 485–6.
[10](1956) 99 CLR 560, 567–8.
The affidavit of Mr Cole deposes that he met with the appellant and his father on the morning of 20 March 2013 prior to the court hearing and that he was handed a bank cheque for $299,000. He deposes that he then met with Mr Segal, NAB’s counsel, and told him that he was ‘holding’ a bank cheque for $299,000 and ‘was instructed to offer that cheque to the bank’. He deposes that Mr Segal said words to the effect that the bank would not take the cheque and that the bank wanted payment of a higher sum. Mr Cole deposes that he could not recall the precise amount mentioned but his recollection is that it was in the vicinity of $317,000 to $320,000. Mr Cole deposes that at no time did Mr Segal take physical possession of the bank cheque which he then returned to Mr Dennis Sgargetta.
The affidavits relied upon by the respondent seek to place what occurred prior to court on 20 March into context. The affidavits are by the two solicitors with carriage of the matter on behalf of NAB, Ms Minassian and Mr Pringle, and by NAB’s counsel, Mr Segal.
Ms Minassian and Mr Segal both depose that at the hearing on 8 March 2013 the dispute as to whether the deed remained on foot was canvassed in open court and that Mr Segal submitted to the judge that the deed had not been complied with and ‘could no longer be complied with by a payment of $299,000’.
The affidavits of Mr Segal, Mr Pringle and Ms Minassian then set out negotiations which occurred between counsel on 13, 14 and 15 March 2013.
On 13 March, Mr Segal telephoned Mr Cole, then acting for the appellant, and told him that the bank was not willing to accept any offer of $299,000, that further costs had been incurred, but that on a without prejudice basis the bank was willing to accept a sum of ‘around $316,000’ which was the $299,000 plus interest, half the mediator’s fees, and legal expenses.[11] Mr Segal said that the calculation of the amount as at that date was approximately $316 459.21. Mr Segal deposes that Mr Cole said he only had instructions to ‘accept’ $299,000 but would speak to Mr Sgargetta. He asked when the offer would lapse. In a subsequent phone call Mr Segal told Mr Cole the offer would have to be accepted by 14 March, and he subsequently confirmed that in an email.
[11]The Court file indicates there had previously been a dispute about the engagement of a paid mediator.
Mr Segal deposes that on 14 March he was contacted by another pro bono barrister for the appellant, Mr Douglas Shirrefs. He deposes that Mr Shirrefs told him the offer he had made yesterday to Mr Cole had been rejected but that he had been instructed to offer ‘$305,000 in full and final settlement’. He said that this represented the $299,000 plus half the mediator’s fees and a reduced amount for expenses.
Mr Segal deposes that he rejected the $305,000 offer the following day in a telephone conversation with Mr Shirrefs. He said that he had been instructed to ‘restate’ NAB’s earlier offer which he told Mr Shirrefs would be open for acceptance until midday on 18 March 2013. He deposes that he did not receive any response from Mr Shirrefs or Mr Cole by midday 18 March 2013.
Mr Segal also deposes to what happened before court on 20 March 2013. He says that both of the appellant’s pro bono barristers, Mr Shirrefs and Mr Cole, were there. He said one of them approached him. His best recollection is that it was Mr Shirrefs. He says he was told that counsel had a bank cheque for $299,000 and that he was shown ‘a copy’ of the bank cheque. He said he was told that that was offered in full and final satisfaction of the matter. Mr Segal deposes that he was instructed to reject that offer and that he communicated that rejection to the appellant’s barristers.
Mr Segal deposes that when the matter was called on Judge Anderson indicated that he could not hear the summary judgment application that day and that it would have to be adjourned. According to Mr Segal, Judge Anderson gave the parties the alternative of simply setting the matter down for trial on 26 August 2013. Mr Segal deposes that the matter was then stood down and that he was instructed not to pursue the application for summary judgment but instead to press for the matter to be fixed for trial.
The order made on 20 March 2013 records the appearances as Mr Segal (of counsel) for NAB and Mr D Shirrefs with Mr D Cole (of counsel) for the appellant. The appellant was given leave to defend the proceeding and leave to file an amended defence and counterclaim that were to be substantially in accordance with a draft document prepared by Mr Shirrefs and Mr Cole. The trial date was vacated and the trial was refixed for hearing on 26 August 2013. Directions were made concerning further pleadings, discovery, and preparation of the matter for trial.
Amended defence and counterclaim
On 20 March 2013, the appellant filed the amended defence and counterclaim that had been prepared by Mr Shireffs and Mr Cole.
The matters pleaded by the appellant fell into three categories.
First, the appellant alleged that the circumstances that caused the settlement not to proceed on 1 December 2008 involved a breach of s 76 of the Uniform Consumer Credit Code (‘UCCC’) by NAB,[12] giving him an entitlement to have the Court determine the amount payable under s 77 of the UCCC.[13] The appellant alleged that the sale did not proceed because (a) the amount orally demanded by NAB was higher than that contained in the Colella letter, (b) NAB had failed to provide a payout figure ‘as required under the UCCC’ and (c) NAB refused to accept a payout figure of $299,000. He also alleged that, as a result of the property failing to sell, he suffered loss and damage, and further and alternatively that he was entitled to compensation from NAB in an amount to be determined by the Court. He also alleged that the conduct of NAB in the November–December 2008 period was, in all the circumstances, unconscionable.
[12]The UCCC formed part of a legislative framework based on the Uniform Credit Laws Agreement 1993 in which the States and Territories agreed to adopt uniform consumer credit laws based on template legislation that was later enacted in Queensland as an appendix to the Consumer Credit (Queensland) Act 1994 (Qld). The appendix under the Queensland legislation applied in Victoria as a law of this State by s 5(a) of the Consumer Credit (Victoria) Act 1995 (Vic) which stated that it was to be referred to as the Consumer Credit (Victoria) Code. Section 5 was repealed by s 20 of the Credit (Commonwealth Powers) Act 2010. The Queensland code was commonly referred to as the UCCC.
[13]Section 76 of the UCCC provided:
Statement of pay out figure
(1)A credit provider must, at the written request of a debtor or guarantor, provide a written statement of the amount required to pay out a credit contract (other than a continuing credit contract) as at such date as the debtor or guarantor specifies. If so requested, the credit provider must also provide details of the items which make up that amount.
(2)The statement must also contain a statement to the effect that the amount required to pay out the credit contract may change according to the date on which it is paid.
(3)A credit provider must give a statement, complying with this section, within 7 days after the request is given to the credit provider.
(4) In the case of joint debtors or guarantors, the statement under this section need only be given to a debtor or guarantor who requests the statement and not, despite section 171, to each joint debtor or guarantor.
Maximum penalty—50 penalty units.
Section 77 provided:
Court may determine pay out figure if credit provider does not provide a pay out figure
(1)If the credit provider does not provide a statement of the amount required to pay out a credit contract (other than a continuing credit contract) in accordance with this Part after a request is duly made by a debtor or guarantor, the Court may, on the application of the debtor or guarantor, determine the amount payable on the date of determination, the amount by which it increases daily and the period for which the determination is applicable.
(2)The credit contract is discharged if an amount calculated in accordance with the determination is tendered to the credit provider within the applicable period.
Section 114 provided:
Civil effect of other contraventions
(1) If a credit provider contravenes a requirement of or made under this Code (other than one for which a civil effect is specifically provided by Division 1 or by any other provision of this Code), the Court may order the credit provider to make restitution or pay compensation to any person affected by the contravention and, in that event, may make any consequential order it considers appropriate in the circumstances.
(2) An application for the exercise of the Court’s powers under this section may be made by the Government Consumer Agency or by any person affected by the contravention.
Second, the appellant alleged that, if he was in default by failing to comply with NAB’s demands for payment, the failure by NAB to give a default notice under the facility agreement and the UCCC meant that NAB had failed to mitigate its loss, and had acted unconscionably within the meaning of the Trade Practices Act 1974 (Cth) (the ‘TPA’).
Third, he referred to the deed and alleged that NAB had breached the deed in unreasonably refusing to accept letters of approval of finance that he had provided to NAB. That conduct of NAB, he alleged, was a repudiation by NAB of the deed which he did not accept. Alternatively, he alleged that there had been a waiver by NAB of its rights under the deed, that there has been a variation of the terms of the deed, or that NAB was estopped from insisting on strict compliance with its terms.
Trial in the County Court
The trial of the proceeding in the County Court was conducted between 26 and 29 August 2013.
The issues which the trial judge identified after reviewing the pleadings were these:
(a)Has NAB prima facie proved its case entitling it to an order for possession of the property?
(b)Did NAB breach its obligations under section 76 of the [UCCC] by failing to provide Sgargetta a payout figure within seven days of a request?
(c)If NAB did breach section 76 of the [UCCC] (which NAB denies) or otherwise acted unconscionably, what amount should Sgargetta pay to NAB pursuant to section 77 of the [UCCC]?
(d)If NAB breached section 76 of the [UCCC] (which it denies) or otherwise acted unconscionably, is Sgargetta entitled to any compensation?
(e)Is Sgargetta entitled to specific performance of the Deed Settlement dated 5 February 2013 entered into by the parties?[14]
[14]Reasons [6].
In dealing with the first of the issues identified above, the trial judge held that the requirements of ss 76 and 78 of the Transfer of Land Act1958 had been satisfied and that the bank had prima facie proved its entitlement to an order for possession.
In dealing with the second of the issues identified above, the trial judge held that, notwithstanding that both the appellant and NAB had accepted that the UCCC was the relevant legislation that governed the transaction, in truth it was regulated by the National Consumer Credit Code (‘the National Code’).[15] Accordingly, on the question of the obligation of NAB to provide a payout figure, he applied s 83 of the National Code rather than s 76 of the UCCC. The terms of the two sections are identical. Section 83 provides:
[15]The National Code came into effect on 1 July 2010 pursuant to the National Consumer Credit Protection (Transitional and Consequential Provisions) Act 2009 (the ‘Transitional Act’), and comprises Schedule 1 of the National Consumer Credit Protection Act 2009 (Cth). The National Code replaced the Consumer Credit (Victoria) Act 1995 (Vic).
(1)A credit provider must, at the written request of a debtor or guarantor, provide a written statement of the amount required to pay out a credit contract (other than a continuing credit contract) as at such date as the debtor or guarantor specifies. If so requested, the credit provider must also provide details of the items which make up that amount.
(2)The statement must also contain a statement to the effect that the amount required to pay out the credit contract may change according to the date on which it is paid.
(3)A credit provider must give a statement, complying with this section, within 7 days after the request is given to the credit provider.
Criminal penalty: 50 penalty units.
(4)In the case of joint debtors or guarantors, the statement under this section need only be given to a debtor or guarantor who requests the statement and not, despite section 194, to each joint debtor or guarantor.
(5) Subsection (3) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
The trial judge noted that NAB had only received a complete copy of the documentation on 25 November 2008 but that the appellant had called off settlement on 1 December 2008, within the 7 day period for NAB to respond to the complete payout request.
The trial judge held that, as the facsimile of 12 November 2008 was obscured, the failure of NAB to respond to it was not a breach of s 83 of the National Code. Further, he was not prepared to find that NAB had contravened s 83 as the appellant had himself called off settlement before the expiration of 7 days after NAB had received the completed documentation.
Further, the trial judge held that, even if NAB had contravened s 83 of the National Code, that would not have affected his determination that NAB was entitled to recover its debt and possession of the property. The first reason for this conclusion was that NAB had provided the payout figure orally before the settlement date. Second, were the Court to itself determine the payout figure it would have regard to the terms of the facility agreement and the figure would be ‘substantially similar’ to the figure provided by NAB.[16] Third, he referred to Monas v Perpetual Trustees Victoria Ltd, in which it had been held that a failure by a financier to comply with a different obligation in relevantly similar legislation exposed the financier to a penalty but did not mean that its rights became unenforceable.[17]
[16]Section 84 of the National Code provides that a court may determine a pay out figure if a credit provider does not provide one. The trial judge held that, if the NAB had breached s 83 of the National Code and that the Court had to fix an amount under s 84, he would fix that amount at $406,513.00. This finding was one of the subjects of the respondent’s Notice of Contention.
[17](2011) 80 NSWLR 739.
The trial judge held that, even if NAB had contravened s 83 of the National Code, any such contravention had not caused the appellant loss and damage. He had entered into the sale contract on 8 October 2008 and, thus, was contractually committed to the sale before he asked for, or knew, any payout figure, and he could in any event have insisted on settlement on 1 December 2008 by requiring the purchaser pay the sale price of $385,000.
The trial judge dismissed the claim that the conduct of NAB regarding ‘the issue of the payout figure’ was unconscionable within the meaning of s 51AC of the TPA, or alternatively ss 21 and 22 of the Australian Consumer Law (the ‘ACL’) which is contained within Schedule 2 of the Competition and Consumer Act 2010 (Cth). He accepted that the conduct of NAB had been ‘unsatisfactory in a number of respects’ but, applying Director of Consumer Affairs Victoria v Scully,[18] held that the conduct of NAB did not have about it ‘the degree of delinquency which can properly be described as “moral opprobrium”‘.
[18](2013) 96 ACSR 455.
The trial judge dismissed the claim that the appellant was entitled to an order for specific performance of the deed. He closely analysed the documentation that was supplied to NAB and also the communications associated with that documentation. Applying Meehan v Jones,[19] he dismissed the argument that the relevant provision of the deed was void for uncertainty. He found that NAB had ‘acted honestly in not accepting that the alleged conditional letters of offer from the financiers complied with’ the deed.[20] On the basis of these findings, he also dismissed an associated claim that NAB’s conduct with respect to the deed had been unconscionable.
[19](1982) 149 CLR 571, 589–590 (Mason J, with whom Wilson J agreed).
[20]Reasons [96].
The trial judge also rejected a claim that the appellant had formally tendered $299,000 to NAB at court on 20 March 2013, purporting thereby to satisfy the obligation in the deed that the appellant pay that amount in cleared funds to NAB by 15 April 2013. The trial judge found that the transcript of 20 March 2013 was inconsistent with the appellant’s evidence that the bank cheque had been produced by his counsel and rejected by NAB’s counsel during the hearing before Judge Anderson on 20 March 2013. The trial judge ‘noted’ that the appellant did not seek to call Mr Shirrefs, and that the tender had not been pleaded in the amended defence and counterclaim his counsel had prepared.
The trial judge dismissed all the appellant’s claims for damages in his counterclaim.
Notice of Appeal
By notice of appeal dated 16 April 2014, the appellant appealed from the orders made by Judge Cosgrave of 17 February 2014. In his notice of appeal, the appellant said, in substance, that the trial judge had erred:
(a)in finding that the appellant had not complied with his obligation to provide to NAB by 25 February 2013 ‘a conditional letter of approval for finance on terms acceptable to NAB for an amount equal to or greater than $299,000’;
(b)in finding that the appellant had not complied with his obligation to provide to NAB $299,000 in cleared funds by 15 April 2013;
(c)in failing to find that the conduct of NAB with respect to the deed had been unconscionable and contrary to s 21 of the ACL;
(d)in finding that NAB had not breached its obligations under s 83 of the National Code;
(e)in finding that, even if NAB had contravened s 83 of the National Code, it would not affect NAB’s right to relief against the appellant, and, in particular, NAB’s entitlement to recover the debt and possession of the property;
(f)in failing to find that the breach by NAB of s 83 of the National Code did not cause the appellant any loss or damage;
(g)in failing to find that the 6 November 2008 NAB payout notice was false and misleading and/or negligently constructed and was therefore a breach of s 53 of the TPA or s 23 of the ACL;
(h)in not disclosing to the parties prior to the commencement of the trial of family shareholdings with NAB.
Misleading and deceptive conduct
In the written submission filed by the appellant personally on 2 May 2014, the first subject which is addressed is entitled ‘False & Misleading Conduct & Representations’. The submissions develop paragraph 25 of the Notice of Appeal.[21] Thereafter, the submission has three paragraphs of text. Counsel did not address this subject or these paragraphs at the hearing of the appeal. However, they are not among the paragraphs said to be abandoned or superseded by counsel’s submissions.
[21]The notice of appeal refers to s 53 of the TPA and s 23 of the ACL. However, the correct corresponding provision to s 53 of the former Act is s 29 (and not s 23) of the latter.
The substance of the three paragraphs is not easy to understand, let alone to summarise. But, it appears that the complaint is that, on 6 November 2008, NAB provided a clear statement that the payout figure was approximately $299,000, and that NAB subsequently reneged saying ‘that this notice was not correct or not a payout notice’. Section 53 of the TPA and s 23 of the ACL are referred to. How these sections are said to operate is not discussed.
There was no claim of a contravention of either of these provisions at trial. There is nothing about them in the amended defence and counterclaim. The trial judge makes no reference to them in his reasons. It is too late to raise them on appeal.[22]
[22]Metwally v University of Wollongong (1985) 60 ALR 68, 71. See also Banque Commerciale SA, En Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279, 284 citing the early Australian authority of Rowe v Australian United Steam Navigation Co Ltd (1909) 9 CLR 1, 24–5.
In any event, Mr Sgargetta’s real complaint is as to the correcting statement not the incorrect initial advice. Unless some action was taken on the incorrect statement, before the correcting one, it is difficult to see how any claim for misleading conduct could be advanced. For present purposes, it suffices to say no such claim was advanced. It cannot be aired for the first time on appeal.
Issues which arise on the appeal
The issues which do arise on this appeal, on the basis we have set out, are these:
(a) whether the appellant had, by 25 February 2013, complied with the obligation in the deed to provide a conditional letter of approval for finance on terms acceptable to NAB for an amount equal to or greater than $299,000;
(b) in the event that the appellant had not complied with that obligation, whether NAB was entitled to proceed with the hearing of the summons for final judgment and the proceedings generally;
(c) in the event that the appellant had complied with the obligation to provide the conditional letter, whether the appellant had, on 20 March 2013, taken a step ‘equal to performance’ of the obligation to pay NAB $299,000;
(d) whether the conduct of NAB with respect to the deed was unconscionable and contrary to s 21 of the ACL;
(e) whether NAB contravened s 83 of the National Code and, if so, what were the consequences of that contravention;
(f) whether there had been a ‘mistrial’ because the trial judge did not disclose ‘family shareholdings’ in NAB.
Whether appellant provided a conditional letter of approval acceptable to NAB
In his notice of appeal, the appellant says that the trial judge should have found that he ‘had complied with his obligations under cl 2.1 of the Deed of Settlement’. In his written submission dated 2 May 2014, the appellant made a series of points about the preparation of the deed. The appellant also said that NAB ‘rejected all loan offers and rejected payment in the amount of $299,000 in accordance with the settlement deed’. He said that the deed ‘gives an unfair advantage to Nab whereby in literal comprehension can never be facilitated, as all the power of position is all one sided in Nab’s favour’.
In its written submissions dated 14 May 2014, NAB addressed the question whether cl 2.1(a) was void for uncertainty and whether it required that NAB act ‘honestly or honestly and reasonably’. It addressed the question whether, if cl 2.1(a) was void, it was severable. As indicated, at the hearing of the appeal counsel for the appellant abandoned the contention that cl 2.1(a) was void for uncertainty. Given the decision in Meehan v Jones,[23] the concession was properly made.
[23](1982) 149 CLR 571.
NAB contended that it was impossible for the trial judge to find that the appellant had complied with cl 2.1(a) ‘unless he found that the [NAB], acting “honestly” or “honestly and reasonably” decided that the Purported Red Rock Offer was acceptable to it or should have done so. Such a finding was not available on the evidence below and is inconsistent with a finding that the [NAB] was acting “honestly” or “honestly and reasonably” in rejecting the Purported Red Rock Offer.’ NAB further contended that there was no evidence that could give rise to a finding that: (a) it had waived compliance with cl 2.1(a); (b) that the parties had agreed to vary cl 2.1(a) so that compliance was no longer required; or (c) that NAB was estopped from relying on cl 2.1(a).
At trial, the appellant maintained that he had provided a conditional letter of approval for finance in accordance with cl 2.1(a) of the deed. It will be recalled that cl 2.1(a) required the appellant to provide to the solicitors to NAB by 5.00 pm on 25 February 2013 ‘a conditional letter of approval for finance on terms acceptable to NAB and for an amount equal to or greater than $299,000’.
At trial, NAB adduced evidence from Melissa Thomas, the Operational Manager of Late Stage Mortgage Collections at NAB. Ms Thomas gave evidence about why the documentation received from the appellant was not acceptable to NAB. The trial judge summarised her evidence in relation to the first ‘Red Rock Mortgages’ document as follows:
• it was not a letter of offer;
•it was not signed by the financier, indicating its agreement to lend to Sgargetta;
•the applicant was Cybil Sgargetta, not the defendant – there were no details regarding the defendant;
•it was not sufficiently certain that NAB would be paid the sum of $299,000.[24]
[24]Reasons [86].
The trial judge summarised her evidence in relation to the second ‘Red Rock Mortgages’ document as follows:
• it was not addressed to Sgargetta;
• it was not a loan offer or approval;
• it was not signed by the prospective lender;
• it did not refer to a specific loan amount of at least $299,000.[25]
[25]Reasons [87].
The trial judge summarised her evidence in relation to the ABNZ document, the final purported offer, as follows:
•the applicant was Cybil Sgargetta, not the defendant, and there were no details pertaining to the defendant in the document;
• it was not addressed to the defendant;
• the lender had not signed the document.[26]
The judge continued:
When questioned about the alleged offer from ABNZ Investments Pty Ltd, Ms Thomas said that the company was not familiar to anyone in her department and that, after conducting searches, NAB found that the company was not a registered lending institution. This raised concerns about the likelihood of NAB receiving any funds.[27]
[26]Reasons [88].
[27]Reasons [90].
On the strength of the documentary evidence and the oral evidence of Ms Thomas, the trial judge found:
I accept that NAB acted honestly in not accepting that the alleged conditional letters of offer from the financiers complied with the Deed of Settlement. In the circumstances referred to, and where the bank had an imminent hearing date set for its application, I accept that the bank honestly held concerns in February 2013 regarding the likely receipt of funds from another financier. As a result of the finding, there is no aspect of NAB’s conduct regarding the Deed of Settlement which I would describe as unconscionable as alleged by Sgargetta.[28]
[28]Reasons [96].
On the hearing of the appeal, counsel for Mr Sgargetta made no challenge to this finding. It is clearly correct. The documents did not comply with cl 2.1(a) for the reasons given by NAB’s solicitors at the time and for the reasons given by Ms Thomas in her evidence. NAB was entitled to find them unacceptable. It is clear that it did so.
The issue concentrated upon by the appellant’s counsel on appeal was whether, upon the appellant’s failure to comply with cl 2.1(a), NAB was entitled to proceed with its recovery proceeding.
Whether NAB was entitled to proceed with the summons for final judgment and the proceedings generally
At the hearing of the appeal, counsel for the appellant said that the deed was to be characterised as one of ‘accord and conditional satisfaction’. In the appellant’s supplementary submission, it was put as follows:
Here, upon the performance by the Appellant of his obligations under Clause 2.1 of the Deed (most materially, the payment of $299,000.00), the Respondent’s promised forbearance with respect to its claim against the Appellant (and discharge of the related subject mortgage) crystallises into an obligation absolute by reason of Clause 2.2 of the Deed.
At the hearing of the appeal, the words ‘most materially’ assumed particular significance. Counsel submitted that the purpose of the deed was to bring about payment to NAB of the sum of $299 000 and to end the litigation. He submitted that the clause was ‘really about the $299,000’ and not the letter of approval. In this respect, he referred to Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd,[29] and Electricity Generation Corporation v Woodside Energy Ltd.[30] He submitted that the sub-clauses of cl 2.1 were to be read together and that the ‘core obligation’ was the payment obligation in cl 2.1(b) to which cl 2.1(a) was ‘subordinate’.
[29](2004) 219 CLR 165, [40].
[30][2014] HCA 7, [35].
We reject this construction of cl 2.1. It seems to us that the obligations in cl 2.1(a) and in cl 2.1(b) are independent of each other. There is no proper basis for characterising one as ‘core’ and one as ‘subordinate’.
At the date of execution of the deed the County Court had scheduled the hearing of NAB’s application for summary judgment for 1 March 2013. The deed recites that fact. The terms of the deed reveal that there was a reason why the deed provided for the obligation in cl 2.1(a) and why it required that that obligation be performed before 1 March 2013.
The deed provides that NAB would forebear from exercising its rights so long as the appellant complied with the deed. As to the consequences of non-compliance, cl 3 of the deed is perfectly clear. It provides that, if the appellant defaults under cl 2, ‘NAB will immediately be entitled to proceed with the hearing of its Summons and the Proceedings generally.’ The entitlement to proceed applies to any non-compliance with cl 2; it is not confined to cl 2.1(b).
Subject to certain limitations which are not here relevant, parties to an agreement are entitled to provide for the rights that are to arise upon the failure of one or both of the parties to fulfil the terms of an agreement. Very frequently, parties do not make express provision for the rights that are to arise consequent on a particular breach. In those circumstances, the court has to discern what the parties are impliedly taken to have agreed and difficult issues can arise as to the consequences of breach of a particular term. In the present case, no such issues arise. The parties have made express provision for their rights consequent upon breach of cl 2 in cl 3.
Upon the failure of the appellant by 5.00 pm on 25 February 2013 to provide to NAB’s solicitors a conditional letter of approval for finance on terms acceptable to NAB for an amount equal to or greater than $299 000, NAB was entitled to proceed with the hearing of its summons and the proceedings generally. That is what it then did. The fact that upon the hearing of the summons leave to defend was granted alters nothing. NAB was entitled to proceed with the proceedings generally, and it did so.
Whether the appellant performed the obligation to pay NAB $299,000
In our view if the appellant had not been in breach of the deed, what occurred on 20 March 2013 would have either constituted conduct equal to performance of cl 2.1(b), or have unequivocally demonstrated that the appellant was willing and able to perform, as the appellant’s counsel submitted.
Given our conclusion that he was then in breach, that conclusion has no significance.
On this issue we have reached a conclusion different from that of the trial judge, although that different conclusion does not affect the outcome. Our conclusion is different because we have fresh evidence which was not before him.
Because the appellant had not complied with cl 2.1(a) of the deed, subject to the unconscionability issues, NAB was entitled to adopt the position it did and to respond as it did to the proffered bank cheque.
Whether the conduct of NAB with respect to the deed was unconscionable
In his written submission dated 2 May 2014, the appellant used the word ‘unconscionable’ in the context of the trial judge’s treatment of NAB’s rejection of the three documents sent by the appellant to NAB’s solicitors in February 2013. He submitted:
Therefore 3 versions of the conditions have been provided and deemed unreasonable, unconscionable and unfair conduct in ensuring and fair and smooth passage is made in order to have this deed and matter concluded.
What occurs if 2.1(a) is not facilitated or can’t be facilitated due to uncertainty?
Or in the situation whereby the drawer and judgment itself varies these conditions.
Between the 25 February 2013 – 1 March 2013 Nab and Sgargetta engaged in correspondence in the attempt to try and clarify the conditions. In this period Sgargetta is insistent on the unfairness of the conduct and urged for clarification of the conditions. It will be argued that Nab as means to indicate some level of fairness provided these conditions, however they are varied twice in this period and will not reasonably allow Sgargetta time to now to meet these varying conditions.
We must then make note of clause 3 of the deed which in fact tells us what occurs if 2.1(a) is not facilitated. Quite simply clause 3 does not permit either party to rescind the deed whatsoever, it just allows Nab the opportunity to proceed with their Summary for judgment, which in turn is completely dismissed by the court entirely on the 20 March 2013.
The supplementary submissions did not further address this ground of appeal; nor was reference made to it in counsel’s submissions.
We reject Mr Sgargetta’s submissions on this issue.
In Attorney-General (NSW) v World Best Holdings Ltd,[31] Spigelman CJ discussed the term ‘unconscionable’ in s 62B of the Retail Leases Act 1994 (NSW).[32] He said:
Unconscionability is a well-established but narrow principle in equitable doctrine. It has been applied over the centuries with considerable restraint and in a manner which is consistent with the maintenance of the basic principles of freedom of contract. It is not a principle of what “fairness” or “justice” or “good conscience” requires in the particular circumstances of the case. As Deane J put it in Muschinski v Dodds(1985) 160 CLR 583 at 616:
“... [P]roprietary rights fall to be governed by principles of law and not by some mix of judicial discretion ..., subjective views about which party ‘ought to win’ ... and ‘the formless void of individual moral opinion’ ... Long before Lord Seldon’s anachronism identifying the Chancellor’s foot as the measure of Chancery relief, undefined notions of ‘justice’ and what was ‘fair’ had given way in the law of equity to the rule of ordered principle which is of the essence of any coherent system of rational law. The mere fact that it would be unjust or unfair in a situation of discord for an owner of a legal estate to assert his ownership against another provides, of itself, no mandate for a judicial declaration that the ownership in whole or in part lies, in equity, in that other ...”
To similar effect are the observations of Dean [sic] J, with whom Gibbs CJ, Mason J, Wilson J and Dawson J concurred, when rejecting the proposition that the common law recognised a tort of unfair competition. His Honour described the concept as “a cause of action whose main characteristic is the scope it allows, under high-sounding generalizations, for judicial indulgence of idiosyncratic notions of what is fair in the market place”. (Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2)(1984) 156 CLR 414 at 445–446.)
The Ministerial second reading speech, quoted (at 581 [112] supra), indicates a similar concern to distinguish what is unconscionable from what is merely unfair or unjust. Even if the concept of unconscionability in s 62B of the Retail Leases Act is not confined by equitable doctrine, as the decisions under s 51AC of the Trade Practices Act (Cth) suggest, restraint in decision-making remains appropriate. Unconscionability is a concept which requires a high level of moral obloquy. If it were to be applied as if it were equivalent to what was “fair” or “just”, it could transform commercial relationships in a manner which the Minister expressly stated was not the intention of the legislation. The principle of “unconscionability” would not be a doctrine of occasional application, when the circumstances are highly unethical, it would be transformed into the first and easiest port of call when any dispute about a retail lease arises.
The original statutory scheme recognised that judges who have had the experience of serving on the Supreme Court or the Federal Court are used to approaching questions of ‘unconscionability’, including in a statutory context, with an appropriate level of restraint. Others, including legal practitioners, whose primary experience is the representation of the interests of particular parties, could well be seen as likely to approach the task of determining unconscionability by a principle of what is “fair” or “just” in all of the circumstances of the case. Non-judicial members with industry backgrounds could readily be so regarded.[33]
[31](2005) 63 NSWLR 557.
[32]Section 62B of the Retail Leases Act 1994 (NSW) was modelled on s 51AC of the TPA.
[33](2005) 63 NSWLR 557, 583-584 [119]–[122].
In Director of Consumer Affairs Victoria v Scully,[34] this Court held that it was obliged to follow statements as to the meaning of statutory unconscionability such as that contained in Attorney-General (NSW) v World Best Holdings Ltd.[35] Unconscionability requires an element of ‘moral taint’; there must be conduct deserving of reproach to which the term ‘moral obloquy’ may be aptly applied.[36]
[34][2013] VSCA 292.
[35](2005) 63 NSWLR 557.
[36][2013] VSCA 292 [58].
The conduct of NAB was not such as to attract moral opprobrium. In the present case, upon the appellant failing to comply with cl 2.1(a) of the deed, NAB did no more than rely upon the entitlement it had, and upon which the parties had agreed, under cl 3 of the deed. It is not unconscionable for a party to rely upon its agreed contractual rights in these circumstances.
Whether NAB contravened s 83 of the National Code and, if so, what were the consequences of that contravention
In his written submission dated 2 May 2014, the appellant has a heading entitled ‘Breach of the UCCC Section.76/NCCP Section.83’. It is not easy to understand what point or points are made save that the appellant is dissatisfied with what the trial judge had to say on these issues. Doing the best we can, it appears that the appellant seeks to impeach the following paragraphs of the trial judge’s reasons:
While the letter from Home Conveyancing dated 12 November 2008 constituted, on one view, a written request for a payout figure, I do not regard NAB’s failure to respond in writing within seven days as a breach of section 83 of the National Code. It was clear from the evidence that the fax sent to the bank was incomplete or materially obscured. The obscured page contained the signature of Sgargetta which authorised NAB to provide relevant information about his account and the property to Home Conveyancing. Had NAB supplied such private information pertaining to Sgargetta to Home Conveyancing without the customer’s authority, the bank would have been potentially liable to the customer for acting in breach of its duties.
Further, I do not consider it would be appropriate to find NAB contravened section 83 when Sgargetta himself cancelled the settlement, cancelled the debit authority pursuant to which he paid the interest due on the bank’s loan, and lodged a complaint with the FOS. These actions all related to the loan in respect of which the payout details were sought. As a result of the defendant’s conduct, any formal response by NAB became academic especially when the defendant took these actions before the expiration of seven days from NAB’s receipt of the complete written request from Ms Maric.
(c) Interaction with NAB’s entitlement to recovery
Even if I considered that NAB had contravened section 83 of the National Code, it would not have affected that part of my decision relating to the establishment of NAB’s entitlement to recover the debt and possession of the property. I say this for several reasons.
First, the bank did provide a verbal payout figure on 28 November 2008 so Sgargetta, or his agent, Home Conveyancing, knew before settlement the amount required to discharge the bank’s security.
Second, Sgargetta referred in his amended defence to the court using its power under section 77 of the Code (which, for reasons discussed above, should more accurately refer to the equivalent provision in section 84 of the National Code) to determine the amount payable to the plaintiff by way of the then current indebtedness. Because the court in making the determination would have had regard to the provisions of the agreement between the parties (including interest provisions), it is likely that the court would have specified an amount payable which was substantially similar to the amount claimed by NAB.
Third, even if NAB had contravened section 83 of the National Code, it seems that such contravention would not have provided a basis in law to contest the bank’s entitlement to possession of the property. In Monas v Perpetual Trustees Victoria Ltd, the parties entered a $330,000 loan agreement in May 2004 pursuant to which the mortgagee granted a registered mortgage in favour of the mortgagee over a property at Liverpool. In January 2009, the mortgagee issued a default notice. The defaults specified in the notice were not remedied, and the mortgagor commenced possession proceedings in April 2009. The mortgagor claimed that the default notice did not comply with section 80(3) of the Consumer Credit (New South Wales) Code 1996 (the “NSW Code”) and accordingly was invalid. While challenging that claim, the mortgagee, by way of a defensive measure, filed a motion for authorisation to begin the proceedings nunc pro tunc should its default notice be found defective.
[The trial judge then extracted s 80 of the NSW Code.]
The mortgagor argued that the notice given in that case did not comply with section 80(3) because it did not clearly tell the recipient that a default of the same kind occurring during the grace period must be remedied before the original notice expires. The mortgagor then argued that the opening words of section 80(1) to the effect that “a credit provider must not begin enforcement proceedings” showed that the legislation intended that the requirements of section 80(3) were mandatory. However, the trial judge found that while section 80 provided a penalty for commencing proceedings without serving a notice, it contained no express provision that the credit contract or mortgage was unenforceable, and hence proceedings commenced in contravention of the section were not a nullity, nor did section 80 require that they be dismissed.
Sections 83 and 84 of the National Code are similar to provisions in the NSW Code. This also applies to provisions such as section 124 of the National Code, which has a counterpart in the NSW Code, and this provision contributed to the ruling in the Monas case. Because Perpetual Trustees Victoria Limited was permitted to pursue the defendant in Monas notwithstanding the terms of section 80 of the New South Wales Code, it seems that NAB should also be allowed to maintain its action against Sgargetta.
If NAB did breach section 83 of the National Code (which NAB denies), what amount should Sgargetta pay to NAB pursuant to section 84 of the National Code?
In case it is later found that I should have determined that NAB breached the terms of the National Code and also claimed an incorrect amount from Sgargetta, I shall address the issue of the amount I would have found that Sgargetta was liable to have paid NAB.
NAB claimed that the prima facie amount which Sgargetta should pay pursuant to the facility was $429,628.98 as at 26 August 2013 (excluding enforcement expenses). This amount, which is set out in the certificate, appears to represent the whole amount owing for the principal and interest for the period from 1 December 2008 until 26 August 2013.
I am not satisfied that NAB should necessarily recover interest for the whole of that period. In particular I am minded to require the bank to forgo interest for much of the period between March 2010, at which time the enquiries of the FOS ceased, and May 2011, at which time the bank sent the default notice dated 11 May 2011 regarding the breach of the terms of the facility. During this period NAB took no, or no effective, measures to enforce its alleged rights against the defendant. Moreover, the bank gave no detailed explanation of its conduct during that period about why it took so long to act.
It appears from the lender’s certificate produced pursuant to clause 45 of the Memorandum of Common Provisions incorporated into the mortgage that interest was accruing under the mortgage at a rate of $63.33 per day at the date of the certificate. Plainly the interest rate might have varied during the course of the mortgage. However, using that daily rate as a guide in what is of necessity an exercise in approximation, I consider that 1 year’s interest at that rate would total about $23,115. If I were of the view that NAB breached section 83 of the National Code and I was called upon to make a determination of the amount to be paid, I would order Sgargetta to pay NAB $406,513.00.[37]
[37]Reasons [51]–[63] (citations omitted).
A matter raised in NAB’s notice of contention is whether the trial judge was correct in his determination of the amount owing, under s 84 of the National Code, in the event contravention of s 83 was established.
The issues raised seem to us to be:
(a)whether NAB complied with s 83 of the National Code;
(b)in the event that NAB failed to comply with s 83, whether NAB was nonetheless entitled to recover the debt and possession of the property; and
(c)whether the trial judge correctly determined the amount owing to NAB pursuant to s 84 of the National Code.
Did NAB comply with s 83 of the National Code?
Sections 82 and 83 of the National Code are located in Subdivision A of Division 1 of Part 5 of the National Code. Part 5 is entitled ‘Ending and enforcing credit contracts, mortgages and guarantees’. Division 1 of Part 5 is entitled ‘Ending of credit contract by debtor etc’. Subdivision A is entitled: ‘Paying out contract etc’.
Sections 82 and 83 provide:
82 Debtor’s or guarantor’s right to pay out contract
(1)A debtor or guarantor is entitled to pay out the credit contract at any time.
(2)The amount required to pay out a credit contract (other than a continuing credit contract) is the total of the following amounts:
(a)the amount of credit;
(b)the interest charges and all other fees and charges payable by the debtor to the credit provider up to the date of termination;
(c)reasonable enforcement expenses;
(d)early termination charges, if provided for in the contract;
less any payments made under the contract and any rebate of premium under section 148.
83 Statement of pay out figure
(1)A credit provider must, at the written request of a debtor or guarantor, provide a written statement of the amount required to pay out a credit contract (other than a continuing credit contract) as at such date as the debtor or guarantor specifies. If so requested, the credit provider must also provide details of the items which make up that amount.
(2)The statement must also contain a statement to the effect that the amount required to pay out the credit contract may change according to the date on which it is paid.
(3)A credit provider must give a statement, complying with this section, within 7 days after the day the request is given to the credit provider.
Criminal penalty: 50 penalty units.
(4) In the case of joint debtors or guarantors, the statement under this section need only be given to a debtor or guarantor who requests the statement and not, despite section 194, to each joint debtor or guarantor.
(5) Subsection (3) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
The obligation created by s 83 is to give a written statement. The obligation is triggered by the making of a ‘written request of a debtor or guarantor’. The ‘verbal request’ made in mid to late October 2008 was not such a written request.[38] The appellant relies on the written request by fax from Home Conveyancing dated 12 November 2008. That fax includes the following statement: ‘PLEASE NOTE that Section 76 of the Consumer Credit Code requires you to provide written payout within 7 days after receipt of this request.’ For its part, NAB contends that the letter of 12 November was not a ‘written request’ within the meaning of the applicable statute. It also submits that the appellant’s ‘request for a payout figure was incomplete in so far as the discharge authorisation form accompanying it was incomplete’ and that, as a result, NAB could not release the information to a person other than the appellant.
[38]See [11] above.
By its notice of contention dated 14 May 2014 NAB sought further to uphold the holding of the trial judge as follows:
In addition to and/alternatively to the learned trial judge’s finding that the respondent did not breach s 76 of the Old Code because it was incapable of processing the appellant’s request as a result of the discharge authority submitted by the appellant being incomplete, the respondent contends that it did not breach s 76 of the Old Code because the letter from the appellant’s conveyancer of 12 November 2008 did not constitute a request within the meaning of s 76(1) as it did not specify a date as at which the payout figure was to be provided.[39]
[39](Citations omitted).
In oral submissions, neither of the parties addressed the question whether NAB complied with s 83 of the National Code. When the reasons of the trial judge are examined, it is plain that he considered that the process envisaged by s 83 had miscarried. When it was originally transmitted by fax, the 12 November letter was corrupted; amongst other things, the signature of the appellant was not transmitted. The trial judge considered that, in those circumstances, NAB would not have been authorised to release private information about the appellant to a third party.[40]
[40]Reasons [51].
The trial judge explained what happened next:
NAB sent back to Ms Maric of Home Conveyancing a copy of the obscured and incomplete facsimile it received so Ms Maric knew on 14 November that NAB had not received a legible and complete copy of the discharge documentation on 13 November. Home Conveyancing did not send a complete copy of the documentation back to NAB until 25 November 2008. Ms Maric was unable to explain the delay in responding to the bank’s request that Home Conveyancing resubmit the documentation.
NAB gave Ms Maric a verbal payout figure on Friday 28 November 2008. After he received notification of the payout amount, Sgargetta called off the settlement scheduled for Monday 1 December 2008. Hence, it was the defendant who cancelled the settlement within the seven day period allowed for the bank to respond (assuming there was a written request within section 83 of the National Code).[41]
[41]Reasons [47]–[48].
In our opinion, the trial judge was right to treat the payout request made on 25 November 2008 as having been retracted. It is clear that the cancellation of the settlement was part of the appellant’s reaction to the verbal payout figure he had been given. That, in itself, could be seen as a retraction of the request for a written statement. But, more importantly, s 83 requires the identification of a payout figure ‘as at such date as the debtor or guarantor specifies’. The only possible date so specified is 1 December 2008, which was said to be the due date for settlement of the sale transaction. When that settlement was cancelled, before the expiration of seven days, there was no date specified.
Was NAB entitled to recover the debt and possession of the property?
Section 83 of the National Code provides that a credit provider must, at the written request of a debtor or guarantor, provide a written statement of the amount required to pay out a credit contract. It also provides for a penalty where it has not been complied with. It does not impose any restriction upon a lender or a mortgagee exercising their rights. A statute will not be interpreted as placing any restriction upon property rights in the absence of express words or necessary intendment.
The text of s 83 may be compared with that of s 80(1) of the Consumer Credit (New South Wales) Code 1996 (the ‘NSW Code’).[42]
[42]Section 5 of the now repealed Consumer Credit (New South Wales) Act 1995 was identical to s 5 of the Consumer Credit (Victoria) Act 1995 both of which apply as law in the respective jurisdictions the Appendix to the Consumer Credit (Queensland) Act 1994 (Qld).
Section 80 provided:
Requirements to be met before credit provider can enforce credit contract or mortgage against defaulting debtor or mortgagor
(1)Enforcement of credit contract. A credit provider must not begin enforcement proceedings against a debtor in relation to a credit contract unless the debtor is in default under the credit contract and—
(a)the credit provider has given the debtor, and any guarantor, a default notice, complying with this section, allowing the debtor a period of at least 30 days from the date of the notice to remedy the default; and
(b) the default has not been remedied within that period.
Maximum penalty— 50 penalty units.
(2)Enforcement of mortgage. A credit provider must not begin enforcement proceedings against a mortgagor to recover payment of money due or take possession of, sell, appoint a receiver for or foreclose in relation to property subject to a mortgage, unless the mortgagor is in default under the mortgage and—
(a)the credit provider has given the mortgagor a default notice, complying with this section, allowing the mortgagor a period of at least 30 days from the date of the notice to remedy the default; and
(b) the default has not been remedied within that period.
Maximum penalty— 50 penalty units.
(3)Default notice requirements. A default notice must specify the default and the action necessary to remedy it and that a subsequent default of the same kind that occurs during the period specified in the default notice for remedying the original default may be the subject of enforcement proceedings without further notice if it is not remedied with the period.
(3A) Combined notices. Default notices that may be given under subsections (1) and (2) may be combined in one document if given to a person who is both a debtor and a mortgagor.
(4)When default notice not required. A credit provider is not required to give a default notice or to wait until the period specified in the default notice has elapsed, before beginning enforcement proceedings, if—
(a)the credit provider believes on reasonable grounds that it was induced by fraud on the part of the debtor or mortgagor to enter into the credit contract or mortgage; or
(b)the credit provider has made reasonable attempts to locate the debtor or mortgagor but without success; or
(c)the Court authorises the credit provider to begin the enforcement proceedings; or
(d)the credit provider believes on reasonable grounds that the debtor or mortgagor has removed or disposed of mortgaged goods under a mortgage related to the credit contract or under the mortgage concerned, or intends to remove or dispose of mortgaged goods, without the credit provider’s permission or that urgent action is necessary to protect the mortgaged property.
(5)Non-remedial default. If the credit provider believes on reasonable grounds that a default is not capable of being remedied—
(a) the default notice need only specify the default; and
(b)the credit provider may begin the enforcement proceedings after the period of 30 days from the date of the notice.
(6)Other law about mortgages not affected. This section is in addition to any provision of any other law relating to the enforcement of real property or other mortgages and does not prevent the issue of notices to defaulting mortgagors under other legislation. Nothing in this section prevents a notice to a defaulting mortgagor under other legislation being issued at the same time, or in the same document, as the default notice under this section.
Note—
By virtue of section 161(2), a notice may contain information required to be given under other legislation or be included in a notice given under other legislation.
In Monas v Perpetual Trustees Victoria Ltd,[43] the New South Wales Court of Appeal considered the consequences of a failure to comply with s 80 of the NSW Code. The borrower contended that ‘the opening words of s 80(1) that a credit provider must not begin enforcement proceedings, [showed] that the legislature intended that the requirements of s 80(3) were mandatory’.[44] Young JA (with whom Beazley and McColl JJA agreed) held that non-compliance with s 80 did not mean that there is a failure by a mortgagee to satisfy a condition precedent to the institution of proceedings for possession.[45]
[43](2011) 80 NSWLR 739.
[44]Ibid 746 [29].
[45]Ibid 747 [37]. In so holding, Young JA followed the decision of Davies J in Bank of Queensland Ltd v Dutta [2010] NSWSC 574 which, relying upon the differences in the terms of ss 7 and 80 of the Credit (Home Finance Contracts) Act 1984 (NSW), did not follow Graham v Aluma Lite Pty Ltd (1996) 39 NSWLR 58. Section 7 provided that a credit provider ‘shall not institute proceedings ... until after the expiration of one month after service ... of a notice in the prescribed form that specifies the proceedings’. In Graham v Aluma Lite Pty Ltd, the Court held unanimously that service of a notice under s 7 was a condition precedent to any action being instituted in the Court.
We think that the decision in Monas v Perpetual Trustees Victoria Ltd was plainly correct: a statute will not be interpreted as placing any restriction upon property rights in the absence of express words or necessary intendment.[46] The Court of Appeal reached its conclusion notwithstanding that the words used in s 80(1) of the NSW Code were that a ‘credit provider must not begin enforcement proceedings against a debtor’. The present case is stronger. Section 83 of the National Code makes no reference to any apparent restriction on commencing proceedings.
[46]R & R Fazzolari Pty Ltd v Parramatta City Council (2009) 237 CLR 603, 618–620 [40]–[45] (French CJ). See the discussion in D C Pearce and R S Geddes, Statutory Interpretation in Australia (LexisNexis Butterworths, 7th ed, 2011) 183–5 and the authorities collected in Perry Herzfeld, Thomas Prince and Stephen Tully, Interpretation and Use of Legal Sources: The Laws of Australia (Thomson Reuters, 2013) [25.1.1950] n 20.
What is a determination under s 84 of the National Code?
In the event that he should have determined that, in contravention of s 83 of the National Code, NAB had not provided to the appellant a statement of the amount required to pay out a credit contract, the trial judge addressed the question of the amount that the court should determine under s 84. In making that assessment, it seems that he understood himself to have a discretion as to the amount he should determine, albeit one guided by NAB’s entitlements under the home loan and the associated mortgage. As he put it: ‘[b]ecause the court in making the determination would have had regard to the provisions of the agreement between the parties (including interest provisions), it is likely that the court would have specified an amount payable which was substantially similar to the amount claimed by NAB’.[47] In the event, the trial judge determined an amount that involved disallowing NAB interest for a period of unexplained delay in enforcement proceedings. As he explained it: ‘[d]uring this period NAB took no, or no effective, measures to enforce its alleged rights against the [appellant]. Moreover, the bank gave no detailed explanation of its conduct during that period about why it took so long to act.’[48]
[47]Reasons [55].
[48]Reasons [62].
Section 84 provides:
Court may determine pay out figure if credit provider does not provide a pay out figure
(1) If the credit provider does not provide a statement of the amount required to pay out a credit contract (other than a continuing credit contract) in accordance with this Part after a request is duly made by a debtor or guarantor, the court may, on the application of the debtor or guarantor, determine the amount payable on the date of determination, the amount by which it increases daily and the period for which the determination is applicable.
(2) The credit contract is discharged if an amount calculated in accordance with the determination is tendered to the credit provider within the applicable period.
It is unnecessary for the Court in the present case to determine the proper construction of s 84. Further, we are without the benefit of any assistance from the parties as no submissions were made to the Court as to its meaning. That said, it does not seem to us that the section confers upon a court a discretion to determine an amount that seems to the court proper or reasonable in all the circumstances. Rather, we make the provisional observation that the section does no more than require a court to determine the amount which, as a matter of law, the credit provider is entitled to. That amount should be identical to the amount that the credit provider itself should have provided under s 83.
Whether there was a ‘mistrial’ because the trial judge did not disclose ‘family shareholdings’ in NAB
In the course of an interchange between Mr Sgargetta and the trial judge after the judge published his reasons, Judge Cosgrove (upon being questioned by Mr Sgargetta as to any business association he had with NAB) said his wife might own ‘100 shares or something like that’.[49] Mr Sgargetta asserts a ‘mistrial’ based upon this disclosure.
[49]Transcript of Proceedings, National Australia Bank Ltd v Sgargetta (County Court of Victoria, CI-12-02770, Judge Cosgrave, 17 February 2013) 6–7.
The applicable principles were set out by the High Court in Ebner v Official Trustee in Bankruptcy.[50] As a matter of prudence any shareholdings in a litigant should be disclosed by the judge, but the fact that shares are held by the judge, directly or indirectly, in a large publicly listed company is not a ground upon which a judge should disqualify himself or herself unless there is a realistic possibility that the outcome of the case could affect the value of the shares. Clearly, no such circumstance arose here.
[50](2000) 205 CLR 337.
This complaint is without substance.
Conclusion
This dispute began because NAB made a mistake. It told Mr Sgargetta that on a sale of the security property he would have to pay out less than the correct payout figure. It corrected that mistake very shortly prior to the due date for settlement of that sale. The sale was pursuant to a contract Mr Sgargetta had made with his wife before either of the payout figures, correct or incorrect, had been provided.
Mr Sgargetta reacted to the correction of NAB’s initial mistake by reporting NAB to FOS, cancelling the settlement, and ceasing all payments on the loan.
Because Mr Sgargetta ceased all payments on the loan the debt escalated significantly.
NAB delayed recovery proceedings for a period which is, at least in part, unexplained.
After NAB took recovery proceedings, a settlement deed was entered into containing terms which were, on one view, favourable to Mr Sgargetta. But he was unable or unwilling to comply with a term of that deed which required him to provide to NAB a conditional letter of approval for finance on terms acceptable to NAB by a specified date. The parties negotiated but could not reach a new agreement, although comparatively little separated them.
After a trial and the delivery of detailed reasons by the trial judge, NAB obtained judgment for the full amount it alleged to be due, obtained judgment for possession of the property, and obtained an order for costs against Mr Sgargetta.
Mr Sgargetta then appealed. He had the assistance of pro bono counsel.
Mr Sgargetta has not made good any of his grounds of appeal for the reasons we have given. His appeal must be dismissed.
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