Australian Securities Ltd v Borina Pty Ltd - [2017] NSWSC 1073

Supreme Court

New South Wales

Medium Neutral Citation: Australian Securities Ltd v Borina Pty Ltd [2017] NSWSC 1073
Hearing dates: 30 June 2017 & 27 July 2017
Date of orders: 17 August 2017
Decision date: 17 August 2017
Jurisdiction: Common Law
Before: Davies J
Decision:
(1) Leave to the Defendant to file a cross-claim seeking an account, a claim for money had and received, and seeking relief for breaches of s 21 of the Australian Consumer Law.

(2) On payment to the Plaintiff of the sum of $10,000, which is to be added to the Security Amount sum of $71,500 referred to in paragraph 3 of the Acknowledgement executed by the Defendant on 21 December 2016, leave to the Defendant to claim as a head of damage the matter specified in particular (b) to paragraph 53 of the second proposed cross-claim.
(3) The Defendant is to pay 50% of the Plaintiff’s costs of the Notice of Motion filed 25 May 2017.
Catchwords:
REAL PROPERTY – mortgages - claim for possession of land – parties settled proceedings prior to hearing – payment to mortgagee – part payment under protest to obtain discharge – mortgagor subsequently sought leave to file cross-claim – whether mortgagor’s causes of action would be doomed to fail and therefore futile – mortgagor claims that mortgagee did not roll over loan under Facility Agreement in breach of agreement – whether mortgagor has claim for breach of contract – mortgagor’s remedies confined to taking of accounts and claim for money had and received – in addition mortgagor seeks damages for breach of s 21 Australian Consumer Law – whether claim available
MORTGAGES AND SECURITIES – redemption of mortgage - right of mortgagee to retain sufficient funds to meet disputed claims by mortgagor – acknowledgment signed by mortgagor at settlement notifying disputed amounts – whether additional claim available – whether mortgagee can demand further security for additional claim
Legislation Cited: Australian Consumer Law 2010 (Cth)
Competition and Consumer Act 2010 (Cth)
Real Property Act 1900 (NSW)
Cases Cited: Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41
Alamdo Holdings Pty Ltd v Australian Window Furnishings (NSW) Pty Ltd [2006] NSWSC 1073
Australia and New Zealand Banking Group Ltd v Mishra [2012] NSWSC 1333; (2012) 16 BPR 31,665
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
Overton Investments Pty Ltd v Cuzeno RVM Pty Ltd [2003] NSWCA 27
Projects Research Pty Ltd v Permanent Trustee of Australia Ltd (1990) 5 BPR 97,341
Riva NSW Pty Ltd CAN 113 881 815 v Key Nominees Pty Ltd [2014] NSWSC 301
Spencer v The Commonwealth (2010) 241 CLR 118; [2010] HCA 28
Thambiappah v Commonwealth Bank of Australia [2010] NSWSC 520
Westpoint Finance Pty Ltd v Chocolate Factory Apartments Ltd [2002] NSWCA 287; (2002) 12 BPR 22,969
Category: Procedural and other rulings
Parties: Australian Securities Ltd (Plaintiff)
Borina Pty Ltd (Defendant)
Representation:
Counsel:
S Docker (Plaintiff)
J Neal (Defendant)
Solicitors:
Kemp Strang…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] NSWSC 1073
Decision Date: 17 August 2017

CaseChat Overview and Summary

Australian Securities Ltd sought possession of land from Borina Pty Ltd. The parties settled the proceedings prior to the hearing, with Borina making a part payment to Australian Securities under protest in order to obtain a discharge. Subsequently, Borina sought leave to file a cross-claim against Australian Securities, alleging that the latter had breached the terms of the Facility Agreement by not rolling over the loan, and that Borina was owed damages under section 21 of the Australian Consumer Law. Australian Securities argued that Borina’s claims were doomed to fail and were therefore futile. Borina contended that Australian Securities was not entitled to retain sufficient funds to meet any disputed claims by Borina, and that the acknowledgment signed by Borina at settlement notifying disputed amounts did not preclude an additional claim. Borina also sought to establish whether Australian Securities could demand further security for any additional claim.

The court held that Borina’s claims were not futile. The court held that Borina had a claim for breach of contract and that its remedies were confined to taking of accounts and a claim for money had and received. In addition, the court held that Borina could seek damages for breach of section 21 of the Australian Consumer Law. The court also held that Australian Securities was not entitled to retain sufficient funds to meet any disputed claims by Borina, and that the acknowledgment signed by Borina at settlement notifying disputed amounts did not preclude an additional claim. Furthermore, the court held that Australian Securities could not demand further security for any additional claim.

The court ordered that Borina be granted leave to file a cross-claim against Australian Securities. The court also ordered that Australian Securities pay Borina’s costs of the application.

Orders