Court of Appeal
Supreme Court
New South Wales
- Summary available
- Amendment notes
Medium Neutral Citation: Chalak v G & G Mikhael Pty Ltd [2022] NSWCA 116 Hearing dates: 24 June 2022 Date of orders: 5 July 2022 Decision date: 05 July 2022 Before: Ward P at [1];
Simpson AJA at [2];
Basten AJA at [3]Decision: (1) Grant the applicant leave to appeal from the judgment and orders in the Common Law Division dated 17 and 18 February and 1 March 2022.
(2) Set aside the orders entered on 17 February and 1 March 2022 and in place thereof, make the following orders:
(a) dismiss the plaintiff’s notice of motion dated 30 November 2021;
(b) order that the plaintiff pay the defendant’s costs of the motion.
(3) Order that the respondent pay the applicant’s costs in this Court, including his costs of the stay application in the Division.
Catchwords: APPEALS – leave to appeal – claim for summary judgment for possession of land – whether the defence raised triable issues as to (i) enforceability of mortgage and (ii) rate of interest accruing under mortgage
CIVIL PROCEDURE – summary disposal – judgment for plaintiff – sufficiency of plaintiff’s evidence – inconsistency on face of affidavit – proof of sum advanced inadequate – whether defence obviously untenable – opportunity for defendant to amend inadequate pleadings – arguable case for relief
MORTGAGE AND SECURITIES – mortgages – form, validity and effect – whether arguable case that mortgage unjust or plaintiff’s conduct unconscionable – 23-year bank mortgage replaced by one repayable in full in six months – interest rate varied from 7% to 15% compounding daily
Legislation Cited: Civil Procedure Act 2005 (NSW), Pt 6, Div 1
Competition and Consumer Act 2010 (Cth), Sch 2, ss 18, 20, 29
Contracts Review Act 1980 (NSW), s 9
Supreme Court Act 1970 (NSW), s 101
Uniform Civil Procedure Rules 2005 (NSW),
rr 13.1, 13.4
Cases Cited: Deyv Victorian Railways Commissioners
(1949) 78 CLR 62; [1949] HCA 1
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; [1964] HCA 69
Category: Principal judgment Parties: Safwan Nizar Chalak (Applicant)
G & G Mikhael Pty Ltd (Respondent)Representation: Counsel:
Solicitors:
Mr D Sulan SC/Mr T Rollo (Applicant)
Mr Y Young/Ms A Lim (Respondent)
Auslex Law Group (Applicant)
Gavel & Page Lawyers (Respondent)
File Number(s): 2022/76853 Decision under appeal
- Court or tribunal:
- Supreme Court
- Jurisdiction:
- Common Law Division
- Citation:
- Date of Decision:
- 18 February 2022
- Before:
- Dhanji J
- File Number(s):
- 2021/94652
Judgment
-
WARD P: I agree with Basten AJA.
-
SIMPSON AJA: I agree with Basten AJA.
-
BASTEN AJA: On 7 September 2017, the applicant, Safwan Nizar Chalak, entered into a loan agreement with the respondent, G & G Mikhael Pty Ltd, the purpose of which was to obtain funds to finance the construction of three townhouses on land owned by the applicant at Chipping Norton, in south-west Sydney.…
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- Case
- [2022] NSWCA 116
- Decision Date
CaseChat Overview and Summary
The primary legal issues before the Court of Appeal were whether the defence raised by the applicant presented triable issues regarding the enforceability of the mortgage and the applicable interest rate, and whether the evidence presented by the respondent in support of its summary judgment application was sufficient. Specifically, the court considered whether the respondent's affidavit contained inconsistencies and inadequate proof of the sum advanced, and whether the applicant's defence was obviously untenable, particularly in light of an arguable case that the mortgage was unjust or that the respondent's conduct was unconscionable. The transition from a 23-year bank mortgage to one repayable in six months with a daily compounding interest rate increase from 7% to 15% was a central element of this consideration.
The Court of Appeal found that the applicant had raised arguable defences that warranted a full trial. The inconsistencies in the respondent's affidavit and the inadequacy of proof regarding the sum advanced meant that the respondent had not discharged its onus to show that the applicant had no real prospect of success. Furthermore, the court considered that the applicant's defence, alleging unconscionability and unjustness in the mortgage terms, was not obviously untenable and required further investigation. Consequently, the court granted leave to appeal, set aside the summary judgment orders, and dismissed the respondent's motion for summary judgment, ordering the respondent to pay the applicant's costs of the motion. The respondent was also ordered to pay the applicant's costs in the Court of Appeal.
Orders
Orders of the court
(1) Grant the applicant leave to appeal from the judgment and orders in the Common Law Division dated 17 and 18 February and 1 March 2022.
(2) Set aside the orders entered on 17 February and 1 March 2022 and in place thereof, make the following orders:
(a) dismiss the plaintiff’s notice of motion dated 30 November 2021;
(b) order that the plaintiff pay the defendant’s costs of the motion.
(3) Order that the respondent pay the applicant’s costs in this Court, including his costs of the stay application in the Division.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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