Chin v Bendigo & Adelaide Bank Ltd

[2010] SADC 94

DISTRICT COURT OF SOUTH AUSTRALIA

(Civil)

CHIN v BENDIGO & ADELAIDE BANK LTD

[2010] SADC 94

Judgment of His Honour Judge Boylan

27 July 2010

REAL PROPERTY

Land mortgaged by Plaintiff to the Defendant bank as security. Plaintiff fell into arrears. Defendant exercised power of sale. Claim by Plaintiff that the notice given by the Defendant does not comply with s55A Law of Property Act 1936(SA) because it allowed him less than one month to remedy the breach from the date of service.

Appeal dismissed.

Law of Property Act 1936 (SA) s12(3) & s55A; Acts Interpretation Act 1915 s27(1), referred to.

CHIN v BENDIGO & ADELAIDE BANK LTD
[2010] SADC 94

1. The plaintiff is the registered proprietor of vacant land at Skye.  The land is mortgaged to the defendant bank as security for a loan to the plaintiff.  The plaintiff fell into arrears with the loan and, after many attempts at trying to negotiate some sort of settlement with him, the bank exercised its power of sale.  In February 2010, the Bank sold the land for $345,000.  The proceeds of settlement will not meet the whole amount owing to the Bank.

2. The plaintiff lodged a caveat.  He applies for an extension of time for the removal of the caveat.  Originally, his application was based upon his assertion that the Bank had sold the land below its market value.

3. There were a number of adjournments. When the matter finally came on for argument before me, the plaintiff did not persist in his argument that the land had been sold at less than its real value. Instead, he claimed that the default notice issued by the defendant Bank and served upon him does not comply with Section 55A of the Law of Property Act 1936. Accordingly, he argues that the caveat should remain in place until, at least, the Bank takes proceedings in accordance with the Section.

4. The Bank cannot enforce its right of sale unless it has served upon the defendant a notice complying with the relevant provisions of Section 55A of the Law of Property Act, 1936. One of those provisions is that, if the breach is capable of remedy, the notice must require the mortgagor and within one month after service of the notice, or such longer period as may be stipulated in the notice to remedy the breach.

5. The relevant part of the notice served upon the defendant read:

   “The default can be remedied by paying Bendigo & Adelaide Bank Ltd within thirty one (31) days of the date of the giving of the notice …”

6. The notice is dated 21 April 2009.  On that same day, the defendant’s solicitor posted a copy of the notice to the defendant’s address at Tranmere.  The following day, 22 April 2009, the Bank’s solicitor’s caused a copy of the notice to be affixed to the land at Skye.  There was, therefore, effective service of the notice.(1)

   (1) Law of Property Act, 1936. S.12(3)

7. The defendant submits that the notice does not comply with Section 55A because it allows him less than one month to remedy the breach.  His argument depends upon the method of calculating when that period of one month begins and ends.  First, the plaintiff submits than one month means one calendar month which, in this case, means thirty days because April has thirty days.  As the notice was affixed to the land on 22 April 2009, that day, 22 April, is not included in the calculation but the following day 23 April, is so included.(2)  That is, the time allowed by Section 55A within which the breach is to be remedied is thirty days from, and including 23 April up to, and including, the last day, namely 22 May 2009.  Therefore, Section 55A requires that the plaintiff be given until the  23 May to remedy the breach.  But, the plaintiff argues, that the notice gives him less time than that by requiring him to remedy the breach by 21 May 2009.  If I have understood him correctly, the plaintiff argues that the effect of the word “giving” in the section of the notice which I have already quoted is that the time begins to run from the date of the notice, 21 April 2009.  If one begins calculating a thirty one day period from, and including, 21 April, the thirty one day period expires on 21 May.  Accordingly, the plaintiff submits that the notice is deficient in that it does not comply with the Act. 

   (2) Acts Interpretation Act 1915, S.27(1)

8. The defendant argues that it has complied with Section 55A.  It accepts that the notice was served on 22 April.  It also accepts that the relevant time period will begin to run on 23 April.  But the defendant argues that the notice does not prescribe an end date for the time period allowed.  All the notice does is state that the default needs to be remedied within thirty one days after the deemed date of service.  In my view, that argument is correct.  Further, Section 55A allows for a longer  period.  Here the effect of the notice is no more than this:  the Bank has given the plaintiff thirty one days after the deemed date of service of the notice to comply with it.  By doing so, the defendant Bank has complied with the requirements of Section 55A.

9. I refuse the plaintiff’s application for an extension of time.