Jinman v ANZ - [2017] SASC 56

SUPREME COURT OF SOUTH AUSTRALIA
(Appeal from a Master)
JINMAN v ANZ
[2017] SASC 56
Judgment of The Honourable Justice Bampton
11 April 2017
MORTGAGES - ESTATE, RIGHTS AND LIABILITIES OF MORTGAGOR AND MORTGAGEE - POSSESSION
PROCEDURE - SUPREME COURT PROCEDURE - SOUTH AUSTRALIA - PROCEDURE UNDER RULES OF COURT - MASTERS
Appeal against order for possession made pursuant to Part 17 of the Real Property Act 1886 (SA) – whether the Master erred in finding that the appellant had not raised an arguable case that warranted the ordering of pleadings and referral to trial.
HELD:
1. The Master was not in error in finding that the appellant had not raised an arguable defence.
2. The Bank was entitled to the order for possession made by the Master.
3. Appeal dismissed.
Real Property Act 1886 (SA) s 51A, Pt 17; Supreme Court Act 1935 (SA) s 50; Supreme Court Civil Rules 2006 (SA) r 204, r 280, r 286; Law of Property Act 1936 (SA) s 55A, referred to.
Financial Ombudsman Services Ltd v Utopia Financial Services Pty Ltd [2016] WASC 55; Cromwell Property Securities Ltd v Financial Ombudsman Services Ltd & Ors (2014) 288 FLR 374; Micarone & Anor v Perpetual Trustees Australia Ltd & Ors (1999) 75 SASR 1; Westpac Banking Corporation v Chadha [2012] SASC 223; Corporation of the Town of Moonta v Rodgers & Rodgers (1980) 26 SASR 143, considered.

JINMAN v ANZ
[2017] SASC 56
Appeal from a Master

BAMPTON J: On 18 August 2016, a Master made on order for possession (“the order”) of a residential property pursuant to Part 17 of the Real Property Act 1886 (SA) (“the RPA”). The order required Mr Jinman, who is the registered proprietor of property at 7 Black Hill Road, Cambrai (“Cambrai”), to give up possession of the property to the ANZ Banking Group Ltd (“the Bank”) within 28 days.
Consideration on appeal
Mr Jinman appeals the order pursuant to s 50(2) of the Supreme Court Act 1935 (SA). The exception to r 280(1)(a) of the Supreme Court Civil Rules 2006 (SA) (“the Rules”) provides that an appeal against an interlocutory judgment of a Master is to be heard and determined by a single Judge. Rule 286 provides that on the hearing of the appeal I am to conduct a rehearing and I may, in my discretion, receive further evidence on any question of fact.
Mr Jinman represented himself before the Master and on appeal.
Documents before the Court on appeal
The Bank relies on the following documents:
·Affidavit of Terence Raymond Simpson, Manager of Commercial Collection Services of the Bank sworn on 29 March 2016 (“the Simpson affidavit”).[1]
·Affidavit of Glenn Gotting, Manager of Commercial Collection Services of the Bank sworn on 1 July 2016 (“the Gotting affidavit”).[2]
[1] FDN 3.
[2] FDN 9.
Mr Jinman filed an affidavit sworn on 20 June 2016[3] which alleges a number of defences and cross-claims (“the Jinman affidavit”).
[3] FDN 6.
Mr Jinman…

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] SASC 56
Decision Date: 11 April 2017

CaseChat Overview and Summary

In Jinman v ANZ, the appellant, Mr Jinman, appealed against an order for possession of his property at Cambrai, South Australia, made pursuant to Part 17 of the Real Property Act 1886 (SA). The bank, ANZ, sought to enforce a mortgage over the property due to Mr Jinman’s failure to meet the mortgage repayments. The primary legal issue was whether the Master erred in finding that Mr Jinman had not raised an arguable case that warranted the ordering of pleadings and referral to trial. Mr Jinman argued that the mortgage over the property was invalid because it secured a business loan rather than a home loan, and he provided affidavits to support this claim. The Bank opposed the admission of the affidavits, arguing that the evidence could have been obtained with reasonable diligence and would not have influenced the outcome. The court received the evidence de bene esse but ultimately dismissed the appeal, finding that the new evidence did not affect the decision to grant the order for possession. The court held that the Master was entitled to make the order for possession if satisfied that there was no triable issue raised on the evidence and that Mr Jinman had not demonstrated a dispute of substance that warranted the ordering of pleadings and referring the dispute to trial.

The appeal hinged on the Master's determination that Mr Jinman had not raised an arguable case supported by some evidence which could give rise to a particular defence. The court noted that the Master was not required to be satisfied beyond reasonable doubt but only that there was some evidence which, if accepted, could give rise to a particular defence. The Master found that Mr Jinman had not met this threshold. The court upheld the Master's decision, finding that the new evidence provided by Mr Jinman did not alter the outcome. The court held that the Master correctly applied the law and that Mr Jinman's allegations of breach of contract, unconscionable conduct, and fraud did not establish a triable issue. The court concluded that the order for possession should stand as the Bank had established a valid claim to enforce the mortgage over the property.

Orders

Orders of the court

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Background

Background to the litigation

Mr Jinman has applied to adduce further evidence on appeal by way of two affidavits sworn 18 October 2016 (“the October 2016 Jinman affidavit”)[4] and 29 November 2016 (“the November 2016 Jinman affidavit”).[5] The Bank opposes the admission of these affidavits, asserting that Mr Jinman has not established that the evidence could not, with reasonable diligence, have been obtained for use before the Master or that the evidence would have had any influence upon the result. I received this evidence de bene esse. However, for the following reasons, the matters deposed to in the affidavits do not affect my decision to dismiss the appeal.[4] FDN 16.[5] FDN 20.Factual background In February 2003, Mr Jinman acquired property at Cambrai in the Murraylands. In 2004, Mr Jinman granted a mortgage to Bank SA to secure a home loan. In 2005, Mr Jinman constructed a house on the property. In June 2008, Mr Jinman sought finance to purchase a motel business, the Belvedere Motel and Restaurant (“the business”), through a finance broker. Mr Jinman deposes in the Jinman affidavit that he expected that finance would be arranged by December 2008. Mr Jinman says securing finance was subject to numerous delays and poor behaviour by the Bank which he describes as a debacle. During this period the Bank obtained four valuations. In a letter dated 4 August 2008,[6] the Bank gave Mr Jinman an “indicative proposal” for finance of the business. The proposal stated both the freehold interest in Cambrai and the freehold interest in the business would be required as security for the finance:The Bank would require a licensed valuation of the Motel Lease on which we would base our valuation (& subsequent borrowings). The valuation would be for your cost.Our normal criteria are that we would lend up to 50% of the valuation. Based on a valuation of $450,000.00 this would be $225,000.As such it would then be preferable for the Bank to take a second mortgage over your house/farm to enable the security to be acceptable.[6] Exhibit PCJ1 to the Jinman affidavit. The proposal referred to a business loan of $300,000 for the purchase of the business and a $19,900 overdraft. The proposal did not make any reference to the refinancing of the Bank SA loan. On 11 September 2008, Mr Jinman gave instructions by email to his finance broker to seek the refinancing of the Bank SA loan.[7][7] Exhibit PCJ2 to the Jinman affidavit. On 11 February 2009, a loan application was submitted on Mr Jinman’s behalf which referred to Mr Jinman having placed a value of $350,000 on Cambrai. On 13 February 2009, the Bank offered Mr Jinman a business loan of $205,000 for the purchase of the business (“the business loan offer of $205,000”). The offer, which did not include the offer of an overdraft, stated that security would be a second ranking mortgage over Cambrai. Under the heading “Other Conditions Precedent” the offer stated that the Bank must also be satisfied of six matters which included:·satisfactory bank valuation of Cambrai confirming the valuation listed in the loan application; and·the Bank holding a first registered mortgage over Cambrai “with a maximum loan of $140,000 to be approved by” the Bank.[8][8] Exhibit PCJ11 to the Jinman affidavit.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

According to the Gotting affidavit, as at 30 June 2016:1The last payment made to the home loan account was on 24 December 2013.2The last payment made to the business loan account was on 25 December 2013.3Absent any acceleration, the arrears of the home loan were $26,755.62.4Absent any acceleration, the arrears of the business loan were $51,696.47.5The balance of the home loan was $155,269.69.6The balance of the business loan was $180,651.02.7The loan to value ratio was 146.05 per cent.The decision of the Master The Master was entitled to make the order for possession sought by the Bank in the event he was satisfied that there was no triable issue raised on the evidence. The Master correctly stated that for the Bank to be deprived of its remedy of a summary order for possession, Mr Jinman had to demonstrate a dispute of substance that warranted the ordering of pleadings and referring the dispute to trial.[20] The Master only needed to be satisfied that Mr Jinman had raised an arguable case supported by some evidence which, if accepted, could give rise to a particular defence.[21][20] Corporation of the Town of Moonta v Rodgers & Rodgers (1980) 26 SASR 143 at 160.[21] Westpac Banking Corporation v Chadha [2012] SASC 223 at [35]. The Master found that Mr Jinman had not raised an arguable case supported by some evidence which could give rise to a particular defence. His Honour therefore granted the order for possession of the Cambrai property.[22][22] FDN 12.The notice of appeal Mr Jinman sets out in para [3] of the notice of appeal his grounds of appeal. In paras [3.1] to [3.8], Mr Jinman makes a new allegation on appeal that the Bank was only entitled to a mortgage of the business leasehold for the business loan. The import of Mr Jinman’s allegations in paras [3.9] and [3.10] of his notice of appeal are that the second ranking mortgage registered over Cambrai is a false document. Paragraph [3.11] of the notice of appeal is to the effect that the Master should have ordered discovery of documents. Paragraph [3.12] appears to assert the Master erred in not finding that Mr Jinman had an arguable cross-claim.Mr Jinman’s submissions The nub of Mr Jinman’s appeal relates to a copy of a Memorandum of Mortgage bearing the date 16 April 2009 transmitted by facsimile[23] that was not in evidence before the Master. Mr Jinman alleges that the business loan was secured only by a mortgage over the lease relating to the business and not by a mortgage over Cambrai and that this is proven by the facsimile record. Mr Jinman further alleges that the evidence tendered by the Bank of the second ranking mortgage dated 23 February 2009 is false and that the Bank has avoided discovery. [23] Exhibit PCJ33 to the October 2016 Jinman affidavit. Mr Jinman argues that the Bank’s failure to proceed with the business loan offer of $205,000 constitutes a breach of contract. Mr Jinman further accuses the Bank of unconscionable conduct and alleges unjust enrichment. Mr Jinman complains that the Bank did not act “with due haste/diligence/delays/inaction/silence”; has defrauded the Office of the Liquor and Gambling Commissioner; is guilty of breach of contract, fraud, forcing him to sign the business loan agreement for $150,000 under duress, refusing to produce requested documents; and presenting false evidence.

Ratio Decidendi

Legal Principle Established

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