Metro Finance Pty Limited v Harrison

District Court

New South Wales

Medium Neutral Citation:

Metro Finance Pty Limited v Harrison [2022] NSWDC 303

Hearing dates:

13 July 2022

Date of orders:

1 August 2022

Decision date:

01 August 2022

Jurisdiction:

Civil

Before:

Abadee DCJ

Decision:

See paragraph 71

Catchwords:

GUARANTEE AND INDEMNITY – applications for summary dismissal or strike out of defence of guarantor – whether arguable defence of set-off based on allegedly wrongful possession of borrower’s equipment – whether arguable defence based on creditor’s agent’s alleged promise not to sue

Legislation Cited:

CivilProcedure Act 2005 (NSW) ss, 56(3), 61(3)

Uniform Civil Procedure Rules 2005 (NSW) rr 12.7, 13.1, 13.4, 14.28, 14.3

Cases Cited:

Bank of Western Australia v Hoy [2012] NSWSC 518

Chalak v G & G Mikhael Pty Ltd [2022] NSWCA 116

Hobbs v ASIC [2013] NSWCA 432

Smith v Skinner [2018] NSWDC 197

State Bank of NSW v Chia [2000] NSWSC 552

Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387

Category:

Principal judgment

Parties:

Metro Finance Pty Limited (plaintiff)
Ms J Harrison (second defendant)

Representation:

Counsel:
Mr Collins for the plaintiff
Mr Green for the second defendant

Solicitors:
Hilton Bradley for the plaintiff
JML Rose for the second defendant

File Number(s):

2020/00277503

Publication restriction:

Nil

Judgment

Background

1. This proceeding commenced on 24 August 2020. It started as a straightforward action by the plaintiff against two guarantors (the first and second defendants) for default in the obligations to be performed by the corporate borrower under a secured loan agreement which the plaintiff alleged was entered into on 25 October 2018. After various iterations of the pleading, on 16 August 2021, the corporate borrower was joined to the proceeding as a third defendant. Before then, the plaintiff obtained a default judgment against the second defendant on 17 November 2020, only for that to be set aside (by consent) on 27 May 2021.

2. On 6 September 2021, all three defendants filed a Defence. Partly piggy-backing on the facts contained within the Defences, on the same day, one of the guarantors (the first defendant) and the borrower (the third defendant) cross-claimed against the lender seeking damages for breach of contract.

3. On 8 November 2021, the plaintiff amended its pleading again (the Third Further Amended Statement of Claim (the ‘TFASC’)) after it had exercised a power to sell goods as security. On 7 December 2021, the defendants were directed to file amended defences by 15 December 2021. That order was not complied with.

4. On 8 February 2022, the plaintiff served its evidence.

5. A show cause hearing, for why the defendants’ Defences and cross-claim should not be struck out, occurred on 8 March 2022 and the defendants were directed to serve any amended cross-claim and evidence by 1 April 2022. The defendants did not comply with that direction.

6. On 29 April 2022, the plaintiff filed a motion applying for summary judgment for the sum of $73,577.12 and the striking out or dismissal of the defences. By that date, the defendants had still not served any defences,…