Mortgage House of Australia Limited v Megale

[2022] NSWSC 319

Supreme Court

New South Wales

Medium Neutral Citation:

Mortgage House of Australia Limited v Megale [2022] NSWSC 319

Hearing dates:

22 March 2022

Date of orders:

22 March 2022

Decision date:

22 March 2022

Jurisdiction:

Common Law

Before:

Lonergan J

Decision:

(1) Pursuant to UCPR 13.1(1) judgment is entered against the first defendant in the amount of $24,737 (inclusive of interest).

(2) The Court declares that the land contained in certificate of title folio identifier [REDACTED] situate at and known as [REDACTED] in the State of New South Wales is charged in favour of the plaintiff to secure payment of the amount in order 1.

(3) The first defendant is to pay the plaintiff’s costs of the notice of motion and of the proceedings against him to date.

Catchwords:

PROCEDURE – order sought under Rule 13.1 of the UCPR – plaintiff loaned money to first defendant – not paid – no appearance in proceedings – no defence

Legislation Cited:

Uniform Civil Procedure Rules 2005 (NSW)

Category:

Procedural rulings

Parties:

Mortgage House of Australia Limited (Plaintiff)
Nicholas Megale (First Defendant)
Westpac Banking Corporation (Second Defendant)

Representation:

Counsel:
A Kaufmann (Plaintiff)
No appearance (First Defendant)
No appearance (Second Defendant)

Solicitors:
Galilee Solicitors (Plaintiff)
No appearance (First Defendant)
Minter Ellison (Second Defendant)

File Number(s):

2021/00277586

Publication restriction:

Nil

Judgment - EX TEMPORE (REVISED)

1. Before me as duty judge today is an application to deal with some of the orders sought in a notice of motion filed by the plaintiff on 14 December 2021.

2. The proceedings, commenced by statement of claim on 29 September 2021, are framed against Nicholas Megale as the first defendant and Westpac Banking Corporation as the second defendant. The relief claimed in the statement of claim is various and relates to property at [REDACTED].

3. The plaintiff is a loan company that entered into a personal loan with the first defendant. In November 2020, the plaintiff entered default judgment against the first defendant in the Local Court in the sum of $12,929.21 inclusive of costs. It also issued a bankruptcy notice and filed a creditor’s petition in the Federal Circuit Court in January and May 2021 respectively.

4. Subsequent to that, the first defendant agreed to pay to the plaintiff a sum of $22,459.32 in return for the plaintiff withdrawing its creditor’s petition. Pursuant to that arrangement, a deed of settlement was prepared. I note at this time the first defendant had a solicitor acting for him, and the deed of settlement was executed by the first defendant and a representative of the plaintiff in around July 2021.

5. By virtue of that deed, the first defendant covenanted to pay the agreed settlement sum by a scheme of payments. The deed was clear in its terms. It nominated a bank account and included clear mechanisms associated with a caveat the plaintiff placed on the first defendant’s [REDACTED] property.

6. Clause 2 of the deed referred to what will happen in circumstances of default. Clause 2.2.1 provided that in the event of the first defendant failing to make payment of the settlement sum as provided in cl 1.5, the plaintiff must give notice of the breach to the first defendant in writing, and provide 7 days to rectify the breach. Then if he fails to comply with that notice to rectify the breach, the first defendant is considered to be in breach of the deed, and the entire unpaid balance of the settlement sum becomes immediately due and payable.

7. Further, cl 2.1.2(ii) provides for entitlement on the part of the plaintiff to enforce the charge brought under cl 1.5 of the deed by way of application to the Court for judicial sale of the property.

8. There is evidence before me today, to which I will turn shortly, that indicated that the first defendant has been provided with due notice and service of the statement of claim, the notice of motion, and other developments and progress before this Court in terms of the matter reaching me today for dealing with certain orders in the notice of motion.

9. The orders sought by the plaintiff today are as follows:

1. Orders pursuant to UCPR 13.1(1) that:

(a) judgment be entered against the first defendant in the amount of $24,183.35 as at 30 August 2021 plus interest (in the sum of $554.21) pursuant to s 100 of the Civil Procedure Act.

(b) a declaration that the land contained in certificate of title folio identifier [REDACTED] situate at and known as [REDACTED] in the State of New South Wales is charged in favour of the plaintiff to secure payment of the amount in order 1(a), and

2. An order that the plaintiff’s costs be paid by the first defendant.

10. The following affidavits were read in support of the application:

1. Simon Duke affirmed 14 December 2021;

2. Kevin James Croom, who is an Asset Collection Officer of the plaintiff, sworn 14 December 2021;

3. Robert Vassallo, a process server, sworn 18 October 2021;

4. Robert Vassallo sworn 11 February 2022;

5. An updating affidavit of Mr Duke, solicitor, affirmed 17 March 2022, annexing correspondence and deposing to compliance with the orders of the Court made by the Registrar on 15 February 2022;

6. An affidavit of Mr Duke, solicitor, affirmed 21 March 2022.

11. In addition, separately tendered and marked on the application is an email from Melinda Smith, a solicitor at Minter Ellison, who acts on behalf of Westpac. That email, dated 14 February 2022, confirmed that Westpac has taken the view that the orders 1(a), 1(b) and 2 of the notice of motion do not concern Westpac so it does not object to nor consent to those orders. I am therefore comfortable that Westpac has not sought to be heard on the orders I am considering today.

12. Before I embarked on the hearing of the motion, the first defendant’s name was called three times outside the Court and there was no appearance. The first defendant has never filed an appearance or defence or appeared at any directions hearing. There has been no correspondence by the first defendant with my Chambers or the Court and nothing in the material tendered and appended to the affidavits that gives any suggestion that the first defendant intends to appear and/or defend the orders being sought.

13. Acting in accordance with his duty to the Court, counsel appearing on behalf of the plaintiff very fairly drew to my attention other provisions of the deed, including cl 6 of the deed which contains a provision that the deed is governed by the laws of Victoria and that each party submits to the exclusive jurisdiction of the courts of that State or Territory and acknowledges that any proceedings arising out of or in connection with this deed may be brought in any court of competent jurisdiction in that State or Territory.

14. Counsel for the plaintiff submitted that there was nothing in that clause that had the effect that this Court was not a proper court before which to bring the application given the property is in NSW, but thought that provision should be drawn to my attention in case it was thought to be a matter that the first defendant would wish to raise if he appeared.

15. I am satisfied that this Court has jurisdiction and is an appropriate court before which to bring the relevant proceeding and seek the orders sought in the notice of motion.

16. In respect of order 1(a) in the notice of motion, I am satisfied on the evidence tendered that judgment should be entered against the first defendant in the sum identified.

17. Counsel for the plaintiff indicated that the basis of the interest calculation to date in the sum of $554.21 is made up on the basis of:

1. 123 days from 30 August 2021 to 31 December 2021 at 4.1%, amounting to 2.716 per day, a total figure of $334.16, and

2. from 1 January to today, a total of 81 days at 4.1% totalling $221.05.

I am satisfied accordingly that the total amount of interest should be added to the judgment sum on that basis.

18. In respect of order 1(b), counsel for the plaintiff pointed out that the declaration sought would have the effect of facilitating the processes of justice, including their just, quick and cheap pursuit, as it would provide to Westpac with basis upon which to know to where it should direct any surplus sum it may have from the sale currently being undertaken by it in pursuit of its first mortgage.

19. I am satisfied that this is a proper additional basis of relief for the Court to grant.

20. Obviously costs follow the event and in circumstances where the first defendant has not appeared at all nor raised any objection or defence to any of the matters raised in the proceedings, let alone in relation to the orders sought in the notice of motion, I am satisfied that order 2 should be made and that the plaintiff’s costs should be paid by the first defendant.

21. In effect, the application is for summary judgment pursuant to r 13.1 of the Uniform Civil Procedure Rules 2005 (NSW). That rule provides that if on application by the plaintiff in relation to the plaintiff’s claim for relief or any part of the plaintiff’s claim for relief:

1. there is evidence of the facts on which the claim or part of the claim is based and

2. there is evidence given by the plaintiff or by some responsible person, that in the belief of the person giving the evidence, the defendant has no defence to the claim or part of the claim or no defence except as to the amount of any damages claimed.

The Court may give such judgment for the plaintiff or make such order on the claim or that part of the claim as the case requires.

22. I am satisfied that the evidence tendered provides a proper basis for orders 1(a) and (b) of the notice of motion and that they “are orders on the claim that the case requires”, and those orders will be made.

23. The Court makes the following orders:

1. Pursuant to UCPR 13.1(1) judgment is entered against the first defendant in the amount of $24,737 (inclusive of interest).

2. The Court declares that the land contained in certificate of title folio identifier [REDACTED] situate at and known as [REDACTED] in the State of New South Wales is charged in favour of the plaintiff to secure payment of the amount in order 1.

3. The first defendant is to pay the plaintiff’s costs of the notice of motion and of the proceedings against him to date.

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Decision last updated: 23 March 2022