National Australia Bank Limited v Munro (No 2)

[1991] TASSC 131

Serial No B17/1991
List "B"

COURT:                 SUPREME COURT OF TASMANIA

CITATION:            National Australia Bank Limited v Munro (No 2) [1991] TASSC 131; B17/1991

PARTIES:  NATIONAL AUSTRALIA BANK LIMITED
  v
  MUNRO, Craig Stephen

FILE NO/S:  MA5/1991
DELIVERED ON:  Crawford J
JUDGMENT OF:  26 April 1991

Judgment Number:  B17/1991
Number of paragraphs:  13

Serial No B17/1991
List "B"
File No MA5/1991

NATIONAL AUSTRALIA BANK LIMITED
vCRAIG STEPHEN MUNRO (NO 2)

REASONS FOR JUDGMENT  CRAWFORD J

26 April 1991

1. The terms of the amended statement of claim are contained in my ruling on the admission of evidence delivered on 28 March 1991. The claim is based on an oral agreement allegedly made on 21 May 1987 whereby the plaintiff lent the defendant $8200. The plaintiff has abandoned its application for summary judgment in so far as it relates to interest on the loan, but seeks judgment for $8103.68 of the capital.

1. According to the amended statement of claim the terms of the oral agreement were embodied in a written "Loan Agreement" signed by the defendant on or about 24 June 1987. The amended statement of claim did not directly plead any terms of the oral agreement. In particular no term of it was pleaded establishing how and when the capital sum would become repayable. Instead, the draftsman of the pleading made no further reference to the oral agreement but referred only to the terms of the Loan Agreement.

1. Assuming for now that the written Loan Agreement did in fact embody the terms and conditions of the oral agreement upon which the action is based, the question therefore arises what terms and conditions of the Loan Agreement have been pleaded so as to establish a basis for repayment of the capital. The following terms of the Loan Agreement were expressly pleaded:

1The defendant would repay the sum of $8200 in 180 monthly instalments by 31 May 1992. (This is impossible to understand taking into account that only 60 months would elapse by that date).

2The defendant would pay interest as part of the monthly instalments on the principal sum remaining unpaid from time to time.

1. There were further statements in the pleading which might have been intended to refer to terms of the Loan Agreement, but that is not clear. They were:

"6       The monthly instalments were payments of both principal and interest and could be varied". (This is vague).

"8       The rate of interest was initially 19% but was subject to variation by the Plaintiff without notice". (This is vague. Whether or not the interest rate applied per annum does not appear).

1. The amended statement of claim further contained:

"13     In accordance with Clause 11 of the Loan Agreement, the Plaintiff served the Notice of Demand on the Defendant on the 5th day of June, 1990, which remains unanswered". (What clause 11 provided was not stated. What "the Notice of Demand" was or contained was not stated. In what way it "remains unanswered" did not appear.)

"14     By virtue of the service of the said Notice of Demand the full amount of principal remaining unpaid at the date of service and all unpaid interest and bank fees became due and owing by the Defendant to the Plaintiff". (Particulars of the principal stated that the sum was $8103.68. The plaintiff's counsel could not explain how it was calculated. The basis for the assertion that it became payable is not clear).

1. In Jones v Stone [1894] AC 122 at 124 the Privy Council said:

"The proceeding established by that order is a peculiar proceeding, intended only to apply to cases where there can be no reasonable doubt that a plaintiff is entitled to judgment ...".

1. This passage was cited, apparently with approval, by the High Court in Clarke v Union Bank of Australia Limited (1917) 23 CLR 5. In Roberts v Plant [1895] 1 QB 597 at 603 Lord Esher MR had this to say:

"That is a stringent power to give, and therefore the Courts have said that its exercise must be strictly watched, in order to see that the plaintiff has brought himself within the scope of the provisions of the order … The meaning is that care must be taken to see that the plaintiff has, in accordance with the terms of the order, made out a cause of action to which the defendant can have no possible defence."

1. The amended statement of claim itself fails to disclose a good cause of action for repayment of the principal sum claimed in the amount of $8103.68 and requires substantial amendment.

1. The plaintiff relied on an affidavit sworn by Mr Martin, who is presently the bank's lending manager for Tasmania. He had no direct knowledge of the matters to which he deposed but said that he had made enquiries with all people who had been involved in the matter and had consulted all the plaintiff's files and records, and could swear as to his belief from information so obtained. He deposed that a bank officer, a Mr Albertson, told him by telephone that on 19 May 1987 he had orally informed the defendant "that the loan that the Defendant had requested for the purchase of a car had been approved". Mr Martin further deposed that his information from Mr Albertson was, and he believed, that the defendant had signed a document dated 24 June 1987 a copy of which was annexed to the affidavit. It is apparently the Loan Agreement. It consists of four pages of small print containing many clauses. Mr Martin went on to depose "(t)hat document embodies the terms upon which the Plaintiff made the loan to the Defendant.'' There was other evidence in the affidavit indicating that the capital money had been made over to the defendant on 21 May 1987.

1. I permitted cross–examination of Mr Martin concerning the sources and grounds of his information and belief. That cross–examination revealed that there was no document recording Mr Albertson's conversation with the defendant and that Mr Martin had no idea whether the Loan Agreement did in fact embody the terms of the oral agreement upon which the plaintiff has sued. I was left with the clear impression that Mr Albertson had not told him that was so and that Mr Martin had no information one way or the other.

1. Accordingly, I am left with no confidence whatever that the terms of the Loan Agreement were embodied in the oral agreement. I am not persuaded of the basis upon which the plaintiff claims to be entitled to repayment of the capital sum of $8103.68. There is no verification that any particular term of the oral agreement upon which the action is based establishes a right to payment of that sum.

1. This matter came before me as an appeal from the Master who dismissed the application for summary judgment. I respectfully agree with what the Master had to say in his reasons for dismissing the application. I am far from convinced that the plaintiff has a good cause of action for the capital sum of $8103.68.

1. The appeal against the dismissal of the application for summary judgment will be dismissed.