National Australia Bank v Grewal

[1999] NSWSC 342

CITATION:	NATIONAL AUSTRALIA BANK v GREWAL & ANOR [1999] NSWSC 342
CURRENT JURISDICTION:	COMMON LAW
FILE NUMBER(S):	11264/98
HEARING DATE(S):	8 April 1999
JUDGMENT DATE:	16 April 1999
PARTIES :	NATIONAL AUSTRALIA BANK LIMITED v SEHDEV GREWAL (First Defendant) GEORGE KEKATOS (Second Defendant)
JUDGMENT OF:	Master Malpass

COUNSEL :	PLAINTIFF: MR J STOLJAR FIRST DEFENDANT: MR R W TREGENZA SECOND DEFENDANT:N/A
SOLICITORS:	PLAINTIFF: MALLESONS STEPHEN JAQUES FIRST DEFENDANT: P BOUZANIS & J KEKATOS SECOND DEFENDANT: N/A
CATCHWORDS:	SUMMARY JUDGMENT
CASES CITED:	Webster & Anor v Lampart (1993) 177 CLR 598. Hospital Products Limited v United States Surgical Corporation & Ors 156 CLR 41. Hoyt's Proprietary Limited v Spencer 27 CLR 133.
DECISION:	SEE PARAGRAPH 15

THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

MASTER MALPASS

16 April 1999

11264/98 - National Australia Bank Limited v Grewal & Anor

JUDGMENT
1 These proceedings were commenced by Statement of Claim filed on 21 May 1998. There are two defendants. The plaintiff seeks judgment for possession of the property known as 4/793-805 South Dowling Street, Redfern (the property). The plaintiff’s claim is as now formulated in the Amended Statement of Claim (a copy of which is annexed to the Amended Notice of Motion filed in Court on 8 April 1999).
2 The first defendant gave a Mortgage over the property to the plaintiff. It was dated 21 May 1996. Initially, it was given to secure a guarantee. Later, it came to secure, inter alia, the repayment of moneys advanced under a Fixed Rate Loan Agreement and an Overdraft Facility. The Fixed Rate Loan Agreement came into being following the execution of documentation in August 1996. The Overdraft Facility came into being following the execution of documentation in December 1996.
3 The plaintiff alleges default under each of these two lending arrangements. Firstly, it is said that there has been failure to repay by the agreed expiry date. Secondly, it is said that there was the further or alternative default pleaded in the Amended Statement of Claim. Clause 12 of the Fixed Rate Loan Agreement documentation contained the following event of default:-

“(a) if at any relevant time, the debiting of an interest payment, or any other amount payable hereunder, to the Working Account by the Bank, would cause the balance of the Working Account to be placed in debit, or exceed any authorised credit limit applicable to the account; or”.

It is alleged that such default took place following the debiting of the payments of interest for February and March 1998.

4 The plaintiff now seeks summary judgment as against the first defendant. The Court has been informed that relief against the second defendant has already been obtained.
5 The plaintiff has relied on seven affidavits. The first defendant relies on two affidavits. One was sworn by the first defendant himself. The other was sworn by Patricia Bouzanis (the solicitor for the first defendant).
6 The principles upon which summary relief is granted were not in dispute. The Court has a discretionary power to give summary judgment. There is abundant authority for the proposition that summary relief should only be given in what might be described as clear cases (see, inter alia, Webster & Anor v Lampard (1993) 177 CLR 598). The applicant bears the onus of demonstrating an entitlement to relief.
7 On behalf of the first defendant, two allegedly triable issues have been identified. Firstly, there is said to be an issue as to the agreed expiry date. Secondly, there is said to be an issue concerning the alleged further or alternative default following the debiting of interest payments.
8 On behalf of the first defendant, it is accepted that his resistance to the application must fail if both of the issues are not regarded as triable.
9 The first allegedly triable issue is dependent upon material appearing in the first defendant’s affidavit. He deposes to discussions had with Mr Di Bernado (the then business banking manager of the plaintiff at its West Ryde branch). On his behalf, it is said that the contractual arrangements comprise both what was said in discussion and the documentation subsequently executed. In particular, it is contended that this material gave rise to a lending arrangement for at least three years (the documents show an expiry date of 31 July 1997 for the Overdraft Facility and of 26 August 1997 for the Fixed Rate Loan Agreement). It is not entirely clear when it is alleged that the relevant conversations took place. However, it may be that these were said to take place prior to or in May 1996. The first defendant placed reliance on what was said in Hospital Products Limited v United States Surgical Corporation & Ors 156 CLR 41 at 61-62. It was not contended that the first defendant was entitled to any relief by way of rectification.
10 The material contained in the affidavit is inconsistent with the contents of the subsequent documentation. The alleged discussion took place some considerable time prior to the execution of the Fixed Rate Loan documentation. It is not said that there was any prior discussion which related to the Overdraft Facility. The plaintiff relies on what was said in Hoyt’s Proprietary Limited v Spencer 27 CLR 133 at 139 et seq. Whilst this decision has been the subject of some criticism, it remains binding authority in cases where there is a distinct collateral agreement. I mention also that the documentation contains material suggesting that the writing was to comprise the contractual arrangements between the parties.
11 I do not accept the submissions made in relation to the alleged first triable issue. In the circumstances of this case, I am satisfied that there is no such triable issue.
12 In support of the alleged second triable issue, the first defendant contends that the working account was in fact in debit in a small sum at the time of the debiting of the relevant interest payment and that on the proper construction of Clause 12(a), such an event of default would only be constituted if the working account was in fact in credit at the time of the debiting of the relevant interest payment.
13 I do not accept either of these submissions. In my view, these arguments are neither maintainable on the evidence nor the proper construction of the documentation. I am satisfied that there is no triable issue as alleged.
14 For completeness, I should add that the first defendant’s own affidavit contains the admission that “the two loans are presently in default”.
15 I direct the entry of judgment for possession of the property. The first defendant is to pay the costs of the application for summary judgment. I reserve the question of leave to issue a writ of possession. The exhibits may be returned.
I hereby certify that paragraphs 1-15 are the reasons for judgment of Master Malpass.

Dated 16 April 1999. (H D LEWIS)

Associate.

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