National Australia Bank v Luna
[2001] VSC 199
•13 June 2001
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
No. 8186 of 1998
| NATIONAL AUSTRALIA BANK | Plaintiff |
| v | |
| LUNA & ORS | Defendants |
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JUDGE: | McDonald J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 13 June 2001 | |
DATE OF JUDGMENT: | 13 June 2001 | |
CASE MAY BE CITED AS: | National Australia Bank v Luna & Ors | |
MEDIUM NEUTRAL CITATION: | [2001] VSC 199 | |
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Money – recovery against defendants pursuant to guarantee – counterclaim of defendants – no appearance of defendants – counterclaim dismissed.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr A. Schlicht | Russell Kennedy |
| For the Defendant | No appearance |
HIS HONOUR:
In these proceedings the plaintiff by its amended statement of claim seeks to recover moneys against the third, fifth, sixth, and seventh defendants. Against the third defendant the plaintiff seeks to recover moneys which it alleges that it is entitled to be paid by that defendant under a guarantee in writing dated 25 May 1993, by which that defendant guaranteed to the plaintiff payment of moneys owed to it by Luna Toys and Gifts Pty Limited. The plaintiff also seeks to recover against the third defendant moneys which it alleges that it is owed by that defendant under a home loan account. As against the fifth, sixth and seventh defendants, the plaintiff seeks to recover moneys which it alleges that those defendants owe to it pursuant to the above referred to guarantee.
I am satisfied that each of the third, fifth, sixth and seventh defendants executed a guarantee in writing dated 25 May 1993 (Exhibit P2). By that guarantee it was provided in part as follows,
"In Consideration of the Bank at the request of the guarantor making loans and advances or providing banking accommodation to the customer whether alone or jointly or in conjunction with any other person and/or in consideration of the Bank at the request of the guarantor forbearing to enforce immediate payment of the moneys (if any) now due and owing by the customer to the Bank the guarantor (jointly and severally if more than one) agrees with and guarantees to and indemnifies the Bank, and shall keep the Bank indemnified as follows:-
(1)The guarantor will pay to the Bank on demand (whether the customer is then in default or not) the moneys hereby secured.
(2) - - - - -
(3) (i)This Guarantee is to be security for the whole of the moneys and other liabilities which the guarantor under Clauses 1 and 2 hereof is liable to pay but (subject to sub-clause (ii) of this clause) the guarantor shall not, subject to clause 4 hereof, be compelled to pay any amount exceeding an amount (hereinafter called 'the limit of the guarantee') being the aggregate of:-
(a)the basic liability set out in Item 4 of the Schedule, and
(b)a sum equivalent to one year's interest on the basic liability calculated at the rate or, if more than one rate, at the highest rate payable by the customer at the date of service of demand upon the guarantor, and
(c)a sum equivalent to the amount of any bank charges and any other charges, costs and expenses payable under Clauses 1 and 2 hereof provided that such sum shall be limited to a sum equivalent to the whole of such bank charges, other charges, costs and expenses which have become payable under Clauses 1 and 2 hereof from the date twelve months prior to the date upon which demand is made upon the guarantor.
(4)From the date of demand upon the guarantor hereunder until the date of payment to the Bank, the guarantor will also pay:-
(a)all bank charges, other charges, costs and expenses of the type referred to in Clauses 1 and 2 hereof incurred during that period,
(b)interest on the total of such bank charges, other charges, costs and expenses, and
(c)interest on the total amount for which the guarantor is liable under Clauses 1 and 2 hereof, as limited by Clause 3 hereof.
Such interest will be calculated in the manner and at the rate or rates determined by the Bank for the time being, compounded and turned into principal accordingly."
The "guarantors", as appears from that guarantee, included each of the third, fifth, sixth and seventh defendants. The customer, as identified in that written guarantee, is Luna Toys and Gifts Pty Limited. The "basic liability" as stated in item 4 of the schedule to that guarantee is the sum of $216,954.
On 31 May 1996, Luna Toys and Gifts Pty Limited was indebted to the plaintiff on a "business instalment account", being account numbered 967900519 in the sum of $11,225.11. That company was also, on 31 May 1996, indebted to the plaintiff on an "overdraft account", being account number 507562475 in the sum of $113,413.75.
On 17 June 1996, the customer, Luna Toys and Gifts Pty Limited, remained indebted to the plaintiff in those amounts, together with interest and bank charges. I'm satisfied that on 17 June 1996, written demand was made by the plaintiff and served on each of the third, fifth, sixth and seventh defendants for payment of such sums due under the guarantee being the aforesaid sums together with interest and bank charges. I am further satisfied that as at 31 May 2001, the customer, Luna Toys and Gifts Pty Limited, was and remained indebted to the plaintiff on each of such accounts and being on the loan instalment account the sum of $21,589.93 and on overdraft account the sum of $276,333.28, being in total $297,923.21. I am satisfied that each of the third, fifth, sixth and seventh defendants is indebted to the plaintiff for such amount under the guarantee as signed by them.
I am further satisfied that on 27 April 1992 the third defendant entered into an agreement with the plaintiff pursuant to which the plaintiff loaned to the third defendant moneys on an account identified as a "home loan" account. The agreement by which the plaintiff loaned such moneys to the third defendant is comprised by two documents being exhibits P3 and P4, tendered in these proceedings.
The agreement provided for the payment of sum loaned together with interest and bank charges, by instalments. From the evidence led before me in these proceedings, I'm satisfied that no instalment has been paid in reduction of that account or in payment of the amount due under that account since December 1994.
On 31 October 1998 there was owing by the third defendant to the plaintiff, pursuant to the "home loan" agreement, the sum of $128,284.73. I am satisfied that on 13 November 1998 a written demand was made by the plaintiff against the defendant for payment of that sum of $128,284.73 together with interest and bank charges.
I am satisfied that as at 31 May 2001 the third defendant was indebted to the plaintiff pursuant to the "home loan" agreement in the sum of $157,206.07.
I am satisfied that as at 31 May 2001 the third defendant was indebted to the plaintiff pursuant to the "home loan" agreement and pursuant the aforesaid guarantee sums totalling $455,129.28.
I am further satisfied that as at 31 May 2001 each of the fifth, sixth and seventh defendants were indebted to the plaintiff pursuant to the terms of the guarantee in the sum of $297,923.21.
Pursuant to the amended defence and counterclaim filed in these proceedings and dated 10 March 1999 each of the first to seventh defendants inclusive made claims against the plaintiff by way of counterclaim. It is to be noted however that by its amended statement of claim the plaintiff has pleaded that on 9 March 1999 the fourth defendant was declared a bankrupt on the petition of the Deputy Commissioner of Taxation. When these proceedings were called on this morning there was no appearance before the court by any of the seven defendants to these proceedings or any person on their behalf. In consequence no person sought to prosecute the counterclaims made on behalf of the defendants in these proceedings. Accordingly in such circumstances it is appropriate that I order that the counterclaim be dismissed.
The orders that I make in these proceedings being satisfied as to the above facts and on the counterclaim being not prosecuted by or on behalf of any defendant are as follows:
1. That the counterclaim of the defendants be dismissed.
2.That there be judgment for the plaintiff against each of the fifth, sixth and seventh defendants in the sum of $297,923.21.
3.That there be judgment for the plaintiff against the third defendant in the sum of $455,129.28.
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