Permanent Custodians Ltd v Barton - [2008] NSWSC 1355

CITATION: Permanent Custodians Ltd v Barton [2008] NSWSC 1355

HEARING DATE(S): 10 October 2008

JUDGMENT DATE :
16 December 2008

JURISDICTION: Common Law

JUDGMENT OF: Rothman J

DECISION:
(i) The motion of the defendants, filed 26 May 2008, to set aside default judgment obtained on 13 May 2008, be dismissed;
(ii) The motion of the defendants, in the alternative, to stay the aforesaid default judgment be dismissed;
(iii) The defendants pay the plaintiff’s costs of and incidental to the motion, as agreed or assessed.

CATCHWORDS: MORTGAGE – mortgagee sale – motion to set aside judgment – Contracts Review Act – Industrial Relations Act – equitable relief – no basis for mortgagee acting other than "innocently" – no rguable case against mortgagee to overturn possession – default judgment not set aside

LEGISLATION CITED: Contracts Review Act 1980
Court (Cross-Vesting) Act 1987
Independent Contractors Act 2006 (Cth)
Industrial Relations Act 1996
Real Property Act 1900 (Cth)
Workplace Relations Act 1996

CATEGORY: Procedural and other rulings

CASES CITED: Batterham v QSR Limited [2006] HCA 23; (2006) 225 CLR 237
Beneficial Finance Corporation v Karavas (1991) 23 NSWLR 256
Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447
Elkofairi v Permanent Trustee Co Ltd [2002] NSWCA 413
Fish v Solution 6 Holdings Limited [2006] HCA 22; (2006) 225 CLR 180
Khan v Hadid (No 2) [2008] NSWSC 119
Permanent Custodians Ltd v El Ali [2008] NSWSC 1264
Perpetual Trustee Company Limited v Albert and Rose Khoshaba [2006] NSWCA 41

PARTIES: Permanent Custodians Ltd (Plaintiff/Respondent)
William John Litchfield Barton (First Defendant/First Applicant)
Patricia Olive Barton (Second Defendant/Second Applicant)

FILE NUMBER(S): SC 10570/2008

COUNSEL: A G Rogers (Plaintiff/Respondent)
J J T Loofs (Defendants/Applicants)

SOLICITORS: Hicksons Lawyers (Plaintiff/Respondent)
Burridge & Legg Solicitors (Defendants/Applicants)

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ROTHMAN J

16 DECEMBER 2008

10570/2008 Permanent Custodians Ltd v William John Litchfield Barton & Ors
JUDGMENT

1 HIS HONOUR: The defendants, Mr and Mrs Barton, move the Court to set aside a default judgment, obtained by the plaintiff, Permanent Custodians Ltd, on 13 May 2008, and since entered. By undertakings, relating to a number of proceedings, Permanent Custodians have undertaken not to enforce the judgment, until the conclusion of the hearing of these proceedings. The proceedings (and the default judgment), to Permanent Custodians, possession of the residential property of Mr and Mrs Barton, due to default in their mortgage.

2 Mr and Mrs Barton seek to set aside the default judgment and file a defence to the claim. The defence raises three issues:

(a) undue influence and/or unconscionability, of which Permanent Custodians had notice or constructive notice;

(b) the “unjustness” of the mortgage, and, for the purpose of avoiding the unjust consequence or result of the contract, the Court ought declare the contract void under the provisions of the Contracts Review Act 1980; and

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Permanent Custodians Ltd v Barton

Details

AGLC: Permanent Custodians Ltd v Barton [2008] NSWSC 1355
Case: [2008] NSWSC 1355
Decision Date: 16 December 2008

CaseChat Overview and Summary

In the matter of Permanent Custodians Limited versus Barton, the Federal Court of Australia was tasked with determining whether a motion to set aside a default judgment in a mortgagee sale should be entertained. The appellant, Barton, argued against the sale of his property, contending that the mortgagee, Permanent Custodians Limited, had acted unfairly and that there was sufficient cause to set aside the judgment. The case revolved around Barton's mortgage on his property and the subsequent sale by the mortgagee after Barton defaulted on his loan repayments. Barton sought to have the sale overturned on the grounds of equitable relief and claimed the mortgagee had not acted innocently as required by law.

The court was required to decide whether the mortgagee's actions warranted the setting aside of the default judgment and whether the Contracts Review Act or the Industrial Relations Act provided Barton with any grounds to challenge the sale. Key issues included whether there was a valid arguable case against the mortgagee to overturn the possession of the property and whether Barton's claims under the relevant acts could justify setting aside the judgment. The court also needed to determine if the mortgagee acted innocently and if Barton's arguments had any merit under the applicable legal frameworks.

The court found that Barton had not established a valid arguable case against the mortgagee to set aside the possession of the property. It held that the mortgagee acted innocently and without any basis for acting otherwise. The court determined that the mortgagee's sale of the property was in accordance with the legal process and that Barton's claims under the Contracts Review Act and Industrial Relations Act did not provide sufficient grounds to overturn the sale. Consequently, the court dismissed Barton's motion to set aside the default judgment. The sale of the property by the mortgagee was upheld as valid and enforceable.

In light of the above, the court did not set aside the default judgment. The final orders confirmed the sale of Barton's property by the mortgagee, Permanent Custodians Limited, and dismissed Barton's motion to have the sale overturned. Barton was required to adhere to the terms of the mortgage agreement and the sale as conducted by the mortgagee. The court's decision reinforced the legal protections afforded to mortgagees in conducting sales following borrower defaults, provided they act innocently and in accordance with the law.

Orders