Permanent Custodians Ltd v Daneshyar Enterprise Pty Ltd

Permanent Custodians Ltd, the plaintiff, sought to enforce a debt against Daneshyar Enterprise Pty Ltd, the defendant, in the Supreme Court of New South Wales. The plaintiff, a financial institution, claimed the defendant had failed to repay a loan that had been secured by a mortgage over certain property. The loan was in arrears, and the plaintiff had triggered the acceleration clause in the loan agreement, demanding immediate repayment. The defendant did not respond to the proceedings, leading the plaintiff to obtain a default judgment for the debt owed, including interest and costs. The defendant subsequently applied to set aside the default judgment, arguing several grounds, including that there was an arguable defence, and that the plaintiff's conduct was unconscionable due to delay and lack of consent to certain actions, such as eviction and forfeiture.

The court was required to determine whether the defendant had established grounds to set aside the default judgment. Key issues included whether the defendant had an arguable defence to the claim, whether the delay in obtaining the default judgment constituted unconscionable conduct, and whether the plaintiff had acted improperly in obtaining the writ of possession without the defendant's consent. Additionally, the court had to consider whether the defendant's claim of prejudice due to the restraining orders and the actions taken by the NSW Crimes Commission affected the fairness of setting aside the judgment.

The court found that the defendant had not demonstrated an arguable defence to the claim, as the evidence showed the loan was indeed in arrears and the acceleration clause was properly invoked. However, the court acknowledged the defendant's concerns regarding the delay and the plaintiff's actions in obtaining the writ of possession without the defendant's consent. The court held that while these factors were relevant, they did not outweigh the defendant's failure to respond to the proceedings. The court emphasised that the defendant had not shown sufficient prejudice to warrant setting aside the default judgment. The court also noted that the restraining orders and actions by the NSW Crimes Commission did not constitute unconscionable conduct on the part of the plaintiff. Consequently, the application to set aside the default judgment was dismissed.

The court ordered that the default judgment remain in place, and the defendant was required to pay the debt owed to the plaintiff, including interest and costs. The court emphasised that the defendant's delay in responding to the proceedings and the plaintiff's actions, while regrettable, did not provide sufficient grounds to set aside the judgment. The defendant was also ordered to pay the plaintiff's costs of the application.