Permanent Mortgages P/L v. Schoch

[2007] QCA 195

SUPREME COURT OF QUEENSLAND

CITATION:	Permanent Mortgages P/L v Schoch [2007] QCA 195
PARTIES:	PERMANENT MORTGAGES PTY LIMITED ACN 097 176 362 (plaintiff/respondent) v MAUREEN CHANTAL SCHOCH (defendant/applicant)
FILE NO/S:	Appeal No 4891 of 2007 SC No 10136 of 2006
DIVISION:	Court of Appeal
PROCEEDING:	Application for Stay of Execution
ORIGINATING COURT:	Supreme Court at Brisbane
DELIVERED EX TEMPORE ON:	8 June 2007
DELIVERED AT:	Brisbane
HEARING DATE:	8 June 2007
JUDGE:	Keane JA
ORDER:	1. Application refused 2. Applicant to pay respondent's costs
CATCHWORDS:	APPEAL AND NEW TRIAL – APPEAL - PRACTICE AND PROCEDURE – QUEENSLAND – STAY OF PROCEEDINGS – WHEN REFUSED – where applicant defaulted under mortgage – where mortgagee given default judgment for recovery of possession – where application to set aside default judgment dismissed – where applicant lodged appeal against dismissal – whether stay should be granted pending determination of appeal
COUNSEL:	The applicant appeared on her own behalf D K Kanitz for the respondent
SOLICITORS:	The applicant appeared on her own behalf Dunstan Hardcastle for the respondent

KEANE JA:  The applicant seeks a stay of the execution of an enforcement warrant issued on 19 April 2007 whereby the respondent may recover possession of units 13C and 13D in the building "Royal Palm Resort" at the Gold Coast.  The stay is sought pending the determination of the applicant's appeal against the dismissal of the applicant's attempt to set aside the default judgment which had been given in favour of the respondent.  That judgment was for the recovery of possession of the units.

The applicant is the mortgagor of the units, having borrowed $670,000 in June 2005 from the respondent, the mortgagee, and charged the units as security for repayment of the loan.  The applicant defaulted in payment of instalments of principal and interest due under the mortgage in 2006, and on 12 October 2006 the respondent demanded payment of all principal, interest and late payment fees.  The applicant has not made payment of any of these monies.

The respondent issued a claim for possession of the units on 22 November 2006.  It experienced difficulty in serving the proceedings on the applicant.  In consequence, an order for substituted service was made on 15 February 2007.  The respondent proceeded pursuant to that order to serve the applicant with the originating process.  The applicant asserts that she did not ever actually receive this process.  Whether or not that is true as a matter of fact, the service of proceedings was effective by virtue of the order of the Court for substituted service.
Default judgment was obtained against the applicant on 30 March 2007 in default of an intention to defend.  The applicant sought to set aside the default judgment, but that application was refused.  The applicant seeks to appeal against that order. 

In the absence of an arguable case on appeal, a stay of the order subject to appeal will not be granted by the Court.  The notice of appeal dated 6 June 2007 was obviously not drawn by a lawyer, but it is sufficiently clear that it does not set up any grounds on which to doubt the correctness of the order of 23 May 2007.  The principal focus of attack in the notice of appeal is the enforcement warrant.  In that regard it is said that the respondent failed to comply with the requirements of the Uniform Civil Procedure Rules 1999 (Qld) in relation to the service of the enforcement warrant. It is also said that her health will be endangered if she is forced to move out of the units.

Neither of these contentions goes to the correctness of the decision of 23 May, and so they do not suggest that the applicant has an arguable case on appeal against that order.  In relation to the medical grounds, it does appear the applicant is very distressed by these proceedings and, as she says, may face considerable and possibly irrevocable harm to her health if she is forced to move onto the streets.  The Court is very sympathetic with that, but of course the applicant may have recourse to other agencies of the State to provide for her welfare in these circumstances.
If the matter is looked at more broadly, one can see that the applicant asserts that the respondent agreed to defer repayments to enable her to seek financial support from other sources.  The applicant's evidence as to the extent of any deferral is not particularly clear in terms of the extent of accommodation which she said she was promised, but even if her evidence is accepted at its highest, there is little basis for thinking that the respondent could be precluded from now insisting on its strict legal rights.  No consideration moved from the applicant to the respondent to bind it to a promise for renewal, and there is no evidence that the applicant has acted to her detriment in reliance on the indication of a deferral which she says she received.

Finally, the applicant asserts that the respondent is adequately secured by its mortgage against any money she may owe, and so would suffer no prejudice if the respondent were prevented from enforcing its right to possession until an appeal could be heard.  In this regard, there is, as I have said, no clear reason to think that the appeal has any prospect of success; but, in any event, there is no evidence to establish that this Court could reliably conclude the respondent does not stand to lose and be left bearing a loss on its loan by reason of a Court enforced continuation of the applicant's possession of the units.

For these reasons, and not withstanding the Court's considerable concern for the distressed situation of the applicant, the application should be refused.
...

KEANE JA:  On the basis that the other side have been successful on the application, it seems to me that they are entitled to an order for their costs and I order that the application for a stay be refused with costs.

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