Perpetual Corporate Trust Limited (ACN 001 341 533) v Adgemis

[2025] NSWSC 520

Supreme Court

New South Wales

Medium Neutral Citation:

Perpetual Corporate Trust Limited (ACN 001 341 533) v Adgemis [2025] NSWSC 520

Hearing dates:

23 April 2025

Date of orders:

23 April 2025

Decision date:

23 April 2025

Jurisdiction:

Common Law

Before:

Rothman J

Decision:

1       Execution of the writ of possession granted in this matter on 10 January 2025 is stayed, being the writ of possession in relation to the land in Folio Identifier 8/74055, situated at, and known as, 2A Conway Avenue, Rose Bay NSW until 7 May 2025 or further order of the Court, whichever occurs first.

2      The foregoing stay does not prevent the plaintiff from taking any and all steps to obtain vacant possession of the aforesaid property, provided any such order permitting or requiring vacant possession is not executed before 27 May 2025.

3      I direct the First Defendant to serve each of the three occupiers of the property described in Order 1 of these orders with the Statement of Claim, the Proposed Defence attached to the Affidavit of the first defendant of 14 April 2025, and the transcript of proceedings today, by 5pm Monday, 28 April 2025.

4      The First Defendant shall pay the costs thrown away as a result of the inability to execute the writ granted. Such costs shall be paid forthwith.

5      All other costs reserved.

Catchwords:

LEASES AND TENANCIES — Ejectment — Writ of possession — motion to stay execution of a writ of possession — where default judgment was granted — where tenant has real hardship — temporary order granted

Legislation Cited:

Australian Securities and Investments Commission Act2001 (Cth)

Contracts Review Act 1980 (NSW)

Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

GE Personal Finance Pty Ltd v Smith (2006) NSW ConvR 56-164; [2006] NSWSC 889

Guthrie v ANZ Banking Group Ltd (1991) 23 NSWLR 672

Category:

Procedural rulings

Parties:

Perpetual Corporate Trust Limited (Plaintiff)
Rose Garigo Adgemis (First Defendant)
Jon Angelo George Adgemis (Second Defendant)

Representation:

Counsel:
M McGirr (Plaintiff)
M Collins (First Defendant)
C Stevens (Second Defendant)

Solicitors:
Dentons (Plaintiff)
Cadre Moss (First Defendant)
Bird & Bird (Second Defendant)

File Number(s):

2024/355044

Publication restriction:

N/A

JUDGMENT

1. HIS HONOUR: The first defendant, Rose Adgemis, by Motion, notice of which was filed on 4 April 2025, moved the Court to issue orders prohibiting the Sheriff from taking action on a writ of possession issued on 10 January 2025, the effect of which would be to obtain possession of the property known as 2A Conway Avenue, Rose Bay in the State of New South Wales in which the first defendant’s daughter, son-in-law and grandson live. The motion is supported by an affidavit sworn on the same date.

2. The applicant on the motion, being the first defendant in the substantive proceedings, attests to the fact that other property is owned by her in an adjoining? neighbourhood. The first defendant lives on her own in the other property. The title search is annexed to the affidavit.

3. The first defendant is, according to the Title Deeds, joint tenant of the property at 2A Conway Avenue together with her son, Jon. Neither of them lives in the property. As earlier stated, along with her daughter and son-in-law, her grandson, Jack, lives at 2A Conway Avenue, Rose Bay (hereinafter the “disputed property”). The title search of the disputed property is before the Court.

4. Jack is severely disabled and requires full-time care. The disputed property has been modified for his requirements.

5. Jack is currently 24 years of age, has ADS (Autism Spectrum Disorder), a profound intellectual disability and, as stated, requires full-time care to manage, amongst other things, his behavioural issues, intellectual impairment, complex drug-resistant epilepsy and tuberous sclerosis, which is a rare genetic disease causing non-cancerous tumours to grow in the brain and other organs. There is not currently medical evidence in relation to this issue in detail but there is a medical history and report from a medical practitioner who has treated Jack and, for the purposes of these interlocutory proceedings only, I accept the statement of the first defendant as to the health of her grandson.

6. Jack attends Giant Steps, a school for children with disabilities, twice weekly. A report confirms those issues.

7. The first defendant has her own health conditions and was scheduled for an operation for surgical removal of a lesion suspected of being cancerous. The first defendant’s daughter also has health issues some of which are seemingly caused by the effect of being a full-time carer to Jack. The daughter suffers from anxiety, depression and panic attacks. Apart from those, the daughter also suffers from asthma and IBS.

8. The affidavit from which the foregoing is obtained also deals with the first defendant’s awareness, or lack of it, of the proceedings for possession. The first defendant gives evidence that she does not recall and has no record of ever receiving the Statement of Claim in relation to the substantive proceedings.

9. Apparently, in the substantive proceedings, a law firm acted for the first defendant. The first defendant denies having ever spoken to any lawyer from the firm in question.

10. In essence, the first defendant seeks to file a defence to the proceedings and set aside the default judgment, at least as against her, and does so for reasons which can be broadly described, without any criticism of any party, as being related to the circumstance that her son, the second defendant and joint owner of the disputed property, conducted all of the meetings and arrangements in relation to the property and mortgage, none of which seems to have been explained or adequately explained to the first defendant. This is the claim of the first defendant.

11. A cross-claim alleging unconscionable conduct under ss 12A and 12CB of the Australian Securities and Investments Commission Act2001 (Cth) (ASIC Act) was filed on 23 April 2025. The cross-claim also seeks a restraining order under the ASIC Act and under general law, orders for the removal of the registered mortgage upon which the plaintiff in the substantive proceedings moves, and orders under the Contracts Review Act 1980 (NSW).

12. The matter came on urgently before the Court as presently constituted acting as Duty Judge. Prima facie, the plaintiff in the substantive proceedings has a right to possession on the basis of the default on the mortgage. The plaintiff is not the only mortgagee on the disputed property.

13. During the course of the proceedings, the Court enquired as to the presence of the occupiers of the property. They were not present in Court. A notice, pursuant to the Practice Note and the Uniform Civil Procedure Rules 2005 (NSW), had been served on the occupiers, addressed “to the occupier”. The only parties to the proceedings are the registered joint owners of the property, the first and second defendants.

14. There is no evidence before the Court as to the arrangements between the defendants in these proceedings and the occupiers. It seems, from information from the bar table, or the lack of it, that there is no lease or rental agreement. As earlier stated, the property has been modified substantially to accommodate the needs of Jack.

15. Jack, as is obvious from that which has already been stated, is and would have been unable to understand any notice to the occupier and, without in any way criticising the plaintiff, only one notice to the occupier was served.

16. Thus, albeit very much at the interlocutory stage and on the basis of the preliminary material before the Court, the Court was faced with the following issues:

1. The first defendant having, it seems, an arguable case in a defence and seeking to file a defence;

2. A circumstance that the disabled grandson of the first defendant was living, with his parents, one of whom was his full-time carer in a house specially modified for him as an occupier, in the absence of any rental or other known arrangements; and

3. The disabled grandson had, it seems, no other place of suitable accommodation.

17. There are a number of issues that arise. First, it is necessary to set out the principles associated with a stay of execution of a writ of possession. The most convenient summary is that of Johnson J in GE Personal Finance Pty Ltd. [1] His Honour, then the possession list judge, set out the bases upon which a stay application may be made and granted. His Honour said:

    1. GE Personal Finance Pty Ltd v Smith (2006) NSW ConvR 56-164; [2006] NSWSC 889.

“11 Firstly, it should be kept in mind that, by the time a stay application is made, the proceedings have usually advanced through various stages without the Defendant participating in the proceedings. In the usual case (of which the present case is an example), the Defendant has not filed a Defence and Default Judgment has been granted (Part 16.4 and Part 36.8 Uniform Civil Procedure Rules) followed by the issue, with the leave of the Court, of a Writ of Possession (Part 39.1(1)(d) Uniform Civil Procedure Rules). Some time is then required for the Plaintiff to make practical arrangements with the Sheriff for execution of the writ.

12   Having been served with originating process alleging default under the mortgage and identifying the relief which the Plaintiff seeks, the Defendant is on general notice as to the consequences which may flow as a result of the proceedings. If the Defendant takes no action until the execution of the Writ of Possession is imminent, a legitimate question arises as to why the Defendant has not taken earlier action, either by way of negotiations with the Plaintiff or application to the Court. A Defendant seeking a stay ought be in a position to explain to the Court his or her action or inaction prior to the making of the application.

13   Secondly, the basis upon which the stay application is made is significant. As paragraph 20 of the Practice Note makes clear, there are three common circumstances advanced on a stay application:

(a)   where the Defendant indicates that the proceedings are to be defended, a draft Notice of Grounds of Defence should be provided and the Defendant ought be in a position to make submissions concerning the merits of the proposed grounds;

(b)   where the Defendant indicates that the loan is to be refinanced, proof of steps undertaken to refinance will be required on the application;

(c)   where the Defendant indicates that the subject property is to be sold, copies of agent sale agreements, a contract for sale of the property, advertisements and other documentary evidence ought be provided.

14   The three categories referred to in the preceding paragraph of this judgment raise different considerations.

15   With respect to the first category, if a Defendant seeks to be let in to defend the proceedings (and, usually, to set aside a default judgment for that purpose), then a stay may be more readily granted to preserve the subject matter of the litigation pending the determination of the proceedings by the Court.

16   As to the second category, where the Defendant seeks to refinance so as to discharge the debt to the Plaintiff under the mortgage, the Defendant is seeking to satisfy the debt payable to the Plaintiff in its entirety so as to render unnecessary the exercise of the power of sale by the Plaintiff.

17 The power of sale under s.58 Real Property Act 1900 is to be exercised for the purpose of the Plaintiff recovering the moneys which are due and owing to it as mortgagee (see s.58(3)). Even where the Plaintiff takes possession of the property for the purpose of exercising its power of sale, the Defendant may obtain an injunction restraining a mortgagee from exercising the power of sale if the amount of the mortgage debt (if this is not in dispute) is paid or (if the amount is disputed) the amount claimed by the mortgagee is paid into Court: Inglis v Commonwealth Trading Bank of Australia (1972) 126 CLR 161 at 164-167, 168-169. In this respect, I have been referred by Mr Groben to a recent decision of Hamilton J in Parist Holdings Pty Limited v Perpetual Nominees Limited [2006] NSWSC 599, where his Honour considered the circumstances in which injunctive relief may be granted to restrain the exercise of power of sale by a mortgagee.

18   Thus, it remains open to a Defendant to discharge the debt owing to the Plaintiff in its entirety before the property is sold and to recover possession of the property. No doubt, it is personally convenient to a Defendant to retain possession of the property continuously rather than lose possession, and then regain it upon discharging the debt to the Plaintiff. It is for this reason that a Defendant who is seeking to discharge the debt to a Plaintiff will seek a stay of execution of the Writ of Possession to allow this to be done.

19   If a Defendant is contending that there is a realistic prospect of obtaining refinance to discharge the debt, it is reasonable to expect that the Defendant will take early steps in this regard and be in a position to provide credible and reliable evidence of available refinancing so as to discharge the total debt. It might be expected that a reasonable Plaintiff would facilitate such a process and not run up further legal costs in such circumstances.

20   The third category involves a stay application where the Defendant wishes to sell the property. It might be thought that the orderly preparation and presentation of the property for sale, with the Plaintiff and Defendant co-operating in this regard, would maximise the prospect of a favourable sale price. This would serve the interests of the Plaintiff and the Defendant. A Defendant may encounter difficulties on a stay application if the decision to sell the property, and to make necessary arrangements for this to be done, is left until the last minute when the Writ of Possession is about to be executed.

21   A stay may be sought on hardship grounds. The Defendant may contend that there will be hardship to him or her and other family members if the writ is executed and they are removed from the property. It must be kept in mind that the Defendant and other occupiers of the property (Part 6.8 Uniform Civil Procedure Rules) will have been served with originating process so that the consequences which may flow from the proceedings would have been notified to them. Of course, it may be that, in the absence of legal advice, the precise consequences may not be clear to a Defendant and other occupiers. It may also be that the Defendant and his or her family may have not confronted the reality of the situation at an earlier time.”

18. On one view, it may be that the first defendant has a reasonable defence. Further, at least arguably, because the second defendant has purported to mortgage the property without the knowledge of the first defendant and without her authority, there may be a severance of the joint tenancy and the creation of a tenancy in common, allowing the plaintiff to enforce the debt against the interest only of the tenant in common: Guthrie v ANZ Banking Group Ltd. [2]

    2. (1991) 23 NSWLR 672 at 679-680 (R Meagher JA).

19. If the factual circumstance is as pleaded by the first defendant, then the first defendant fits within the first category or basis upon which the default judgment may be set aside and a stay granted. It is unnecessary for the Court to determine such an issue finally or at all.

20. That which concerns the Court, as presently constituted, far more is the hardship issue associated with Jack. Not only is there an issue of hardship but, given the circumstances of the occupation of the property and the identity of the registered owners, there may well be an argument that the beneficial ownership of the property or some equitable title or equity is held by Jack.

21. The difficulty with such a proposition is that such an interest is inconsistent with the financial interests of the first and/or second defendants and may well be inconsistent with the interests of the other occupiers of the disputed property or at least the mother. It may well be that for a variety of family reasons, Jack’s mother, being the daughter of the first defendant, would not seek to deprive the first defendant and/or the second defendant of their interests in the property.

22. Further, the notice to the occupier, which was served, appropriately, by the plaintiffs, would not have come to the attention of Jack and, even if it were to have come to his attention, he could not, on the material currently before the Court, have understood it.

23. If, as is a real possibility, the joint tenants were holding the property in trust for Jack, the first defendant’s grandson, and his parents, then the second defendant also acted in breach of trust, but, more importantly from the perspective of these proceedings, Jack would need to be represented by a tutor and his interest asserted.

24. Such an interest would not have priority over the registered interests of the plaintiff, but in circumstances where there is an occupier with an intellectual disability of this magnitude, the requirements of UCPR r 16.4(3)(a) and (b) together with the terms of UCPR r 6.8(1) may mandate different action.

25. As earlier stated, it is unnecessary for the Court, in the present application, to decide or determine these more complicated issues. It was sufficient for present purposes to show that there was, at a very preliminary stage, an arguable defence by the first defendant and real hardship seemingly suffered by Jack. It was the hardship that was the basis for the temporary order granted on 23 April 2025.

26. It is for the foregoing reasons that the Court issued the orders on 23 April 2025 staying execution of the writ of possession granted on 10 January 2025.

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Endnotes

Decision last updated: 22 May 2025