Precious Property Pty Ltd v Santoso

[2014] VCC 926

IN THE COUNTY COURT OF VICTORIA Revised
(Not) Restricted

AT MELBOURNE

COMMERCIAL LIST
GENERAL DIVISION

Case No. CI-13-03562

PRECIOUS PROPERTY PTY LTD	Plaintiff
v.
SELLY SANTOSO	Defendant

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JUDGE:	His Honour Judge Anderson
WHERE HELD:	Melbourne
DATE OF HEARING:	25 June 2014
DATE OF JUDGMENT:	25 June 2014
CASE MAY BE CITED AS:	Precious Property Pty Ltd v. Santoso
MEDIUM NEUTRAL CITATION:	[2014] VCC 926

REASONS FOR JUDGMENT

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Catchwords:              Practice and procedure – Summary judgment – Written loan agreement

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr D. Clough of Counsel	Lennon Mazzeo Lawyers
For the Defendant	Ms S. Santoso in person

HIS HONOUR:

1The defendant, Ms Selly Santoso, is a property developer. In February 2012, the plaintiff, Precious Property Pty Ltd, advanced to her the sum of $150,000. The loan was to be repaid on 16 February 2013, 12 months later, together with interest of 40% per annum, if the payment was made at that time. This was a further sum of $60,000.

2The agreement between the parties was contained in a loan agreement prepared by Ms Santoso’s solicitor. It appears to be in a standard form. It was the subject of some negotiation between the directors of Precious Property Pty Ltd with Ms Santoso’s solicitor. Because the default interest rate under the loan was 50% per annum, Ms Santoso’s solicitor gave her written advice as to the appropriateness of her entering into the agreement.

3At the expiration of 12 months, Ms Santoso apparently sought an extension of the time for repayment of the loan. In her oral submissions, she has suggested that an agreement was reached with the directors of Precious Property Pty Ltd that there would be a further extension of the repayment date for the loan and that the lender would agree to reduce the acceptable interest rate from 40% per annum to 20% per annum.

4Ms Santoso suggested that the consideration for the extension on those terms was that Precious Property Pty Ltd or its directors would become involved in a further project with her.

5The plaintiff seeks summary judgment in the proceeding. The proceeding was commenced by Writ dated 4 July 2013. A defence drafted by counsel was filed on 17 October 2013. The defence includes the following allegations:

a.Ms Santoso did not receive the loan;

b.the interest rate is unconscionable;

c.she would not be responsible for repayment of the loan but rather, that this would be the responsibility of her company Aqua Invest Pty Ltd;

d.in some way, the involvement by the directors of the plaintiff in a development at Healesville, in which Ms Santoso was also involved, affected her liability to repay the loan;

e.someone else had received the benefit of the loan and, as a consequence, she should not be responsible.

6Ms Santoso now represents herself. She filed an affidavit in opposition to the summary judgment application. The matters deposed to in the affidavit raise issues which are somewhat different from those raised in the Defence.

7In the affidavit:

a.Ms Santoso appears to admit that moneys were advanced;

b.she suggests that the moneys were advanced as an investment by the directors of the plaintiff in the Healesville development;

c.she suggests that the directors of the plaintiff, having had an involvement in the Healesville development, somehow had conflicts of interest in relation to the plaintiff recovering the moneys allegedly due under the loan agreement.

8It is apparent from emails exhibited as PT-5 to the affidavit of Paul Theobald sworn
8 May 2014 that in May 2013 there was a meeting between Ms Santoso, the directors of the plaintiff and others in relation to the moneys outstanding under the loan agreement.

9The plaintiff asserted that the result of those discussions was that $76,000 would be paid to the plaintiff. That was denied by another participant at the meeting in an email apparently sent on Ms Santoso’s behalf.

10A payment of $31,950 had been paid by the defendant on 13 February 2013. No other payments have been made either in reduction of interest or the principal of the loan.

11I am not satisfied that Ms Santoso has raised any defence to the plaintiff’s claim which has a real prospect of success, or is a reason for the matter being permitted to proceed to trial.

12A number of matters have been raised by Ms Santoso, firstly, in the defence drawn by her counsel, secondly, in her affidavit filed today and, thirdly, in her oral. submissions.

13There is a degree of inconsistency between the matters that have been raised by her.

14Ms Santoso has not addressed the fact that the claim is made pursuant to a written agreement that she has signed, whereby she agreed to borrow the sum of $150,000 and to repay it 12 months later with interest of 40%.

15It is impossible on the material that has been filed to accept that:

a.any person other than Ms Santoso has a liability in respect of the loan amount;

b.the loan amount was not received by Ms Santoso or was used by her otherwise than in respect of a project she had at Cranbourne;

c.she has paid any sum other than the sum of $31,950 to the plaintiff in reduction of the amount owing under the agreement.

16Accordingly, I consider that the plaintiff has established that it is entitled to judgment together with interest. The total amount is $307,922 which includes:

a.interest of $60,000 to 16 February 2013, which the plaintiff has claimed at the acceptable rate of 40% rather than the default rate of 50%, even though the payment was not made and;

b.interest, taking account of the repayment on 13 February 2013, from 16 February 2013 to 24 June 2014 (493 days) at the default rate of 50% per annum.

17The loan agreement is structured in such a way that the lesser interest rate of 40% per annum might be accepted if there were no default on the part of the borrower. Therefore the interest rate pursuant to the agreement is 50% per annum. Ordinarily in those circumstances there would be no argument that the 50% interest rate constitutes a penalty or is otherwise unconscionable or unenforcable.

18    The orders I will make are as follows:

1. Judgment for the plaintiff against the defendant that the defendant pay to the plaintiff $307,922.

2.       The defendant must pay the plaintiff’s costs of the proceeding, including any reserved costs and the costs of the plaintiff’s summons filed 9 May 2014 and of the hearing today, to be assessed by the Costs Court in default of agreement.

3.       Stay execution on the judgment for 21 days.

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Certificate

I certify that the preceding 3 pages are a true copy of the reasons for decision of His Honour Judge Anderson delivered on 25 June 2014.

Dated: 25 June 2014

Olivia Bramwell    

Associate to His Honour Judge Anderson