Rural Bank Ltd v Lloyd

[2013] NSWSC 1214

Supreme Court

New South Wales

Medium Neutral Citation:	Rural Bank Limited v Lloyd [2013] NSWSC 1214
Hearing dates:	20 June 2013
Decision date:	03 September 2013
Jurisdiction:	Common Law
Before:	Adams J
Decision:	Leave granted to issue writ of possession together with costs.
Catchwords:	MORTGAGES - possession - claim for writ of possession - borrower relies on tender by pretended bill of exchange - no genuine payment or tender - no basis for stay under r 6.17 of the Uniform Civil Procedure Rules 2005 PROCEDURE - default judgment - application to set aside default judgment for payment - pretended bill of exchange - no irregularity
Legislation Cited:	Uniform Civil Procedure Rules 2005
Category:	Interlocutory applications
Parties:	Rural Bank Limited (Plaintiff) David Lloyd (Defendant)
Representation:	Counsel: S B Loughnan (Plaintiff) Solicitors: Hennessey & Co (Plaintiff) Self-represented (Defendant)
File Number(s):	2012/310706

Judgment

Introduction

1. On 8 October 2012 the plaintiff filed a statement of claim seeking an order for possession of an identified parcel of land, judgment against the defendant plus interest and costs. No defence was filed and on 8 May 2013, following a notice of motion in that respect, judgment by default was awarded to the plaintiff. In accordance with the practice of the Court, the plaintiff filed a notice of motion seeking leave to issue a writ of possession and an order for the issue of a writ in respect of the land. The application was supported by an affidavit of a manager employed by the plaintiff setting out, amongst other things, the amount of the judgment debt plus fees and costs, deposing, in particular, that the judgment debtor has made no payments since entering of judgment.

1. On 28 March 2013 a notice of payment was filed by the defendant stating that, on 22 March 2013 he paid to the plaintiff the sum of $505,000, the total amount claimed in the statement of claim. (As it happens, this amount is not correct but nothing turns on it.) The defendant on 6 June 2013 filed a notice of motion seeking to set aside the default judgment.

The claim of payment

1. The affidavit of the defendant states -

"During the period early 2012 to 21 March 2013, due to circumstances beyond my control I was unable to make repayments pursuant to the terms and conditions of the Facility Agreement, however in a timely manner I in my proper capacity as Drawer executed a financial instrument otherwise known as a bill of exchange, and as Drawee I accepted such in accord and satisfaction of the terms provisions and tenor of the bill of exchange and coupled statement of the transaction associated with same, the Drawee paid and delivered same to the Plaintiff/ Payee (Rural Bank) which had both the cumulative legal and lawful effect of discharging the existing Plaintiff's mortgage and created an issue of promissory estoppel and a serious matter of law to be tried, should there be a breach of the equitable promissory estoppel.

1. The defendant goes on to depose that he sent the amount of $505,000 to the plaintiff by way of cheque. On 18 June 2013 the defendant, by affidavit exhibited the bill of exchange which he said was made by way of tender of the outstanding debt. The bill of exchange commences in the following way -

"THE PUBLIC-CHARITABLE-CESTUI-QUE-TRUST OF DAVID LLOYD;

PAY ON DEMAND TO THE ORDER OF: RURAL BANK LIMITED ABN:74 083 935 416

c/o 27 Currie Street Adelaide in the state of South Australia 5000

THE SUM CERTAIN OF: ONE AUSTRALIAN DOLLAR EXACTLY, BEING SUFFICIENT VALUABLE CONSIDERATION ON ANY BILL OF EXCHANGE TENDERED IN ORDER TO CONSTITUTE AND SUPPORT A SIMPLE CONTRACT BETWEEN THE PARTIES: DAVID LLOYD & RURAL BANK LIMITED

$505,000.00"

(Although elsewhere in the document it refers to the sum of $505,000, at no point does it suggest this amount should be paid.) The "Bill of Exchange" also stated -

"INDORSEMENTS

INCHOATE ACCOUNTING INSTRUMENT ACCEPTED FOR VALUE MISSING PARTICULARS COMLETED.

ISSUED AND RETURNED COMPLETE

Pay the sum certain of: ONE AUSTRALIAN DOLLAR EXACTLY

ONLY ACCEPTED AND PAYABLE AT AND NOT ELSEWHERE:

208 Arden Street, Coogee New South Wales [2034]

OR PRIOR BY MUTUAL ARRANGEMENT AT ANOTHER AGREED ALTERNATE ADDRESS at 11.45 hrs without further: let, delay, hindrance, ado, on Thursday, the Twenty-Eighth day of March, AD 2013 in accord and satisfaction..."

1. When this matter came before me on 20 June 2013, after hearing some preliminary oral submissions, I decided that the appropriate course was to require each of the parties to file written submissions.

Discussion

1. No discussion is required about the "Bill of Exchange". It is plainly worthless. At all events it only proffers the amount of one dollar. Not surprisingly, no one from the plaintiff attended the proposed or a later meeting stipulated by the defendant.

1. The defendant's submissions rely on tender and submit that it followed that, under r 6.17 of the Uniform Civil Procedure Rules, the filing of the notice of payment operated as a permanent stay unless the Court ordered otherwise and that, as payment was tendered, default judgment had been obtained illegally or irregularly within the meaning of r 36.15. So far as the notice of payment is concerned, it is apparent from r 6.17 that it may be filed only when the plaintiff has been paid the debt and costs as described in r 6.17(2). Since neither payment nor tender was made, it follows that the filing of the notice of payment could not procure a stay. For the same reason, there is no basis for setting aside the default judgment.

1. For completeness I should mention that payment under the mortgage will amount to a credit only where the bank actually receives the money paid towards satisfaction of the debt. Of course, that did not happen here.

Conclusion

1. No payment has been made and no defence has been disclosed. It follows that the plaintiff is entitled to the orders sought in the notice of motion seeking issue of the writ, together with costs.

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Decision last updated: 12 September 2013