Secure Funding Pty Ltd v Deren; Deren v Secure Funding Pty Ltd (No 2)
[2014] NSWSC 348
•28 March 2014
Supreme Court
New South Wales
Medium Neutral Citation: Secure Funding Pty Ltd v Deren; Deren v Secure Funding Pty Ltd (No 2) [2014] NSWSC 348 Hearing dates: 17 December 2013 Decision date: 28 March 2014 Jurisdiction: Common Law Before: Schmidt J Decision: 1. The plaintiff have possession of the whole of the land described in Certificate of Title Folio Identifier Lot XXX in Deposited Plan XXXXX X, the postal address of which is XX XXXXX XXX Road, Morisset Park NSW 2264 (Land).
2. The plaintiff have leave to issue a writ for possession over the Land immediately.
3. Judgment be entered against the first defendant in the amount of $296,061.23 being the amount owing under the Loan as at 13 December 2013.
4. Interest on the judgment amount calculated at the rate or rates applicable under the Loan and Mortgage from 13 December 2013.
5. The first defendant pay the plaintiffs fees and charges in accordance with the Loan and Mortgage.
6. Declare that the plaintiff is entitled to any insurance proceeds in relation to any contract of insurance between the first defendant and the second defendant.
7. The first defendant's cross-claim is dismissed.
8. All exhibits and subpoenaed material may be returned forthwith; any exhibits returned must be retained intact by the party or person that produced the material until the expiry of the time to file an appeal, or until any appeal has been determined.
Catchwords: POSSESSION - leave to issue writ for possession - cross-claim - whether plaintiff caused delay in insurance payment - whether plaintiff responsible for property being underinsured - whether loan agreement and mortgage unconscionable - whether contacts unfair - orders made - leave to issue writ for possession granted - cross-claim dismissed Legislation Cited: Australian Securities and Investments Commission Act 2001 (Cth) Cases Cited: Secure Funding Pty Ltd v Deren [2013] NSWSC 1898 Category: Principal judgment Parties: Secure Funding Pty Ltd ACN 081 982 872 (Formerly Liberty Funding Pty Ltd) (Plaintiff/First Cross-Defendant)
Reny Raymond Deren (First Defendant/Cross-Claimant)
Insurance Australia Limited trading as NRMA Insurance ACN 000 016 722 (Second Defendant/Second/Cross-Defendant)Representation: Counsel:
Mr V Bedrossian (Plaintiff)
Solicitors:
Norton Rose Australia (Plaintiff)
Mr Deren, unrepresented (Defendant)
File Number(s): 2012/203997 Publication restriction: None
Judgment
In 2007 the property the subject of these proceedings was severely damaged by storms, with the result that Mr Deren, the first defendant, made a number of claims under his insurance policy with the NRMA, which were disputed. That property secured a loan made by the plaintiff to Mr Deren. The insurance dispute was only resolved in 2012, after these proceedings were commenced and long after his loan with the plaintiff had fallen into arrears. The plaintiff now seeks possession of the property.
Mr Deren defends that claim by a cross-claim, by which he seeks amongst other things, orders relieving him of the obligation to repay what is outstanding under the loan, because of the plaintiff's alleged unfair conduct in relation to his dispute over the insurance claims.
Mr Deren relies on the Australian Securities and Investments Commission Act2001 (Cth) to claim, amongst other things, that the loan agreement and mortgage were unconscionable. He sought orders requiring the plaintiff to waive all charges, costs, fees and expenses levied since June 2007, and requiring that some $203,000 plus interest calculated from that date be credited to his loan account. He also sought an order for various claimed damages.
Mr Deren is now the only active defendant, the claims earlier pursued against the NRMA having been resolved by its payment of some $203,000, which was used to reduce what was outstanding under Mr Deren's loan.
The consumer loan agreement which Mr Deren entered with the plaintiff was in standard terms. Clause 7 dealt with default and clause 8 with enforcement expenses. The mortgage made similar provision in clauses 21 to 23. There was no question as to the parties' agreement that the plaintiff had the right to take possession of the property in the event of default. Provision for evidentiary certificates to be given was made by clause 3 of the mortgage. Such a certificate evidenced that the loan was in arrears and that at the date of hearing Mr Deren owed some $296,000 under the mortgage.
The issues
The plaintiff, Mr Deren and the NRMA entered a Deed of Release in 2010 by which Mr Deren directed the NRMA's payment be made to the plaintiff to reduce the outstanding loan balance. The payment was not made until 2012. There was a dispute as to who was responsible for what occurred in respect of the payment and its timing.
A statement of matters of fact and law in dispute was agreed. There it was recorded that it was agreed amongst other things that the loan was made; that its terms were recorded in the March 2007 loan agreement and mortgage; and that the loan went into default. It was finally not in issue that demand for repayment had been made.
When the hearing commenced his solicitor Mr Allchin represented Mr Deren. He then made and I refused an adjournment application (see Secure Funding Pty Ltd v Deren [2013] NSWSC 1898). The hearing proceeded and after the morning tea adjournment, Mr Allchin announced that Mr Deren would appear for himself, but Mr Allchin remained to assist him.
The plaintiff called Mr Larkin, its Manager, Asset Realisation. His cross-examination was abandoned by Mr Deren, who then observed that the documents in evidence would speak for themselves. The plaintiff also relied on the affidavits of other witnesses who were not required for cross-examination. In evidence were various electronic records which the plaintiff maintained, which on Mr Deren's case were not complete and were in some respects inaccurate, but which in part he relied on. He also relied on recordings he had made of certain conversations. Mr Deren also gave evidence and was cross-examined and made his own submissions, finally not pressing all that had earlier been identified to be in issue.
The issues had earlier been identified by the parties to include unconscionability; failure to mitigate and negligence. What was principally pressed finally concerned:
"(d) whether the default by the First Defendant under the Loan and the Mortgage was relevantly attributable to any act or omission on the part of the Plaintiff (for example, Def [9]) and, more specifically:
(i) whether there was any relevant delay or inactivity of the part of the Plaintiff in relation to the payment or receipt of the insurance monies payable by the Second Defendant;
(ii) if there was any such relevant delay or inactivity, whether that caused the First Defendant's default under the Loan and the Mortgage, or exacerbated the First Defendant's prima facie liability under the Loan and the Mortgage;"
Was the plaintiff responsible for the home building insurance?
One aspect of Mr Deren's case was that the plaintiff was responsible for the property being underinsured. That was not established.
In dispute between Mr Deren and the NRMA was whether the NRMA had to reinstate the property, or pay him under the policy and if so, for what amount and on what terms. Mr Deren relied on a conversation with an employee of the plaintiff, during his ongoing dispute with the NRMA, who suggested to him that the building had been underinsured. Mr Deren's evidence was that it was in discussions with Mr Allanson, in May 2009, that Mr Allanson had suggested to him that the property had been underinsured and that he should get legal advice or approach the Ombudsman.
Mr Deren had been offered the loan by letter of 30 May 2007. He was there advised that he had to provide the plaintiff with:
"A Certificate of Currency from your Home Building Insurer (with Secure Funding Pty Ltd noted as Mortgagee). The minimum cover required for your security is
xx xxxxxxxx Road MORISSET PARK, NSW 2264 $190,000
What the value of the building was when it was insured was not sought to be established. It was Mr Deren who insured the property with the NRMA for buildings and contents at $220,000 and $100,000 respectively. How those figures were arrived at was not established. It was not suggested that the plaintiff chose them. The evidence did not establish Mr Deren's claim that the building was underinsured, or that it was the plaintiff who was responsible for the amount for which he insured it.
Did the plaintiff cause the delay in the payment made under the insurance policy?
Mr Deren complained that the plaintiff had not assisted him, as it ought to have, in his dispute with the NRMA. He claimed that the plaintiff had refused to permit his settlement with the NRMA, because the amount it had offered him was not sufficient to discharge the mortgage. He also claimed that it was the plaintiff which had caused or materially contributed to the long delay in the payment made by the NRMA. None of this was established on the evidence.
Neither the loan agreement nor the mortgage required the plaintiff to assist Mr Deren as he claimed in these proceedings it ought to have. The plaintiff had various rights, including in relation to insurance, the mortgage providing:
"5.1 You must do your best to ensure that proceeds from an insurance claim (including a claim by a governing body if the property is a part of a shared scheme) are:
(a) used to reinstate to the property or carry out other works; or
(b) paid to us, (we must then use them as set out in clause 27.)
However, if we direct you to use or hold insurance proceeds you receive in a particular way, you must use or hold them as we direct.
5.2 You must notify us if an insurance claim is refused either in part or in full.
5.3 If we notify you, we may take over your rights to make, pursue or settle an insurance claim. We may exercise those rights in any manner we choose."
Clause 13 of the consumer loan agreement was also relevant. It provided:
"Statements
13.1 We give you a statement for your loan account at least every 6 months.
How we may exercise our rights
13.2 We may exercise a right or remedy or give or refuse our consent in any way we consider appropriate including by imposing conditions.
13.3 If we do not exercise a right or remedy fully or at a given time, we can still exercise it later.
13.4 Our rights and remedies under this agreement are in addition to other rights and remedies provided by law independently of it.
13.5 Our rights and remedies under this agreement may be exercised by way of our employees or any other person we authorise.
13.6 We are not liable for loss caused by the exercise or attempted exercise of, failure to exercise, or delay in exercising, a right or remedy.
The evidence did not establish that the plaintiff had exercised its rights unconscionably. It seems that with the benefit of hindsight, Mr Deren seeks to attribute fault to the plaintiff, for the consequences of decisions which he made himself from time to time, which have affected him adversely.
Mr Deren relied on the plaintiff's internal records to establish delay caused by the plaintiff. On his case, those records reflected his advice in 2008 that the NRMA was prepared to release funds to him and that the plaintiff required written confirmation from the NRMA, of its position. While the evidence suggested that Mr Deren had then supplied the plaintiff with a copy of his extensive documentation as to his pursuit of his insurance claim, it did not establish that he had provided the plaintiff with such advice from the NRMA, or that this was its position at the time.
He was certainly then not prepared to accept what the NRMA was offering on the terms it required.
On 30 April 2008, the NRMA offered to pay Mr Deren $199,466.60 on conditions which included that the money be paid to him and that he sign a deed of release. Why it did not offer to pay the sum to the plaintiff is not clear. That does not appear to have been suggested to it by Mr Deren. He did not, in any event, accept that offer. Various negotiations ensued, about which at times he sought the plaintiff's support.
On Mr Deren's evidence he was then unable to reside in the property and had to live in rented accommodation. Because of the ongoing delays he undertook some necessary repairs and building work, at his own expense. In August 2008, the plaintiff agreed to a five week reprieve on his mortgage payments, on the basis that he was then five weeks ahead.
In November 2008 Mr Deren wrote to the plaintiff:
"As per my call earlier today I require for an appeal with the Ombudsman a letter stating the condition of the home at the time of the loan application, I also require a letter stating why Liberty Financial will not accept the NRMA cash settlement to date, I need this so as to achieve the required outcome by Liberty to have the home repaired to is original state."
The reply does not appear to be in evidence, although internal records suggest one was sent. At that time, the NRMA had not offered to make a payment to the plaintiff.
In December 2008, the NRMA ceased paying Mr Deren's rent, with the result he said, that he had to either default on the mortgage in order to pay his rent, or live on the street. His evidence was that he then informed the plaintiff that he could no longer repay the loan.
The plaintiff's electronic record recorded a telephone conversation in December 2008 when Mr Deren advised that the NRMA had offered to pay $199,466.60 to him. The plaintiff advised that it required the payment to be made to it, to be applied to reduce the mortgage; that the offer was insufficient to discharge the mortgage debt in full; and that it would consider extending the loan, so that he could carry out repair work. He ceased making payments on 19 December.
There was an ongoing dispute about what Mr Deren had said about the NRMA on a website. On his evidence, he had launched that website in late January or February 2009, due to the refusal of the plaintiff and the NRMA to allow a settlement to be authorised. In various correspondence he also referred to what he had said about the plaintiff on that website.
On Mr Deren's evidence he was served with a default notice in April 2009. He then acted to protect himself, attempting to mitigate his losses by selling the property in its damaged state. Due to the stress and pressure that he was under, he lost his employment and later attempted suicide. He then began recording conversations, keeping dairy entries and seeking legal advice.
On 24 April 2009, Mr Deren wrote to the NRMA's solicitor offering to accept the sum the NRMA had offered him, but on different terms. He also offered to authorise the NRMA to contact the plaintiff direct, but he was not prepared to resolve the website dispute, or have it form part of the settlement. He proposed that he would accept the money amount offered, but refused any restriction as to what he said about the NRMA or the payment. On Mr Deren's evidence, he and the NRMA reached a stalemate.
The plaintiff's electronic record noted a phone request he had made for the plaintiff to deal direct with the NRMA and its request that he provide written authorisation. On 6 May he emailed the plaintiff a copy of the authority provided to the NRMA's solicitor to deal directly with the plaintiff. On 8 May Mr Deren was advised that the plaintiff had not heard from those solicitors.
Mr Deren relied on the plaintiff's internal records, which noted advice given to him in September 2009 that the insurance issue was one between he and the NRMA. He claimed that he was then willing to finalise the claim.
Mr Larkin's evidence was, however, that the plaintiff's electronic records included:
- The plaintiff's request on 1 June 2009 for written authorisation for it to speak direct to the NRMA.
- On 4 June Mr Deren advised that the NRMA declined to speak to the plaintiff. It required that communication be with Mr Ishak, its solicitor and that he would provide such authorisation.
- On 10 June Mr Ishak advised that the NRMA was not seeking title to the property and that its offer to Mr Deren was to resolve his claim.
- In July Mr Deren advised that he had sought legal advice.
- In October Mr Deren advised that he had refused NRMA's offer as inadequate to repair the property, which needed to be demolished and rebuilt.
- In October the plaintiff requested a copy of Mr Deren's insurance contract and sought a valuation of the property. It later proposed that Mr Deren accept the NRMA's offer; it would indemnify him for any loss on the loan; it would take possession; it would sell the property and refund any surplus to him. Mr Deren advised that he had a legal team on standby and that he was pursuing $330,000 from the NRMA, which he asked the plaintiff to convey to the NRMA.
- NRMA's solicitors advised the plaintiff that its offer would not be increased. Mr Deren was asked to reconsider his position. He declined.
Mr Deren's evidence was that he had sought legal advice because he was at his wits end, because the NRMA was refusing to settle without the plaintiff's authority and it was refusing to claim the money. That was not supported by the documentary evidence.
In March 2010 Mr Deren proposed to the plaintiff that the outstanding loan balance be settled by a payment of $250,000, at a time when he had received an offer to purchase the property for $270,000. In cross-examination Mr Deren explained that he had offered $250,000 so that he could use the balance to pay rates and legals, as he had then advised the plaintiff.
In re-examination Mr Deren explained that he had made every effort to have the plaintiff and the NRMA "put the insurance money against the house". He wanted to sell the house, but on a basis which left him able to walk away and start his life over.
His evidence in re-examination included:
"A. Yes, okay. On the 30th - or in March anyway I notified Secure Funding that an insurance claim was approved for repairs for the home and it was deemed as a cash settlement by the insurance company. Originally the insurance company was doing it as a repair. But their failure to make good the repair of the home first, before they made the pool a priority resulted in an electrical short in the home, following a fire.
Following that the cash settlement was forced upon me, requiring approval from Secure Funding to allow it to be finalised. Secure Funding told me, no, insufficient funds because they had both quotes from my builder and from the NRMA which was reduced by $50,000. Secure Funding blatantly said, no, insufficient funds to repair the home. We want the insurer to repair the home.
Wouldn't put it in writing for me, refused to put it in writing, so I could forward it back to the insurance company. So I then went on the attack against the insurance company, because they were failing to pay you direct, always insisting to pay me.
Where was I going with that?
So on 30 April I received the final acceptance by the insurance company, which was $199,000. I forwarded that to Secure Funding which showed all the terms and agreements as they requested, as is in their diary notes. Nothing was acted upon. Secure never rung me. They never rang NRMA. I did 80% of those calls to Secure, begging, begging for them to assist me.
I tried. I notified them, as I was required to under the contract. If an insurance claim is reduced by part or in full they were notified. It was partly reduced. Fine. Put it against me, do what you want. Help me to secure my home. I'm not in default. I was doing everything that I can. I was on a penalty loan, because I had just went through divorce. Your client was charging me high interest, which went well over 10%. It was at the time when interest rates were going through the roof."
Mr Deren also explained that at the time he made the offer of settlement for $250,000:
"Q. The third point, from my note, was the proposal of the settlement of $250,000 when the sale price was $270,000.
A. Yes, okay. The reason I made that claim with Secure Funding and offered them $250,000 and allowed me to walk with this insurance claim, because they denied me any right or any action by Secure Funding to instigate and finalise the insurance claim. So by that point I was forced into rental. I had two options; rent or live on the street and pay the mortgage.
It's my belief that Secure were just as responsible. They had an opportunity to say, yes, let's take the money and we'll sort the mortgage out after that. So I gave them an offer of $250,000 as full and final settlement because all that I had lost to that point of stage, because they should have accepted it much earlier and that was why I made the offer of $250,000. "
That offer was refused. The balance outstanding then exceeded that sum. This was at a time when Mr Deren was still negotiating a settlement with the NRMA over the $199,466.60 it had offered him. The plaintiff had no obligation to accept a loss of some $50,000 on what was then outstanding under the loan.
In April 2010 the NRMA again offered to make a payment of $193,083,31, but offered to pay that sum direct to the plaintiff. That offer was also not accepted.
In April 2010, he wrote to the plaintiff advising:
"I have attached your authority so you can talk with the NRMA solicitors and make a claim for the sum offered $193,083.31. This amount does not include funds or repairs to the faulty workmanship carried out by NRMA for the pool repairs. Council are looking at taking action for the state of the pool due to health risks.
After notifying the NRMA solicitor of this an attempted [sic] to have this included in their offer. I have reached a stalemate with them and give you the right to claims [sic] these funds so I can try and save the family home and with friends and family rebuild it.
If you have any questions please contact me, by saying that let me know you have received this email."
The document which he provided did not effect such authorisation. The evidence suggests that the plaintiff's position was then affected by the complaint Mr Deren was pursuing against it with the Credit Ombudsman's Service Limited and the result, that it could not then pursue its rights against him. It is difficult to criticise the plaintiff for the consequences of the actions which Mr Deren so pursued.
Mr Deren had also lodged a complaint about the NRMA with the Insurance Ombudsman.
At that stage, the NRMA was requiring Mr Deren to accept terms which he was still refusing, in relation to what he had published on his website. The offer which he received was not one which he was prepared at that time to accept. That NRMA would have accepted different terms if approached by the plaintiff, was not apparent.
On 21 April 2010 the plaintiff was advised that Mr Deren's position was that he was seeking to settle the payment of the outstanding loan for an even smaller amount, on the basis that:
- Liberty to accept the sum of $177,000 as full and final payment of the home loan and to discharge its mortgage over the security property following receipt of this sum; and
- Liberty to provide the Complainant with the authority required in order to claim the sum of $177,000 from NRMA and to have this sum remitted to Liberty.
This proposal was also not accepted by the plaintiff. Mr Deren's complaint to the Ombudsman did not finally succeed. He later advised the plaintiff that he considered the process to have been extremely biased.
Mr Deren deposed that he was advised by the NRMA's solicitor Mr Ishak in May 2010, that the plaintiff had made attempts to use clause 5.1 of the mortgage "to take over as power of attorney and basically undermined the process of COSL". On 17 May 2010, Mr Deren gave the NRMA a written notice rescinding his prior authority that it could communicate direct with the plaintiff. There was at that time still an ongoing disagreement between the NRMA and Mr Deren about the website on which he had made disparaging remarks about the NRMA.
In May Mr Deren offered to accept some $205,000 from the NRMA. A sum of some $203.083.31 was later agreed. In June the NRMA's solicitor wrote to the plaintiff enclosing a draft Deed of Settlement, noting that it was also to be provided to Mr Deren.
The terms of the Deed were settled, accommodating changes Mr Deren required. It was executed by the plaintiff on 3 November and forwarded to the NRMA, which did not execute it until December. It provided for a payment of some $76,000 to be made to Mr Deren for contents and for $203.083.31 to be paid to the plaintiff. The Deed also required the plaintiff and Mr Deren to provide the NRMA with an executed direction to pay. Mr Deren did not authorise the NRMA to make that payment to the plaintiff. His dispute before the Ombudsman was then still proceeding. It eventually failed.
The plaintiff served another default notice in August 2011, which Mr Deren acknowledged by email and which his solicitor later also acknowledged in November. In cross-examination, he confirmed that he had received that notice. Still he did not authorise the NRMA to make payment to the plaintiff.
In March 2012 the plaintiff wrote to the NRMA seeking payment of the insurance money, exercising its power under the mortgage. In April, the NRMA wrote to Mr Deren, who did not authorise the payment. The sum outstanding under the loan then amounted to some $430,000. These proceedings were commenced in June, naming the NRMA as a party.
In August the NRMA declined to make the payment which the plaintiff sought.
Mr Deren sought to establish relevant delay by the correspondence in which the NRMA asked the plaintiff whether it was taking over his claim under clause 5.3 of the mortgage. As Mr Deren submitted, the plaintiff did not then advise either the NRMA or him that it had exercised that right. At that time he was actively opposing any payment being made to the plaintiff. Later, when it did seek to rely on its mortgage rights, he still opposed the payment being made to it, despite what had since been agreed in the Deed of Release.
Mr Deren led evidence that in October 2012 he received advice that his claim was hopeless. In November he authorised the NRMA to pay the sum agreed to the plaintiff. It was paid on 12 November 2012.
This evidence did not establish that either the delay in the settlement reached in 2010, or the further delay in the authorisation Mr Deren gave the NRMA only in November 2012 for the long agreed sum to be paid to the plaintiff was the result of actions it had taken. To the contrary, that delay was the result of various decisions which Mr Deren himself made, which proved to be to his considerable detriment.
Were the loan agreement and mortgage shown to be unconscionable?
Mr Deren explained in his submissions that he felt strongly that his contracts were totally unfair. While he was obliged to comply with their terms, the plaintiff ought to have had some responsibility, at an early stage, to accept the funds and mitigate its losses, given what it knew of his insurance claim.
That view was difficult to accept in the face of the evidence as to Mr Deren's own attitude, from the outset, to the amount of the offer which the NRMA had made to him and the terms on which it was made, neither of which were acceptable to him.
Mr Deren also explained that he considered that his dispute with the NRMA about non-disclosure of his allegations about it on his website to have involved him in a catch 22. That was difficult to understand, given that he was the author of the allegations, which he had published on his own website. That was not something which the plaintiff caused or for which it was shown to have had any responsibility.
Mr Deren submitted that the plaintiff ought to have taken over his claim and authorised the NRMA to make a payment to him, because then he would have been better off. Later, he explained that he considered it unfair that the plaintiff had tried to take payment from the NRMA, after he had taken the matter to the Ombudsman. That was at a time when the amount the NRMA was to pay under the policy had been agreed and when it would have been to his obvious interest to have the amount paid, so that the arrears of the loan could be reduced, rather than continuing to attract interest. It was within Mr Deren's hands to authorise that payment, but he refused to do so. The plaintiff cannot justly be held responsible for the consequences of his own actions.
Mr Deren explained that the final increase of $10,000 in the NRMA's offer reflected a payment for damage to the pool and that at that time, he wanted the funds to placed in a trust fund, rather than remaining with the NRMA, because he could not get the plaintiff to accept the funds. The evidence established that this was not what happened.
These confusing and seemingly contradictory submissions were simply not made out on the documents in evidence.
The evidence shows that the unfortunate position in which Mr Deren now finds himself is the result of his own refusal of offers which both the NRMA and the plaintiff made to him, at various times, offers which would have left him much better off than he is now, had he accepted them.
With the benefit of hindsight he ascribes blame to others for his refusal of offers which he was, at the time they were made, not prepared to accept, being intent on the pursuit of higher amounts and/or different terms than those available to him, or which he finally accepted. That was why at some points he sought the plaintiff's assistance, assistance which at various points it sought to provide him, even at one point offering to indemnify him for any loss on the loan, take possession, sell the property and refund any surplus to him, if he accepted NRMA's offer.
He was not prepared to do so. Mr Deren's current position is the result of various problems he had to deal with and how he approached them. His refusal of the various offers which he received from the NRMA; his complaints against the NRMA and the plaintiff and their resolution; his refusal of the plaintiff's offer; and his refusal to authorise the NRMA to pay the agreed sum to the plaintiff as the deed which the parties executed in 2010 contemplated, have all led him to the situation which he is now in.
It would have been to his considerable advantage if he had taken a different course, as the legal advice he received in 2012 revealed. It was only then that he authorised the NRMA to make the agreed payment to the plaintiff. The result was that from the time of the execution of the deed to the time of the NRMA's payment of the agreed sum, a period of some two years had elapsed, during which considerable interest unnecessarily accrued.
These decisions have had very adverse consequences for Mr Deren, for which the plaintiff cannot justly now be held responsible. Mr Deren has not proven that the plaintiff's conduct was unconscionable, warranting him being relieved of his obligations under the loan and mortgage.
Mr Deren finally explained that his case was that on 30 April 2008 the plaintiff should have accepted the NRMA's offer and applied it to his mortgage, reducing it to $52,000. He would then have had 26 weeks of paid rental from the NRMA and excess income to repair his home and make it liveable, so that he could have returned to live in the house. The result would have been that he could have repaid the mortgage within two years, eight months. In the circumstances the plaintiff had no right to the possession which it sought and he owed it nothing under the loan.
Mr Deren submitted that the plaintiff's conduct in refusing that offer would be found to have been unfair, as well as the contractual terms which permitted it to pursue that conduct and that its claim for possession should accordingly be dismissed.
The problem with the case so advanced is that the evidence does not establish that the plaintiff received any offer in 2008 which it could have accepted, let alone an offer in such terms.
Conclusion
The plaintiff has made out its case. Its rights under the loan and agreement and the mortgage are clear. The loan is in default. It has not been shown that the delays in payment of the insurance moneys to the plaintiff were the result of its unconscionable conduct or any unfairness in the parties' contracts. Mr Deren has not made out his case and his cross-claim must be dismissed and the orders sought by the plaintiff must be made.
The usual order as to costs is that they follow the event. In the statement of claim that plaintiff sought an order that the first defendant is to pay the plaintiff's costs of the proceedings. Unless the parties approach within 14 days, that will be the Court's order.
Orders
For those reasons, I order:
1. The plaintiff have possession of the whole of the land described in Certificate of Title Folio Identifier Lot 381 in Deposited Plan XXXXX X, the postal address of which is XX XXXXX XXX Road, Morisset Park NSW 2264 (Land).
2. The plaintiff have leave to issue a writ for possession over the Land immediately.
3. Judgment be entered against the first defendant in the amount of $296,061.23 being the amount owing under the Loan as at 13 December 2013.
4. Interest on the judgment amount calculated at the rate or rates applicable under the Loan and Mortgage from 13 December 2013.
5. The first defendant pay the plaintiffs fees and charges in accordance with the Loan and Mortgage.
6. Declare that the plaintiff is entitled to any insurance proceeds in relation to any contract of insurance between the first defendant and the second defendant.
7. The first defendant's cross-claim is dismissed.
8. All exhibits and subpoenaed material may be returned forthwith; any exhibits returned must be retained intact by the party or person that produced the material until the expiry of the time to file an appeal, or until any appeal has been determined.
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Decision last updated: 28 March 2014
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