Secure Funding Pty Ltd v Gill
[2016] WASC 382
•22 NOVEMBER 2016
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: SECURE FUNDING PTY LTD -v- GILL [2016] WASC 382
CORAM: ACTING MASTER STRK
HEARD: 15 NOVEMBER 2016
DELIVERED : 22 NOVEMBER 2016
FILE NO/S: CIV 1804 of 2015
BETWEEN: SECURE FUNDING PTY LTD
Plaintiff
AND
ALAN DAVID GILL
JOAN EVA GILL
Defendants
Catchwords:
Summary judgment - Application for judgment against first defendant only - Turns on own facts
Legislation:
Nil
Result:
Judgment granted
Category: B
Representation:
Counsel:
Plaintiff: Ms K L Link
Defendants: In person
Solicitors:
Plaintiff: Norton Rose Fulbright Australia
Defendants: In person
Case(s) referred to in judgment(s):
Nil
ACTING MASTER STRK: By an application dated 15 August 2016, the plaintiff (Secure Funding) seeks leave to enter summary judgment against the first named defendant (Mr Gill).
Background
Secure Funding carries on the business of providing finance. Mr Gill and the second named defendant (Ms Gill) are related. Ms Gill is the mother of Mr Gill.
Secured Funding says that:
(a)on or about 15 June 2007, Mr and Ms Gill entered into a loan contract with Secure Funding by executing a document entitled 'Investment loan agreement (variable rate) schedule Account No 1276402' (Loan Agreement);
(b)the Loan Agreement expressly incorporated the terms and conditions contained in the 'Investment loan agreement Standard Terms and Conditions' provided by Secure Funding to Mr and Ms Gill (Terms and Conditions);[1]
(c)pursuant to the Loan Agreement, Secure Funding advanced $657,000 to Mr and Ms Gill (the Loan); and
(d)by a mortgage dated 17 July 2007 (Mortgage), Mr and Ms Gill mortgaged a property known as 39 Atkinson Way, Karratha Western Australia (Mortgaged Property), in favour of Secure Funding as security for repayment of the Loan.
[1] The affidavit of Joe George Mercieca sworn 15 August 2016 (First Mercieca Affidavit), attached a copy of the Terms and Conditions at 'JGM‑2'. In his affidavit sworn on 4 October 2016 (Gill Affidavit), Mr Gill says that a different version of the Terms and Conditions are applicable, being version '1‑BBB‑Nov06'. By his second affidavit sworn 14 October 2016 (Second Mercieca Affidavit), Mr Mercieca annexes a copy of version 1‑BBB‑Nov06' of the Terms and Conditions [4], and 'JGM‑2'. Secure Funding say that there are no material differences between the two versions of the Terms and Conditions and for the purpose of the summary judgment application, Secured Funding is prepared to accept that the version 1-BBB-Nov06' of the Terms and Conditions applies.
The Loan Agreement provides, among other things, that:
(a)Mr and Ms Gill would make 60 interest only monthly payments to Secure Funding of $4,292.40 followed by 300 principal and interest payments of $5,001.38;[2]
(b)Mr and Ms Gill would pay Secure Funding's fees and charges, interest charges, and any enforcement expenses;[3]
(c) in the event of a default in payment of an instalment, Secure Funding may give Mr and Ms Gill a notice stating that they are in default, and if the default is not corrected in the notice period, then at the end of the period and without further notice to them, the 'total amount owing' under the Loan Agreement becomes immediately due for payment. Secure Funding may then sue for that amount, or enforce any security, or do both.[4]
[2] Affidavit of Joe George Mercieca sworn 15 August 2016, 'JGM‑1'.
[3] Affidavit of Joe George Mercieca sworn 14 October 2016, 'JGM‑2', cl 4.1.
[4] Affidavit of Joe George Mercieca sworn 14 October 2016, 'JGM-2', cl 7.2.
Secure Funding says that in breach of the Loan Agreement and the Mortgage, Mr and Ms Gill failed to make monthly payments to Secure Funding as and when they fell due (the Default). Further, a notice of default was served on each of Mr and Ms Gill on or about 24 April 2015, but the Default was not remedied.[5]
[5] Affidavit of Joe George Mercieca sworn 15 August 2016 [14] ‑ [17], 'JGM‑6', 'JGM‑7'.
By proceedings commenced on 28 May 2015, Secure Funding claimed against each of Mr and Ms Gill payment of the sum of $656,949.27, interest and costs, together with orders for possession of the Mortgaged Property.
Defences filed
A defence was filed by Mr Gill on 23 October 2015. He is not represented in the proceedings. Mr Gill raised a number of matters in his defence, some of which concerned the reasons why he says his mother ought not have judgment entered against her in these proceedings.
A defence was filed by Ms Gill on 26 October 2015. While it appears that she is not represented in the proceedings, the defence filed by Ms Gill was prepared by a solicitor.
Mortgaged Property sold
It appears from the papers filed by the parties in the proceedings that:
(a)neither Mr nor Ms Gill resided in the Mortgaged Property. Rather, it was rented from time to time;
(b)when vacated, Secure Funding took possession of the Mortgage Property;
(c)the Mortgaged Property was sold on 6 November 2015 by Secure Funding, asserting what it says were its rights under the Mortgage; and
(d)the proceeds of sale were applied to the amounts said to be due and owing under the Loan Agreement and the Mortgage.[6]
[6] Affidavit of Joe George Mercieca sworn on 15 August 2016 [19].
Amounts alleged to be due and owing
Secure Funding relies on its records which state that:
(a)the amount advanced by Secure Funding to Mr and Ms Gill on 17 July 2007 was $657,000;
(b)the amount of repayments made by Mr and Ms Gill as at that date was $943,829.36;
(c)the amount of interest or instalments in arrears as at the date of issue of the writ (being 28 May 2015) was $26,705.74, and as at 15 August 2015 was $196,115.68;
(d)the total amount remaining due and owing under the Loan Agreement and the Mortgage as at 15 August 2016 was $196,115.68; and
(e)Secure Funding is claiming interest at the rate of 6% per annum pursuant to s 32 of the Supreme Court Act 1935 (WA) on the amount due under the Loan Agreement and the Mortgage, being $32.24 per day until the date of payment.[7]
[7] The affidavit of Joe George Mercieca sworn on 15 August 2016.
As at 15 November 2016 (the hearing of the summary judgment application), the solicitors for Secure Funding certified that as at that date, Mr Gill was indebted to Secure Funding in the sum of $206,066.83.
The position taken in relation to Ms Gill
In the defence filed on behalf of Ms Gill in the proceedings, the circumstances which she says surrounded her entry into the Loan Agreement and the Mortgage are explained. She says that in all of the circumstances, her entry into the Loan Agreement and the Mortgage arose by virtue of Secure Funding or its agents engaging in unconscionable conduct and misleading or deceptive conduct.
By the application for summary judgment, Secure Funding elects not to pursue any relief against Ms Gill.
Prima facie case established
From the affidavits filed by Secured Funding, I am satisfied that the claim against Mr Gill is a good one and that the affidavits do verify the essential elements of the cause of action upon which the application for summary judgment is based.
Once Secure Funding has established a prima facie case the evidentiary onus shifts to Mr Gill to demonstrate that there is an arguable defence or other reason for trial.
Opposition to summary judgment
Mr Gill does not dispute that he and Ms Gill were in default of the Loan Agreement. Relevantly, he says:
I do not deny that mortgage payments were missed and we were in default of the loan agreement, but every effort was being made to rectify that situation. Some incidents had occurred that was beyond my control.[8]
[8] Affidavit of Alan David Gill sworn 4 October 2016 [6].
Mr Gill raises a number of matters upon which he relies so as to resist summary judgment. The matters raised are conveniently summarised at [20] of the Secured Funding's outline of submissions in support of application for summary judgment dated 25 October 2016, as follows:
20.The matters raised by the first named defendant in opposition to the application can be summarised as follows:
(a)the plaintiff engaged in unconscionable conduct in relation to its dealings with the second named defendant;
(b)a broker mislead the defendants by stating that the Property could be sold in the event the defendants faced financial difficulties;
(c)the second named defendant did not understand the nature of the Loan Agreement and did not seek independent legal advice;
(d)the value of the Property had fallen such that it was below the value of the amount outstanding to the plaintiff;
(e)the plaintiff failed to seek top-up security in respect of the shortfall between the outstanding amount and the value of the Property;
(f)the Property was damaged and the tenants failed to pay rent when due;
(g)the plaintiff improperly charged valuation fees; and
(h)the defendants were not offered a hardship arrangement by the plaintiff.
Having had regard to the pleadings and to all of the affidavit evidence filed in the proceeding, and having considered each of the matters raised by Mr Gill in turn, and in particular, having carefully considered the Gill Affidavit, I find that Mr Gill has no arguable defence, and there is no other reason for trial.
Delay - leave to apply for summary judgment
Secure Funding requires leave to apply for summary judgment by reason of its delay. The reasons for the delay in applying for summary judgment are set out in the First Mercieca Affidavit.
In short, Secure Funding says that in order to avoid unnecessary costs, it sought to sell the Mortgaged Property and apply the proceeds of sale to the total amount outstanding before deciding whether to make an application for summary judgment.[9]
[9] Affidavit of Joe George Mercieca sworn 14 October 2016 [4(iii)].
The Mortgaged Property was sold on 6 November 2015, but the proceeds of sale did not satisfy the whole of the debt due to it.
In July 2016, Secure Funding determined to seek summary judgment in relation to the remaining debt and in July 2016, its solicitors attempted to confer with Mr and Ms Gill in relation to a possible settlement.[10]
[10] Affidavit of Joe George Mercieca sworn 14 October 2016 [4(v)], [4(vi)].
Had the application for summary judgment been filed in November 2015 (immediately following at the sale of the Mortgaged Property), leave to bring the summary judgment application would have been required in any event. I also note that there is no evidence of any particular prejudice to Mr Gill resulting from the delay. In the circumstances, although the delay is not adequately explained, the delay is not fatal to Secure Funding's application for summary judgment.
Determination
In all of the circumstances, I am satisfied that Mr Gill has no defence to the claim and that Secure Funding is entitled to leave and judgment.
As to the question of costs, an unjustified delay in bringing the application for summary judgment may deprive the applicant of some of its costs. However, in circumstances where there is no evidence of any particular prejudice resulting from the delay in bringing the application, I do not propose to make an order depriving Secure Funding of its entitlement to its costs on judgment. Secure Funding is entitled to its costs, paid on a solicitor and own client basis by operation of cl 8.1(c) of the Terms and Conditions.
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