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Secure Funding v Patane

Secure Funding v Patane

Case [2009] NSWSC 845 25 August 2009

Mortgages & Security Interests

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CITATION: Secure Funding v Patane [2009] NSWSC 845

HEARING DATE(S): 14 August 2009

JUDGMENT DATE :
25 August 2009

JURISDICTION: Common Law

JUDGMENT OF: Harrison AsJ

DECISION: (1) The notice of motion filed 7 April 2009 is dismissed.
(2) The defendants are to pay the plaintiff's costs as agreed or assessed.

CATCHWORDS: MORTGAGES - mortgages and charges generally - rights and liabilities of mortgagor and mortgagee - mortgagor sought orders pursuant to s 73 Civil Procedure Act 2005 to dismiss proceedings and set aside default judgment for possession – mortgagor sought leave to file defence pursuant to r 36.16 of the Uniform Civil Procedure Rules 2005– proposed defence shows no viable grounds of defence - application dismissed - construction of the mortgage – whether loan agreement clearly acknowledged the registered mortgage – CONTRACTS - general contractual principles - illegal and void contracts - whether default rate of interest and administration fees are penalties – four per cent penalty rate not out of proportion - whether mortgagor’s delayed payment of lesser sum than the debt falls within the de minimis exception

LEGISLATION CITED: Civil Procedure Act 2005
Uniform Civil Procedure Rules 2005

CATEGORY: Principal judgment

CASES CITED: Acron Pacific Ltd v Offshore Oil NL [1985] HCA 63; (1985) 157 CLR 514
AMEV-UDC Finance Ltd v Austin (1986) 162 CLR 170
Adams v Kennick Trading (International) Ltd & Ors (1986) 4 NSWLR 503
Bay Bon Investments Pty Ltd v Selvarajah [2008] NSWSC 125
Cohen v William (1995) 38 NSWLR 476
Cuttle v Brandt (1947) 64 WN (NSW) 96
David Securities Pty Ltd v Commonwealth Bank of Australia (1990) 23 FCR 1
Davies v Pagett (1986) 10 FCR 226
Hungerford v Walker (1989) CLR 125
Perpetual Trustees Victoria Ltd v English and Anor [2009] NSWSC 478
Perpetual Trustees Victoria Limited & Anor v Tsai [2004] NSWSC 745
Ringrow Pty Ltd v BP Australia Pty Ltd [200] HCA 71
Vacuum Oil Pty Limited v Stockdale (1942) 42 SR (NSW) 239

PARTIES: Secure Funding Pty Ltd ACN 081 982 872 (formerly Liberty Funding Pty Ltd) (Plaintiff)
Alfie Richard Patane (First Defendant)
Karen Jean Patane ( Second Defendant)

FILE NUMBER(S): SC 11368/2008

COUNSEL: A McManus (Solicitor for Plaintiff)
D Jenkins (Defendants)

SOLICITORS: Deacons (Plaintiff)
N/A (Defendants)

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IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
POSSESSION LIST

ASSOCIATE JUSTICE HARRISON

TUESDAY, 25 AUGUST 2009

11368/2008 - SECURE FUNDING PTY LTD

ACN 081 982 872 (formerly Liberty Funding Pty Ltd) v ALFIE RICHARD PATANE & ANOR

JUDGMENT (Set aside default judgment; file defence)

1 HER HONOUR: On 15 July 2008, default judgment was entered that the plaintiff Secure Funding Pty Ltd (“Secure Funding”) have possession of the whole of the land comprised in Certificate of Title Folio Identifier 157 in Deposited Plan 239144, the postal address of which is xxx xxxxxx xxxx, Bobs Farm, New South Wales (“the property”); judgment was entered that the first and second defendants, Alfie Richard Patane and Karen Jean Patane, pay to the plaintiff the sum…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Secure Funding v Patane

Details

AGLC: Secure Funding v Patane [2009] NSWSC 845
Case: [2009] NSWSC 845
Decision Date: 25 August 2009

CaseChat Overview and Summary

In Secure Funding v Patane, the respondent, Mr Patane, was a mortgagor in respect of a property which was subject to a mortgage held by the applicant, Secure Funding. Mr Patane sought orders under section 73 of the Civil Procedure Act 2005 to dismiss the proceedings and set aside a default judgment for possession. Additionally, he sought leave to file a defence under rule 36.16 of the Uniform Civil Procedure Rules 2005. The primary legal issues the court had to decide involved the construction of the mortgage, the enforceability of the interest rate and fees in the loan agreement, and whether the delay in payment by the mortgagor constituted a de minimis exception.

The court considered whether the loan agreement clearly acknowledged the registered mortgage and whether the default interest rate and administration fees were penalties. The court found that the four percent penalty rate was not disproportionate and that the mortgagor's delayed payment of a lesser sum than the debt did not fall within the de minimis exception. The proposed defence did not show any viable grounds, and the court dismissed the application for leave to file a defence. The court held that the four percent penalty rate was not out of proportion and that the mortgagor's delayed payment of a lesser sum than the debt did not constitute a de minimis exception.

The court dismissed the respondent's application to set aside the default judgment and granted leave to file a defence. The court found that the mortgage was valid and enforceable, and the interest rate and fees in the loan agreement were not penalties. The court further found that the mortgagor's delay in payment did not constitute a de minimis exception. The court held that the proposed defence did not show any viable grounds and dismissed the application. The court's decision was based on the clear terms of the mortgage and the enforceability of the interest rate and fees in the loan agreement. The court found that the four percent penalty rate was not disproportionate and that the mortgagor's delayed payment of a lesser sum than the debt did not fall within the de minimis exception.

Orders