Secure Funding v Patane

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.