Sutherland v Ghougassian (No 3) - [2012] NSWSC 334

Supreme Court

New South Wales

Medium Neutral Citation: Sutherland v Ghougassian & Ors (No. 3) [2012] NSWSC 334
Hearing dates: 30 March 2012
Decision date: 30 March 2012
Jurisdiction: Equity Division - Corporations List
Before: White J
Decision:
Direct the parties to provide a calculation in accordance with these reasons.

Catchwords:
MORTGAGE - mortgages and charges - calculation of interest on moneys secured by mortgage - amounts of advances and repayments allowed in the taking of accounts of the moneys owed - interest on advances to be calculated on compound basis at non-default rate of interest - consideration to the provision for profit
PRACTICE AND PROCEDURE - judgments and orders - rectification - orders not yet made in accordance with reasons given - matter relisted for further argument - neither party disputed reconsideration of questions
Cases Cited: Sutherland v Ghougassian & Ors [2012] NSWSC 125
Vartanians v St. Gregory's Armenian School Inc [2011] NSWSC 406
Category: Procedural and other rulings
Parties: Roderick Mackay Sutherland (as liquidator of St. Gregory's Armenian School Inc (in liquidation) - Applicant (2010/66795)
Michael Ghougassian - 1st Respondent
Daniel Ghougassian - 2nd Respondent
Nareg Internet Pty Limited - 3rd Respondent;
St. Gregory's Armenian School Inc - Applicant (2011/10869)
Daniel Ghougassian - 1st Respondent
Michael Ghougassian - 2nd Respondent
Norwest Legal Services Pty Limited - 3rd Respondent
Representation: Counsel:
J Taylor (Plaintiff)
J Loxton (Defendant)
Solicitors:
Addisons Lawyers (Applicants)
Robert Balzola & Associates (Respondents)
Matthews Dooley & Gibson (Norwest Legal)

File Number(s): 2010/66795; 2011/10869

Judgment

HIS HONOUR:In my reasons of 29 February 2012 (Sutherland v Ghougassian & Ors [2012] NSWSC 125) I stated my conclusions as to the amounts of advances and repayments that should be allowed in the taking of the account for the moneys owed by St. Gregory's Armenian School Inc (in liquidation) ("the School") to Mr Michael Ghougassian and Dr Daniel Ghougassian (at [78] and [95]) secured by the mortgage. I also said that the mortgage secured simple interest at the "Interest Rate" as defined in the Deed of Loan. I stood the proceedings over for the calculation of interest to be made.

On 14 March 2012 counsel for Dr and Mr Ghougassian sought to make a claim that interest should be calculated in accordance with clause 3.2 of the Deed of Loan. Counsel submitted that interest was payable without demand by monthly instalments on each Payment Date and that as interest had not been paid, compound interest at the default rates was payable under clause 3.2. At that time I said that it was too late for that contention to be raised, and I directed that the calculation be brought in on the basis of simple interest at the Interest Rate as defined in the Deed of Loan and not at the Default Interest Rate.

On 21 March 2012, at my request, my associate sent a note to counsel for the parties advising that I wished the matter to be relisted for further argument as to whether it…

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.

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Details

Case: [2012] NSWSC 334
Decision Date: 30 March 2012

CaseChat Overview and Summary

The dispute in this matter involved the calculation of interest on moneys secured by mortgage between the parties. The matter was before the Supreme Court of New South Wales, and the case was the third iteration in the ongoing dispute between the parties. The plaintiff, Sutherland, sought to have the interest on the mortgage calculated in a particular way, while the defendant, Ghougassian, disagreed with this approach. The court was required to determine the correct method of calculating the interest and whether the orders made were in accordance with the reasons given.

The legal issues before the court involved the interpretation of the mortgage and the calculation of interest on the sums owed. The court needed to consider the terms of the mortgage, the amount of advances and repayments, and the applicable rate of interest. The court also had to consider whether the interest should be calculated on a simple or compound basis and whether any consideration should be given to the provision for profit. The court needed to determine the correct approach to calculating the interest and whether the orders made were in accordance with the reasons given.

The court found that the interest on the mortgage should be calculated on a compound basis at the non-default rate of interest. The court also found that the provision for profit should not be considered in the calculation of interest. The court found that the orders made were not in accordance with the reasons given, and the matter was relisted for further argument. Neither party disputed the reconsideration of the questions.

The final orders of the court were not included in the text provided. However, it is likely that the court will make orders that reflect its findings on the calculation of interest and the provision for profit. The court may also make orders regarding the costs of the proceedings.

Orders