Watts v Adelaide Bank Limited

FEDERAL COURT OF AUSTRALIA

Watts v Adelaide Bank Limited [2009] FCA 420

Brunninghausen v Glavanics [1998] FCA 230
Killoran v Duncan, in the matter of Killoran [1999] FCA 1574

BHOJI WATTS AND GAMBHIR WATTS v ADELAIDE BANK LIMITED

NSD 1945 of 2008

BUCHANAN J
29 APRIL 2009
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1945 of 2008

BETWEEN: BHOJI WATTS AND GAMBHIR WATTS
Applicant

AND: ADELAIDE BANK LIMITED
Respondent

JUDGE:	BUCHANAN J
DATE OF ORDER:	29 APRIL 2009
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The application to set aside bankruptcy notice No NN 4517/08 is dismissed with costs.

2.Time to comply with the bankruptcy notice is extended to 8 May 2009.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

The text of entered orders can be located using eSearch on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1945 of 2008

BETWEEN: BHOJI WATTS AND GAMBHIR WATTS
Applicant

AND: ADELAIDE BANK LIMITED
Respondent

JUDGE:	BUCHANAN J
DATE:	29 APRIL 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

BUCHANAN J:

1. This judgment deals with an application to set aside a bankruptcy notice in the amount of $64,561.19 which was served on the applicants on 26 November 2008 and 5 December 2008 respectively.  The bankruptcy notice was founded on a judgment of the Supreme Court of NSW entered on 3 April 2006.

2. The basic facts are not in dispute although the parties differ on the significance to be accorded to them.  They were set out in an affidavit affirmed by Robyn Clay on 17 March 2009 which was filed by the respondent.  The respondent made two loans to BMG Poseidon Corp Pty Limited (“BMG”).  The loans were made pursuant to loan agreements executed on 11 February 2004 and 30 June 2004 respectively.  The loans were secured by a first registered mortgage granted by BMG in favour of the respondent over a property at 68 Lyons Road, Drummoyne, New South Wales.  Each loan was also secured by a guarantee and indemnity from the applicants executed on 19 February 2004 and 6 July 2004 respectively. 

3. BMG defaulted under each of the loan agreements in 2005.  On 11 May 2005 BMG was served with a default notice but failed to remedy the default thereby notified.  On 6 July 2005 the respondent called on the guarantees and indemnities.  The applicants failed to comply.  The applicants say that the respondent acted unreasonably in calling in the loans and calling on the guarantees and indemnities.

4. On 22 July 2005 proceedings were commenced in the Supreme Court of New South Wales for debt and for possession of the property.  The proceedings were taken against BMG and the applicants.  On 24 March 2006 the respondent filed for default judgment and on 3 April 2006 judgment was entered in favour of the respondent granting possession of the property to the respondent and ordering BMG and the applicants to pay the respondent…