Ahmad v National Bank of New Zealand HC Auckland CP167/01

[2001] NZHC 286

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY CP167/01

BETWEEN MOHAMMED SHAMEEN AHMAD, MOHAMMED AYUB AHMAD AND AJARA BIBI AHMAD
Plaintiffs

AND THE NATIONAL BANK OF NEW ZEALAND LIMITED
Defendant

Hearing: 18 April 2001

Counsel: J C La Hatte for Plaintiffs
P R Cogswell for Defendant

Date of Judgment: 18 April 2001

ORAL JUDGMENT OF RANDERSON J

[1] This application for interim injunction came before the Court this morning.

[2] The plaintiffs are the mortgagors of two properties at East Tamaki and Pakuranga. Approximately $500,000 is owed by them to the defendant mortgagee, the National Bank of New Zealand Ltd. There has been continuing default in terms of the mortgage since May last year due to cashflow difficulties which the plaintiffs have been experiencing. Notice has been given under s 92 of the Property Law Act 1952 and the Pakuranga property (owned by a guarantor), was sold at auction this morning for
$300,000. Settlement is due in May. Apparently one of the plaintiffs successfully bid for that property. The other property at East Tamaki is due for auction at 2 pm today.

[3] The plaintiffs have sworn an affidavit confirming that they are making arrangements to re-finance the mortgage with another bank but no decision has yet been made in that respect. Effectively, the plaintiffs are seeking a four week deferral of the sale of the remaining property to enable them to put the re-financing arrangements in place.

[4] The grounds of the application as filed were that the sale would result in a low value to the properties; that the plaintiffs would be able to re-finance in the four week period; that service of the notice under s 92 was defective; and finally, that the bank had not complied with a disclosure request under s 19 of the Credit Contracts Act 1981. Mr La Hatte has informed me this morning that he will not be pursuing the defective service point and that disclosure of the documents sought has been made by the bank today.

[5] There is no evidence to support the allegation that the sale will result in a low value to the properties. The ability or otherwise of the plaintiffs to re-finance during the four week period is not a ground upon which the Court could grant an interim injunction. There must be a reasonably arguable case that there is some invalidity in the steps now being taken by the bank to execute its powers under the mortgage.

[6] No grounds have been put before the Court which would warrant the grant of an interim injunction and it will be refused accordingly. The defendant is entitled to costs against the plaintiffs according to scale on a 2B basis.