Bridgecorp Limited v Raju HC Auckland CIV-2006-404-5664

[2007] NZHC 1618

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2006-404-5664

BETWEEN  BRIDGECORP LIMITED Plaintiff

AND  KIRTI RAJU Defendant

Hearing:         15 February 2007

Appearances: M.C. Frogley for Plaintiff

Defendant K. Raju in person

Judgment:      15 February 2007

ORAL JUDGMENT OF ASSOCIATE JUDGE D.I. GENDALL

[1]      Before me is an application for summary judgment by the plaintiff against the defendant.   It relates to loan advances made by the plaintiff to the defendant and secured by her granting a first mortgage to the plaintiff over a property she owned at

38A and 38B Miranda Street, Auckland.

[2]      The financial accommodation under the loan agreement related to advances up to a maximum amount of $525,000.00, and interest thereon at 14% per annum, with a default interest rate of 24% per annum.

[3]      Default occurred under the term loan agreement and mortgage, and ultimately a mortgagee sale of the property occurred.

[4]      A shortfall on the mortgagee sale occurred.  This proceeding is an action by the  plaintiff to  recover  the  shortfall,  together  with  interest  and  costs,  from  the plaintiff.

BRIDGECORP LIMITED V K.RAJU HC AK CIV-2006-404-5664  15 February 2007

[5]      There is no formal Notice of Opposition or any supporting material filed by the defendant to the plaintiff’s summary judgment application.

[6]      Instead she has provided to the Court and to the plaintiff a letter filed on 7

February 2007 which sets out certain matters.

[7]      Effectively  the  summary  judgment  application  is  not  opposed  by  the defendant in her letter.  She does raise issues concerning her ability to meet the debt shortfall,  but these are not  matters for  consideration on this summary judgment application.

[8]      It is clear that the defendant accepts she signed the term loan agreement, that it was extended at a later time, there was default under the agreement, she received notice of this default and the default remains unremedied.

[9]      It seems from a comment in her letter that she does endeavour to make some complaint that the plaintiff in carrying out a mortgagee sale of her property did not proceed to subdivide the property into two titles.

[10]     Apparently  a  second  dwelling  was  in  the  course  of  construction  on  the property, but  it  was incomplete and no  code of compliance certificate had been issued.

[11]     As a result, it appears the plaintiff made a commercial decision to sell the property in one title, and did so through a tender process through a reputable firm of real estate agents.

[12]     In  terms  of the  decisions  Countrywide  Banking  Corporation  v  Robinson

[1991] 1 NZLR 75 (CA) and Apple Fields Limited v Damesh Holdings Ltd [2001] 2

NZLR 586 (CA), there is little doubt that a mortgagee is entitled to decide in its own interest  at which time, and indeed if,  it  wishes to  sell a property subject  to  its mortgage,  and that  there  is  no  further  requirement  on  a  mortgagee  to  effect  a subdivision.

[13]     Under all the circumstances here, I am satisfied that there is little defence available to the defendant to the plaintiff’s present summary judgment application. Indeed, the defendant herself before me today, to her credit, acknowledged that she had no effective defence.

[14]     That said, the plaintiff’s application succeeds.

[15]     Summary  judgment  is  granted  to  the  plaintiff  against  the  defendant  as follows:

a)

The amount claimed in the

Statement of Claim

$438,629.11

b)

Interest at 24% per annum from

23 August 2006to 15 February 2007

(176 days at $288.41 per day)

$  50,760.16

$489,389.27

[16]     In addition, the plaintiff is entitled to costs on a 2B basis which are calculated at $5,760.00, together with disbursements totalling $1,322.00.

Associate Judge D.I. Gendall