Liberty Financial Limited v Toloke

[2022] NZHC 2791

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-2152

[2022] NZHC 2791

UNDER

the Property Law Act 2007

BETWEEN

LIBERTY FINANCIAL LIMITED

Plaintiff

AND

MELEANE FANGA PULOTU TOLOKE

and SOLOMONE LATU TOLOKE both of 33c Farquhar Road, Glendene, Auckland, as trustees of the Toloke Family Trust

First Defendants

MELEANE FANGA PULOTU TOLOKE
Second Defendant

SOLOMONE LATU TOLOKE

Third Defendant

Hearing:

27 October 2022

Appearances:

W Hofer for Plaintiff

No appearance by or on behalf of the Defendants

Judgment:

27 October 2022

JUDGMENT OF WOOLFORD J

(Summary Judgment and Order to Deliver Up Property)

Solicitors:           Tompkins Wake (JA MacGillivray and K Mills), Auckland Counsel:  Tompkins Wake (W Hofer), Auckland

LIBERTY FINANCIAL LIMITED v TOLOKE [2022] NZHC 2791 [27 October 2022]

[1]This is an application for summary judgment. The plaintiff lent $390,000 at

10.55 per cent per annum to the defendants by way of a first mortgage over the defendants’ home in Glendene. The loan was for six months. The defendants were to sell their house to their son so they could repay the debt. The defendants paid the full six months interest in advance by way of deduction from the loan monies. The sale has not materialised. The loan was extended at 12.05 per cent per annum, but subsequently has incurred default interest at 18.05 per cent per annum. The debt has increased significantly with default interest plus various other charges. The total owing is now over $600,000. The plaintiff seeks judgment and wishes to take possession of and sell the house.

Defendants’ opposition to application

[2]        By e-mail dated 10 March 2022, the defendants filed a document entitled “Memorandum of Defendants Submission of Defense” from which the grounds of opposition to the plaintiff’s summary judgment application can be gleaned. So they are:

(a)The plaintiff broke the rules set out in the Responsible Lending Code. The second and third defendants were recent bankrupts and on benefits when they borrowed $390,000 from the plaintiff.

(b)The defendants believe the mortgage broker was paid more than $250 set out in the plaintiff’s letter of formal approval of the loan.

(c)The broker and the plaintiff’s representative worked together to the defendants’ disadvantage as borrowers. They knew the defendants were vulnerable and played on their vulnerability.

(d)The defendants have made every effort to negotiate an acceptable outcome for all parties, but the plaintiff has refused to reduce monthly repayments or lengthen the term of the loan.

Evidence tendered by defendants

[3]        On 28 April 2022, the second defendant filed a document entitled “Memorandum of Defendants Affidavit”, which had been affirmed by her on 14 April 2022. It more or less repeats the substance of the “Memorandum of Defendants Submission of Defence”.

Defendants’ failure to file any further documentation

[4]        By minute dated 12 July 2022, Hinton J directed that the defendants were to file and serve any amended notice of opposition and any affidavits in support by     22 July 2022 and their submissions by 26 August 2022. These dates were later extended by Gordon J to 21 September 2022 and 14 October 2022. Nothing further has been filed.

[5]        On 25 October 2022, counsel for the defendants filed a memorandum in which he advised the Court that the position has now been reached where the defendants have elected not to file any further documents. Counsel is not instructed to bring any further applications seeking to hinder the plaintiff’s application and, accordingly, the defendants’ opposition to the plaintiff’s application is not to be advanced beyond the documents already filed by the defendants.

Discussion

[6]        Although the defendants have raised the issue of whether the plaintiff has complied with the Credit Contracts and Consumer Finance Act, and the Responsible Lending Code, including whether it followed the rules relating to lending to people under time or financial pressure, such allegations are at a high level of generality without any specifics.

[7]        The plaintiff considers it has complied with all aspects of the Responsible Lending Code. In a synopsis of submissions dated 12 May 2022, Mr Hofer, for the plaintiff, sets out in detail the procedures followed in advancing the loan to the defendants and submits that there has been no identifiable breach of either statute or code.

[8]        What the broker may have been paid or subsequent efforts to settle the claim also cannot have a bearing on this application for summary judgment.

[9]        Finally, the allegation that the broker and the plaintiff’s representative worked together to the defendants’ disadvantage is again at a level of generality, such that no account can be taken of such allegations without detailed and specific evidence. It has not been provided.

Result

[10]      The application is, in effect, now unopposed. I am satisfied on the affidavit evidence that the plaintiff is entitled to summary judgment. The defendants have not provided an evidential basis for any defence to the plaintiff’s claim.

[11]There will be the following orders:

(a)Judgment is entered against the defendants in the sum of $684,818.88. Post-judgment interest is also to be paid at the Expired Facility Interest Rate and the default interest rate pursuant to mortgage loan agreement and s 22 of the Interest on Money Claims Act 2016.

(b)The defendants are to deliver up possession of the property contained and described in Record of Title 655550 (North Auckland Registry), Lot 1 DP 475602, located at 33c Farquhar Road, Glendene, Auckland, and that any occupant of the property vacate it, within four weeks of today’s date.

[12]The judgment sum is made up as follows:

(a)Judgment for $511,617.36, being the amount owing under the mortgage loan agreement as at 15 October 2021, as set out at paragraph [13] of the statement of claim (and as shown in the account statement at   page 41 of Exhibit “A” annexed to the affidavit of Joe Mercieca;

(b)Interest in accordance with s 22 of the Interest on Money Claims Act 2016, at the plaintiff’s applicable interest rate in the sum of

$127,008.07, from 16 October 2021 to 27 October 2022, pursuant to paragraphs 5(d), 5(f), 5(n), 5(o) and 8 of the statement of claim and pursuant to the Loan Agreement and in particular the Expired Facility Interest Rate, being interest and default interest under the mortgage loan agreement on $511,617.36.

(c)Costs in the sum of $44,749.50 excluding GST, representing the plaintiff’s actual solicitor/client costs to August 2022, pursuant to paragraph 5(r) of the statement of claim; and

(d)Disbursements in the sum of $1,443.95, pursuant to paragraph 5(r) of the statement of claim.

Woolford J