Supreme Court New South Wales Medium Neutral Citation: Secured Lending 1 Pty Ltd & Anor v Luvnlife Consulting Pty Ltd [2020] NSWSC 851 Hearing dates: 25 June 2020 Date of orders: 25 June 2020 Decision date: 25 June 2020 Jurisdiction: Common Law Before: Lonergan J Decision: (1) To the extent that there was an informal application raised by the defendant to have the mother of the director of the defendant, Ms Andrea Ruiz-Diaz, or Ms Athena Madormo represent her in these proceedings, the application is denied for the reasons I have outlined. (2) Judgment for the first and second plaintiffs for possession of the whole of the land comprised in folio identifier 4046/808215 being the land situated at and known as 410 Old Northern Road, Glenhaven in the State of New South Wales. (3) Leave to issue a writ of possession forthwith. (4) Costs in favour of the first and the second plaintiffs on an indemnity basis. Catchwords: CIVIL PROCEDURE — parties — representation — UCPR r 7.1(2)(a) — rules state that a company may carry on proceedings by a solicitor or a director of the company — issue of representation by unqualified persons — previous order of the Court as to representation by unqualified persons — consideration of whether it is appropriate for an unqualified person to appear on behalf of a litigant — present circumstances do not warrant the rules of the Court being dispensed with — informal application for representation by unqualified persons — application refused. MORTGAGES AND SECURITIES — mortgages — duties, rights and remedies of mortgagee — possession — deed of forbearance executed — consent judgment signed and annexed to the deed of forbearance — deed of forbearance entitles the plaintiff to file the consent judgment — deed of forbearance prevents the opposition of any judgment in favour of the plaintiffs Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW) Cases Cited: Secured Lending 1 Pty Ltd v Luvnlife Consulting Pty Ltd [2020] NSWSC 637 Secured Lending 1 Pty Ltd v Luvnlife Consulting Pty Ltd (No 2) [2020] NSWSC 729 Category: Procedural and other rulings Parties: Secured Lending 1 Pty Ltd (First Plaintiff) Longevity Property Pty Ltd (Second Plaintiff) Luvnlife Consulting Pty Ltd (Defendant) Representation: Counsel: A Djurdjevic (Plaintiffs) Solicitors: Summer Lawyers (Plaintiffs) No appearance (leave refused to allow mother of director of defendant or Ms Madormo to appear) File Number(s): 2019/138347 Publication restriction: Nil EX TEMPORE Judgment 1. The proceedings listed before me today are in the nature of a further hearing of the plaintiffs' notice of motion filed on 14 April 2020. These are proceedings commenced by statement of claim filed on 31 May 2018, seeking orders for possession of an identified piece of land in Glenhaven. 2. The history of the matter has been set out in the judgments of Ierace J of 27 May 2020 in Secured Lending 1 Pty Ltd v Luvnlife Consulting Pty Ltd [2020] NSWSC 637 and Cavanagh J on 11 June 2020 in Secured Lending 1 Pty Ltd v Luvnlife Consulting Pty Ltd (No 2) [2020] NSWSC 729. 3. The statement of claim was personally served on the director and secretary of the defendant company on 18 May 2019. No defence was filed. On 5 June 2019 the plaintiffs appointed receivers and managers, and after that a Deed of Forbearance was entered into with Ms Stephanie Ruiz-Diaz as guarantor. It seems that the Deed made some provision for the manner in which the defendant could satisfy the debt, and a Consent Judgment was signed by Ms Ruiz-Diaz annexed to the Deed dated 13 June 2019. 4. It seems that then due to lack of activity before the Court, the matter was dismissed by the Court's own motion. An application made by the plaintiffs by notice of motion filed 14 April 2020 sought, as its first order, restoration of the matter to the list pursuant to Pt 36 r 16(2)(b) of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"). 5. Ierace J on 27 May 2020 made orders setting aside the dismissal of the proceedings that had been ordered on 6 February 2020, and by virtue of that order, the matter is now back in the active list. 6. Cavanagh J then dealt with the matter on 11 June 2020 and formed the view that in addition to refusing permission for Ms Madormo to appear on behalf of the defendant, there should be an adjournment to allow the defendant to obtain representation and file some evidence. 7. The matter came before me on 19 June 2020 as Duty Judge. On that day, due to other urgent matters, this matter was only able to be dealt with at 4:00pm. I made various orders, including standing the plaintiffs' notice of motion over to today for it to be heard in respect of the second order, which is in effect an order for judgment for the plaintiffs for possession of the land, and costs. 8. Given that the matter had to be adjourned, I formed the view that despite the fact that the defendant has had a number of opportunities to file and serve evidence, I should provide one last opportunity. To that end, I made an order permitting the defendant to serve any evidence upon which she wished to rely on behalf of the defendant company, of which she is the director, by 1:00pm, Wednesday, 24 June 2020. I also, in response to an issue raised about Ms Stephanie Ruiz-Diaz's asserted health, ordered that any evidence that she wished to rely upon addressing her ability to appear and respond to the matters raised, must also be filed and served by 1:00pm, Wednesday, 24 June 2020. 9. What was filed was a very short report from a Dr Josephine Terry, who describes herself as a clinical psychologist, stating that Stephanie Ruiz-Diaz has "reported significant emotional distress in response to being asked to attend an upcoming court hearing", and "confirming that Stephanie Ruiz-Diaz had attended five sessions of psychotherapy for support with anxiety and stress. Her treatment is ongoing". 10. Unfortunately, despite the order requiring that medical evidence be filed and served, it was not served on Summer Lawyers and there is no evidence before me that it was. 11. Mr Djurdjevic of counsel appeared for the plaintiffs. I accept his advice that the report was not served. In any event it is my view that the report is not sufficient to evidence why the defendant is unable to appear by telephone today to assist the Court. In addition Mr Djurdjevic raised some difficulties with the defendant not being represented today by either Stephanie Ruiz-Diaz as the director of the defendant company, or by a solicitor. 12. Rule 7.1(2)(a) of the UCPR states that "a company within the meaning of the Corporations Act 2001 of the Commonwealth may commence and carry on proceedings in any court by a solicitor or by a director of the company". 13. Subrule (3) provides that, "in cases of proceedings in the Supreme Court, subrule 2(a) authorises a company to commence proceedings by a director only if the director is also a plaintiff in the proceedings". 14. The rule makes it clear that only a solicitor or a director of the company may carry on proceedings. 15. I also embrace the reasons set out by Cavanagh J at [22]-[23] as to the circumstances in which it may be appropriate for a non-lawyer to appear on behalf of a litigant, as well as the reasons why often it is not. 16. As noted by Cavanagh J, "the Court may dispense with any requirement of the rules of the Court if satisfied that it is appropriate to do so in the circumstances of a particular case but I am not satisfied that this case is one where it is appropriate to do so". I agree. 17. I also note that a Ms Madormo interrupted and interfered with the processes of the Court whilst Cavanagh J was dealing with this matter on 11 June 2020, to the extent it seems that the matter could not continue to a conclusion. 18. I note that today Ms Madormo again attempted to shout across statements of the Court and submissions of Mr Djurdjevic in a way that I considered not to be constructive or helpful in circumstances where it has been made crystal clear to Ms Madormo that she has not been given leave to appear on behalf of the defendant or to take any active role in these proceedings. Order regarding the issue of representation 1. To the extent that an informal application has been raised seeking leave for the defendant to be represented by the mother of the director of the defendant, Mrs Andrea Ruiz-Diaz, or Ms Madormo, that application is denied for the reasons that I have outlined. Facts relevant to order for leave to issue a writ of possession 1. In support of the writ for possession, Mr Djurdjevic read the affidavits of Russell Grant Nevell affirmed 9 April 2020, 22 May 2020, 26 May 2020, 29 May 2020 and 24 June 2020. 2. On behalf of the defendant, a bundle of largely incomprehensible material was emailed to these chambers late yesterday at around 7:00pm. The material purported to be an affidavit of a Ms Madormo who appears to continue to proceed on the basis that she has some status to speak for the defendant, despite a specific decision to the contrary by Cavanagh J and statements to the same effect by me on 19 June 2020 when the defendant's director was represented by her mother, with Ms Madormo occasionally interrupting. 3. The material was not filed in compliance with the orders made on 19 June 2020. There had already been a breach of orders that required material to be filed and served by 9 June 2020. It was made clear at the directions hearing on 19 June 2020 that the material was due by 1:00pm on 24 June 2020 and that no further extensions would be granted. 4. Leave was not granted to file the material late. The material was rejected and was not read on the application. 5. The matter thus proceeded for determination based on the material tendered on behalf of the plaintiffs. 6. The Court may, if satisfied that all relevant parties have been notified, give judgment or order that judgment be entered in the terms of an agreement between parties in relation to proceedings between them, UCPR r 36.1A: Part 36 Judgments and orders 36.1A Consent orders (1) The court may, if satisfied that all relevant parties have been notified, give judgment, or order that judgment be entered, in the terms of an agreement between parties in relation to proceedings between them. ….. 1. The parties entered into a Deed of Forbearance in 2019 to which a Consent Judgment was annexed. 2. The Forbearance Deed expressly provides in the "Background", page 1 at G: "…This deed sets out the terms upon which the Lender(s) agrees to forbear from its Enforcement Action against the Debtor(s)". 1. The Consent Judgment was signed by the director of the defendant, Stephanie Ruiz-Diaz, consenting to the orders sought in the statement of claim if there was a fresh event of default. 2. On 20 September 2019, the then solicitors for the defendant and its director, Stephanie Ruiz-Diaz, requested a three month extension of the forbearance period. 3. On 25 September 2019 the plaintiffs agreed to the request for an extension of the forbearance period, subject to certain terms which included that the defendant and the director agreed to pay interest on the secured monies in the sum of $12,495.57 on the 28th of each month, starting 28 September 2019. This was referred to as the "Extension Agreement". 4. Contrary to the terms of the Deed, as varied by the Extension Agreement, the defendant failed to pay interest on the secured monies on 28 November 2019 and 28 December 2019. 5. Each of those failures constituted a fresh event of default that had the effect of ending the plaintiffs' forbearance under the Deed, Clause 3. 6. Clause 3 provided for consequences of a fresh event of default as follows: "In the event that a Fresh Default Event occurs the Debtor(s) acknowledge and agree that if the Debtor(s) defaults with its obligations under this Deed, the Debtor(s) acknowledge and agree that: (a) The forbearance by the Lender(s) under this Deed will immediately end; (b) If any consent judgment has been provided by any or all of the Debtor(s) to be held by the Lender(s) in escrow pending the end of the Forbearance Period, the Lender(s) may, without further notice, file that consent judgment; (c) the Debtor(s) will immediately deliver up possession of any of the Securities to the Lender(s) or any Controller appointed by the Lender(s) upon 14 days written demand; and (d) The Lender(s) will be at liberty to immediately commence any enforcement action, without limitation and in its sole discretion, for the recovery of the Secured Monies without notice to the Debtor(s) including, but not limited to, securing possession of any or all of its Securities for sale by the Lender(s) or any Controller appointed by the Lender(s); (e) the Debtor(s) will not take any step whatsoever, whether directly or indirectly to frustrate or delay the Lender(s) or any Controller appointed by the Lender(s) (whether by its agents or Authorised Officers) in exercising any of its rights, including enforcement rights, under the Security Documents, this Deed and at law; (f) The Debtor(s) will not take any steps to defend or oppose any proceedings or claim which the Lender(s) may choose to take against the Debtor(s), including but not limited to any one of more of the following steps: (a) filing a defence or cross claim in any proceedings brought by the Lender(s) which involve the Debtor(s); (b) not consenting to or otherwise opposing any judgment in favour of the Lender(s) in any proceedings; or (c) applying to set aside any judgment in favour of the Lender(s); (d) applying to seek a stay of eviction in any enforcement of any Land by the Lender(s); and (e) the Debtor(s) will not seek to oppose or obstruct any creditors' petition or bankruptcy proceedings or any winding-up application against the Debtor(s) by the Lender(s)". 1. The plaintiffs without further notice to the defendant, became entitled to file the Consent Judgment: Clause 3(b). 2. The defendant and director cannot oppose any judgment in favour of the plaintiffs: Clause 3(f)(b). 3. The debt the defendant owes to the plaintiffs is approximately $720,037.31. Decision 1. In all the circumstances, I am satisfied that the order for possession should be made. The costs outcome is provided for in the Deed and so I see no reason to make any different order. Orders 1. I make the following orders: 1. To the extent that there was an informal application raised by the defendant to have the mother of the director of the defendant, Ms Andrea Ruiz-Diaz or Ms Athena Madormo represent her in these proceedings, the application is denied for the reasons I have outlined. 2. Judgment for the first and second plaintiffs for possession of the whole of the land comprised in folio identifier 4046/808215 being the land situated at and known as 410 Old Northern Road, Glenhaven in the State of New South Wales. 3. Leave to issue a writ of possession forthwith. 4. Costs in favour of the first and second plaintiffs on an indemnity basis. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 02 July 2020