BENSON v COMMONWEALTH BANK OF AUSTRALIA SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL MAHONEY JA 6 April 1995 [1995] NSWCA 43 Mahoney JA. This is an application which comes before the Court in unusual circumstances. In deference to the arguments advanced by Mrs Cominos for the applicant, I shall set out what I understand the position is and the substance of the application and the substance of the material before the Court. It is apparently not questioned that the Bank was owed by Mr Benson a sum in excess of $4 million. A document exchanged between them recites that an amount in excess of $4,300,000 was owing. Proceedings were taken by the Bank for recovery of the amount and for possession of property apparently given by way of security for the loan. Orders were made by the Supreme Court on 28 July 1994 in proceedings referred to in the notice of motion of 6 April 1995 which is placed before me on this application. Those orders provided in substance that the Bank should have possession of the relevant properties. Subsequently on 13 December 1994 a document bearing the heading 'Deed of Settlement' was entered into between Mr Benson and the Commonwealth Bank. That document provided in its recital an acknowledgment of certain mortgages being indefault; of the commencement of proceedings; of Mr Benson having initially defended the proceedings; to consent orders that have been made for the indebtedness in the amount in excess of $4,300,000 to which I have referred; and to the commencement of proceedings to enforce the consent orders of 28 July 1994 referred to in the documents. It recites that the parties 'have agreed to further record their overall settlement in the deed'. The operative provisions of the deed provide that the parties agree to consent to the orders, the effect of those set out in the short minutes. Those short minutes appear to be minutes or orders providing, inter alia, for the giving of possession to the Bank of the properties here in question. It provides that Mr Benson should pay to the Bank $1,240,000 by 10 February 1995 together with interest as there provided. It provides for Mr Benson to mortgage to the Bank certain property and it provides for certain warranties, representations and agreements. Clause 6 of the deed of settlement provides that providing certain things are done, then 'the Bank hereby agrees and undertakes that prior to 20 January 1995 it shall take no step to enforce that liability of the mortgagor to the Bank'. Clause 7 provides that provided the persons there referred to pay to the Bank $40,000 on or before 20 January 1995, 'the Bank hereby agrees and undertakes that prior to the due date it shall take no step to enforce any liability of the mortgagor to the Bank'. I interpolate that the due date appears to be 10 February 1995. 2 UNREPORTED JUDGMENTS Provision is then made in the deed that if the mortgage sum in clause 8 of the deed of settlement is paid to the Bank on or before the due date, the Bank undertakes to do the various things there provided for and to agree to orders in the Equity proceedings to the effect that the Equity proceedings be dismissed and for no order as to costs. Clause 9 provides that if the whole of the amount of the agreed sum, together with interest, is not received by the bank 'on or before the due date the Bank shall beat liberty to take such steps as it sees fit to enforce the consent orders of 28 July 1994 and without limiting the generality of the above to take the following steps ... '. Those steps include having writs enforced in respect of the properties. That deed seems to have been the basis for what subsequently happened. The parties have, by agreement, placed before me what is a synopsis of the judgment of Windeyer J. It appears from that and otherwise from the material before me, that in fact the payments to be made on 20 January 1995 were not made. The payments to be made on 10 February 1995 were not made. It appears that on 2 March 1995 consent orders were made — I take this from the synopsis of the judgment — in effect seeking a stay of the orders in the Common Law proceedings. At that time it was noted that there was an agreement: the Bank accepted $1,240,000 plus interest in full and final settlement provided the amount was paid on 24 March 1995. That amount was not paid. Application was then made to Windeyer J. The application appears to have been made yesterday and was heard by his Honour as a matter of urgency yesterday evening. The application was for a stay of the execution upon the orders made on 28 July 1994. Those orders remain effective and prima facie the Bank is entitled to enforce them. The application made to his Honour at that late stage was therefore for a stay of execution of orders which, on the face of them, were made by consent in the proceeding and in respect of which there appeared to be no outstanding reason why they should not be executed. The application was made for a stay apparently upon the basis that it was contended that the provisions made in the deed of settlement of 13 December 1994 were not provisions for payment of which time was of the essence. It was said that if the payments there referred to were not made on time, it remained open to Mr Benson to make those payments on later dates and on that basis to have the benefit of the deedof settlement, and (it may be, although this has not been explored before me) such agreement as may or may not have been made on or about 2 March 1995. Mr Justice Windeyer held against that contention. As I understand his judgment, he also took the view that in the circumstances this was not a matter in which a stay should be granted. As I read his judgment, he refused the stay on two grounds. First, because time was of the essence in respect of the payments to be made; but, secondly, in any event he would not, presumably in the exercise of his discretion, grant a stay. An application has now been made or is to be made to the Court of Appeal for leave to appeal against the order of Windeyer J made yesterday refusing the stay that had been sought. That application, of course, has not been made but upon the basis that it is going to be made, an application is now made to me to stay the execution of the orders of 28 July 1994. Those orders will be executed today unless a further stay is granted. URJ BENSON v COMMONWEALTH BANK OF AUSTRALIA (Mahoney JA) 3 I have taken into account what has been taken into account by Windeyer J; I have taken into account the personal position of Mr Benson; and I have considered, so far as I may do in the time available, the terms of the deed of settlement of 13 December 1994. In so far as they are before me, the proceedings or agreements of 2 March 1995 referred to in the judge's judgment have also been taken into consideration by me. But the simple fact is that despite several provisions which have been made as to payment — on at least three occasions — no payments have been made as then agreed. What is now suggested is that arrangements have been made which it is hoped will achieve the payment of the relevant amount. The date that has been specified is 20 April 1995. It has been said that particular amounts have been or can be paid totalling something over $1 million and that the balance can be obtained, with the aid of a mortgage, from another company described as Fulton Holdings Pty Limited by20 April 1995. It is suggested that because of that particular possibility or suggestion the court should grant a further stay of the execution of judgment. I do not think that such a stay should be granted. I do not think that the deed of settlement, however interpreted, admits of the construction that the payments need not be made on the days there specified. If there was a margin for delay in respect of those payments, that is, if on the proper construction of the deed it allowed for payment within a reasonable time thereafter, in my opinion that reasonable time has long since expired. Nothing has been suggested before me which would lead to the conclusion that the present time is within the bounds of a reasonable time for doing any of the things referred to in the deed of settlement. Tf and in so far as what took place on or about 2 March 1995 is relevant, again nothing has been placed before me to suggest that, if a reasonable time was to be allowed in respect of any of those matters, that time has not expired. I would have thought that in all the circumstances the Bank has extended indulgences to Mr Benson for many months. The particular provisions which have been made for payment have not been complied with and what is now sought is to fix a further date by which it is hoped that another person, referred to as Fulton Holdings Pty Limited, will or may provide the moneys in question. Mr Justice Windeyer was not convinced that Mr Benson would be able to pay the particular amounts. I am not satisfied that he will. For all of these reasons I do not think that it is proper that a stay be granted. As I have said, I am conscious, as Windeyer J was, of the difficulties which arise when persons who owe money are called upon to meet their obligations and when the proceedings involved will affect property occupied by them, their home or otherwise. But in the end, I do not think that those are matters which can jeopardise the execution of the judgment which was given now many months ago. Giving full rein to one's sympathy in relation to the position of the defendant who (perhaps through no fault ofhis own, I do not know) is not able to meet his obligations, I do not think that the case has been made out for a further stay. In my opinion, the application should be dismissed with costs. Orders accordingly.