WESTPAC BANKINGS CORPORATION v GATTELLARO [2000] NSWSC 775

New South Wales Supreme Court

CITATION : WESTPAC BANKINGS CORPORATION v GATTELLARO [2000] NSWSC 775 revised - 11/10/2000 FILE NUMBER(S) : SC 12474 of 1990 HEARING DATE(S) : 1.11.99; 2.11.99; 5.11.99 JUDGMENT DATE : 11 August 2000

PARTIES : Plaintiff: Westpac Banking Corporation Defendant: Rocco and Yolanda Gattellaro JUDGMENT OF : Hulme J at 1

COUNSEL : Plaintiff: J Stevenson Defendant: G McVay SOLICITORS : Plaintiff: Spencer Whitby & Co Defendant: Henry Davis York DECISION : Orders deferred

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

NO: 12474 of 1990

Friday, 11 August 2000

HULME J WESTPAC BANKING CORPORATION v Rocco GATTELLARO & Yolanda GATTELLARO JUDGMENT

HIS HONOUR :

1 By Summons filed on 30 May 1990 the Plaintiff, a mortgagee, sought judgment for possession of the land contained in Certificate of Title Volume 7212 Folio 230 known as 12 Withers St Chiswick, an order that the Defendants pay an amount of $197,378.09 which the Plaintiff alleged to be owing, interest thereon and consequential orders. 2 In an Affidavit of 3 August 1990 the First Defendant denied the indebtedness claimed, contending that the Commercial Bank had failed to credit his account in a sum of $32,380.28 paid on 1 December 1978 and, on 30 June 1978 had debited without explanation, and by inference wrongly, a further sum of $42,873.99 to the Defendants' account. It was asserted that these sums together with the interest that had been charged in consequence, exceeded the sum claimed by the Plaintiff. 3 A Cross-Claim filed on 8 August 1990 sought a declaration that a sum of $30,000 and interest thereon from 12 October 1978 and the sum of $42,873.99 and interest thereon from 30 June 1980 were due from the Plaintiff to the Defendants. There was no explanation in the Cross Claim of these sums. 4 Pleadings were ordered. So far as is presently relevant, the Statement of Claim added nothing to the above account other than to particularise the mortgage as one dated 2 June 1986. On 27 June 1991 a Defence was filed. In effect that admitted all of the allegations in the Statement of Claim other than those of indebtedness and matters consequent thereon. In the Defence the Defendants asserted that on or about 1 August 1977 the Plaintiff's predecessor, the Commercial Bank of Australia Limited provided a commercial bill facility to the Defendants, and that on or about that date their account should have been credited with a sum of $30,000 but was debited with the amount of the bill facility and that in consequence they have lost the benefit of the $30,000 the subject of the bill facility. The Defence also repeated the complaint concerning the sum of $42,873.99. There was no repetition of the earlier complaint concerning the sum of $32,380.28. 5 On 10 July 1998 an Amended Cross-Claim was filed in which, in addition to the earlier claims, it was asserted that the mortgage of 2 June 1986 relied on by the Plaintiff was unenforceable pursuant to the Contracts Review Act as to particularised amounts of $69,822.79 and $125,625.67 together with interest thereon from 2 June 1986. It was asserted that prior to that date, these moneys had been advanced to a company, Falgat Constructions Pty Ltd, were unsecured and were not debts of the Defendants. It was also alleged that the Plaintiff had been guilty of misleading or deceptive conduct within Section 52 of the Trade Practices Act, and had negligently misstated the effect of the mortgage, an omission which led to the Defendants entering into it and for which the Defendants sought damages. It is convenient to defer further particularisation of the matters relied on in these respects. 6 Subsequent amendments to the Cross-Claim have not altered the substance of the dispute between the parties. In its Amended Defence to the Further Amended Cross Claim the Plaintiff, inter alia:- (i) relied on a term (endorsed on bank statements of Commercial Bank of Australia Limited) that "vouchers supporting entries in this statement will be destroyed after two years and this account will be considered as settled unless objection is received in respect of any entry shown hereon within six months of the date of issue of this statement", contending that this was a term of the contract or, in conjunction with other factors, gave rise to an estoppel, (ii) said that by a guarantee which the Bank could not produce but the existence of which the bank asked to be inferred, the Defendants had guaranteed Falgat Constructions' indebtedness and this indebtedness was secured by an earlier mortgage of 17 June 1977, and (iii) asserted that a number of the Plaintiffs' claims were barred by the passage of time. 7 Prior to early 1986 the Defendants conducted their banking at 59 Goulburn Street, Sydney, originally with the Commercial Bank of Australia Limited and, after that was taken over or merged, with Westpac. The Defendants operated on a number of bank accounts either in their own name or in the name of Falgat Constructions. Included in these were accounts 007,59,922 and 007,60,499 in their own names which seem to have been opened on or about 22 April 1977 and 20 June 1977 respectively. An account 007,60,472 in the name of Falgat Constructions Pty Ltd seems to have been opened on or about 27 July 1977.