New South Wales Supreme Court CITATION : Pakair Pty Limited v Maulolo [2007] NSWSC 24 This decision has been amended. Please see the end of the judgment for a list of the amendments. HEARING DATE(S) : 29/1/07 JUDGMENT DATE : 29 January 2007 JUDGMENT OF : Bell J at 1 EX TEMPORE JUDGMENT DATE : 29 January 2007 DECISION : 1. Give the plaintiff possession of the premises being the whole of the land in certificate of title folio identifier 83/1/1788 (the property); 2. The plaintiff have leave to issue a writ of possession in respect of the property; 3. The defendant pay the plaintiff's costs of the proceedings; 4. Dismiss the first cross-claim.; There has been no appearance either by the cross-claimant or the first cross-defendant to the second cross-claim and in those circumstances I strike the proceedings out of the list. With respect to the second cross-defendant, no evidence has been led in support of claims against him and in these circumstances the second cross-claim against the second cross-defendant are dismissed and the cross-claimant is to pay the second cross-defendant's costs. Credit (Home Finance Contract) (Saving and Transitional) Regulation 1984 LEGISLATION CITED : Farm Debt Mediation Act 1994 Landlord and Tenant Act 1899 Residential Tenancies Act 1987 Pakair Pty Limited (Plaintiff) PARTIES : Sammy Toesami Maulolo (Defendant) Mani Subramanian Nair (Second cross-defendant to second cross-claim) FILE NUMBER(S) : SC 11176/04 A F Fernon (Plaintiff) COUNSEL : No appearance (Defendant) R A Pepper (2nd Cross-Defendant) SOLICITORS : Low Doherty & Stratford (Plaintiff) Colin Biggers & Paisley (2nd Cross-Defendant) IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION BELL J Monday 29 January 2007 11176/04 PAKAIR PTY LIMITED v SAMMY TOESAMI MAULOLO JUDGMENT 1 HER HONOUR: These proceedings were commenced by statement of claim which was filed on 23 April 2004. The plaintiff claims possession of premises known as 45 Lackey Street, Merrylands (the property), and an order for leave to issue a writ of possession. The plaintiff pleads that it loaned monies to the defendant on the security of a mortgage and that there has been default under the mortgage. 2 Default judgment was entered in September 2004. Subsequently the defendant moved to set aside the default judgment. In due course an order was made setting the judgment aside and directions were made with respect to the filing and service of both a defence and foreshadowed cross-claims within a specified period. A defence and cross-claims were filed. A further amended statement of second cross-claim was filed on 6 March 2006. 3 The history of the proceedings, including a brief recitation of the defences pleaded and the nature of the cross-claims is set out in the judgment of Hall J delivered on 21 March 2006. 4 The proceedings were again before Hall J on 18 September 2006. On that occasion the defendant/cross-claimant did not appear. The matter was set down for hearing on 29 January 2007 with an estimate of three days plus. His Honour made directions including that the plaintiff send a letter by certified or registered mail advising the defendant of certain matters. 5 Mr Fernon, who appears on behalf of the plaintiff, read the affidavit of Patrick Anthony Doherty, sworn on 25 January 2007, which annexes a letter dated 14 September 2006 addressed to the defendant at the property, which was sent by registered post and which records that the matter had been set down for hearing on this date. Also annexed to Mr Doherty's affidavit is a customer receipt issued by Australia Post confirming delivery of the letter together with a document described as delivery confirmation - advice receipt which appears to bear the signature of the defendant acknowledging receipt of the letter. 6 The matter has a lengthy history as noted by Hall J in the judgment to which I have referred including that the defendant had retained Mr Geering, a solicitor, to act for him on 13 December 2005 in place of the solicitors previously acting for him. There has been no appearance by or on behalf of the defendant today. 7 Mr Fernon sought to proceed and to prove his client's claim. Taking into account the history of the matter, and the absence of explanation for the non-appearance of the defendant, the matter has proceeded to trial. 8 Ms Pepper appeared on behalf of Mr Nair, the second cross-defendant to the second cross-claim. It is convenient to note at this juncture that there has been no appearance by the first cross-defendant to the second cross claim, John Tannous. Mr Tannous was served with the third amended second cross-claim on or about 4 September 2006. Evidence was led by Mr Fernon of service upon Mr Tannous of a letter dated 19 September 2006 advising him that the proceedings had been fixed for hearing today. No appearance has been filed on Mr Tannous' behalf. 9 Ms Pepper seeks an order dismissing the claim against her client, there being no evidence in support of the claims advanced against him. I will return to the second cross claim. 10 In support of the relief claimed by the plaintiff, Mr Fernon read the affidavits of Dimitris Amargianitakis, which were sworn on 6 July 2004, 1 November 2004 and 29 January 2007, together with paragraph 5 of the affidavit of the defendant Sammy Toesami Maulolo which was filed in court on 17 March 2006. In addition, a number of documents were tendered in the plaintiff's case and together were marked, exhibit A. I note the further affidavit read by Mr Fernon on the plaintiff's behalf of Thomas Pfeifle, sworn 26 August 2004, which records service on the occupier of the property of the statement of claim. 11 Mr Amargianitakis in his first affidavit deposes to the defendant as the only person in possession of the property and to the circumstance that the proceedings are not brought in contravention of s 2 A of the Landlord and Tenant Act 1899 in that the defendant is the owner of the property and that no relationship of landlord and tenant exists. He further deposes to the proceedings as not being brought in contravention of ss 5(9), 6(8), or 7(1) of the Credit (Home Finance Contract) (Saving and Transitional) Regulation 1984; s 3 of the Farm Debt Mediation Act 1994; or s 71 of the Residential Tenancies Act 1987. 12 In his affidavit of 1 November 2004 Mr Amargianitakis, who is a director of the plaintiff responsible for the day-to-day dealings with the defendant, set out the history between the two, which culminated in the loan of the sum of $150,000 to the plaintiff. A copy of the loan contract is at tab 7 of exhibit A. It is dated 25 June 2003 and appears to bear the signature of the defendant. The schedule to the loan contract records the term of the loan as two months and sets out the interest payable under it. The loan was secured by mortgage, a copy of which appears at tab 33 of exhibit A. An extension of the term of this first loan for a further two months was subsequently sought and granted, tab 41 and tab 16. 13 I note the definition of "secured monies", under the mortgage, which includes all monies that the mortgagor, whether a loan or with any other person, is or may at any time be liable to pay to the mortgagee under any financing document, and the definition of "financing document" that are set out in clause 1 of annexure A to the mortgage. The mortgage incorporates memorandum Q860000, a copy of which appears at tab 13, and I note the acceleration provision in clause 6. 14 In his affidavit of 1 November 2004, Mr Amargianitakis deposes to the loan funds being advanced on 26 June 2004. This appears to be a typographical error. Mr Amargianitakis refers to the payment instructions received from M S Nair & Co at 11.11am on that day. A copy of the letter exhibited to him is at tab 14 of exhibit A and bears the date 26 June 2003. 15 In paragraph 5 of his affidavit the defendant admits to the "first loan" in an amount of $150,000 and refers to the drawdown of it on 25 June 2003. He acknowledges the interest due under the first loan and principal in an amount of $243,000 as at 16 March 2006. In the same paragraph the defendant admits the "second loan" in an amount of $50,000 and refers to the drawdown of it on 11 September 2003. Particulars of the second loan are as set out in the affidavit of Mr Amargianitakis and are the subject of a number of documents which form part of exhibit A. The defendant acknowledges interest due under the second loan, together with the principal in an amount of $78,000 as at 16 March 2006. Further particulars of interest under the first and second loans are set out as at 16 September 2006. The defendant admits to the total of principal and interest under the two loans due as at this latter date in the sum of $345,000. 16 I note that by his amended defence, which was filed on 18 May 2005, the defendant admits that in or about June 2003 the plaintiff lent monies to him and to John Tannous on the security of mortgage registered number AA353438H in respect of the property. 17 Mr Amargianitakis deposes to the service by registered mail of a notice under s 57 (2)(b) on the Real Property Act 1902 on the defendant on 27 October 2003. A copy of the notice is at tab 31 of exhibit A. A further notice sent to the defendant, under cover of letter dated 5 March 2004, which records default under the mortgage with respect to the failure to pay the principal sum and amounts of interest under the first and second loans also forms part of exhibit A. Documents which also form part of exhibit A include a declaration signed by the defendant on 25 June 2003 stating that the sum advanced pursuant to the mortgage is for business purposes and that the advance is not governed by the Consumer Credit (NSW) Code at tab 9 and an acknowledgement of receipt of independent legal advice regarding the loan and security documents signed by him on the same date at tab 11. 18 In his third affidavit, which was sworn this day, Mr Amargianitakis records that the plaintiff has not received any payments from or on behalf of the defendant, other than the payments that are detailed in the earlier affidavits sworn by him, and states that the amount currently outstanding pursuant to the first loan agreement is $267,665.75 (increasing at the rate of $98.63 per day) and under the second loan agreement of $89,682.19 (increasing at the rate of $32.87 per day). 19 The plaintiff has established default under the mortgage. No evidence has been led in support of the claims pleaded in the defence or the cross claim. I am satisfied that the plaintiff has established its entitlement to the relief that is claimed. Accordingly, I make the following orders: 1. The defendant, Sammy Toesami Maulolo, give the plaintiff possession of the premises known as 45 Lackey Street, Merrylands, New South Wales, being the whole of the land in certificate of title folio identifier 83/1/1788 (the property); 2. The plaintiff have leave to issue a writ of possession in respect of the property; 3. The defendant pay the plaintiff's costs of the proceedings. 4. Dismiss the first cross-claim. 20 I turn now to the second cross-claim. There has been no appearance either by the cross-claimant or the first cross-defendant to the second cross-claim and in those circumstances I strike the proceedings out of the list. 21 With respect to the second cross-defendant, for whom Ms Pepper appears, no evidence has been led in support of claims against him and I dismiss the second cross-claim against the second cross-defendant and order that the cross-claimant pay the second cross-defendant's costs. ********** 02/02/2007 - Amended year on judgment - Paragraph(s) header 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.