National Australia Bank Limited v Paul Burness in his capcity as Trustee of the Bankrupt Estate of Mark William Bradley [2007] NSWSC 247

New South Wales Supreme Court

CITATION : National Australia Bank Limited v Paul Burness in his capcity as Trustee of the Bankrupt Estate of Mark William Bradley [2007] NSWSC 247

HEARING DATE(S) : 12, 13, 14 March 2007

JUDGMENT DATE : 22 March 2007

JUDGMENT OF : Cooper AJ at 1

DECISION : See paragraph

Real Property Act 1900 LEGISLATION CITED : Consumer Credit (NSW) Code Contracts Review Act 1980 Trade Practices Act 1974 (Commonwealth)

Permanent Mortgages Pty Ltd v Cook (2006) NSWSC 1104 CASES CITED : Johnsson v Arkway Pty Ltd (2003) 58 NSWLR 451 Linkenholt Pty Ltd v Quirk (2000) VSC 166

National Australia Bank Limited - Plaintiff Paul Burness in his capacity as Trustee of the Bankrupt Estate of Mark William Bradley - First Defendant PARTIES : Vicki Rae Bradley - Second Defendant Vicki Rae Bradley - Cross Claimant National Australia Bank Limited - Cross Defendant

FILE NUMBER(S) : SC 10971 of 2004

COUNSEL : Mr M Jackman with Mr J Stoljar - Plaintiff Mrs V Bradley (in person) - Second Defendant

SOLICITORS : Dibbs Abbott Stillman Lawyers - Plaintiff

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

Cooper AJ

22 March 2007

No 10971 of 2004 National Australia Bank Limited v Paul Burness as Trustee of the Bankrupt Estate of Mark William Bradley – First Defendant and Vicki Rae Bradley – Second Defendant

JUDGMENT 1 In this case, the plaintiff seeks judgment for possession of the whole of the land referred to in Certificate of Title Folio Identifier A/357411 and known as 5 Macquarie Road, Pymble NSW. It seeks leave to issue a writ of possession to enforce the judgment and also seeks judgment for money due under the mortgage against the Second Defendant plus interest and costs. 2 The plaintiff sues on Registered Mortgage No 7324997H (the mortgage) over real property in respect of which Mark William Bradley and the Second Defendant were the registered proprietors at 5 Macquarie Road, Pymble. 3 It should be understood at the outset that a sequestration order was made against Mr Bradley on 1 May 2003 and the First Defendant was appointed trustee of his bankrupt estate. The First Defendant has consented to judgment for possession of the land. 4 The land is now registered in the names of the First Defendant as trustee and the Second Defendant as tenants in common. 5 It is the Second Defendant, Mrs Bradley, who is contesting the action. The Hearing 6 It is necessary to mention some matters concerning the conduct of the hearing before me. 7 Mrs Bradley was unrepresented at the hearing. She sought permission to be represented by her husband. This permission was refused because the terms of her Cross-claim gave rise to a potential conflict of interest between her and her husband. This conflict of interest arose out of the allegations in her Cross-claim at paragraphs 34 and 35 where she alleged that she signed documents as the result of undue influence on the part of her husband. Furthermore, it was at least possible that he could be called as a witness. 8 However, during the course of the hearing Mr Bradley sat next to her and the two of them conferred from time to time as to the matters that were to be put to the Court and as to questions to be asked of witnesses in cross-examination. 9 As appears from page 4 of the transcript, I asked Mrs Bradley if she was seeking an adjournment of the case and she indicated that she was not. She did, however, indicate then that she would like an expert witness to help explain the nature of the documents that were produced to her. This witness was not then readily available and she indicated that the hearing could proceed. 10 As appears at pages 112 and 113 of the transcript, towards the end of the hearing, Mrs Bradley indicated that she wished to call two expert witnesses, namely Mr Bruce Ford and Professor Stephen Keane. She had no report from either or them. She was relying on the decision in Permanent Mortgages Pty Ltd v Cook (2006) NSWSC 1104 in which these witnesses had given expert evidence referred to in that judgment. 11 A consideration of that judgment reveals that the facts were totally different from those in the present case. Furthermore, those expert witnesses had given written reports before the hearing and copies had been served on the opposing side in accordance with the rules. 12 In the present case there were no such reports and it appeared that Mrs Bradley just wished to call them because she felt their evidence had helped the defendants in the other case. 13 Because Mrs Bradley has been unrepresented I have considered it necessary to go into far more detail when outlining the facts of this case than may otherwise have been the situation. The Pleadings 14 The Further Amended Statement of Claim alleges that by mortgage dated 27 September 2000, Mr and Mrs Bradley mortgaged the land at Pymble to the plaintiff and that mortgage was duly registered and given the number 7324997H. 15 It is alleged that mortgage incorporates the terms of Memorandum lodged at the Land and Property Information NSW and numbered 2469574. The terms of that Memorandum will be referred to later. 16 Paragraph 5 of the Further Amended Statement of Claim alleges that the plaintiff advanced monies totalling $905,000, being the limit of the facility referred to in the loan contract to the mortgagors pursuant to account number 50-722–1857, and the mortgagors subsequently were in default under the loan contract and such default has not been remedied. 17 Paragraph 5A of the Further Amended Statement of Claim alleges that by FlexiPlus Mortgage Facility, Individuals – Personal Investments Purposes document dated on or about 24 May 2001, Mr and Mrs Bradley as borrowers agreed to pay the balance of the loan together with interest and all fees and other money owing to the plaintiff immediately upon cancellation of the facility established under the loan contract and, if they failed to do so and were placed in default thereunder, upon the plaintiff giving them a Default Notice and where the default had not been remedied, then unless the plaintiff had notified the mortgagees to the contrary, the plaintiff is entitled to bring the present proceedings against them 18 The Claim continues that on or about 19 January 2004, the plaintiff served on the defendants a Cancellation Notice demanding payment in the sum of $1,284,094. 20 in respect of that loan contract and that the defendants failed to pay to the plaintiff the sum so demanded. 19 It also alleges that on or about 29 January 2004, the plaintiff served on the defendants Default Notices demanding payment in the sum of $1,284,094.12 being the sum then due in respect of the loan contract which notices also constituted notices under s 57 (2) (b) of the Real Property Act 1900. The defendants failed to pay the whole of the sum so demanded and the default was not remedied. 20 It claims that on or about 3 March 2004, the plaintiff made formal demand on the defendants to pay to it the sum of $1,310,963.33 being the total amount then due under the loan contract and that they failed to pay this amount. 21 The Further Amended Statement of Claim further alleges that on about 21 June 2006, the plaintiff served on Mrs Bradley a Default Notice demanding payment in the sum of $1,352,015.31 being the total amount then due under the loan contract. This notice constituted a notice under s57(2)(b) of the Real Property Act. The Second Defendant failed to pay this amount. 22 On about 27 July 2006, the plaintiff made a further formal demand on the Second Defendant to pay the sum of $1,364,085.52 being the total amount then due in respect of the loan contract. That demand was not met. 23 By her Further Amended Defence, the second defendant concedes that she and her husband were registered proprietors of the subject land and the mortgage 27 September 2000 and that the mortgage incorporates the terms of the Memorandum as alleged.