New South Wales Supreme Court CITATION : National Australia Bank Limited v Landy Chen-Conway & Anor [2008] NSWSC 448 HEARING DATE(S) : 08/05/08 JUDGMENT DATE : 9 May 2008 JURISDICTION : Equity Division Commercial List JUDGMENT OF : Einstein J DECISION : Plaintiff to have judgment for possession CATCHWORDS : Farm Debt Mediation Act (1994) NSW - Proper Construction of particular provisions - Whether any certificate was 'issued' under section 11 Farm Debt Mediation Act 1994 (NSW) LEGISLATION CITED : Real Property Act 1900 (NSW) Uniform Civil Procedure Rules 2005 (NSW) CATEGORY : Principal judgment Cassegrain v Commonwealth Development Bank of Australia Ltd [2003] NSWCA 260 CASES CITED : CIC Insurance Limited v Bankstown Football Club Limited (1997) 187 CLR 384 Gain v Commonwealth Bank of Australia (1997) 42 NSWLR 252 Myross (NSW) Pty Limited v Kahlefeldt Securities Pty Limited [2003] NSWSC 138 National Australia Bank Limited (Plaintiff) PARTIES : Landy Chen-Conway (First Defendant) David Conway (Second Defendant) FILE NUMBER(S) : SC 50174/07 COUNSEL : Mr J Stoljar (Plaintiff) Mr M Thompson (Defendants) SOLICITORS : Minter Ellison (Plaintiff) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION COMMERCIAL LIST Einstein J Friday 9 May 2008 50174/07 National Australia Bank Limited v Landy Chen-Conway & Anor JUDGMENT The proceedings 1 These are proceedings in which the National Australia Bank Ltd seeks judgment for possession of the land referred to in Certificate of Title Folio Identifier 61/755418, known as "Linden", Henry Lawson Drive, Mudgee, NSW (the Linden Property). 2 The defendants, Landy Chen-Conway and David Conway, by mortgage dated 22 December 2003 registered number AA337790 mortgaged the Linden Property to the plaintiff (the Linden Mortgage) (1/17). 3 There is no controversy in these proceedings that the plaintiff and a company of which the defendants were the sole directors and shareholders, and through which they carried on their business, Mudgee Wines Pty Limited (Mudgee Wines), entered into the facilities set out below; that the plaintiff provided to Mudgee Wines the funds contemplated by those facilities; that Mudgee Wines has failed to repay to the plaintiff the amounts owing by it under those facilities; and that Mudgee Wines is thereby seriously in default under those facilities. 4 It follows there could be no serious controversy that the defendants are liable to the plaintiff under a guarantee and indemnity entered into by them on 21 July 2004 in respect of the obligations of Mudgee Wines to the plaintiff (the Guarantee), and also pursuant to the Linden Mortgage. No challenge has been raised by the defendants in these proceedings as to the efficacy of either the Guarantee or the Linden Mortgage. 5 The only substantive issues which the defendants seek to agitate is that a mediation is required, pursuant to the Farm Debt Mediation Act 1994 (NSW) (the Act), as a precondition to the commencement or continuation of these proceedings, or that a certificate issued on 5 December 2005 by the Rural Assistance Authority of New South Wales (the Authority) under section 11 of the Act, certifying that the Act does not apply to the Linden Mortgage (the section 11 Certificate) (2/50) is invalid or ineffective. Factual background 6 The factual background contended for by the Bank is made out on the materials before the court. That background was as follows: i. The defendants are the registered proprietors as tenants in common in equal shares of the Linden Property (1/19). ii. The defendants are and were at all material times the sole directors of and shareholders in Mudgee Wines (1/2). iii. On or about 16 December 2003 the plaintiff provided to Mudgee Wines a Farm Management Account Facility with a limit of $50,000 and an expiry date of 30 November 2004 (1/4) (the Farm Management Account Facility). iv. On or about 22 December 2003 the plaintiff agreed to provide financial accommodation to Mudgee Wines in the form of a bill facility in the sum of $1,450,00 (the Bill Facility). v. The Farm Management Account Facility and the Bill Facility were secured by, among other things, the Linden Mortgage. The Linden Mortgage incorporated the terms of the memorandum lodged at Land and Property Information (NSW) No 7652469 (the Linden Memorandum) (1/1). vi. The Linden Memorandum provides that the defendants are in default under the Linden Mortgage if, among other things, they: … do not pay the amount owing when due for payment (emphasis in original) (1/1, p 11). vii. Clause 44 of Linden Memorandum provides that the " amount owing " includes, among other things: All amounts which at that time are owing and unpaid, or owing but not presently payable, or owing upon a contingency by you to the Bank for any reason (1/1, p 17) (emphasis in original). viii. On or around 13 July 2004 the plaintiff and the defendants varied their funding arrangements as follows. First, the plaintiff increased the limit under the Farm Management Account Facility to $100,000 (1/22). ix. The expiry date under the revised Farm Management Account Facility as provided for in the plaintiff's letter of 13 July 2004 was 31 October 2004 (1/22, p 148, 149). The Farm Management Account Facility provided (1/22, p 151): x. The whole of the balance owing under the Facility and any other money owing under this agreement must be paid to the Bank if you are in default as specified below and t he default remains unremedied after the Bank gives you a notice specifying the default (emphasis in original). xi. The Farm Management Account Facility further provided that a default would occur when, among other things (1/22, p 151): The Expiry Date shown above [ namely, 31 October 2004 ] occurs and you owe the Bank any money under this agreement. xii. The Farm Management Account Facility further provided that the facility would end immediately if any event of default occurred, including the one referred to above, or if Mudgee Wines was otherwise in default of the Facility (1/22, p 151). xiii. Secondly, also on 13 July 2004 the plaintiff in effect continued or renewed the Bill Facility, in accordance with a letter from the plaintiff to Mudgee Wines headed "Bill Facility – Letter of Offer" (1/23) (the Bill Facility Letter). The terms and conditions of the Bill Facility were thereafter regulated by the Bill Facility Letter. xiv. The Bill Facility Letter provided that an event of default would include (at 17(h)) (1/23, p 158): If at any time the Drawer should fail to pay to the Bank any monies from time to time due and payable to the Bank pursuant to any other arrangement or facility, or fail to comply with any other provision of such arrangement or facility or the provision of any security given to the Bank. xv. By guarantee and indemnity dated 21 July 2004 (the Guarantee) the defendants guaranteed the obligations of Mudgee Wines to the plaintiff on the terms and conditions set out in the Guarantee (1/26). xvi. Pursuant to clause 7.1 of the Guarantee the defendants agreed among other things as follows: You agree to pay the Bank any of those amounts in respect of which the customer [ ie, Mudgee Wines ] is at any time in default, up to the basic liability as at the time the Bank demands that you pay them to the Bank (1/26, p 180). Default under the Farm Management Account Facility xvii. On 31 October 2004, being the expiry date under the Farm Management Account Facility, Mudgee Wines failed to repay the amount owing under that facility (2/66, p 379). Indeed the facility was at that time in excess of the limit of $100,000. xviii. On 1 April 2005 the plaintiff gave notice to Mudgee Wines that it was cancelling the Farm Management Account Facility and demanded that Mudgee Wines pay to it the amount owing by 12 April 2005 (1/35). xix. Also on 1 April 2005 the plaintiff gave notice to Mudgee Wines that it was in default under the Bill Facility pursuant to, among other things, its failure to clear the balance owing in respect of Farm Management Account Facility on the expiration date. By the said notice the plaintiff terminated the facility (1/34). Procedures under the Farm Debt Mediation Act xx. On 14 March 2005 the plaintiff gave notice to the defendants pursuant to section 8 of the Act that it intended to take enforcement action against property over which it held a farm mortgage under which the defendants were in default (the section 8 Notice) (1/32). xxi. The details of the security instruments sought to be enforced as identified in the section 8 Notice included the Linden Mortgage, and the property over which the Linden Mortgage was held was identified as the Linden Property. xxii. Conformably with the requirements of the Act the section 8 Notice included the following: Under the Farm Debt Mediation Act you are entitled to insist that a mediation between the creditor and yourselves take place within the next three months at a time and place to be agreed upon. You should give consideration to obtaining professional independent advice before making any decision regarding mediation (1/32). xxiii. The section 8 Notice also advised the defendants that they had 21 days in which to give notice to the plaintiff of their intention to participate in a mediation, and attached a notice under section 9 of the Act in the prescribed form. xxiv. On 16 March 2005 the defendants received the section 8 Notice (1/33). xxv. On 24 March 2005 the defendants caused to be served a notice under section 9 of the Act requesting a mediation in regard to the farm debt and farm mortgage referred to in the section 8 Notice (1/33). xxvi. On 4 April 2005 the plaintiff wrote to the Authority advising that mediation had been required and requesting that a mediation kit be sent to the farmer (1/36). xxvii. On 5 April 2005 the plaintiff wrote to the defendants in respect of making arrangements for the mediation, including requesting that the defendants nominate a time and location for the mediation convenient to them and put forward the name of a mediator (1/37). xxviii. On 7 April 2005 the Authority wrote to both the defendants and the plaintiff attaching a mediation kit and stating among other things (1/38): It is the responsibility of the creditor/Bank and the farmer to reach agreement on how the costs of the mediation will be shared, where and when the mediation will take place, and who the mediator will be. The parties will need to contact each other to arrange the mediation. (emphasis in original). xxix. On 3 May 2005 the plaintiff through Mr Fuller spoke to a representative of a leasing company apparently in respect of a possible refinance of the defendants' or Mudgee Wines' facilities (1/39). xxx. On 25 May 2005 David Conway rang Craig Fuller of the plaintiff to give an update of his position (1/40). Mr Fuller asked David Conway concerning his choice of the mediator for the Farm Debt Mediation process. Mr Conway stated that he had not taken any action to date. Mr Fuller told Mr Conway that he had to proceed with choosing a mediator and advise the Bank accordingly as time was running out. Mr Fuller brought to Mr Conway's attention the rate of penalty interest. Mr Fuller emphasised the urgency of choosing a mediator. xxxi. On 3 June 2005 the plaintiff through Mr Fuller had a further conversation with Mr Conway regarding progress on obtaining a mediator (1/41). Mr Conway advised Mr Fuller that he had made contact with a mediator by leaving a message but had not heard back and that he would follow it up that day. Mr Conway also said that he was making further enquiries with regard to refinancing the bank debt. Mr Fuller advised Mr Conway that he had until 20 June to commence the mediation process. xxxii. On 22 June 2005 the plaintiff wrote to the defendants stating among other things (1/42): I refer to your correspondence dated 17 June 2005 and confirm the Bank's acceptance of the appointment of Mr Robert Hemphill as mediator in this matter. A preliminary mediation conference, by telephone will need to be held. We request that you provide the Bank a "customer issues paper", outlining all relevant issues to be dealt with prior to the mediation. xxxiii. Also on 22 June 2005 the plaintiff wrote to Mr Hemphill confirming the Bank's acceptance of his appointment as mediator and advising him by whom the plaintiff would be represented at the mediation (1/43). xxxiv. On 11 July 2005 the defendants through Mr Conway wrote to the plaintiff stating that they look forward to the mediation and identifying various matters they wish to discuss (1/44). The address identified by the letterhead of this letter was 280 Henry Lawson Drive. xxxv. On 28 July 2005 the plaintiff through Mr Gardiner telephoned Mr Hemphill and advised him that the plaintiff was ready for a pre-mediation meeting (1/45). Mr Hemphill advised that he would call Mr Conway and move forward. xxxvi. On 17 August 2005 the plaintiff through Mr Gardiner again called Mr Hemphill and asked him to call back to confirm what was happening (1/45). xxxvii. On or about 23 August 2005 a telephone conversation took place between Mr Fuller and Mr Conway in which words were said to the following effect: Mr Conway: I'm looking to arrange to pay out the Bank and I am trying to arrange refinancing. I expect to arrange this within 4 to 6 weeks. Mr Fuller: Keep me informed as to how you go but we will need to keep the mediation process on track. xxxviii. On 17 October 2005 the plaintiff wrote to the Authority requesting a section 11 certificate and enclosing various documents in support (1/46). xxxix. On 31 October 2005 the Authority wrote to the plaintiff acknowledging receipt of the section 11 certificate application and stating (1/47): We have today written to the farmers, advising them of your application, and of the grounds upon which the Authority has been requested to issue the certificate. The farmers have been allowed until close of business on Wednesday, 30 November 2005 to lodge a submission and advised that the Authority will not make a decision regarding the issue of a certificate before Friday, 2 December 2005. xl. Also on 31 October 2005 the Authority wrote to the defendants setting out a history of the progress of the attempted mediation and enclosing copies of various correspondence. The authority invited the defendants to make submissions by close of business on Wednesday, 30 November 2005 (2/53, p 277). xli. Service of this letter on the defendants is proved by the file note of Mr Kevin John Ekerick, manager farm debt mediation, at the Authority, dated 1 November 2005 (2/53). xlii. The defendants plainly received the letter of 31 October 2005 from the Authority, together with further documents referred in Mr Ekerick's file note, because following 31 October 2005 there were several telephone conversations between the Authority and Mr Conway. A file note created by the Authority states: There have been several telephone conversations with Mr Conway as a result of our letter of 31/10/05. The conversation focused mainly on NAB and his actions in attempting to arrange a refinance. xliii. On or by 2 December 2005 no submission had been received by the Authority from the defendants (2/54). xliv. On or about 5 December 2005 the Authority issued the section 11 Certificate (2/50). xlv. On 5 December 2005 the Authority wrote to the defendants advising them that the Authority had issued the section 11 Certificate (2/51). Further demands and notices xlvi. By letter dated 18 January 2006, the plaintiff gave notice to Mudgee Wines that it was in default of the bill facility and demanded that Mudgee Wines remedy a default by paying $1,638,677.79 immediately (2/55). The letter was sent by the plaintiff to Mudgee Wines and also to the defendants personally (Gardiner 8.11.07 [32]). xlvii. By letter dated 1 March 2006 the plaintiff gave notice to Mudgee Wines that it was in default of the bill facility and also the Linden Mortgage and demanded payment of $1,668,231 (2/56). The demand gave notice that if payment was not received within 31 days from the date of the letter the plaintiff could enforce its rights under the Linden Mortgage and sell the Linden property. Again this letter was sent both to Mudgee Wines and to the defendants personally (Gardiner 8.11.07 [33]). xlviii. On 6 April 2006 the plaintiff gave notice to Mudgee Wines that it had not remedied the default specified in the default notice of 1 March 2006 and demanded payment within 7 days of the whole amount secured by the Linden Mortgage being $1,694,236.79 (2/57). xlix. On 19 April 2006 the plaintiff made formal demand under the Guarantee to the defendants (2/58), in the following terms: Pursuant to the provisions of the Guarantee, NAB hereby demands immediate payment by You of the following monies that are secured by the Guarantee and are due and owing to NAB up to and including today. l. The defendants failed to comply with this demand. li. On 4 May 2006 the plaintiff made demand under the Linden Mortgage, which demand also comprised a notice under section 57(2)(b) of the Real Property Act 1900 (NSW). Again, the defendants failed to comply with this demand. Reliability of the evidence given by Mr Conway 7 Mr Conway's evidence cannot be regarded as reliable. Mr Conway had difficulty on a number of occasions in recalling the events of the time. On being confronted with a document bearing his signature he had no recollection of ever signing it. Plainly enough he has an interest in the result of the proceedings. He had deposed in his affidavit of 6 December 2007 that he at no time received notice from the plaintiff informing him of the plaintiff's intention to take enforcement action in respect of the mortgage and of the availability of mediation under the Farm Debt Mediation Act in respect of the debt. Under cross-examination he conceded that it was necessary to withdraw this evidence. Its withdrawal carries with it the clearest of inferences that his evidence cannot be regarded as reliable unless corroborated by other evidence of contemporary material or by other evidence given by witnesses whose evidence may be regarded as reliable. 8 In contradistinction none of the bank's witnesses were required for cross-examination. Their evidence is in the main supported by the contemporaneous documentation. The issues raised by the defendants 9 In overview submissions the defendants conceded that: i. there is no dispute as to the debt claimed by the plaintiff, nor as to the fact of the guarantees relating to same being given by the defendants. ii. there is no dispute that the Farm Debt Mediation Act 1994 (as amended) ("the Act") applies to this debt. 10 Their contentions were put as follows: i. At issue is whether any certificate was ever "issued" under section 11 of Act in this instance. Without it, the plaintiff is barred by Section 8 of the Act from taking the instant enforcement action against the defendants. ii. The second defendant's evidence (Affidavit of 6 December 2007) is to the following effect: a) He never received any certificate under the Farm Debt Mediation Act . b) No mediation took place in respect of the debt. c) At no stage did he decline to mediate in respect of the debt. d) At no time did he receive notice from the plaintiff informing him of the plaintiff's intention to take enforcement action in respect of the debt. e) At no time did he received notice from the plaintiff informing him of the availability of mediation under the Farm Debt Mediation Act in respect of debt. f) He is not aware of any attempt by the plaintiff to mediate in good faith prior to the certificate's issue. 11 The defendants essential contention was that a certificate under section 11 was never "issued at the time the Plaintiff commenced the enforcement action. Their short contention is that: i. the concept of a certificate being "issued", connotes its conveyance to the farmer whose farm debt is intended to be subject to it. In this instance, no certificate was ever received. ii. Accordingly, even if prepared by the Authority (which is not admitted), it was never "issued" as the Act requires. iii. If no certificate was ever "issued" under section 11 of the Act, the plaintiff's enforcement proceedings herein are void under Section 6 of the Act. If so, the proceedings are a nullity, cannot be stood over pending belated compliance with the Act and there must be a verdict in favour of the defendants. Dealing with these issues 12 To the extent that the defendants had pleaded that, absent a concluded mediation, the section 11 Certificate should not have been issued, or, at least, the plaintiff should not have commenced or continued any enforcement action, that proposition was misconceived. 13 The starting point is that the object of the Act is stated in section 3: The object of this Act is to provide for the efficient and equitable resolution of farm debt disputes. Mediation is required before a creditor can take position of property or other enforcement action under a farm mortgage. 14 Conformably with this statutory object, section 8 of the Act provides that a creditor must not take enforcement action against a farmer in respect of a farm mortgage until at least 21 days have elapsed after the creditor has given notice to the farmer under this section. 15 Section 8(2) provides that the said notice must be in writing in a form approved by the Authority, which informs the farmer of the creditor's intention to take enforcement action in respect of the farm mortgage and of the availability of mediation under the Act in respect of farm debts. Section 8 does not apply if a certificate is in force under section 11 in respect of the farm mortgage concerned (see section 8(3)). 16 The section 8 procedure was invoked by the plaintiff on or about 14 March 2005 when it issued to the defendants the section 8 Notice, as set out above. 17 Section 9 of the Act provides that a farmer to whom notice has been given under section 8 may, within 21 days after the notice was given, notify the creditor that the farmer requests mediation. Section 9(3) provides that if a farmer requests mediation but subsequently refuses to mediate, the Act ceases to apply to the farm mortgage concerned. 18 Again, the procedure contemplated by section 9 of the Act was invoked in the present case: the defendants on or about 24 March 2004, within the relevant 21 day period, caused to be served a notice under section 9 of the Act requesting a mediation. 19 Pursuant to section 10 of the Act, once a farmer has given a creditor a notification in accordance with section 9 requesting mediation, the creditor must not take enforcement action in respect of the farm mortgage concerned unless a certificate is in force under section 11. 20 As noted by Barrett J in Myross (NSW) Pty Limited v Kahlefeldt Securities Pty Limited [2003] NSWSC 138 (at [22]) [See also Cassegrain v Commonwealth Development Bank of Australia Ltd [2003] NSWCA 260 at [28]]: If the mortgagor does request mediation, enforcement action by the mortgagee is precluded until a section 11 Certificate comes into force in relation to the farm mortgage. 21 In particular, section 11 contemplates that a certificate under that section may be issued in three circumstances: i. first, a satisfactory mediation has taken place in respect of the farm debt involved, pursuant to section 11(1)(c)(i); ii. secondly, the farmer has declined to mediate. Section 11(2) provides that a farmer is presumed to have declined to mediate if, among other things: the farmer has failed to take part in a mediation in good faith or has unreasonably delayed entry into or proceeding with mediation; the farmer has indicated in writing that he or she does not wish to enter into or proceed with a mediation; or the farmer has failed to respond in writing with 28 days to an invitation to attend a mediation session; or iii. thirdly, three months have elapsed after a notice was given by the creditor under section 8 and the creditor has throughout that period attempted to mediate in good faith " whether or not a mediation session or satisfactory mediation took place during that period " (section 11(1)(c)(iii)). 22 As is made express by the italicised words appearing in section 11(1)(c)(iii), it is not a prerequisite for the issue of a certificate under section 11 that a mediation in fact take place. 23 That is consistent with the object of the Act which seeks to achieve the "efficient and equitable resolution of farm debt disputes". Were it otherwise a farmer could in theory, by declining to mediate, stave off enforcement action in perpetuity. The Act seeks to balance, on the one hand, the interests of a prompt and equitable resolution of the farm debt dispute through means other than litigation with, on the other, the need to allow a creditor to pursue proper enforcement action in the event that reasonable alternative dispute resolution procedures have been exhausted. 24 As summarised by Barrett J in Myross (NSW) Pty Limited v Kahlefeldt Securities Pty Limited (at [23]): The Act's purpose is thus to require a mortgagee to hold his hand on enforcement of the farm mortgage until there has been an opportunity for resolution of differences with respect to the mortgage by mediation and either an arrangement acceptable to the mortgagor and the mortgagee has been reached or the possibility of resolution is seen to be exhausted. Only at that point is the mortgagee free to resort to enforcement action. 25 The section 11 Certificate has now been issued by the Authority. It thereby has the effect contemplated by the Act, namely: the Act does not apply to and, pursuant to section 10, the plaintiff is free to continue with enforcement action under, the Linden Mortgage. 26 The defendants, having had the benefit of legal representation, have elected not to challenge the section 11 Certificate by judicial review: Gain v Commonwealth Bank of Australia (1997) 42 NSWLR 252. Accordingly, the section 11 Certificate is and remains valid and effective. 27 As the Bank has contended it is not to the point that the defendants might prefer that the section 11 Certificate had not been issued, or now seek to adopt a course different from that which they pursued in 1995. The approach which the defendants apparently propound is that the Court should go behind, or ignore the effect of, a valid statutory instrument, namely the section 11 Certificate. There is no power in this Court (at least as these proceedings are constituted) to take this approach, and no reasons advanced for the Court doing so even if there was. 28 On any view the proposition that no reasonable administrator in the position of the Authority could have concluded that a section 11 certificate should have been issued is plainly unsustainable (Gain v Commonwealth Bank of Australia (1997) 42 NSWLR 252 at 256C). 29 In particular, even if the Court could in these proceedings go behind the section 11 Certificate, the Certificate was properly issued in the sense that the elements required by section 11 were fulfilled. 30 Thus, first, pursuant to section 11(1)(c)(iii) a period of three months had elapsed between the giving of the section 8 Notice and the issue of the section 11 Certificate. Secondly, during that period the plaintiff attempted to mediate in good faith. Without going through the facts summarised above exhaustively, the following are of particular relevance in establishing the latter proposition. 31 On 26 May 2005 Mr Fuller telephoned Mr Conway. Mr Fuller's filenote records: I [ ie, Mr Fuller ] asked David again regarding his choice of mediator for the FDM process and he confirmed that he has still not taken any action to date. I told him that he has to proceed with choosing a mediator and advise the Bank accordingly as time was running out. 32 During the same conversation Mr Fuller records that: I again advised him how urgent it was to choose a mediator so that negotiations could commence to discuss reduction of interest. He will get back to me (1/40). 33 A further conversation between Mr Fuller and Mr Conway took place on 3 June 2005. Mr Fuller records that he spoke to Mr Conway "regarding progress on obtaining a mediator and he stated that he has made contact with a mediator by leaving a message and has not heard back from him. He will follow it up today" (1/41). 34 As noted above two letters were sent on 22 June 2005 (1/42, 43). 35 On 11 July 2005 the defendants through Mr Conway wrote to the plaintiff with regard to the progress of the mediation. 36 On 28 July 2005 Mr Gardiner telephoned the mediator. His note records: Let him know we are ready for pre-mediation (1/46). 37 On 17 August 2005 Mr Gardiner telephoned the mediator again. His note records: Ask him to call me back to confirm what is going on (1/45). 38 On 23 August 2005 a telephone conversation took place between Mr Fuller and Mr Conway in which the mediation was again discussed. 39 As the bank has submitted the inference that the plaintiff was at all times willing to mediate in good faith during the period between the section 8 Notice and the issue of the section 11 Certificate is supported by the commercial reality. It was plainly in the plaintiff's interests to prosecute and conclude a mediation under the Act, either to reach an agreed position or to enable it to proceed with enforcement action. It is highly unlikely in these circumstances that the plaintiff was motivated by anything other than a genuine desire to proceed with and finalise the mediation process. 40 In any event, the section 11 Certificate is described on its face as having been issued simply under section 11(1) of the Act. In other words, it would be sufficient if the requirements of section 11(1)(b) had been complied with, namely that the defendants had declined to mediate, including by unreasonably delaying entering into or proceeding with mediation. 41 In the circumstances, this alternative basis for the issue of the section 11 Certificate has also been made out. No explanation is offered by the defendants for their failure to proceed with the mediation, or even to respond to the Authority's letter of 31 October 2005 inviting further submissions. In these circumstances it was plainly reasonable for the Authority to issue the section 11 Certificate. The suggested requirement of "conveyance" or service 42 Ultimately this issue involves a question of statutory construction: does the proper construction of section 11 of the Act imply that a certificate is issued, and effective, on its execution and sealing by the Authority, or when the certificate is subsequently served or "conveyed" to the farmer. 43 In the ordinary course this question is determined by reference to the ordinary natural meaning of the words of the statute, considered in context of the relevant statutory purpose or object: CIC Insurance Limited v Bankstown Football Club Limited (1997) 187 CLR 384 at 408. 44 I reject the contention that upon its proper construction the reference [to be found in section 11 (1)] to the issue of a certificate that the Act does not apply to the farm mortgage, requires service upon the farmer whose farm debt is intended to be subject to 'such certificate'. Those words are not to be found in section 11 (1). The inclusion of that parameter would permit the farmer to absent himself or herself from being in a position to receive the material communication, hence aborting the statutory scheme. 45 Section 11 of the Act requires only the "issue" of a certificate by the Authority. In contrast to other sections of the Act, there is nothing in section 11 requiring the Authority to convey the certificate to the farmer. 46 In contrast, a number of other sections in the Act make specific provision for the communication or conveyance of a notice or other information from the creditor to the farmer or vice versa, for example: · section 8 specifically requires a creditor to have "given a notice to the farmer" under the section; · section 9 requires that a farmer, wishing to invoke the mediation procedure after the receipt of a section 8 notice, must "notify the creditor in writing that the farmer requests mediation"; · section 9A(1) contemplates that a creditor who receives a request for mediation and wishes either to agree or to decline to mediate may do so "by notice in writing given to the farmer"; · section 10 provides that a creditor must not take enforcement action "once a farmer has given a creditor a notification in accordance with section 9"; · section 11(2)(b) provides that a farmer is presumed to have declined to mediate if the farmer has "indicated in writing to the authority or to the creditor that the farmer does not wish to enter into or proceed with mediation"; and · section 11B provides that a farmer may "serve a written notice on the creditor or the creditor's Australian legal practitioner" rescinding a heads of agreement. 47 In other words, had the legislature intended that a certificate under section 11 would only be effective or operative upon, or in the event of, its notification to or service on the farmer, it could easily have said so. The legislature has deliberately chosen not to require that service of a section 11 certificate is a precondition for its validity. As the Bank has contended, that defendants seek to read words into the Act that are simply not there. 48 The issuing of an instrument by a statutory body is an act by, and internal to, that body. The subsequent notification or service of that instrument to a third party is an entirely separate and distinct step. (to take an example in a different context, Rule 33.2 of the Uniform Civil Procedure Rules enables the "issue" of a subpoena; the separate step of serving a subpoena so issued is regulated by Rule 33.5). 49 Section 11 of the Act regulates the issuing of the certificate (ie, by the Authority); the Act does not make express provision for the subsequent, and independent step of the service or notification of the certificate to the farmer (although in practice this would appear to be carried out by the Authority as a matter of course). 50 Indeed, to the extent that the Act requires a certificate under section 11 to be "conveyed" to anyone it is to the creditor: section 11 requires the certificate to be issued "on the application" of the creditor, and section 11A(5) contemplates the issue of a certificate under section 11 "to a creditor". This is consistent with the fact that such a certificate is to the benefit of a creditor. 51 The foregoing construction of the Act is also consistent with the policy of the Act. That policy and object is to provide the farmer with a fair and reasonable opportunity for mediation prior to the creditor proceeding with enforcement action. Once that opportunity has been exhausted the farmer is taken to have forfeited his or her right or entitlement to mediate. 52 Rather, as was the case here, on the expiry of a three month period after the service of the notice under section 8, provided the creditor has during that period sought to mediate in good faith, the certificate may be issued, and is on and from that time effective as contemplated by the Act. Conclusion 53 The Act, and the mediation proceedings it contemplates, do not give rise to any impediment to these proceedings. 54 The Act expressly contemplates the issue of a certificate under section 11 in circumstances in which no mediation has been concluded, and the section 11 Certificate was properly issued by the Authority. 55 Further, the section 11 Certificate having now been issued, and not having been the subject of any challenge by the defendants through judicial review or otherwise, it therefore has the effect contemplated by the Act, particularly section 10 (which provides, in effect, that a creditor's enforcement action is only postponed prior to the issue of a certificate under section 11). The finding is that the plaintiff can proceed with enforcement action including as contemplated by these proceedings, even absent a mediation. 56 Even if it were now somehow open to go behind the section 11 Certificate, the elements prescribed by section 11 for the issue of a section 11 Certificate were satisfied in the present case, such that any challenge to the section 11 Certificate would fail. Orders 57 The bank has established its entitlement to the relief sought. The orders are: 1 Order that the plaintiff have judgment for possession of the whole of the land comprised in Certificate of Title, Folio Identifier 61/755418 and known as "Linden" Henry Lawson Drive, Mudgee in the State of New South Wales. 2 Grant leave to the plaintiff to issue writs of possession to enforce the judgment in paragraph 1 above. 3 Reserve the question of costs of the proceedings. 4 Grant leave to the parties to address written submissions on the question of costs. The parties are to exchange [and furnish in soft copy to my associate] written submissions on or before 12 May 2008 following the receipt of which the orders as to costs will be made in chambers. ****** 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.