Supreme Court New South Wales Medium Neutral Citation: Richardson v HomeSec Finance Express Pty Limited [2013] NSWSC 821 Hearing dates: 19 June 2013 Decision date: 21 June 2013 Jurisdiction: Common Law Before: Adams J Decision: 1. The mortgagor is estopped from commencing the new proceedings. 2. The statement of claim is summarily dismissed pursuant to r 13.4 of the Uniform Civil Procedure Rules 2005. Legislation Cited: Contracts Review Act 1980 (NSW) Civil Procedure Act 2005 (NSW) Fair Trading Act 1987 (NSW) National Consumer Credit Protection Act 2009 (Cth) National Consumer Credit Protection (Transitional and Consequential Provisions) Act 2009 (Cth) National Credit Code Trade Practices Act 1974 (Cth) Uniform Civil Procedure Rules 2005 (NSW) Cases Cited: HomeSec Finance Express Pty Ltd v Richardson [2012] NSWSC 1365 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 Category: Principal judgment Parties: Jill Richardson (Plaintiff) HomeSec Finance Express Pty Limited (Defendant) Representation: Counsel: M W Young SC (Defendant) Solicitors: Bransgroves Lawyers (Defendant) File Number(s): 2013/78573 Judgment Introduction 1. This motion is brought to strike out a statement of claim filed on 14 March 2013 (the new proceedings) in relation to the same mortgage in respect of which the mortgagor unsuccessfully defended an action, in substance, brought to enforce the mortgage and unsuccessfully sued the mortgagees in a cross-claim. The new proceedings seek various declarations with respect to alleged breaches by the mortgagees of the National Consumer Credit Protection Act 2009 (Cth) (NCCPA) and the National Credit Code (NCC) and injunctions restraining the mortgagees from enforcing the mortgage and the enforcement of the prior judgment, together with compensation and possession of the mortgaged properties, and, under the NCC, orders that the mortgage be re-opened, voiding interest charges over 24% per annum and fees over 5% and fees and charges as being "harsh and unconscionable". 2. The Notice of Motion was filed on 4 June 2013 and served by ordinary mail and email as specified in the Statement of Claim. There was, however, no appearance by the plaintiff and the motion was heard in her absence. The old proceedings 1. The nature of these proceedings, commenced on 15 June 2011, and the Court's conclusions on the issues are sufficiently set out in the judgment of Button J of 14 November 2012: HomeSec Finance Express Pty Ltd v Richardson [2012] NSWSC 1365. This account can, accordingly, be brief. As is conventional, the mortgagees sought possession of the mortgaged land, monetary judgment pursuant to the loan contract and a registered mortgage, interest and costs. The mortgagor contended, one way or another, that the mortgage should not be enforced by reason of the Contracts Review Act 1980 (NSW), general law unconscionability, and the unconscionability provisions of the Trade Practices Act 1974 (Cth) and the Fair Trading Act 1987 (NSW). Amongst other things, the mortgagor submitted that the interest rate for which the loan contract provided (a penalty rate of 12% monthly) was unfair, unconscionable and usurious. 2. Button J rejected every ground of the defence and cross-claim, gave judgment for the mortgagee and ordered short minutes to be brought in reflecting these conclusions. On 30 November 2012 final orders were entered giving a monetary judgment in favour of the mortgagees in the sum of $1,548,800, interest from 1 December 2012 under s 101 of the Civil Procedure Act 2005 in the sum of $1,731.15 per day (equivalent to an annual interest rate of 40.8%) and dismissing the Amended Cross-Claim. For reasons which are not clear, but presumably responsively to the short minutes prepared, the orders made did not grant possession of the properties to the mortgagees or leave to issue writs of possession, but rather gave leave to issue Writs of Levy of property against them. The new proceedings 1. The relief sought in the new proceedings is summarised above. The basis for that relief is, essentially, that in the circumstances the transaction fell within the provisions of the NCCPA and the NCC and the mortgagees were precluded from engaging in credit activities after 1 July 2011 in providing credit under a contract and loan agreement dated 26 October 2010, exercised rights under the contract, and continued to be mortgagees and exercised rights under the mortgage of 26 October 2010. Furthermore, the interest and fees payable were governed by the NCC and were less than those actually charged. Insofar as the terms of the transaction differed from those prescribed by the NCC, those terms are claimed to be void. (It may be worth making the point - although it is not necessary to decide - that these allegations appear to ignore the provisions of the National Consumer Credit Protection (Transitional and Consequential Provisions) Act 2009 (Cth)). Issue Estoppel 1. The issue concerning the amount of money owing by the mortgagor to the mortgagee was determined by the judgment of Button J in the prior proceedings. Those proceedings were between the same parties, so far as the debt was concerned, as in the new proceedings and arose out of the same subject matter, namely the enforceability of the loan contract and the mortgage. Furthermore, the matters now raised which affect the legality of the contract and the amount of interest, charges and fees were not pleaded in the defence nor raised in the cross-claim. This failure to traverse the allegation in the statement of claim as to the obligations of the mortgagor in these respects has the consequence that the adverse decision of Button J "imported also a particular adverse decision" as to those matters: Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 599. In the circumstances, the fact that the same matters relied on in the defence were the subject of a cross-claim is immaterial. The mortgagor is accordingly estopped from undertaking proceedings that seek to relitigate this question. This necessarily applies not only to the primary debt but also to the interest, fees and charges that were the subject of the Court's orders. 2. The mere fact that the new proceedings are different in form, in the sense that the mortgagor relies on matters that were not relied on in the original defence or cross-claim is immaterial where, as here, the new claim and its subject matter "was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it [in answer to that action]": Anshun Pty Ltd per Gibbs CJ, Mason and Aicken JJ ibid at 602. Their Honours added (at 602 - 603) - "… Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding. In this respect, we need to recall that there are a variety of circumstances, some referred to in the earlier cases, why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in other proceedings eg, expense, importance of the particular issue, motives extraneous to the actual litigation, to mention but a few." The mere fact that the litigant is unrepresented is not, to my mind, a material consideration. 1. Another important principle identified in Anshun in determining whether estoppel existed is whether the subsequent action "if it succeeds, will result in a judgment which conflicts with an earlier judgment": ibid at 603. In the present case, this is precisely the effect which the mortgagor seeks to bring about. Conclusion 1. It follows that the mortgagor is estopped from commencing the new proceedings and the statement of claim must be summarily dismissed pursuant to r 13.4 of the Uniform Civil Procedure Rules 2005 (NSW). ********** 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. Decision last updated: 14 November 2016