Supreme Court New South Wales Medium Neutral Citation: Perpetual Nominees Ltd v Salad Express Pty Ltd [2013] NSWSC 1127 Hearing dates: 15 August 2013 Decision date: 15 August 2013 Before: Adamson J Decision: (1) The application for stay of the writ of possession and the stay of the auction is refused. (2) The defendants' notice of motion filed 15 August 2013 is dismissed. (3) The defendants are to pay the plaintiff's costs of the motion. Catchwords: PRACTICE AND PROCEDURE - application for stay of public auction - ample time afforded to mortgagor for refinance Category: Interlocutory applications Parties: Perpetual Nominees Ltd (Plaintiff) Salad Express Pty Ltd (Defendant) Representation: Counsel: P Reese (solicitor) (Plaintiff) GP Macri (director of defendant company) (Defendant) Solicitors: Bransgroves Lawyers (Plaintiff) File Number(s): 2012/186994 Publication restriction: Nil Judgment 1In this matter Mr Macri, who is a director of Salad Express Pty Ltd (Salad Express), seeks a stay by motion filed in Court on 15 August 2013 of a public auction of property over which a mortgage was granted to the plaintiff, Perpetual Nominees Limited. The public auction of the property is due to commence at 10.30 this morning, 15 August 2013. There was no opposition to my granting leave to Mr Macri to appear on behalf of Salad Express. Mr Macri read an affidavit of Giulia Penna of 15 August 2013 in support of the application. Ms Penna described herself in her affidavit as the defendant's mortgage consultant. 2Mr Reese, who appears for the plaintiff, opposes the stay of the public auction and the stay of the writ of possession. 3The basis on which Mr Macri contends that I ought grant a stay of the public auction is that Salad Express has obtained refinance which could pay out the loan to the plaintiff and discharge the mortgage. 4Ms Penna annexed to her affidavit a letter of offer dated 7 August 2013 from a mortgage broker, South Western Financial Services. The proposed loan is to be guaranteed by Mr Macri and his wife and other companies associated with them. The proposed security for the property is the property mortgaged to the plaintiff. 5The letter of offer provides, in part, that the application for finance has been approved subject to certain terms and conditions. The first term is the loan advanced to be the lesser of $4.9 M or 50% of valuation. The interest rate is to be 20%. 6There are further conditions, including condition 7, which provides that the lender's solicitors must be satisfied on all matters which, in their opinion, are necessary to give the lender adequate security, including the signing and execution of security documents as required. 7Condition 9 is that the property is subject to a satisfactory valuation by a valuer approved by the lender. 8Condition 16 is that the lender reserves the right to withdraw should the lender's inspection of the property at the valuation prove unsatisfactory to the lender. 9Ms Penna's affidavit also annexes a letter from South Western Financial Services dated 14 August 2013 to Mr and Mrs Macri, as directors of Salad Express Pty Ltd. The loan offer issued on 7 August 2013 is referred to. The author confirmed that valuations have been received and are satisfactory for a loan of $4.9 M. The proposed loan is referred to in the letter as unconditional. The letter stated that solicitors have been instructed to prepare mortgage documents. John D Hancock is identified as the lender's solicitor. The letter also stated that documentation is currently being prepared and will be forwarded with a view to settling in a matter of days. 10Ms Penna also annexed an email from Mr Hancock dated 14 August 2013, sent at 3.12pm, to the solicitors for the plaintiff, in which Mr Hancock confirms that his client has approved a loan to Salad Express and to Mr and Mrs Macri and the amount of the advance is $4.9 M for the two purposes of investment and to repay the loan to Perpetual. The email contains the following statement: "The advance is to be finalised upon completion of legal formalities and documentation. This is likely to take around 14 days". 11In her affidavit Ms Penna deposed to the hardship which will be suffered by Salad Express, its directors and those associated with the company. Whilst I can understand that a sale by public auction in these circumstances may not necessarily be in the interests of the borrower, that is hardly the point, when the lender has a legal right to sell the property and, in my view, ample time has been afforded to the defendant, Salad Express, to refinance the mortgage. 12Mr Reese opposes the stay, on the ground that the loan offer, although described in the letter by South Western Financial Services of 14 August 2013 to be unconditional, is not, on proper analysis, unconditional, and that it merely follows a string of earlier attempts by the defendants, each of which has proved to be unsuccessful, to refinance the loan. Mr Reese referred me to orders made by McCallum J on 7 May 2013, ordering that the writ of possession issued in the proceedings on 12 March 2013 lie in the office until 30 May 2013, on the basis that the defendants had refinance and that, within that period, the loan secured by the mortgage could be paid out and the mortgage discharged. 13It is now over three months since that order was made and the plaintiff still has not been paid out. 14I accept Mr Reese's submissions that although the word "unconditional" is used in the letter from South Western Financial Services of 14 August 2013, the loan offer, on its true construction, is not unconditional. Furthermore, even if it were unconditional, in my view it would require some indulgence to be granted by, or some agreement to be reached with the plaintiff, since it is not for this Court, having regard to the history of the matter, to defer a public auction on the basis that its being conducted is likely to cause hardship to the debtors. Orders 15I make the following orders: (1)The application for stay of the writ of possession and the stay of the auction is refused. (2)The defendants' notice of motion filed 15 August 2013 is dismissed. (3)The defendants are to pay the plaintiff's costs of the motion. ********** 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: 16 August 2013