Perpetual Trustee Australia Limited v Romeo [2011] NSWSC 1116

Perpetual Trustee Australia Limited v Romeo [2011] NSWSC 1116

Although the defendants' explanation for default was only barely adequate and the Court had considerable doubt about the strength of their proposed Contracts Review Act claim, the material did not permit the Court to rule out the prospect that the defence and cross-claim could succeed. Issues including the applicable lending guidelines, compliance with them, the reliability of serviceability evidence, and the circumstances of the loan approval process were matters that could properly be litigated. It was therefore in the interests of justice to set aside the default judgment, but only on terms protecting the plaintiffs, including payment into Court, interest undertakings, disgorgement...

Jurisdiction
Australia
Judgment Date
16 September 2011
Procedural Posture
Proceedings for Possession With Notice of Motion to Set Aside Default Judgment / Interlocutory Application
Outcome
Default judgment set aside on terms upon payment into Court by the defendants and undertakings; defendants ordered to pay the plaintiffs' costs of the application forthwith.
Legal Topics
['default Judgment' 'application to Set Aside Default Judgment' 'possession Proceedings' 'contracts Review Act 1980' 'unjust Contracts' 'unconscionable Conduct' 'asset Lending']
['civil Procedure' 'contracts' 'consumer Protection' 'mortgage Law'] ['default Judgment' 'application to Set Aside Default Judgment' 'possession Proceedings' 'contracts Review Act 1980' 'unjust Contracts' 'unconscionable Conduct' 'asset Lending']

Case Brief

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Procedural Posture

Proceedings for Possession With Notice of Motion to Set Aside Default Judgment / Interlocutory Application

Legal Issues

  1. 1 ['Whether the defendants had an explanation for failing to file a defence and for any subsequent delay.' 'Whether the defendants had a good or arguable defence or cross-claim under the Contracts Review Act 1980 or for unconscionable conduct.' 'Whether the loan agreement and mortgage were arguably unjust because they amounted to asset lending.' 'Whether it was in the interests of justice to allow the proposed defence and cross-claim to be litigated.' 'What terms should be imposed if the default judgment were set aside.']

Ratio Decidendi

Although the defendants' explanation for default was only barely adequate and the Court had considerable doubt about the strength of their proposed Contracts Review Act claim, the material did not permit the Court to rule out the prospect that the defence and cross-claim could succeed. Issues including the applicable lending guidelines, compliance with them, the reliability of serviceability evidence, and the circumstances of the loan approval process were matters that could properly be litigated. It was therefore in the interests of justice to set aside the default judgment, but only on terms protecting the plaintiffs, including payment into Court, interest undertakings, disgorgement...

Court Disposition

Default judgment set aside on terms upon payment into Court by the defendants and undertakings; defendants ordered to pay the plaintiffs' costs of the application forthwith.

Orders

  • ['That, upon payment into Court by the defendants of the sum of $1.6 million within 28 days of the date of these orders, and further upon their undertaking to the court to maintain interest payments on that amount at 7.75 percent per annum, the default judgment entered on 14 September 2011 be set aside.' "That, upon...