National Australia Bank Limited v Amed & Ors [2011] NSWSC 988

National Australia Bank Limited v Amed & Ors [2011] NSWSC 988

Although the bank proved on the balance of probabilities that the second, sixth and seventh defendants were served and the applicants therefore had no acceptable explanation for failing to defend within time, they disclosed viable defences to liability on the guarantees, particularly under the Contracts Review Act 1980 arising from alleged assurances about enforcement only after sale of the Cairns property and the circumstances of advice and execution. With no substantive prejudice shown beyond loss of the default judgments, the interests of justice required the default judgments in respect of guarantee obligations to be set aside and leave given to defend; however, Michael had no...

Jurisdiction
Australia
Judgment Date
07 September 2011
Procedural Posture
Interlocutory Application to Set Aside Default Judgment / Application by the Second, Sixth and Seventh Defendants After Default Judgments Entered Against Them
Outcome
Default judgments in respect of the guarantee obligations were set aside; leave was granted to the second, sixth and seventh defendants to file defences; the defendants were ordered to pay the plaintiff's costs of the motion.
Legal Topics
['setting Aside Default Judgment' 'service of Statement of Claim' 'bona Fide Defence' 'guarantee Enforcement' 'contracts Review Act 1980' 'estoppel' 'misleading or Deceptive Conduct' 'default Interest and Penalties']
['civil Procedure' 'banking and Finance' 'guarantees' 'contract Law'] ['setting Aside Default Judgment' 'service of Statement of Claim' 'bona Fide Defence' 'guarantee Enforcement' 'contracts Review Act 1980' 'estoppel' 'misleading or Deceptive Conduct' 'default Interest and Penalties']

Case Brief

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Procedural Posture

Interlocutory Application to Set Aside Default Judgment / Application by the Second, Sixth and Seventh Defendants After Default Judgments Entered Against Them

Legal Issues

  1. 1 ['Whether the second, sixth and seventh defendants had been served with the statement of claim and had an adequate explanation for not defending within time.' 'Whether the applicants disclosed a bona fide defence sufficient to justify setting aside the default judgments.' 'Whether the bank was arguably precluded from enforcing guarantee obligations before selling the mortgaged Cairns property.' 'Whether the guarantees were arguably unjust under the Contracts Review Act 1980.' 'Whether default interest and/or default charges were arguably penalties affecting the amount payable under the guarantees.']

Ratio Decidendi

Although the bank proved on the balance of probabilities that the second, sixth and seventh defendants were served and the applicants therefore had no acceptable explanation for failing to defend within time, they disclosed viable defences to liability on the guarantees, particularly under the Contracts Review Act 1980 arising from alleged assurances about enforcement only after sale of the Cairns property and the circumstances of advice and execution. With no substantive prejudice shown beyond loss of the default judgments, the interests of justice required the default judgments in respect of guarantee obligations to be set aside and leave given to defend; however, Michael had no...

Court Disposition

Default judgments in respect of the guarantee obligations were set aside; leave was granted to the second, sixth and seventh defendants to file defences; the defendants were ordered to pay the plaintiff's costs of the motion.

Orders

  • ['The default judgments in respect of the guarantee obligations be set aside.' 'Leave granted to the second, sixth, and seventh defendants to file defences.' "Defendants to pay the plaintiff's costs of the motion."]