MORTGAGE HOLDING TRUST CO LTD V MAINWARING HC HAM CIV 2010-419-000645

MORTGAGE HOLDING TRUST CO LTD V MAINWARING HC HAM CIV 2010-419-000645 17 August 2010IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY CIV 2010-419-000645UNDER Part 12 of the High Court Rules IN THE MATTER OF an application for summary judgment BETWEEN MORTGAGE HOLDING TRUST COMPANY LIMITED Plaintiff AND ANNE GEORGINA MAINWARING Defendant Hearing: 16 August 2010 Counsel: AL Bowater for plaintiff Judgment: 17 August 2010 at 11:00amJUDGMENT OF ASSOCIATE JUDGE FAIRE [on application for summary judgment]This judgment was delivered by me on 17 August 2010 at 11:00am pursuant to Rule 11.5 of the High Court Rules. Registrar/Deputy Registrar DateSolicitors: Simpson Grierson, Private Bag 92 518, Auckland And To: AG Mainwaring, 84 Alfred Street, HamiltonThe application[1] The plaintiff applies for summary judgment against the defendant. [2] There are five causes of action. Four relate to personal borrowing under four separate loan agreements. The fifth arises from the defendant entering into a contract of guarantee in respect of two separate loan agreements involving AJM Hedged Investments Ltd. [3] The plaintiff seeks the amount advanced less payment made, plus interest and costs. It also seeks an order for possession in respect of the property which was provided as security for the loans.First call of proceeding[4] The application was called on 19 July 2010. Counsel appeared for the plaintiff. No appearance was entered on the defendant's behalf. [5] I summarised the position as it appeared to me at that time in a minute. The minute recorded the following:1) This application for summary judgment was called before me today. 2) The defendant was called and entered no appearance. I was told, however, that parties known to her were seated in the court, no doubt keeping a watching brief. 3) I announced to counsel for the plaintiff that I was concerned about the affidavit in support of the application. In a number of respects it does not match the paragraphs to which it makes reference in the statement of claim. Counsel informed me that this was simply a typographical error and that the paragraph numbers were approximately one number out in each case. The court relies on the accuracy of affidavits in support of summary judgment applications. Whilst amendments can be made, it is vital the evidential foundation for a summary judgment application is correct. Accordingly, I order that the affidavit in support be re-executed so that the errors are removed. The defendant has not appeared today, but may well be advised by those present of the order which I have made. If she makes application to the plaintiff's solicitors for a copy of the revised affidavit that must be made available to her forthwith.4) Another matter that concerned me was that the first cause of action is in respect of a loan which advanced the sum of $5,000. The plaintiff has realised one of the securities that are involved in the loan agreements and has debited the costs of the exercise against the loan which is the subject of the first cause of action. The result is that a sum of some $38,978.43 is claimed in respect of the first cause of action. In this respect counsel referred me to clause 2.9 of the loan agreement in respect of the first cause of action. 5) I invite counsel at the resumed hearing of this application to provide authority which justifies the inclusion of such a provision in the contract or, if no authority exists, by reference to the appropriate legislation indicating that a clause, such as clause 2.9, is not objectionable. (Refer, for example, to Credit Contracts and Consumer Finance Act 2003.) 6) Accordingly, I order as follows: a. An amended affidavit in support of the application for summary judgment shall be filed by 26 July 2010. If a request is made by the defendant for a copy of same, a true copy shall be provided to her forthwith; b. The application for summary judgment is adjourned to the summary judgment list at 12 noon on 16 August 2010. I expect counsel to cover the matters I have referred to in this minute at that time; c. A copy of this minute is to be sent to the plaintiff's counsel and posted by the Registrar to the defendant at 84 Alfred Street, Hamilton.Amendments[6] Generally, there are three hurdles which an applicant for an amendment must meet before an amendment is granted, namely, a) that the amendment is in the interests of justice; b) that it will not significantly prejudice the defendant; and c) that it will not cause significant delay: Elders Pastoral Ltd v Marr.1(1987) 2 PRNZ 383 at 385.1 Elders Pastoral Ltd v Marr (1987) 2 PRNZ 383 (CA) at 385.[7] In Cegami Investments Ltd v AMP Financial Corp (NZ) Ltd2 it was confirmed that amendments to the proceedings were possible in the summary judgment procedure. [8] An amended affidavit by David Frank Rugen was filed. Counsel confirmed, as did Ms Mainwaring, that a copy of the affidavit was forwarded to Ms Mainwaring on 26 July 2010. [9] The problems that I saw originally in the proof of this case have been cured. I can find no evidence of any prejudice to the defendant by my reading the amended affidavit in place of the original affidavit. There is no question of any difficulty being caused by delay in the matter. Indeed, the adjourned hearing has led to a situation where the defendant has, in fact, appeared. I conclude therefore that it is appropriate that I read the amended affidavit of David Frank Rugen in support of the application for summary judgment.Opposition[10] The Registry has received the following documents, apparently on the defendant's behalf, namely: a) Document headed "Letter of courtesy and warning order"; b) Unsworn affidavit of Walker F Todd which appears to relate to a proceeding in the Circuit Court for the County of Oakland and which has a date on it 5 December 2003; c) Document entitled "To the trial judge"; and d) Document entitled "Rule of engagement notice of undertaking and intent and lawful claim of rights".2 Cegami Investments Ltd v AMP Financial Corporation (NZ) Ltd [1990] 2 NZLR 308 (CA).[11] On 16 August 2010 at the second call of this proceeding I allowed a Mr McKay to speak on behalf of the defendant. The defendant was present, however, throughout. Mr McKay presented a further document which is headed "Statement to be read on the record".The courts approach to a summary judgment application[12] Rule 12.2 of the High Court Rules requires that a plaintiff satisfy the court that a defendant has no defence. In Krukziener v Hanover Finance Ltd3 guidance was given as to how that position should be approached by the court when determining a summary judgment application. The court said:The question on a summary judgment application is whether the defendant has no defence to the claim; that is, that there is no real question to be tried:Pemberton v Chappell [1987] 1 NZLR 1 at 3 (CA). The Court must be left without any real doubt or uncertainty. The onus is on the plaintiff, but where its evidence is sufficient to show there is no defence, the defendant will have to respond if the application is to be defeated: MacLean v Stewart (1997) 11 PRNZ 66 (CA). The Court will not normally resolve material conflicts of evidence or assess the credibility of deponents. But it need not accept uncritically evidence that is inherently lacking in credibility, as for example where the evidence is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable: Eng Mee Yong v Letchumanan [1980] AC 331 at 341 (PC). In the end the Court's assessment of the evidence is a matter of judgment. The Court may take a robust and realistic approach where the facts warrant it: Bilbie Dymock Corp Ltd v Patel (1987) 1 PRNZ 84 (CA).Ms Mainwaring's documents[13] Ms Mainwaring's documents do not disclose any legitimate defence to the plaintiff's claim against her. They do not comply with the relevant High Court Rules, namely rr 7.24 and 7.25 relating to an opposition. They do not relate to the form and content required for affidavits, which is prescribed in r 9.76. They do not provide for me any basis for a defence to the plaintiff's claim. Indeed, counsel for the plaintiff described them as nonsensical.3 Krukziener v Hanover Finance Ltd [2008] NZCA 187 at 26.[14] Out of an abundance of caution I arranged for the Registrar to show Ms Mainwaring copies of the loan documents and the contract of guarantee which are annexed to the amended affidavit of David Frank Rugen. Ms Mainwaring confirmed that a likeness to her signature was contained in the copy documents. There is nothing in the material before me to suggest that she had not signed the originals of the loan documents and the guarantee. [15] In my minute of 19 July 2010 I expressed concern relating to the amount claimed in the first cause of action when that was considered against the amount actually advanced under the first loan agreement. Counsel had drawn attention to clause 2.9 of the terms and conditions applicable to the first loan agreement and to all of the other loan agreements exhibited. That gave authority to charge the first loan agreement with any amount which is due and payable. [16] The evidence discloses that the first loan agreement account was used as the payment account in respect of the defendant's other obligations to the plaintiff, including her obligations under the second, third and fourth loan agreements. Each month the amounts owing under each of the four agreements were debited against the first loan agreement account. I can find nothing objectionable, nor was it suggested on Ms Mainwaring's account that there was anything objectionable, in the way loans were linked and payments were accounted for. There is certainly no justification, on the material placed before me, to suggest that this clause, or the manner of handling payments, was oppressive. Counsel, indeed, referred me to Tapp v ASB Bank Ltd 4 where payments were made through a current account. What is apparent in this case is that there is no foundation to suggest: a) the money was not advanced to the defendant; b) that she was not obliged to pay it back with interest; and c) that there has been any wrong charging of the defendant in respect of the moneys now claimed.4 Tapp v ASB Bank Ltd HC Auckland Civ 2004-404-4 26 May 2004 per Venning J.In short, I am satisfied that the plaintiff has met the required onus of proof as to both liability and quantum in respect of the amounts claimed by way of summary judgment. [17] Counsel presented a helpful memorandum which sets out the amounts claimed under each of the causes of action with the appropriate calculation of interest. For completeness sake, I set out paragraphs (a) to (e) of that memorandum.A. For first cause of action against the defendant(a) Amount claimed as per statement of claim $38,978.43 (b) Interest on the sum of $38,686.43 at the rate of 10.85% per annum compounding on the 15 th day of every month from 13 May 2010 to 16 August 2010 $1,114.96Subtotal $40,093.39 Interest continues to accrue on the sum of $38,686.43 at the rate of 10.85% per annum from 17 August 2010 until the date of actual payment (c) An order that the defendant and any other occupants at 84 Alfred Street, Hamilton, vacate this property and deliver up possession of the property to the plaintiffB For a second cause of action against the defendant(a) Amount claimed as per statement of claim $42,604.34 (b) Interest on the sum of $42,420.78 at the rate of 10.85% per annum compounding on the 15 th day of every month from 13 May 2010 to 16 August 2010 $1,222.58Subtotal $43,826.92 Interest continues to accrue on the sum of $42.420.78 at the rate of 10.85% per annum from 17 August 2010 until the date of actual paymentC For a third cause of action against the defendant(a) Amount claimed a per statement of claim $99,507.75 (b) Interest on the sum of $99,079 at the rate of 10.85% per annum compounding on the 15 th day of every month from 13 May 2010 to 16 August 2010 $2,855.46Subtotal $102,363.21 Interest continues to accrue on the sum of $99,079.00 at the rate of 10.85% per annum from 17 August 2010 until the date of actual paymentD For a fourth cause of action against the defendant(a) Amount claimed as per statement of claim $113,530.98 (b) Interest on the sum of $110,000.00 at the rate of 10.85% per annum compounding on the 15 th day of every month from 13 May 2010 to 16 August 2010 $2,595.85Subtotal $116,126.83 Interest continues to accrue on the sum of $110,000.00 at the rate of 10.85% per annum from 17 August 2010 until the date of actual paymentE For a fifth cause of action against the defendant(a) Amount claimed as per statement of claim $148,731.62 (b) Interest on the sum of $147,950.33 at the rate of 10.85% per annum compounding on the 15 th day of every month from 13 May 2010 to 16 August 2010 $3,491.43Subtotal $152,223.05 Interest continues to accrue on the sum of $147,950.33 at the rate of 10.85% per annum from 17 August 2010 until the date of actual payment I am satisfied that the amounts claimed in that memorandum are correct.Order for possession[18] The statement of claim also seeks an order for possession of the property of which security was given. The defendant gave mortgage securities in favour of the plaintiff in respect of two properties. One has been sold. Property Law Act notices were served on the defendant. The evidence discloses attempts by the defendant to prevent the plaintiff from having access, for the purpose of exercising its right of mortgagee sale, to the property at 84 Alfred Street, Hamilton. The mortgage gives the plaintiff the right to take possession of the property. [19] The plaintiff is entitled to rely on the Property Law Act 2007, s 137(1)(c). The relevant parts of the provision are:137 Exercise of power to enter into possession(1) If a mortgagee becomes entitled under a mortgage, after compliance with subpart 5, to exercise a power to enter into possession of mortgaged land or goods, the mortgagee may exercise that power by— (c) applying to a court for an order for possession of the land or goods.[20] I have already recorded that notices under the Property Law Act had been issued in this case. The prayer for relief seeking an order for possession is accordingly justified.Costs analysis[21] Counsel's memorandum also set out a calculation of costs based on Category 2 Band B of the High Court Rules. The calculation is as follows: (a) Item 1 : Commencement of proceedings (3 days @ $1,880 per day) $5,640.00 (b) Item 5.1 : Preparing and filing summary judgment application (0.6 days @ $1,880 per day) $1,128.00(c) Item 4.17: Appearing at mention (0.2 days @ $1,880 per day) $376.00 (d) Item 4.18: Sealing judgment (0.2 days @ $1,880 per day) $376.00Subtotal $7,520.00 [22] Counsel's memorandum also included the disbursements which were incurred which are as follows: (a) Filing statement of claim and interlocutory application for summary judgment $1,100.00 (b) Sealing fee $40.00 (c) Service fee $101.25Subtotal $1,241.25 I am satisfied as to the correctness of that sum.Judgment[23] Accordingly I enter judgment as follows: a) On the first cause of action, inclusive of interest to today, $40,093.39; b) An order that the defendant and any other occupants at 84 Alfred Street, Hamilton vacate that property and deliver up possession to the plaintiff; c) On the second cause of action, inclusive of interest to today, $43,826.92;d) On the third cause of action, inclusive of interest to today, $$102,363.21; e) On the fourth cause of action, inclusive of interest to today, $116,126.83; and f) On the fifth cause of action, inclusive of interest to today, $152,223.05.Costs[24] The defendant shall pay the plaintiff's costs of $7,520.00 together with disbursements of $1,241.25. _____________________ JA Faire Associate Judge