WESTPAC NEW ZEALAND LIMITED V BALBEER SINGH GOLIAN HC AK CIV 2010-404-007556

WESTPAC NEW ZEALAND LIMITED V BALBEER SINGH GOLIAN HC AK CIV 2010-404-007556 21 September 2011IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV 2010-404-007556UNDER Part 12 of the High Court RulesIN THE MATTER OF an application for summary judgmentBETWEEN WESTPAC NEW ZEALAND LIMITEDPlaintiffAND BALBEER SINGH GOLIANFirst DefendantAND ROSHNI DEVI GOLIANSecond DefendantAND BITS TRUSTEE LIMITEDThird DefendantHearing: 6 May 2011Counsel: M V Robinson and P V Shackleton for PlaintiffS H Barter and J Kim for DefendantsJudgment: 21 September 2011 at 5:00 PMJUDGMENT OF ASSOCIATE JUDGE ABBOTTThis judgment was delivered by me on 21 September 2011 at 5pmpursuant to Rule 11.5 of the High Court Rules.Registrar/ Deputy RegistrarDate:Solicitors:Simpson Grierson, Private Bag 92518, Auckland 1141 for plaintiffBarter & Co, PO Box 197, North Shore City 0755 for defendants[1] The plaintiff (Westpac) has applied for summary judgment against the defendants (related parties) for the balance of money due under a series of loans made to the defendants to purchase several properties, principally for development. The properties were mortgaged as security for loans and for cross-guarantees given by the defendants for the obligations of the other defendants.[2] The defendants defaulted on their obligations. They then failed to comply with notices issued under the Property Law Act 2007. Westpac exercised its power of sale over four of the six security properties, and in this proceeding seeks summary judgment against the defendants for a balance of principal and interest due at the date of hearing of $2,530,254.70, together with costs and disbursements.[3] The defendants oppose summary judgment. They say they have a genuinedefence to the claim arising out of Westpac's failure to take proper care in the exercise of its power of sale, and for failure to act in good faith in its dealing with them.Background[4] The first and second defendants are husband and wife. They are directors of the third defendant, and also trustees of the R & B Golian Family Trust.[5] The third defendant is the corporate trustee of Bits Development Trust.[6] Over the period from approximately May 2006 to September 2007 the defendants purchased six properties with the assistance of loans from Westpac:(a) In June 2006 the first defendant purchased land at 39 Constellation Avenue, Beachlands with a view to developing it (it engaged a builder to construct a house but the builder went into liquidation in October 2007 before completing it);(b) Also in June 2006 the first and second defendants, as trustees of the R & B Golian Family Trust, purchased Lot 1, 133A Tauroa Street,Whangarei, with the intention of developing it (they purchased building plans for a development comprising 6 townhouses from the previous owner);(c) In May 2007 the first and second defendants each purchased a residential unit (Unit 10 and Unit 33 respectively) in a development at 1002 State Highway, Karapiro (apparently as an investment);(d) Also in May 2007 the third defendant purchased vacant land at 4 Victoria Street, Waipawa (interestingly, from the same vendor as the Tauroa Street property) on the understanding that it was capable of development by the construction of 24 town houses as a proposed retirement village; and(e) In about August 2007 the third defendant purchased two lots of land at 19 Kamaka Crescent, Alexandra, which had a long-standing subdivision consent in place (originally granted in 2002) for subdivision into six allotments.[7] There is no dispute that the defendants have obligations to Westpac in respect of all loans, either as the borrower or under cross-guarantees, and that the mortgage securities given over all properties are security both for the loans and for the guarantees.[8] The development of the Constellation Avenue property ran into difficulties when the builder went into liquidation. The second defendant, who has given evidence on behalf of the defendants, says that this occurred on 31 July 2007 and that it took four months to obtain information from the builder and quotes from other builders to complete the work. She said that this created difficulties for the defendants. Official records show that the builder was put into liquidation on 31 October 2007. Whatever the second defendant meant to say, it appears that the defendants were under financial pressure by November 2007 at least, as by then several loans were in arrears, and oversight of the loans was transferred to a seniormanager in Westpac's Asset Management division (Ms Madden).[9] Westpac sought information as to the anticipated completion of the Constellation Avenue development, and received assurances from the second defendant that matters were in hand (it appears that the defendants were also engaged in other developments and were endeavouring to juggle their commitments on more than just the loans and properties at issue in this proceeding).[10] Notwithstanding ongoing correspondence and at least one warning (in March2008) about the defendants' failure to bring arrears up to date and Westpac'sintention to take legal action, the defendants continued to struggle to do so. In July 2008 Westpac served Property Law Act notices in respect of the mortgages over Constellation Avenue, Victoria Street, Kamaka Crescent and Unit 10 Karapiro on the defendants (both as borrowers and as guarantors), in respect of arrears as at 3 July 2008. Those notices required the defendants to remedy the defaults on or before 18 August 2008. The second defendant says that she attempted to deposit money to remedy the defaults on 18 August 2008, but was too late (the bank had closed). She did make the payments the following day.[11] Westpac's solicitors advised on 21 August 2008 that as the notices had expired unremedied on 18 August 2008, the money secured by the mortgages had become due and payable and Westpac had acquired the right to sell the mortgaged properties. It said that it was accepting the payments made following expiry of the notices, without prejudice to the accrued rights of sale.[12] Notwithstanding its accrued rights, Westpac agreed on 1 September 2008 to withhold further action if the defendants made two lump sum payments that month, completed Constellation Avenue from their own resources, and maintained a stipulated level of monthly payments from 30 September 2008. In Westpac's letterconveying this position, it was noted that the second defendant had said the Constellation Avenue property would be completed within a month. Also in that letter (written by Ms Madden) Westpac expressly reserved its right to resume enforcement action if the conditions were not met on the due dates. If the conditionswere met, Ms Madden would review Westpac's position again on 1 November 2008.[13] On 22 September 2008, Westpac served a Property Law Act notice in respect of Unit 33 Karapiro, and subsequently (in early December 2008) a further Property Law Act notice in respect of the Tauroa Street property.[14] The defendants made the first payment ($100,000) due under the ―deferralarrangement but were unable to comply with the other terms (although the second defendant says that she made a second payment of $50,000 on 30 September 2008, Westpac has no record of that payment).[15] The defendants attempted to sell the various security properties, to release funds for repayment that way. They say they referred several agreements to Westpac, in an effort to avert mortgagee sales. (Westpac acknowledged receiving some, but not all, of them.) Westpac was not prepared to defer the mortgagee processes, but told the defendants that it was likely to make a release of the mortgage available if the defendants were to obtain a sale price that was acceptable to Westpac, and if that sale settled prior to Westpac entering into an unconditional sale as mortgagee.[16] None of the agreements put forward by the defendants proceeded for reasons I will return to later in this judgment. Westpac proceeded to sell the Constellation Avenue, Tauroa Street, Victoria Street and Kamaka Crescent property in exercise of its power of sale:(a) Constellation Ave went to auction on 4 March 2009. It was not sold on the day, but was sold subsequently (on 13 March 2009) to one of the bidders, after further negotiations;(b) Tauroa Street sold at auction on 9 April 2009;(c) Victoria Street went to auction on 17 April 2009. There were no bids at the auction, but it was sold after negotiation following the auction; and(d) Kamaka Crescent went to auction on 17 April 2009. It was passed in at the auction, and a subsequent offer was not accepted. It was re- marketed for sale by tender, and was subsequently sold by tender in October 2009.[17] Westpac applied the sale proceeds against the outstanding balances under the loans. It made demand on the defendants on 12 July 2010 for the balance then due of $2,135,862.97. The second defendant replied promptly, noting the defendants had tried to sell their properties to clear the debts, and requesting that they be given time to sell remaining properties and pay the debts before further action was taken (at that point it appears that the two Karapiro units were the only properties left securing loans to Westpac). In follow up correspondence in October 2010, Westpac responded through its solicitors that the sale of the Karapiro units would still leave a substantial shortfall. It informed the second defendant that it would consider any substantive proposal to clear the debts but in the meantime intended to continue with the steps to enforce the agreements.[18] Westpac issued its claim in November 2010. The defendants filed a notice of opposition to the application for summary judgment in January 2011, raising for the first time their contention that Westpac had breached duties owed to the defendants in the exercise of its powers of sale.Further evidence[19] At the start of the hearing the defendants sought leave to file a third affidavit by the second defendant (she had filed two affidavits in support of their notice ofopposition, and sought to file a further affidavit to Westpac's affidavit in reply).Counsel for the defendants submitted that the reply affidavits contained new material as to the valuation of the properties (in particular, forced sale values) and advertisements of the Kamaka Crescent property (wanting to address the effect on the sale price of the failure to mention the development potential of the land). Theevidence included a report from the defendants' valuer on Kamaka Crescent together with evidence that resource consents and engineering approvals were still in place at the time of the advertisements.[20] Counsel for Westpac opposed the further evidence but, in the event that the affidavit was accepted, sought leave to file a very brief affidavit exhibiting a further advertisement (in the re-marketing stage of Kamaka Crescent).[21] Although I had some reservations as to whether this was truly new material, I granted leave to both parties to file the further affidavits on the basis that there was already evidence on the points before the Court, and it was better to make a decision on the basis of all available evidence.Principles for summary judgment[22] Counsel were in general agreement on the principles that the courtapplies in determining an application for summary judgment. As they are wellestablished, it is sufficient to note that they can be found in the classic case ofPemberton v Chappell1 and has recently been succinctly summarised by theCourt of Appeal in Krukziener v Hanover Finance Ltd in the following passage:2[26] The principles are well settled. 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).[23] The principles of significance in the present case are:(a) The plaintiff seeking summary judgment has to show that there is no defence to the claim, or put another way, that there is no real1 Pemberton v Chappell [1987] 1 NZLR 1 (CA).2 Krukziener v Hanover Finance Ltd [2008] NZCA 187; (2008) 19 PRNZ 162 at [26].question to be tried. The court must be left without any real doubt or uncertainty;(b) While the onus is on the plaintiff, a defendant needs to provide a sufficient basis (or foundation) for the defences raised to resist entry of summary judgment; and(c) In assessing that evidential foundation, the court will not normally try to resolve conflicts of evidence or assess credibility of the witness, but can still decide whether evidence passes a threshold of credibility: it need not accept evidence that is inherently lacking in credibility (because it is inconsistent with undisputed contemporary documents or other statements by the same witness), or is equivocal, imprecise or inherently improbable.(d) The court is entitled to assess the evidence in a robust and commonsense way.The duty of a mortgagee[24] There is no dispute of the fact that Westpac sold the four properties in exercise of a valid power of sale under the mortgages. The defendants' case is thatwhen Westpac exercised its power of sale it owed the defendants a duty of good faith, and a statutory duty under s 176 of the Property Law Act 2007 to take reasonable care to obtain the best price reasonably obtainable at the time of sale.3[25] The duties of the mortgagee now incorporated in s 176 are derived from equitable principles:4Several centuries ago equity evolved principles for the enforcement of mortgages and the protection of borrowers. The most basic principles were, first, that a mortgage is security for the repayment of a debt and, secondly, that a security for repayment of a debt is only a mortgage. From these principles flowed two rules, first, that powers conferred on a mortgagee must be exercised in good faith for the purpose of obtaining repayment and3 Downsview Nominees Ltd v First City Ltd [1993] 1 NZLR 513 (PC).4 Ibid, at 522.secondly that, subject to the first rule, powers conferred on a mortgagee may be exercised although the consequences may be disadvantageous to the borrower. [26] An equitable duty co-exists with the statutory duty (although it is largely incorporated within it). In most cases the statutory duty of care will be more onerous than the equitable duty.5 This is because the duty to act in good faith only requires a mortgagee to act without fraud and without wilfully or recklessly sacrificing the interests of the mortgagor (stopping short of exposing the mortgagee for liability for negligence).6[27] The principles that the court applies in deciding whether there has been a breach of the s 176 duty have been reviewed in several recent New Zealand cases.7[28] Counsel identified the following principles as having relevance to the present application:(a) Following default, the mortgagee is entitled to decide if and when to sell the secured property; in making this decision the mortgagee is entitled to act purely in its own interests;8(b) The statutory obligation is not to obtain the best price reasonably obtainable, but to take reasonable care to obtain the best price reasonably obtainable (emphasis added). In other words, the focus of the duty is on process rather than price per se;9(c) A mortgagee sale at a price less than the current market value assessed by valuers does not, of itself, establish a breach of duty —5 Apple Fields Ltd v Damesh Holdings Ltd [2001] 2 NZLR 586 (CA) at [47], upheld in AppleFields Ltd v Damesh Holdings Ltd [2004] 1 NZLR 721 (PC).6 Commercial and General Acceptance Ltd v Nixon (1981) 38 ALR 225 at 249, accepted in Apple Fields (CA), above n 5, at [47].7 Apple Fields (CA), ibid at [40]—[52]; Agio Trustees Co Ltd v Harts Contributory MortgagesNominee Co Ltd (2001) 4 NZ ConvC 193,480 at [70]—[71]; Harts Contributory MortgagesNominee Co Ltd v Bryers HC Auckland CP403-IM00, 19 December 2001 at [43]; Public Trust vOttow (2009) 10 NZCPR 879 at [17].8 Cuckmere Brick Co Ltd v Mutual Finance Ltd [1971] Ch 949 (CA); Downsview Nominees Ltd v First City Corporation Ltd, above n 3; Agio Trustees Co Ltd v Harts Contributory Mortgages Nominee Co Ltd, above n 7.9 Agio Trustees Co Ltd v Harts Contributory Mortgages Nominee Co Ltd, above n 7, at [122];Moritzson Properties Ltd v McLachlan (2001) 9 NZCLC 262,448 (HC) at [55].some unreasonable material deficiency in the sales process will usually be necessary; however, a large discrepancy may indicate a failure to take reasonable care;10(d) The mortgagee is not entitled to sell in a hasty way, at a knock-down price sufficient to pay the debt, where the speed of sale leads to a lower price than could otherwise be obtained;11 and(e) Proper care must be taken to expose the property to the market byadvertising with an adequate description of the property's attributesand, within reason, widely enough to attract all possible purchasers.12[29] There are several further principles which I consider directly relevant. Theserelate to a mortgagee's obligations under s 176 regarding agreements for sale andpurchase of a property entered into by the mortgagor prior to a mortgagee sale. In summary, they are that:(a) A mortgagee is not obliged to support an agreement for sale that is entered into by the mortgagor prior to a mortgagee sale.13(b) The duty under s 176 must be looked at realistically, and in practical commercial terms.14(c) A mortgagee is not bound to take any steps that would prejudice its security15 and is therefore entitled not to support a contract for sale of a property entered into by the mortgagor, if clear doubt exists as to its commercial viability.1610 Moritzson Properties Ltd v McLachlan, ibid, at [61].11 Palk v Mortgage Services Funding Plc [1993] Ch 330 (CA) at 338.12 Harts Contributory Mortgages Nominee Co Ltd v Bryers, above n 7, at [43](d).13 British Mercantile & Loan Trust Co Ltd v Trustees Executors Ltd (2006) 7 NZCPR 738 (HC) at[29].14 Apple Fields Ltd (CA), above n 5.15 Dorchester Finance Ltd vTee- Wang HC Christchurch CIV-2008-409-814, 21 August 2008 at[27].16 British Mercantile & Loan Trust Co Ltd, above n 13, at [29].[30] Ultimately, however, whether the mortgagee has taken reasonable care to obtain the best price reasonably attainable can only be assessed by reference to the facts of the case.The grounds of opposition[31] As there is no issue as to the parties' obligations under the loan agreementsand guarantees, or as to the validity of the securities, the question for determination is whether any of the matters advanced by the defendants give rise to an arguable defence. This includes a consideration of the evidential foundation for any matter raised in defence.[32] The defendants contend that Westpac breached its statutory duty by:(a) Rejecting the agreements for sale of the properties that they presented to it;(b) Failing to advertise adequately and in relevant terms; and(c) Selling at values that were so much lower than expert valuation assessments, that an inference that it failed to take reasonable care may be drawn.[33] The defendants also rely on the same matters to support their contention that Westpac failed to act in good faith. In addition to those points they refer to the terms required by Westpac in September 2008 for postponing steps in the mortgagee sale, which terms they say were out of proportion to the defaults and were capable of being claimed only because the defendants were one day late in meeting the Property Law Act notices. They also point to Westpac's failure to warn them that it wasintending to issue a Property Law Act notice in respect of Unit 33, Karapiro when it discussed the terms for deferring mortgagee sale action under the four notices issued to that point.The steps taken by the plaintiff[34] The starting point for the evidence is a consideration of the steps that Westpac took to obtain the best price reasonably obtainable. Ms Madden has given evidence of the process followed for each of the four properties:(a) It obtained market appraisals for each property from two real estate agents;(b) It appointed a real estate agent to advertise and market each property for at least four weeks (in the case of Victoria Street it was five weeks), engaged experienced agents to undertake the process, and, where offers received were not consistent with appraisals or valuations, sought advice on the best means of securing a sale.(c) It obtained valuations from professional valuers ahead of sale, and in some cases consulted with the valuer before accepting an offer;(d) It sold all properties either at auction, or subsequent to auction after negotiation, or by a tender process.[35] I am satisfied that Westpac's evidence establishes a prima facie case that itexercised reasonable care in the mortgagee sale process. In light of that evidence, it is for the defendants to provide an evidential foundation for the matters that they contend comprise a breach of duty by Westpac.Rejection of defendants' agreements[36] The defendants' case is that Westpac acted unreasonably in rejecting agreements procured by the defendants for Constellation Avenue, Tauroa Street and Kamaka Crescent between September and November 2008. Their counsel submitted that these agreements would all have led to sales prior to, or about, the time of the eventual mortgagee sales, and would have resulted in substantially greaterrecoveries. He relied on two authorities17 to support his submission that in a declining market it was at least arguable that in rejecting the offers Westpac acted unreasonably, and that it should carry the risk of not achieving a similar price. This submission needs to be examined for each of the affected properties.Constellation Avenue[37] The second defendant produced an agreement for the sale of Constellation Avenue at $660,000 on the basis that it would be completed before settlement: settlement was to be ten working days after the issue of a code compliance certificate, but not later than 30 January 2009. A deposit of $20,000 was payable upon the contract becoming unconditional in all respects – the agreement was subject to the first defendant vendor completing the works prior to settlement, and tothe purchaser obtaining finance ―sufficient to complete the purchase within 20working days from the date of the agreement. The agreement was undated but the second defendant says that it was signed after the Property Law Act notices wereissued, and she thought it was ―about October 2008. She says that she met with MsMadden immediately after it was signed to discuss it. She says that Ms Madden refused to consent to that sale at that meeting.[38] Ms Madden does not recall discussing this agreement with the second defendant, and has no record of a meeting in October 2008. Her diary shows meetings on 22 August 2008 and 1 September 2008, both of which would fit with thesecond defendant's recall of the agreement being signed after the Property Law Actnotices were issued.[39] Although it seems unlikely that the second defendant met with Ms Madden in October 2008, I am unable to resolve whether they had a discussion about this agreement at either of the August and September meetings. However, it is not necessary to make a finding on that point to determine this application, for two reasons.17 AMP Finance NZ Ltd v Kendall (1989) 1 NZ ConvC 190,175 (HC) at 190,178; Palk v MortgageServices Funding Plc, above n 11, at 339.[40] First, it is not in dispute that the building was never completed and a code compliance certificate was never issued. There is no evidence that an extension to the settlement date was sought, and the second defendant's evidence is that sheaccepted by as early as November 2008 that she could not complete construction, at which point she listed Constellation Avenue with a real estate agent. She also says that she listed it with a second agent, which further suggests that she accepted it was unlikely that the agreement would proceed.[41] The second factor is that there was no attempt to settle the agreement either on 30 January 2009 (the due settlement date) or at any time up to 13 March 2009 when Westpac entered into its agreement. Ms Madden says that if she had been asked to provide a discharge of mortgage to allow the defendants' agreement tosettle, she would have done so. She says that she would have been delighted to have received $660,000 from that security rather than the $370,000 eventually achieved. I have no hesitancy in accepting this evidence given that Westpac had obtained a forced sale valuation in July 2008 of $466,000 (valuations obtained after the settlement date were lower still).Kamaka Crescent[42] On 19 September 2008 the third defendant entered into an agreement to sell the two lots at 19 Kamaka Crescent to Empire Civil Limited or nominee for$517,500. The agreement provided for a deposit of $30,000 to be paid ―in BBX Trade Dollars to be credited to 'the vendor's BBX account'. Settlement was to be four months from the date that the third defendant provided the purchaser with engineering consent documents for subdivision under an existing resource consent, and issue of a certificate under s 223 of the Resource Management Act 1991 in relation to the survey plan.[43] The second defendant provided Westpac with a copy of this agreement on 21 November 2008, following a request by Ms Madden for copies of all agreements for all properties. (It is apparent from a subsequent exchange of emails on 24 and 25 November 2008 that the only agreements provided at that time were the Kamaka Crescent agreement and agreements on each of the Karapiro units.) Ms Maddensays that the agreement was not acceptable to Westpac. She conveyed this to the second defendant in an email on 25 November 2008, and gave the reasons: the provision for the deposit to be paid in BBX dollars rather than cash, and the long settlement date.[44] The second defendant's response to that email (also on 25 November 2008)was to inform Ms Madden that she had spoken to the purchaser:... who will consider giving cash for the deposit but they can only give may be [sic] 5 % now and 5 % after x-mas. The settlement can be brought forward as well as all the consents in place already.[45] Ms Madden replied, again by email, the following day:I refer to your e-mails received yesterday.The Bank intends to proceed with it's recovery action under the expiredProperty Law Act Notices. As you are aware you have been provided with a significant amount of time already for sales to be achieved/debt to be repaid.You have the right to redeem your mortgages at any time up until the Bankhas unconditionally sold it's security.Without prejudice to the above position, if you have a sale agreement which is at a price acceptable to the Bank and the sale settles prior to the Bank entering into an unconditional sale as mortgagee, then it is likely that a release of mortgage would be available on settlement on that basis.I would suggest that it is now appropriate that you now seek legal advice as to your position.[46] There is no evidence to suggest that the purchaser agreed to provide a deposit in cash or to bring the settlement date forward.[47] I do not consider it unreasonable for Westpac to have rejected the agreement (in terms of refusing to stop further mortgagee sale action) on these grounds. Westpac had no obligation to accept trade dollars as a deposit. Although the defendants produced evidence an organisation known as Bartercard that these trade dollars had been used in other property transactions, they are clearly not redeemable in cash, and Westpac is entitled to be repaid in cash. The second defendant appears to have accepted this by seeking to negotiate payment in cash with the purchaser. It is telling that she did not get back to Westpac to confirm that change to theagreement. Similarly I do not accept that Wespac acted unreasonably in proceeding with its mortgagee sale given the lengthy settlement period, and particularly given itsindication that ―the door was open to the defendants if they could bring the settlement of their agreement forward. It is significant that they could not. Although Ms Madden expressed its position cautiously, it is clear from her email that Westpac was likely to provide a discharge if the defendants could cure the difficulties with the agreement.Tauroa Street[48] The first and second defendants (as trustees of R & B Golian Family Trust) entered into an agreement on 19 November 2008 to sell Tauroa Street to Fratelli Family Trust or nominee for $410,000. The agreement provided for a deposit of $25,000. A further term of sale provided that the deposit was to be paid 'in OZONE Trade Dollars' to be credited to 'the vendors OZONE account'. The settlement date was stated to be 13 May 2009 (approximately six months later).[49] The second defendant says that the defendants were unable to proceed with this contract because Westpac had said that it was not acceptable because the deposit was payable in trade dollars rather than cash.[50] Ms Madden says that she can find no record that Westpac ever received this agreement, but says that she would have rejected it in any event for the same two reasons that made the agreement on Kamaka unacceptable: first, her understandingthat ―OZONE trade dollars are part of a bartering system and are not redeemable for cash; secondly because of the delayed settlement.[51] As with the Constellation Avenue property, I do not have to determine the dispute over whether Westpac knew of this agreement (as the second defendant contends), but I refer again to the exchange of email correspondence between the second defendant and Ms Madden in November 2008 in which the second defendant was asked to provide copies of all agreements, and note that on 21 November 2008 (two days after the date of this agreement) the second defendant provided Westpac with only the agreements on Kamaka Crescent and the two Karapiro units. Iconsider that the likelihood is that Westpac was not provided with a copy of this agreement, and that the second defendant had the Kamaka Crescent agreement in mind when saying that Westpac knew of this one, as the Kamaka Crescent agreement was with a party associated with the purchaser of Tauroa Street and also provided for payment of the deposit in trade dollars, and for a lengthy period before settlement.[52] I take the same view of the arguments regarding this agreement as for the identical arguments in respect of the Kamaka Crescent agreement.[53] Lastly, I do not find the authorities put to me by counsel for the defendants in support of the submission that Westpac had to take the risk of a lower price at auction assist their case. The circumstances of both cases were peculiar, and clearly distinguishable on the facts.[54] In AMP Finance NZ Ltd v Kendall,18 the plaintiff mortgagee had attempted to sell the property privately and also by auction, with no success. It then turned down an offer because it was well below a valuation it had obtained. However, since the valuation, the property market had fallen. The plaintiff failed to sell the property at auction a second time. It subsequently sold the property to the person who made thefirst offer, but for an amount less than the earlier offer. In considering the defendant'sliability for the shortfall, Master Hansen stated that in the normal course of events it would be difficult to find that a mortgagee, conducting a sale by way of auction, was not exercising reasonable caution in exercising its power of sale.19 He continued:... the facts in this particular case are somewhat different and it seems to me that each individual case must be viewed against its own peculiar facts. Bythe time the stage of mortgagee's sale had been reached it must have beenabundantly clear that the January 1988 valuation was completely unrealistic ... Against the background circumstances of the earlier unsuccessful efforts to sell by private treaty and auction; against the obvious considerable decrease in value from the January valuation, it seems to me at least to be arguable that the Defendant ought to have accepted the $380,000 in discharging the onus to it to obtain a proper price.18 AMP Finance NZ Ltd v Kendall, above n 17.19 Ibid, at 190, 178.[55] The Court found, having regard to the overall circumstances and nature of the agreement procured by the defendant, it was unreasonable for the plaintiff mortgagee to reject the first opportunity to sell and to proceed with its power of sale.[56] A similar conclusion was reached by the English Court of Appeal in the second authority relied on by the defendants: Palk v Mortgage Services Funding Plc.20 That case was an appeal against the County Court Judge's refusal of themortgagor plaintiffs' application for an order for sale. The plaintiffs, a husband andwife, were unable to meet the obligations of their mortgage to the defendant finance company and so negotiated a sale of the house for £283,000. The amount needed to redeem the mortgage was £358,587. The company refused to consent to the sale, and instead sought an order for possession with a view to letting the house and postponing sale to achieve a better price once the market had improved.[57] By the time the appeal was heard, the amount owing on the mortgage had increased to approximately £409,000. The Court of Appeal held that while a mortgagee is entitled to protect its own interest, it is not entitled to conduct himself in a way which unfairly prejudices the mortgagor. The Court said:21If Mortgage Services wishes to chance its arm, and run the risk involved in waiting to see what happens to house prices, it should be free to do so. In common fairness, however, it ought not to be able to saddle Mrs Palk with that risk and a rising debt against her wishes. It should back its own judgment. It should not be able to have recourse against Mrs Palk for an increased sum, being the adverse financial consequences of a realisation scheme Mrs Palk opposes on reasonable grounds. She should not be at risk of being worse off than she is now. She ought not to be made liable for what I have referred to as the income shortfall. She ought to be credited now with the current value of the property. Subsequent fluctuations in value, for better or for worse, would then become a matter of concern only to Mortgage Services.[58] The defendants in the present case have not pointed to anything whichdemonstrates that Westpac's rejection of any agreement presented by them wasunreasonable, thus causing them to be prejudiced unfairly. I see no reason why Westpac should be required to assume the risk of any shortfall resulting from the20 Palk v Mortgage Services Funding Plc, above n 11.21 Ibid, at 339.various sales achieved by Westpac at auction, negotiation subsequent to auction, or tender.Was the advertising adequate?[59] The essence of the defendants' argument in respect of advertising is that thevalue of Tauroa Street, Victoria Street and Kamaka Crescent properties lay in their development potential, and that this was not clearly or sufficiently brought out in the advertisements ahead of the mortgagee sales. In particular, the second defendant stated in evidence that she had Council approval to build town-houses on Tauroa Street, that she had the necessary Council consents for a 24 unit retirement village development at Victoria Street, and that the third defendant had ―subdivision consent, engineering approval and resource consent for a six lot development of theKamaka Crescent land.[60] Counsel for the defendants submitted that the failure to refer to these mattersin advertisements of the sales meant that each properties' attributes were not adequately described. He submitted that this was arguably a breach of Westpac'sduty.22[61] Counsel for Westpac argued that the advertising of all properties was adequate having regard to the specific attributes of each property. Again, I will consider the evidence in respect of each property.Tauroa Street[62] In the case of the Tauroa Street property counsel for Westpac accepted that existing zoning permitted subdivision of that property. He accepted that the advertising did not refer to subdivision, but submitted that no resource or other subdivisional consent had been issued for any development (as evidenced by a recent LIM report), a fact which was confirmed by Westpac's valuer in a report issued in July 2008 in which the valuer had also expressed the view that in light of the22 Relying on Harts Contributory Mortgages Nominee Co Ltd v Bryers, above n 7, at [43](d) andANZ National Bank Ltd v Taylor HC Auckland CIV-2010-404-201, 17 December 2010 at [36].subdivision costs for that land, coupled with diminishing demand, a subdivision to its potential would not be a viable exercise in the prevailing market; the valuerviewed the property as ―a large residential block with possible future subdivision[sic].[63] In light of that evidence, counsel for Westpac submitted that explicit reference to possible subdivision potential was not a particular attribute, the omission of which was significant enough to render the advertisement inadequate. This submission needs to be considered by reference to evidence as to the potential market, and the steps taken generally.[64] The marketing programme undertaken by the real estate agent engaged to market the property shows that advertising undertaken in the local property guide and local newspaper were only two aspects of the marketing programme. In addition, the agent undertook a mailout of a brochure (not provided in evidence) to―qualified databases and sent email advice to its ―qualified developer databases, aswell as listing the property on its website.[65] The advertisement needs to be considered in light of that wider marketing, and prevailing market factors identified in the valuer's report of July 2008. This includes reference to a number of larger residential blocks in the same locality with a potential to be subdivided (having the same zoning as Tauroa Street), some of which had initial scheme plans drafted and resource consent approvals, but the majority of which had not been subdivided due to the uncertainty in the marketplace and a fall in market activity.[66] In those circumstances, I do not consider the failure to refer in the advertisement to future subdivision potential to be a breach of duty. The advertisement identified the size of the land (3,451m2) which would have indicated subdivision potential to anyone with an interest. Local developers were specifically targeted. The defendants say they had done a considerable amount towards obtaining a subdivision consent. There was no evidence of those steps other than the purchase of building plans and an engineering report. The second defendant says that the defendants would need to spend about $60,000 to reach the point of separatetitles being issued. Again there is no detail as to what was needed in that respect. In my view this puts the case in a different category to ANZ National Bank Ltd v Taylorwhere a resource consent for the subdivision was extant but had been omitted from the advertisement and marketing of the property. (It is clear that there was no consent in place in this case - in addition to the evidence of the LIM report, a reference to an "approved consent" was deleted from the defendants' agreement with Fratelli Family Trust.)Victoria Street[67] The defendants' complaint about advertising of the Victoria Street propertyagain was that it made no mention of its subdivision potential. As a secondary complaint, they say that the size of the advertisements was inadequate as they failed to stand out from surrounding advertisements, advertising trades and services.[68] Westpac says that the complaints are unjustified, and that the advertisement (which referred to a flat bare site of 1.1991 ha ―being packed with potential – but without any reference to the proposal for a retirement village development) was entirely appropriate having regard to difficulties that had been identified with the site (primarily the fact that it lay in a designated flood zone).[69] In those circumstances counsel for Westpac submitted that it was inappropriate for Westpac to have said anything about subdivision potential without addressing many of the negative features, and that the advertisement (by referring to the size of the land and to ―potential) was adequate to attract the attention of anyone with a possible interest. He made the point, as with the other properties whose advertisements have been criticised, that this was all land in small town or semi-rural locations where subdivision potential was less significant than in a large urban environment where there was far less vacant land available (as was the case of the land in issue in ANZ National Bank Ltd v Taylor).[70] Counsel for Westpac also relied on a LIM report which evidenced the fact that no consents had been issued for the retirement village, and valuation evidenceobtained in June 2008 that some limited subdivision potential was available, subject to resolving the drainage issues and an increase in local demand.[71] Lastly, counsel noted that the advertisements produced by Ms Madden were as examples only, and pointed to the fact that advertisements had been conducted over a five week period, in two local newspapers, as well as internet advertising.[72] It is clear from the report of Westpac's valuer in June 2008 that although theVictoria Street land is zoned for medium, or even high, density development, the low-lying nature of the land, and potential flooding restrict that potential subdivision substantially, and likely subdivisional requirements make any subdivision problematic, and potentially uneconomic. The following paragraph from the valuation report is significant:There are no applications on file at the Council to subdivide this land although Council staff inform me that initial applications have been made but when Council requested details on how stormwater and sewage were to be addressed beyond the subject property no further submissions were made; as this entire area is low-lying any upgrading of the drain beyond the subject property is likely to be very expensive. Hence until servicing of the locality is addressed most likely intensive subdivision will be prohibitively expensive as there is little demand for sections in this locality and land values are low.[73] If a resource or any other subdivision consent had been given, that may well have been an attribute of the property that would need to be conveyed to potentialpurchasers. However, I cannot accept the second defendant's statement that she hadall the necessary consents for the third defendant's proposed development (and hadonly to spend a further $50,000 to complete the subdivision) in light of the unequivocal evidence available in the LIM report that no relevant resource consents have been granted (a resource consent was granted in 2009 to relocate a dwelling on to the land and this possibility was mentioned in the advertisement).[74] In the circumstances I accept the submission of counsel for Westpac that Westpac could not extol the subdivision potential claimed by the defendants, or indeed in any particular respect, and that it was appropriate to confine advertising to the reference to the size of the site and to "potential", leaving it for prospective purchasers to decide for themselves what that potential might be.Kamaka Crescent[75] The advertisement of the Kamaka Crescent land raises slightly different issues. In this case resource and engineering consents for subdivision into the six allotments were in place, but there was no specific reference to them in the advertisements either for the auction held in April 2009 or for the subsequent tender.[76] Counsel for Westpac submitted that such explicit reference was not needed tomeet the ―attribute test. He argued that the potential for subdivision was apparentfrom the area of the land and the fact that the advertisement was directed to―Entrepreneurs, Developers, Investors or those looking for a large site. Theadvertisement of the sale by tender went further by referring to possible subdivision:This property has a total of 1.3335 ha and has the potential for possible subdivision.[77] Counsel for Westpac submitted that at the time of the advertisements there was uncertainty over the subdivision consents. A resource consent for the six lot subdivision had been granted in July 2002, subject to 19 conditions, and to the subdivider providing suitable access to all lots without any Council contribution to the costs of forming and maintaining a carriageway on an unformed legal road, and to all Council charges being paid. Two extensions had been sought and granted, taking the period of the consent up to 1 July 2009. The most recent request had beenmade by the defendants' engineers to allow them time to complete the requirementsfor engineering approval. That approval was granted on 19 November 2008.[78] Westpac obtained marketing appraisals from two local real estate agents in December 2008. Both referred to difficulties in developing the sites due to rocky and sloping terrain and the need for expensive and costly site development and engineering work associated with it. One of the agents (not the one engaged to market it) commented that the proposed development was a difficult and costly subdivision that was most likely to be uneconomical having regard to current land values in the area. Counsel for Westpac submitted that in light of those appraisals, the resource consent was not a significant attribute for the property. He invited the Court to find that the auction advertisement had sufficiently identified the attributesof the property by referring to the size of the lots (particularly the larger lot of 1.2168ha) and by calling for the attention of ―Entrepreneurs, Developers, Investors or thoselooking for a large site Westpac had done all that was necessary.[79] Counsel for Westpac also referred to an appraisal undertaken by the real estate agent engaged to conduct the sale by tender to the effect that at that time (12 August 2009) there were still issues over the consents:(a) It was unclear whether the approved subdivision plan had been lodged before the consent lapsed on 1 July 2009 (there was no record on the titles of completion of that process);(b) Council charges for consultation on the engineering approval were outstanding and would have to be paid if the subdivision proceeded;(c) Costs associated with the carriageway over the paper road, required to gain access to one of the lots, would have to be met by the developer (the Council had stated it would not be contributing to them);(d) The subdivision would require engineering of retaining walls for access ways, and either excavation of the rocky terrain or construction of retaining walls to provide building platforms, and for the subdivision (estimated at $250,000 plus GST in 2005) would likely increase as they did not include additional costs for rock breaking, and as a result of inflation.[80] Counsel for Westpac agreed that although there were three potential target markets (developers, land bankers and buyers wanting lots for a single home) the resource consent would only be relevant to developers who were likely to be interested only if the subdivision plan had in fact been lodged, and that even then,the costs of development meant they would only consider purchasing ―at the lower end of the scale. He submitted that in those circumstances reference to the resource consent (with just over two months to run in respect of the auction, and of uncertain status in respect of the tender) was of doubtful value, and the reference tosubdivision potential adequately established the attributes for the property (because the real question was whether it was economic to carry out the subdivision, it was unreasonable to require Westpac to make express reference to available resource consents in light of the uncertainties about them – to the contrary, it was reasonable to expect that purchasers interested in the subdivision potential would obtain a LIM report and establish the position for themselves).[81] Again he submitted that ANZ National Bank Ltd v Taylor should be distinguished on the basis that a resource consent granted for a subdivision in an urban environment was of far greater significance than the resource consent in a provincial location where there was far greater availability of land. He argued that ultimately the question was whether any omission had an impact on the value obtained, and pointed out that the evidence of the defendants' valuer (responding tothis very point) did not go this far:PERHAPS a better sale price could have been achieved had the property been advertised acknowledging that [the resource and engineering consents] were in place (albeit that the resource consent was due to expire).[82] Although the existence of a consent to subdivide may well be material to the value that a potential developer would pay for land, that will largely depend on the terms of the consent (whether there are constraints on the type of development and what the costs are likely to be to fulfil any conditions). However, for the purpose of the present application the question is whether existence of the consent is likely to create an interest that would otherwise not exist. The terms of the consent would then be material to whether the interest would arguably result in greater value being obtained for the land. Where the consent is for a straightforward subdivision capable of being undertaken within the period of the consent, knowledge of its existence could well attract interest that might otherwise not exist. It would also allow a prospective purchaser to put a value on that consent. I infer that that is the view that the Court took of the consent that was available in ANZ National Bank Ltd v Taylor.[83] I am not persuaded that addition to the advertisement of a reference to the consent in place for the Kamaka Crescent property would both have attracted greater interest and resulted in a higher price. The advertisement as placed was sufficient to attract developers with a general interest in Alexandra. Reference to the resourceconsent could well have been counterproductive if someone who was not otherwise interested was attracted by the promise of a consent, only to find that there were unmet conditions and, either that it was about to lapse or had already lapsed, after having been in existence for seven years.[84] This point does not sit in a vacuum. It has to relate back to what was reasonable for Westpac. Westpac had to walk a fine line between attracting likely interest and not misrepresenting the property. In the circumstances, I do not accept that failure to include reference to this resource consent in the advertisement was a breach of its duty. As I have said already, I consider that it is of a different character to the resource consent in place for a subdivision of a residential block in central Auckland, as in ANZ National Bank Ltd v Taylor.The valuation evidence[85] The next ground advanced by counsel for the defendants was that the values obtained were so much lower than the defendants' valuations (and in some cases valuations obtained by Westpac) that the defendants ought to be able to put the whole process 'under the microscope' of discovery and trial. I do not accept that this provides the defendants with an arguable ground for defence for two reasons.[86] The first is that the valuations were clearly dropping over time (with the movement in the market), or there were reasons given for the valuer having revised his views (for example, purchaser feedback in the case of Constellation Avenue). Secondly, and even more compellingly, the auction or tender process established the market position, and in that circumstance prevails over valuation evidence. I will expand upon each of these points in turn.Constellation Avenue[87] The defendants argue that the sale price of $370,000 for Constellation Avenue was unsupportable having regard to a mortgagee sale assessment by Westpac's valuer in July 2008 of $466,000, and a reassessment just before auction at $410,000.[88] That complaint has to be viewed in the following context:(a) The July 2008 valuation was eight months earlier than auction and there is no doubting the fact that the market was falling. Further, and although the same valuer reduced his forced sale assessment to $410,000 immediately before the auction, the valuer was asked to comment on the fact that the highest offer at auction was $300,000.(b) The valuer obtained information from prospective purchasers, as a result of which he again revised his forced sale assessment to $340,000 (the feedback that he was given was that prospective purchasers had concerns about the quality of workmanship, on top of the fact that there was still work to complete to obtain a code compliance certificate).(c) The price ultimately obtained after negotiations ($370,000) was both higher than the valuer's last assessment ($340,000), and was consistent with market appraisals obtained in December 2006.[89] Any questions, however, as to whether the difference between price obtained and valuations could possibly give an arguable defence is squarely put to rest by the fact that the property went to auction, after a four week advertising period:23Regardless of valuations altogether, the ultimate test was the auction. Valuations lose most of their significance once there has been a properly advertised auction. In this case, following a marketing period which was adequate in length and nature, the highest bid was only $1 million. Harts were acting on expert advice when they ultimately accepted the offer of $1.2 million. They cannot be criticised for that.Tauroa Street[90] The issue in respect of this property is that the defendants obtained a valuation on 10 March 2009 (that is, a month before auction) for $410,000. On its face, that value appears to raise issues where the property was sold for $80,000. The23 Harts Contributory Mortgages Nominee Co Ltd v Bryers HC Auckland CP 403-IM00, 19December 2001, [49].defendants' valuation was a market valuation rather than forced sale, and Westpac's valuer took issue with much of its methodology. The significant point, for present purposes, is that the price ultimately achieved was obtained at auction, after a four week advertising period, was just below the lower end of the range for forced sale value given in June 2008, was within the range given by its valuer prior to sale and, was the same as a market appraisal given by an agent in November 2008. In the circumstances, the possible inference to be drawn from the disparity between the defendants' valuation and the price obtained at auction is rebutted.Victoria Street[91] The defendants relied, in the case of this property, on a pre-purchase valuation obtained in March 2007 for $287,000. The property was sold, following an unsuccessful auction, for $80,000.[92] Again, I find that any possible inference to be drawn from the difference between the defendants' valuation and the eventual sale price is satisfactorily rebutted by the plaintiff's evidence as to the following:(a) It obtained a valuation in June 2008 of $105,000 on a forced sale basis.(b) Westpac obtained market appraisals from real estate agents in November 2008, one of which was substantially lower ($50,000) and the other was for a range slightly higher than the June forced sale valuation.(c) No bids were obtained at auction on 17 April 2009. Westpac went back to its valuer who confirmed that the market had deteriorated further and confirmed that auction was likely to lead to the best price being obtained.(d) Westpac subsequently received an offer of $50,000 which it rejected (notwithstanding that its agent recommended acceptance because ofthe negative features of the property and other easier options for purchasers), and subsequently received another offer of $80,000 which it accepted.Kamaka Crescent[93] The defendants base their argument in respect of this property on a valuation obtained in September 2008 (for both lots) of $500,000, compared to the eventual sale (by tender) at $85,000.[94] Again, I find that any possible inference to be drawn from this disparity in values is rebutted by the following:(a) Westpac obtained a valuation in July 2008 for forced sale in the range of $210,000 - $225,000.(b) Westpac obtained market appraisals from two real estate agents in December 2008 of about $290,000 for both, as against a range of $140,000 - $160,000 for both (and engaged the agent who put forward the higher appraisal).(c) The day before auction, Westpac sought advice from its valuer as to whether there had been any change in his assessment. His advice was that the market had dropped further, and the way to establish a proper value was to market and sell as Westpac was doing.(d) The property was passed in at auction on 17 April 2009 (an offer made after the auction of $82,000 was not accepted).(e) Westpac obtained a further appraisal in August 2009 for remarketing the property. That appraisal recommended sale by tender, and gave a forced sale range of $150,000 - $200,000.(f) Notwithstanding the valuation advice and the appraisals, the best tender was $85,000. Westpac accepted it.Good faith[95] Counsel for the defendants argued that the matters specifically put forward as indicating a breach of duty were also evidence of a desire by Westpac to remove what it clearly viewed as risky loans from its loan book, to protect itself at a time of global financial difficulties without regard to the interests of the defendants. In addition to the arguments that Westpac had rejected agreements that had the potential to provide greater recovery, the allegedly inadequate advertising and willingness to accept prices well below valuation, counsel submitted that further support for his argument could be found in:(a) Westpac's 'precipitous action' in calling up the loans when the defendants were only one day late in complying with the Property Law Act notices;(b) the issue of a Property Law Act notice in respect of the second Karapiro unit after agreeing at the start of September 2008 to give the defendants time;(c) Westpac's insistence on the defendants making substantial payments off the loans in September 2008, preventing them from using that money to complete Constellation Avenue (in particular); and(d) Westpac failing to fund completion of developments (such as Constellation Avenue) to improve potential recoveries.[96] This argument conveniently overlooks the fact that Westpac (through its senior manager Ms Madden) had been working with the defendants from November 2007 in an effort to get these loans on a better financial footing. The defendants had known, since the loans were put under Ms Madden's care in November 2007, that the position was serious but had been unable to address Westpac's concernssatisfactorily. In particular I record that at a meeting on 15 January 2008 Ms Madden informed the second defendant that Westpac would not be allowing any further drawings until valuations and financial accounts were available and Westpac could reassess any request in light of the security and debt servicing position. Subsequently, on 4 February 2008, and again on 11 March 2008, Ms Madden wrote to the second defendant asking for arrears to be brought up to date and, in the latter letter, told her that recovery action was about to commence.[97] Westpac's decision to proceed with calling up the loans following expiry of the notices was hardly 'precipitous action' against that background. Even then, Westpac still gave the defendants opportunity to resolve matters by agreeing not to act for two months. Its terms for doing so (bringing arrears up to date and making some lump sum payments to improve Westpac's security) were simply the actions of a prudent lender. Further, there was no suggestion that there was any agreement that Westpac would not issue a further Property Law Act notice during the agreed deferral period.[98] What is more significant is that the defendants were unable to keep to the terms on which Westpac granted the deferral, including the requirement that the defendants complete Constellation Avenue out of their own resources. It is notable that this requirement was in accordance with statements made by the second defendant, dating back to November 2007, that the defendants were able to complete Constellation Avenue and other properties out of their own resources:(a) In an early email to Ms Madden (on 21 November 2007) the second defendant contended that she had 'surplus cash of $1 million in various places, so we are not cash short'.(b) On 10 December 2007 the second defendant told Ms Madden that everything on Constellation Avenue was paid for and it should be completed within 45 days.(c) On 31 December 2007 the second defendant advised that the defendants were about to start the subdivision of Kamaka Crescent, and that the second defendant was funding it personally.(d) At a meeting on 15 January 2008 the second defendant informed Ms Madden that Constellation Avenue was almost complete ('about $10k - $15k to go').(e) On 24 May 2008 the second defendant informed Ms Madden by email that she had allowed for the cost of completing Constellation Avenue from her own cash flow.[99] In summary, there is no evidence from which the Court can infer that Westpac was acting capriciously in proceeding to its mortgagee sales, or in rejecting the agreements advanced by the defendants. To the contrary, the evidence establishes that Westpac went to considerable lengths to get these loans on to a proper footing, both before and after issuing its Property Law Act notices, and then left it open to the defendants to come up with private sales of the mortgagee sales. There is no evidence to support an argument that Westpac was not acting in good faith. The comments of this Court in Harts Contributory Mortgages Nominee Co Ltd are apposite:24On the other hand, in evaluating judgments made by or on behalf of the mortgagee it should not be forgotten that in the absence of bad faith, the mortgagee shares with the mortgagor and guarantor an incentive to maximise the price obtained. It is not lightly to be assumed that the mortgagee has acted in a way that was contrary to its own interests as well as the interests of others.Decision[100] I am satisfied that Westpac took reasonable care to obtain the best price reasonably obtainable for the sale of the four properties. The defendants have not put forward a sufficient evidential basis for their allegation that Westpac breached either statutory or equitable obligations in respect of its exercise of its power of sale.[101] Westpac is entitled to summary judgment against the defendants for the sum of $2,530,254.82, for principal and interest due under the loans as set out in the memorandum of counsel for Westpac dated 6 May 2011.24 Harts Contributory Mortgages Nominee Co Ltd v Bryers, above n 7, [43](i).[102] The defendants are to pay costs to Westpac (calculated on a scale 2B basis) of $9,964 as set out in counsel's memorandum (but excluding the allowance for second counsel) together with disbursements of $1,303.33, again as set out in counsel's memorandum.____________________Associate Judge Abbott