Bidesi and Sons Ltd v Australia and New Zealand Banking Group Ltd [1994] FJHC 49; Hbc0294a.90 (13 May 1994)

IN THE HIGH COURT OF FIJI
(AT SUVA)
Civil Jurisdiction

CIVIL ACTION NO. 294A OF 1990

BETWEEN:

BIDESI AND SONS LIMITED
Plaintiff

- and -

AUSTRALIA AND NEW ZEALAND
BANKING GROUP LIMITED
Defendant

V. Maharaj for the Plaintiff
S. Parshotam for the Defendant

DECISION

This is an application by a mortgagor who seeks an Order restraining the mortgagee from exercising its power of sale.

The affidavits before me are:

(i) Plaintiff filed 31 July 1990.

(ii) Defendant filed 27 August 1990.

Written submissions filed by Counsel are:

(i) Plaintiff filed 24 October 1990.

(ii) Defendant filed 29 October 1990.

I heard argument on 26 February 1991 and adjourned the matter part heard for a date to be fixed for continuation no later then 5 March 1991.

Over the next 2 years there were 11 further mentions but no date for continuation was agreed. Unfortunately Mr. Parmanandam who had first appeared for the Plaintiff then died. After a further 7 mentions the matter was finally argued de novo before me on 26 April 1994, that is over three years after the first part hearing.

Such delays and adjournments are quite unacceptable in any efficient legal system. They reflect poorly on the legal profession. In particular when seeking equitable relief Counsel should bear in mind that delay on its own may debar the relief sought (see G.W.Rly v. Oxford Rly [1853] 3 De G M and G 341 and generally The Law Society Gazette N0.43, 23 November 1988).

The Plaintiff's case as appears from the first affidavit is that Mr. S.M. Bidesi, a director of the Plaintiff, had agreed to assist his nephew whom he understood to be in temporary financial difficulties by offering to mortgage the property in question for a period of six weeks up to a total amount of $100,000. Mr. Bidesi says that when he signed the mortgage document (Exhibit SMB3 to the affidavit) he understood that it was limited to advances up to that amount. He says he was misled into signing a document which was not in fact limited in the way that he wished it to be and that the nephew and the Defendant (the Bank) fraudulently concealed from him the fact that at the time the Mortgage Deed was signed his nephew's indebtedness to the Bank was much higher then he had previously been led to believe. He submits, apparently in the alternative, either that he is not liable to the Bank for any sum exceeding $100,000 or that he is, by reason of fraud perpetrated upon him, not liable for any sum at all.

The written submission filed on behalf of the Plaintiff was apparently prepared by overseas Counsel who did not attend Court to present or amplify the submission. I did not find the submission altogether easy to follow. Mr. Maharaj adopted the submission but did not expand upon it. His main argument was that the Bank had acted unconscionably and that this provided grounds for impugning the mortgage. He cited ANZ Bank v. Barry (Supreme Court of Queensland Appeal 96/90) and Commercial Bank of Australia v. Amadio (1982 - [1983] HCA 14; 1983) 151 CLR 447 in support of his submission that the Plaintiff had shown that there were triable issues and that on the basis of the well known principles governing the grant of injunctions (American Cyanamid Co v. Ethicon Limited [1975] UKHL 1; [1975] AC 396; [1975] 1 All ER 504) I should exercise my discretion in the Plaintiff's favour.

The Bank in the second affidavit made by one Ravindra Chandra a Bank Officer and in the legal submission filed on its behalf denied fraud or misleading the Plaintiff. Mr. Parshotam pointed out that the Plaintiff was a well known and prominent business and that the whole transaction complained of was commercial and not at all comparable with the domestic arrangement which was the subject of ANZ v. Barry (supra). Citing a number of authorities referred to in the Modern Contract of Guarantee by Donovan and Phillips 1985 page 119 Mr. Parshotam maintained that the Bank had not failed in any duty of disclosure to the Plaintiff about the state of his nephew's account. If the Plaintiff had been misled at all then it was by the nephew. If the Plaintiff had wanted to seek independent legal advice on the effect of the mortgage document then it could easily have done so.

It is not for me at this stage to try to resolve the issues between the Parties on the basis of the affidavit evidence before me. The only question is whether the Bank should be restrained from exercising the power of sale conferred upon it by statute (see Property Law Act - Cap. 130 section 79 (1)) and by the mortgage deed pending trial of the issues raised. The Plaintiff at trial will essentially be attempting to offer evidence aimed at varying or restricting the effect of the mortgage, a document required by law to in writing (see Land Transfer Act - Cap. 31 section 37). This may present problems (Phipson on Evidence 12th Edition paragraph 1871).

The Plaintiff's main difficulty, as I see it, is that as is well known and long established the Courts are most reluctant to interfere with a mortgagee's right of sale, save in the most exceptional circumstances. Inglis v. Commonwealth Trading Bank of Australia [1972] 126 CLR 161, 164 has regularly been followed in Fiji (see for example Taivesi Volau v. BNZ Lautoka 601/86; Official Receiver v. BNZ Lautoka 759/85; Deo Ratna v. NBF Suva 722/88; Fiji Co-operative v. NBF Suva 345/90 and Rauzia Zawwed Mohammed v. ANZ 66/84 and FCA 323/84).

On my view of the material placed before me the Plaintiff clearly intended to extend to or facilitate the extension of a line of credit to his nephew up to an amount of $100,000. He intended to mortgage his property to achieve that purpose. Whether or not the Defendants will succeed in obtaining the whole amount claimed remains to be seen. Meanwhile I do not think that the circumstances of this case are so exceptional that the Bank should be restrained from exercising its powers of sale in the absence of payment into Court by the Plaintiff of the amount claimed.

The application fails.

M.D. SCOTT
JUDGE

SUVA
13 May, 1994

HBC0249A.90