Westpac Banking Corporation v Goiset [2009] VUSC 34; Civil Case 213 of 2007 (19 May 2009)

IN THE SUPREME COURT OF
THE REPUBLIC OF VANUATU
(Civil Jurisdiction)

Civil Case No. 213 of 2007

BETWEEN:

WESTPAC BANKING CORPORATION
Claimant

AND:

JEAN MARCEL GOISET AND THI TAM GOISET
Defendants

Coram: Justice N. R. DAWSON

Date of Hearing: 24th March, 2009
Date of Decision: 19th May, 2009

Counsel: Claimant: Mr. M. Hurley
Defendant: Mr. J. Malcolm

DECISION

1. The Defendants have made an Application to Stay or Suspend a Mortgagee Sale Order dated 20th November, 2008 and in Opposition to the Application for Enforcement Orders.
   
2. The grounds upon which the application is based are:-
   
   1. The Claimant is stopped from making the claim as a result of a partly oral partly written agreement for stay.
      
   2. There is a dispute as to the validity of the Notice of Demand.
      
   100. There is a dispute as to the service of the claim and/or in time
        
   4. There is a dispute as to service of a Notice of Application for Hearing for the Claimant’s Default Judgment.
      
   5. There is a dispute as to quantum.
      
3. The application must be based either on the Courts inherent jurisdiction and/or Rule 14.10 of the Civil Procedure Rules whereby the Court is empowered to suspend enforcement of its orders. Rule 14.10 (3) says:-
   

"(3) The Court may:-

(a) Suspend the enforcement of all or part of the Order because facts have arisen or been discovered since the Order was made or for other reasons; and

(b) Make other orders it considers appropriate, including another enforcement order."

4. The background in this matter is that Claimant has a mortgage over four properties belonging to the Defendants. Initially the mortgage secured VT 72 million but the amount owing by the Defendants increased to VT 304 million by June 2007. Sporadic payments have been made to the Claimant by the Defendants, the last being on 24 September, 2008.
   
5. On 1st June, 2007 the Claimant issued a notice of demand which was served upon Mr. Goiset on 4th June, 2007 and served upon Mrs. Goiset on 5th June, 2007. On 19th December 2007, a Supreme Court Claim was filed by the Claimant and served on Mr. and Mrs. Goiset on 10th January, 2008. No statement of defence has ever been filed by the Defendants. On 9th September, 2008, Ms. May-James, a Manager at the Claimant bank sent Mrs. Goiset an email saying "when would you be able to come and sign the agreement of stay of proceedings as we agreed......". On the 26th September, 2008 Ms. May-James emailed to Mrs. Goiset "Variation of Mortgage" and "Consent for Sale of Property" documents. The Variation of Mortgage purported to increase the amount secured to VT 240,000,000. None of the documents were ever signed by the Defendants. Further Notices of Demand were then served on the Defendants on 24th October, 2008. Following a further application to the Court an Order for a Mortgagee sale of the Defendants property which was made on 20th November, 2008.
   
6. The Defendants submit that the Claimant is stopped from proceeding with this Claim against the Defendants on the basis of partly oral and partly written agreements for a stay. The Defendants point to an email from Ms. May-James referred to in paragraph 5 above and also to the meeting that took place on 21st October, 2008 between their counsel, Mr. Gulvis with Ms. May-James at the Westpac Office.
   
7. The Claimant denies that any stay was agreed to. The Sworn Statement of Ms. May-James makes it clear that the discussions relating to a stay in proceedings would be subject to the execution by the Defendants of the Variation of Mortgage documents increasing the amount secured by the mortgage to VT 240,000,000 to match the Defendants current level of debt. The Claimant’s position is that Mrs. Goiset was invited to go to the bank to sign the documents but the defendants never did so, therefore any arrangements for a stay, were never concluded. Ms. May-James also denies that any agreement was concluded with Mr. Gulvis. The only evidence of any such agreement available from the Defendants is the hearsay evidence of Mrs. Goiset in her sworn Statement of what she said Mr. Gulvis had told her.
   
8. The Court finds that there is insufficient evidence to establish the existence of any agreement of a stay stopping the Claimant from making its Claim. The evidence of the Claimant is logical and has every appearance of following what would be normal banking practice. There is no reason or logic to suggest that the bank would agree to a stay when the Defendants would not comply with the banks wish for them to sign the Variation of Mortgage and other documents in return. The Defendants submission that there was a partly oral and partly written agreement seems to be based upon wishful thinking. The hearsay evidence of Mrs. Goiset as to what she says she was told by Mr. Gulvis should have been given by Mr. Gulvis if such evidence was available. It was not. The evidence is insufficient for this Court to find that the parties had a meeting of minds that amounted to an agreement for a stay.
   
9. The Defendants dispute the validity of the Claimant’s Notice of Demand dated 1st June 2007 served on Mr. Goiset and Mrs. Goiset on 4th June and 5th June 2007 respectively. This Notice of Demand led to the Claimant issuing proceedings on 19th December 2007. The Defendants submit that a delay of over six months from the time of the serving of the Notice of Demand and the issuing of the proceedings is too long.
   
10. There is no law that limits the time by which the Claimant should have issued its proceedings following the service of its Notice of Demand. The Defendant can only ask this Court to exercise an inherent jurisdiction to say that the Notice of Demand is in invalid after a period of time after taking into account all the circumstances of this case. What is clear from all evidence before the Court is that the Claimants and the Defendants were in contact on frequent occasions throughout this time and the Defendants cannot have been in any doubt that the Claimant wished to have its security over the defendant’s property regularised or for the amounts owed to the Claimant repaid. The Notice of Demand was validly issued and served and there is no reason for this Court to find that it had expired in any way prior to the issuing of the proceedings by the Claimant.
    
11. In her Sworn Statement Mrs. Goiset had said that she had no recollection of having been served with the Supreme Court Claim and if it was served on her then it was served out of time. The Sworn Statement of Trevor Leo is that on 10th January, 2007 he served copies of the Supreme Court Claim upon both Mr. and Mrs. Goiset. The Sworn Statement is dated 24th January 2008. The Supreme Court Claim was filed by the Claimant on 19th December 2007, so clearly the Defendants could not have been served with a copy of the Supreme Court Claim on 10th January, 2007. In the course of the hearing it became apparent that the reference to 10th January 2007 was a typographical error and the Sworn Statement by Trevor Leo should have referred to having served the Supreme Court Claim upon both the Defendants on 10th January 2008. Accordingly the service of the Supreme Court Claim upon both Defendants has taken place within the two month period described by Rule 5.3. The Defendants are not in a position to dispute the service of the Supreme Court Claim upon them within the prescribed period.
    
12. The Defendants have never filed any statement of defence and therefore it was open for the Claimant to make the application for Default Judgment pursuant to Rule 9.2. The Defendants are not in a position to complain at not having received a notice of hearing of the Application for Default Judgment as the Claimant was not required to serve notice of this hearing upon them.
    
13. It is submitted by the Defendants that there is a dispute as to the quantum claimed by the Claimants. This is based on Mrs. Goiset’s claim in her sworn statement, that she has challenged the interest rate charged by the Claimant in respect of the various Financial Facilities. The Defendants have failed to show any basis for this submission. All the borrowing facilities that the Defendants had with the Claimant are recorded and the interest rates are also recorded in the appropriate documentation. The Defendant did not like the overdraft rates of interest that they were being charged by the Claimant but that does not put the amount in dispute. At the time of the arranging of each loan facility they agreed to the terms of the borrowing. The defendants are not in a position to unilaterally change the amount of interest the Claimant is entitled to claim and thereby claiming that there is a dispute as to the quantum owed. This submission is also dismissed.
    
14. The Defendant’s Application to Stay or Suspend a Mortgagee Sale Order dated 20th November 2008 and in Opposition to the Application for Enforcement Orders are both declined. Costs are awarded against the Defendants in favour of the Claimant at an amount to be agreed and failing agreement then to be fixed by the Court.
    

Dated at Port Vila, this 19th day of May, 2009

BY THE COURT

N. R. DAWSON
Judge