Tenant's Stay of Execution Request Rejected in Mortgage Dispute

The court dismissed an application for a stay of execution of a writ of possession, finding that the tenant's claims of hardship and lack of proper notice were insufficient grounds to grant the stay.

Supreme Court New South Wales

Medium Neutral Citation: [COMPANY] v [COMPANY] [2020] NSWSC 863 Hearing dates: 2 July 2020 Decision date: 02 July 2020 Jurisdiction: Common Law Before: Adamson J Decision: The notice of motion filed on 2 July 2020 is dismissed. Catchwords: MORTGAGES AND SECURITIES — Mortgages — Duties, rights and remedies of mortgagee — Possession — application to stay execution of writ of possession — application dismissed Category: Procedural and other rulings Parties: [NAME] (First applicant on motion) [NAME] (Second applicant on motion) [COMPANY] [PHONE] (Plaintiff) [COMPANY] in its corporate capacity and as Trustee for the [NAME] 27 970 527 313 (Receivers and Managers Appointed) (Defendant) Representation: Counsel: [redacted] [NAME] (Plaintiff / respondent on motion)

Solicitors: [redacted] [NAME] (Plaintiff) File Number(s): 2019/358119

Judgment (EX TEMPORE)

Introduction 1. By notice of motion filed today and referred to me as the duty judge, [NAME] and her son, [NAME] (the applicants), apply for a stay of the execution of the writ of possession of property of which they are occupiers at 15 O'[ADDRESS], Port Kembla (the O'[ADDRESS] property). The stay is sought for a short period in order that the applicants can put on evidence to establish a cause of action arising from the circumstances in which they have come to occupy the property.

Background 1. The short background to the proceedings is that [COMPANY] (the defendant) was the registered proprietor of two properties at Port Kembla, the O'[ADDRESS] property and another property in [ADDRESS] (the properties). It granted a mortgage to [COMPANY] (the plaintiff), which was registered. The defendant also granted a second mortgage to a third party (the second mortgagee).

2. The defendant defaulted on both mortgages. The second mortgagee appointed receivers and managers to the defendant. The plaintiff commenced proceedings for possession of the properties.

3. The first applicant, [NAME], deposed that she came to occupy the O'[ADDRESS] property because she had been persuaded to transfer her home to the defendant to allow it to build townhouses. In return she was told that she would receive lifetime rights to live in one of the townhouses erected on the property. Even accepting this to be correct she would, at best, have a bare equity or equitable interest in the O'[ADDRESS] property. Her interest would necessarily, by reason of the law of priorities, rank after the interest of the plaintiff, who is the registered mortgagee.

Accordingly, whatever claim she may have against the defendant, the second mortgagee, or any other third party, would not give her a right which would stand in the way of the plaintiff enforcing the writ of possession arising from the mortgage granted to it by the defendant.

Matters raised in support of the stay application 1. [NAME], who appeared on behalf of the applicants, raised three issues in support of their application for a stay: lack of service, lack of notice and hardship to the applicants. I accept the submissions of [NAME], who appeared for the plaintiff, that none is sufficient to warrant a stay of execution of the writ of possession in respect of the proceedings. It is necessary to address each in turn.

Whether the applicants were served 1. I do not accept the allegation that the applicants were not served. In an affidavit sworn on 13 December 2019, [NAME], process server, deposed that he gave documents to the female occupant of the O'[ADDRESS] property who refused to provide her name and informed him that she was the only resident at that address. Upon leaving the property, [NAME] placed a copy of the documents, being the statement of claim, the notice to the occupier and the possession of land cover sheet in the letterbox of that property. On the basis of this evidence, I am satisfied that the applicants have been relevantly served with the documents.

Whether the applicants were given notice of the execution of the writ of possession 1. I do not accept that the applicants have not been notified of the writ of possession. According to the Court record, this matter came before Wright J on 25 June 2020. This was at least the second occasion on which an application for a stay had been made to this Court. An earlier application was made and dismissed by Button J on 14 May 2020. On 25 June 2020 Mr [NAME], solicitor, purported to act for the defendant although he was instructed by a director of the defendant and not by its receiver and manager. He informed Wright J that the occupant of the O'[ADDRESS] property was an elderly woman who needed four days to move out of the premises. It appears from the Court record that it was on this basis that his Honour stayed the execution of the writ until 12.01am on 1 July 2020. Mr [NAME] has also witnessed the first applicant's oath on her affidavits read before me today. Having regard to the circumstance that Mr [NAME] appeared before his Honour on 25 June and also witnessed the two affidavits sworn by the first applicant, [NAME], on 2 July 2020, I am satisfied that she has been notified of the execution of the writ of possession today.

The hardship which the applicants will suffer if the execution is not stayed 1. The third matter raised by [NAME] is the matter of hardship. I note from the affidavit of [NAME] that she has a son who is under her care and who is subject to a community treatment order. She is elderly and an aged pensioner. Whilst I accept that she will be disadvantaged if she is required to leave her home, this is a necessary consequence of the legal right which has accrued to the plaintiff under the registered mortgage. She has been on notice for a considerable time of the risk that an order for possession would be made in relation to the property and has not taken steps to move out of that property until this time.

Conclusion 1. In all the circumstances I am not persuaded that there is any reason to stay the execution of the writ of possession in relation to the O'[ADDRESS] property.

Orders 1. For the reasons given, I dismiss the notice of motion filed on 2 July 2020.

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