10 March 2014

The lender sought judgement for:

  1. $6.8 million
  2. Two cattle stations
  3. Specified livestock

This was granted in default of a defence being filed by a Registrar. However being a mixed judgement only a Judge had the power to enter default judgement (not the Registrar).

It has been long accepted that a defendant is entitled to have an irregularly entered judgment set aside as of right, subject to it not being futile to interfere with the judgment.

Here the appeal court found that it would not have been futile because the registrar should not have entered default judgement even if he had the power. This was because the statement of claim was a sketchy and rather unsatisfactory document.

  1. There was no direct allegation in the statement of claim that the principal was actually advanced.
  2. The material terms of the loan agreement were not pleaded or identified
  3. There was no direct allegation in the statement of claim that the principal were due and owing.
  4. It alleged that the lender wrote to the borrowers seeking to mediate “the debt owed in accordance with the Queensland Farm Debt Mediation Scheme” and that the borrowers refused to mediate in accordance with such scheme but did not specify how those matters were relevant.

Click here to read the full judgment

Matthew Bransgrove, Partner

Matthew Bransgrove has practised exclusively in the field of mortgage law and mortgage related litigation since 1998. He is author of Avoiding Mortgage Fraud in Australia (2015) Lexis Nexis. He is co-author of The Essential Guide to Mortgage Law in NSW (2008) Lexis Nexis and its successor The Essential Guide to Mortgage Law in Australia (2013) Lexis Nexis.

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