Background
Capital Securities Mortgages Pty Ltd advanced $1.555 million to Events by Lush Pty Ltd under a loan deed secured by mortgages over properties at Rosemeadow and Ambarvale. Events by Lush defaulted almost immediately, and Capital Securities terminated the loan and demanded repayment. After Events by Lush failed to file a defence to possession proceedings, the Supreme Court entered default judgment for possession of the Rosemeadow property.
Events by Lush and guarantor Christine Anne Perry unsuccessfully sought to set aside default judgments against them. The primary judge found that their proposed defences—including statutory and equitable unconscionability, asset-based lending, and special disadvantage—had no evidentiary support and were contradicted by documents recording that the guarantors had obtained independent legal advice. Ian Robert Perry’s defence was struck out with leave to replead, but he did not do so, and judgment for possession was later entered against him.
The three applicants sought leave to appeal, alleging that the judgments were irregular, that registry-access problems had prevented compliance, that requiring a draft defence created a procedural trap, and that the primary judge had failed to account properly for serious family medical circumstances and the overriding purpose of civil procedure.
The Court’s Holding
The Court of Appeal refused leave to appeal with costs. It held that the proposed appeal raised no issue of principle or public importance and disclosed no reasonably clear error, going beyond the merely arguable, that resulted in injustice.
The Court rejected the contention that an irregular judgment must be set aside as of right under UCPR r 36.15. Even where irregularity is established, the power remains discretionary and sufficient cause must be shown. The notice of appearance was filed only after default judgment and its later backdating did not invalidate the judgment; any registry-access difficulty was cured by the applicants’ subsequent opportunities to present an arguable defence. They nevertheless provided no evidence supporting the facts on which their proposed defences depended.
The primary judge had not created a procedural trap by requiring a draft defence or denied procedural fairness by evaluating whether it disclosed a bona fide defence. Nor had he ignored the premature birth and medical difficulties affecting the family or Christine’s health problems; his reasons expressly addressed that evidence. The appellate stays affecting enforcement and the Ambarvale writ of possession therefore ended when leave was refused.
Key Takeaways
- An irregular judgment is not automatically set aside under UCPR r 36.15; the court retains a discretion, and sufficient cause must be shown.
- A party seeking to reopen a default judgment may be required to demonstrate an arguable defence with evidence supporting any facts on which that defence depends.
- Courts must give self-represented litigants enough procedural information to ensure fairness, but need not advise them how to run their case or remedy deficiencies in their evidence.
Why It Matters
The decision reinforces the demanding threshold for obtaining leave to appeal from interlocutory orders concerning default judgments. Portal problems, procedural irregularities, personal hardship, and self-representation will not justify appellate intervention where later opportunities cured any practical disadvantage and the applicant still cannot demonstrate a bona fide defence.
For lenders and borrowers, the ruling also underscores the evidentiary importance of signed declarations confirming independent legal advice. Unsupported allegations of pressure, special disadvantage, or unconscionable lending may not suffice to prevent enforcement when contemporaneous documents point the other way.