AMP Bank Limited v Doherty [2023] NSWSC 957 (16 August 2023)

Last Updated: 16 August 2023

Supreme Court New South Wales

Case Name:	AMP Bank Limited v Doherty
Medium Neutral Citation:	[2023] NSWSC 957
Hearing Date(s):	14 August 2023
Date of Orders:	16 August 2023
Decision Date:	16 August 2023
Jurisdiction:	Common Law
Before:	Harrison J
Decision:	See [17]
Catchwords:	POSSESSION – application by mortgagee for possession after asserted default – where defendant claims mortgage entirely paid off twice by third party – where third party a charlatan with no evidence of such transfer
Legislation Cited:	Uniform Civil Procedure Rules 2005 (NSW) r 13.1
Category:	Principal judgment
Parties:	AMP Bank Limited (Plaintiff) Pamela Simone Doherty (Defendant)
Representation:	Counsel: N Bailey (Plaintiff) Solicitors: HWL Ebsworth Lawyers (Plaintiff)
File Number(s):	2022/250331
Publication Restriction:	Nil

JUDGMENT

1. HIS HONOUR: Pamela Doherty is the registered proprietor of a property known as 303/361 Bernera Road, Edmondson Park. AMP Bank Limited holds a legal mortgage registered over the property, granted to Ms Doherty on 24 June 2021, securing a loan to her of $528,866 to be used for its purchase. By its amended statement of claim filed on 13 September 2022, the bank alleges that Ms Doherty is now in default of the loan, having breached terms requiring her to make monthly payments towards principal and interest. The bank seeks an order for possession of the property and judgment for the outstanding balance of the monies secured by its mortgage.
2. By her amended defence dated 30 November 2022, Ms Doherty maintains that the debt has been repaid in full, not once but twice, by an unnamed third party. The amended defence is an extraordinary document, not merely because it rests upon that highly unlikely proposition, but also because it is replete with nonsensical and irrelevant contentions that would appear in terms to have been generated by someone, clearly not Ms Doherty, with significant personal difficulties. If it discloses a defence at all, it is patently incapable of withstanding the bank’s pleaded case. It is unsurprising in such circumstances that the bank has now moved the Court by motion filed 31 January 2023 for orders pursuant to UCPR 13.1 that judgment be entered on its claim.

Background

3. Ms Doherty submitted an application to the bank on or about 1 June 2021 for a loan of $531,000. That loan was approved and Ms Doherty signed a loan agreement with the bank on 24 June 2021. The loan amount was $528,865.72. Security for the loan was by way of a first registered mortgage over the Edmondson Park property. Ms Doherty became the registered proprietor of that property on 18 October 2021. The bank’s mortgage was registered on the title to the property on the same day. It was a term of the loan agreement that Ms Doherty would repay the loan by regular instalments of principal and interest.
4. Ms Doherty fell into arrears. A notice of default was served on her demanding payment of $10,285.43 on or before 5 August 2022. Ms Doherty failed to comply with the default notice. In due course, the full amount of the unpaid loan became due and the bank became entitled to take possession of the property.
5. These and other matters are set forth in an affidavit sworn on 31 January 2023 by Alan Laubhan, a senior collections officer in the Client Assist Team of the bank. Mr Laubhan’s affidavit was read without objection. He was not cross-examined.
6. Ms Doherty swore an affidavit on 29 March 2023 that was read without objection. She was not cross-examined. Ms Doherty deposed that at 8.00am on 9 February 2022, someone described as “Dr David Murphy” sent an email to the bank advising it that $1,053,998.22 had been sent to the bank by electronic funds transfer, presumably in full discharge of her obligations. It seems that Ms Doherty relies upon this email as evidence that the bank has received the monies to which it refers. Unfortunately, that email is a dense and virtually incomprehensible salad of meaningless statements and assertions that, whatever else may be said about it, does not prove that any money was sent to or received by the bank on her behalf by “Dr David Murphy” or indeed by anyone at all.
7. Notwithstanding that fundamental difficulty, Mr Laubhan responded to Ms Doherty’s affidavit in his further affidavit sworn on 19 May 2023 in the following relevant terms:

“Doherty Affidavit

23. I have read the Doherty Affidavit and Exhibit PD-1 to the Doherty Affidavit. Set out below are responses to certain paragraphs of the Doherty Affidavit. An absence of comment does not reflect any agreement by me or by AMP as to the correctness or validity of the contents of the Doherty Affidavit.

24. Paragraph 9 of the Doherty Affidavit refers to two payments, each of $1,053,998.22, allegedly notified to AMP on 9 February 2022 and in payment of ‘Mortgage xxx of Ms Pamela Doherty’.

25. AMP does not have any records of the Electronic Funds Transfer (as defined in paragraph 9 of the Doherty Affidavit), of any payment on or around 9 February 2022, or any payment at all (other than the four payments referred to in paragraph 10 above), being made into the Loan account or any account held by Ms Doherty.

26. In this regard, I have checked AMP’s electronic books and records against Ms Doherty’s unique customer number and say that Ms Doherty only holds one other account with AMP, being AMP Access Account with account number ending 751 (Access Account). AMP does not have any record that the Electronic Funds Transfer was made into the Access Account. At Confidential Exhibit AL-1: [1-4] is a copy of the statement of account for the Access Account together with a transaction listing transaction statement for the Access Account for the period 1 January 2023 to 14 May 2023.

27. The recipient account referred to in paragraph 9 of the Doherty Affidavit is ‘BSB 93-200-892599751’.

(a) BSB 939200 is the BSB for AMP’s branch in Parramatta; and
(b) Account number 892599751 is not a valid AMP account number for Ms Doherty or at all.

28. Paragraph 13 of the Doherty Affidavit refers to two payments, each of $1,060,588.06, allegedly notified to AMP on 16 May 2022 and in payment of ‘Mortgage xxx of Ms Pamela Doherty’.

29. AMP does not have any records of the Electronic Funds Transfer (as defined in paragraph 13 of the Doherty Affidavit), of any payment on or around 16 May 2022, or any payment at all (other than the four payments referred to in paragraph 10 above), being made into the Loan account or the Access Account.

30. Paragraph 17 of the Doherty Affidavit refers to contact allegedly between AMP and Rodny Ghalie. I have reviewed the books and records of AMP, including the electronic server of AMP referred to in paragraph 15 above, and say that there is no record of any communication between AMP and a person called Rodny Ghalie in respect of Ms Doherty or the Loan.

31. From my review of AMP’s books and records, including its electronic server, at no point in time has AMP ever informed Ms Doherty, or any other person communicating with AMP regarding the Loan, that the Loan had been paid out, or that the Mortgage has been discharged.

No Defence and Judgment

32. I have reviewed the communication at 17 and 19 above and the amended defence filed by Ms Doherty in this proceeding. From that review and my review of the books and records of AMP as deposed to above, I am of the belief that there have been no payments, other than the $6,703.40 plus the $350.00 as deposed to in paragraph 10 above, towards the debt owed to AMP pursuant to the Loan (including no ‘overpayments’ on 9 February 2022 or otherwise, as alleged by Ms Doherty in her amended defence) and that there is no defence to the claim brought by AMP in this proceeding, including on the grounds set out in the amended defence.”

8. No objection was taken to that affidavit. Mr Laubhan was not cross-examined.
9. Ms Doherty was unrepresented in the proceedings before me. It became apparent that she was not able to provide me with any evidence that she had paid any outstanding sum to the bank, or that anyone had done so on her behalf. At the close of the evidence, I attempted to explain the position, as I then saw it, to Ms Doherty:

“HIS HONOUR: Your obligation is to establish, if you can, that you've paid the money. You can't do it by saying, ‘I've paid it’, you need to refer to documents that would establish that moneys were transferred. In your case, you say electronically to the bank. One of the ways of doing that would be to provide me with copies of the bank account statements from the account that's said to have disgorged the money to the bank. There's none of that here.

DEFENDANT: Right.

HIS HONOUR: Correspondingly, if the money was sent to an appropriate bank account, being your mortgage account with AMP, unless something extraordinary happened, one would expect to see that credit in the ledgers of the bank held in your name. Clearly enough, the bank hasn't got that, that's why they're suing you, but your response is to say, ‘Well, this money was paid’. It would be a simple matter if the money was paid by mistake, and you'd have a complete defence if you'd overpaid or discharged the mortgage by the payment of the amount due. If you could show documentary evidence from the bank account from which this money was paid and put it before me, but there isn't anything like that.

DEFENDANT: Right.

HIS HONOUR: How long would it take for you to do that? I suppose you could do a screenshot of Dr Murphy's bank records and show it to me in 10 minutes, probably, couldn't you?

DEFENDANT: Dr Murphy? ... I would have to just look at my documents, your Honour.

HIS HONOUR: Take your time. Take your time. If you say the money's been paid from a bank account, that bank account will show the debit in the account for that amount, and it'll also show the destination of those funds, you say, presumably, AMP. I'd like to see something that showed that. I might also, while I'm thinking of it, have expected - although it's a matter for you - to have provided me with an affidavit from, say, Dr Murphy, deposing to the fact that he transferred this money from his account, annexing copies of his account to that affidavit. I don't have any of that.

DEFENDANT: I don't have it with me, your Honour.

HIS HONOUR: How long would it take you to get it?

DEFENDANT: It'll take me - it'll take me a while to get it, your Honour.

HIS HONOUR: Well, your approach to banking might be different to mine or a lot of people, but do you have a mobile phone on which you use electronic banking? I'm just asking this theoretically. You don't have to answer my question. If you do, unless your system is different to the one I operate upon, you should have access to the whole of your bank records, including statements in a historical list. We're not looking at long years back here, obviously. If Dr Murphy has a similar system and if he's using electronic funds transfer, I'm assuming that he'll have access to that. Maybe somebody could turn up, either on a computer or a telephone. The particular account statements that if evidenced, the transfer of this money. Then we're cooking with gas.

MURPHY: It is on the internet that there's been a name change.

HIS HONOUR: Would you like 10 minutes or 15 minutes to do that? Or how long you would need?

DEFENDANT: How long would we need, Dr David? About 10 minutes, your Honour.

HIS HONOUR: Well, I don't want to rush you. Why don't I take an adjournment for 20 minutes, and you can turn up that material on somebody's electronic device. I'll come back at five to 11. If you need more time, just let me know. Ms Bailey, do you have any objection to that?

BAILEY: No, your Honour.

HIS HONOUR: I'll adjourn briefly and you can have a search of that material, and we'll come back.”

10. As the transcript of the proceedings will reveal, Ms Doherty was unable to find or to produce any documents supporting the fact of payments to the bank. That remained the position thereafter, including a further adjournment until 3.00pm to enable Ms Doherty to return to Mr Murphy’s residence in Concord in an attempt, if possible, to retrieve the evidence in question.
11. Later in the afternoon, I continued to discuss the position with Ms Doherty:

“HIS HONOUR: These proceedings, however, would appear to have proceeded upon the basis, in the first instance, that you disputed you owed money or at least in the second instance that you didn't propose to discharge the debt that the bank claims by selling the property and raising the money.

Do you appreciate that I can only act on evidence before me?

DEFENDANT: Correct, yeah.

HIS HONOUR: The evidence in these proceedings suggests that the bank lent you the money you've referred to, that you became the proprietor of the property subject to a mortgage in favour of the bank, and that possibly with some small exceptions there haven't been payments on that mortgage as required. There's evidence to that effect.

DEFENDANT: Yes.

HIS HONOUR: There's no evidence that I'm able to accept that somehow your debt was discharged by the beneficence of some third party, such as Mr Murphy, or anybody at all, and I've suggested to you that I would need admissible evidence in the form of bank statements or somebody on oath telling me that they made a payment discharging your mortgage by payment of the full amount, and I don't have that. Do you appreciate that this is a matter with a lot of documents in it and I am ultimately going to reserve my decision and produce a written judgment so that it's clear to everyone concerned what view I take, but as the matter presently stands, unless you can convince me otherwise by reference to some material that I've overlooked and am not presently aware of, I have to say the bank has a pretty good case to recover its money and the property.”

12. One of the documents exhibited to Mr Laubhan’s 31 January 2023 affidavit was a letter dated 5 May 2022 sent to Ms Doherty by the bank. Ms Doherty acknowledged that she had seen the letter and had read it in full. It is presently instructive to record part of what the letter contained as follows:

“The Discharge

I spoke to you on the phone on 2 May 2022 and you informed me that in early 2022, you were referred to Dr Murphy by a friend, and that you had met with him to discuss the discharge of your Loan.

You stated that you had completed a Discharge Form and that you understood that Dr Murphy would provide the necessary documents to the Bank on your behalf to discharge the Loan.

Following the meeting, Dr Murphy sent an email to the Bank on 9 February 2022, and instructed the Bank to discharge the Loan by way of an EFT which had been attached. The email also attached further documents which provided instructions on how the EFT was to be processed and information relating to Dr Murphy and his business Aussie Bailout.

Following the receipt of Dr Murphy’s instructions, the Bank contacted you on several occasions in relation to the discharge.

The Bank:

Provided you with payout figures and instructions on how the Loan could be discharged; and

Informed you that the Loan could not be discharged by way of the EFT that had been provided by Dr Murphy.

Dr Murphy

In order for you to understand why the Bank could not process the EFT and therefore, why your Loan has not been discharged, it is important for you to be aware of the charges that Dr Murphy is currently facing in relation to his past business activities.

On 26 April 2022, Dr Murphy appeared at Downing Centre Local Court in NSW charged with engaging in dishonest conduct while carrying on a financial services business and making false or misleading statements. The charges were in relation to a business that Dr Murphy operated known as Debt Wipeout.

It is alleged that between September 2019 and November 2021, Dr Murphy represented to consumers that he could discharge their existing debts in return for an upfront ‘swap’ payment of a percentage of the outstanding debt. It is alleged that the consumers then paid the ‘swap’ payment to Dr Murphy, but Dr Murphy did not discharge the consumers [sic] debt. The matter is being prosecuted by the Commonwealth Public Prosecutions after an investigation and referral by ASIC.

It is evident from the documents that have been provided to the bank, and your belief that Dr Murphy would repay your Loan, that Dr Murphy is continuing to operate a business similar to Debt Wipeout known as Aussie Bailout, and that you have fallen victim to his false promises.

You have informed me that to date you have made no payments to Dr Murphy, however, if this is not the case, we urge you to seek independent legal advice.

Repayment Arrears

After you had met with Dr Murphy, you were of the understanding that the Loan would be repaid in full and on this basis, you contacted the Bank on 22 February 2022, and instructed them to cancel the direct debit for the Loan repayments.

The Loan was not discharged, and the Loan fell into arrears because the repayments for 18 February 2022, 18 March 2022 and 19 April 2022 were not made.

When the Loan fell into arrears the Bank endeavoured to contact you by phone, SMS and email in relation to the arrears, however, you failed to make contact with the Bank, and the arrears were therefore reported.

We accept that this is an unfortunate situation and that you have been misguided by Dr Murphy and that your repayments have fallen into arrears because of his false promises. However, now that you have been made aware that Dr Murphy has been charged with fraud and that your Loan will not be discharged in accordance with Dr Murphy’s instructions, I strongly encourage you to ensure that the repayments are brought up to date as soon as possible.”

13. The bank tendered without objection what might be described as a bankers’ certificate indicating that as at 9 August 2023, the amount owed to it by Ms Doherty, secured by mortgage over the Edmondson Park property, was $594,544.00.

Conclusion and orders

14. This is an extremely sad and unusual case. It is difficult at one level to understand how someone such as Ms Doherty could have been so thoroughly taken in and duped by Mr Murphy. And yet she was. His correspondence and other documentation is patently the product of a disordered mind. It bears no resemblance to reality and almost defies description: the so-called EFT email upon which Ms Doherty attempted to rely as evidence of the electronic transfer of monies to the bank discharging her indebtedness is a striking and relevant example of this. It would appear to be the stuff of Mr Murphy’s fantastic scheme, promoted by him under the Aussie Bailout logo, in terms such as the following:

“We can wipe out your problematic debts and loans at a mere 20% or less swap payment of the total amount of the debt! This is not a loan to you! It is a complete ‘payout’, a swap of 100% of the debt balance for only 20%, or less, of that balance from you!

We are not kidding. Our aim is to help the multitude of people who have awful suffocating 'albatross’ loans or debts that they would like to have paid out for only 20%, or less, of the debt value !

How do I begin this process of eliminating all my debts?

All the debtor has to do is simply email their debt details to us with their phone number and we will immediately proceed to action. It really is that simple!

So what are you waiting for?

Dr David G Murphy introduces the 400% PAYOUT OPTION FOR all DEBTORS/CREDITORS

We pay out 400% of the original debt under the brand new ‘New World Order’ system where everyone gets paid and everyone is happy.

Please ask Dr David for further details and to get started Immediately!!!”

15. The only portion of this promotion that it is possible with undiluted confidence to accept as the truth is the adjacent large-print description of this fraudulent rubbish as “WORLD FIRST”.
16. Ms Doherty has no defence to the bank’s claim. However, I have proceeded to hear and determine that claim on a final basis by reference to the whole of the evidence upon which the parties relied in accordance with the orders of Davies J made on 14 April 2023. The bank would in my opinion, however, have been entitled in any event to summary judgment in accordance with its application filed on 31 January 2023 seeking orders pursuant to UCPR 13.1.
17. I am satisfied that the bank is entitled to a judgment for the full amount of its secured debt and that it is entitled to an order for possession of the Edmondson Park property. Subject to further submissions, as foreshadowed by me with the parties, I propose the following orders:
    • (1) Judgment for the plaintiff for $594,544.00.
    • (2) Judgment for the plaintiff for possession of the land comprised in Certificate of Title Folio Identifier 25/SP100581 being the land known as and situate at 303/361 Bernera Road, Edmondson Park in the State of New South Wales.
    • (3) Grant leave to the plaintiff forthwith to apply for the issue of a writ of possession for the property referred to in order (2) hereof.
    • (4) Order the defendant to pay the plaintiff’s costs.

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