ANZ National Bank Limited v Laurie HC Palmerston North CIV-2010-454-912 [2011] NZHC 456 (6 May 2011)

Last Updated: 17 June 2011

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

_{CIV-2010-454-912}

BETWEEN ANZ NATIONAL BANK LIMITED Plaintiff

AND STUART PETER GEORGE LAURIE First Defendant

AND MARGARET ANNE CAMMISH Second Defendant

AND STUART PETER GEORGE LAURIE

AND MARGARET ANNE CAMMISH AS TRUSTEES OF THE LAURIE FAMILY TRUST

Third Defendants

Hearing: 5 May 2011

(Heard at Palmerston North)

Counsel: P. Broczek - Counsel for Plaintiff

S.P.G. Laurie - First Defendant in person

M.A. Cammish - Second Defendant in person

Judgment: 6 May 2011 at 3:30 PM

_{JUDGMENT OF ASSOCIATE JUDGE D.I. GENDALL}

This judgment was delivered by Associate Judge Gendall on 6 May 2011 at 3.30 pm under r 11.5 of the High Court Rules.

_{Solicitors: Gibson Sheat, Solicitors, PO Box 2966, Wellington 6140}

ANZ NATIONAL BANK LIMITED V SPG LAURIE HC PMN CIV-2010-454-912 6 May 2011

[1] Before the Court is an application by the plaintiff for summary judgment against the defendants as guarantors on certain amounts outstanding on overdrawn loan accounts advanced to principal borrowers Bloom Furniture Limited (“BFL”) and Bloom Manufacturing Limited (“BML”).

[2] On 1 March 2011 Ms Cammish filed a Notice of Opposition to the summary judgment application and an affidavit in support.

[3] On 2 May 2011 Mr Laurie filed a Notice of Opposition to the summary judgment application and an affidavit in support both of which provide almost identical grounds of opposition.

[4] At the outset of the hearing before me a preliminary issue arose. Mr Broczek for the plaintiff confirmed that so far as the summary judgment application before the Court was concerned, the plaintiff was no longer seeking summary judgment against the defendants relating to the first cause of action noted in the statement of claim for an overdrawn account owed by Mr Laurie personally, an overdrawn account owed by Ms Cammish personally and an overdrawn account owed by the Laurie Family Trust.

[5] Leave was granted to the plaintiff to withdraw its summary judgment application relating to the first cause of action noted in the plaintiff’s statement of claim, this relating to two sums totalling about $4,000.00.

[6] The summary judgment application proceeded, however, with respect to the second and additional causes of action against the first defendant and the third defendants for personal guarantees of outstanding BFL loan accounts totalling

$814,914.80 and for overdrawn BML loan accounts totalling $568,984.89.

[7] As I have noted the application before the Court is one for summary judgment on which the plaintiff relies on r 12.2 High Court Rules which states in part:

12.2 Judgment When there is No Defence or Where No Cause of Action Can

Succeed

(1) The Court may give judgment against a defendant if the plaintiff satisfied the Court that the defendant has no defence to a cause of action in the statement of claim or to a particular part of any such cause of action.

[8] The principles of summary judgment have been summarised recently by the

Court of Appeal in Krukziener v Hanover Finance Ltd [2008] NZCA 187; [2010] NZAR

307:

[26] The principles are well settled. The question on a summary judgment application is whether the defendant has no defence to the claim; that is, that there is no real question to be tried: Pemberton v Chappell [1987] 1

NZLR 1; (1986) 1 PRNZ 183 (CA), at p 3; p 185. The Court must be left without any real doubt or uncertainty. The onus is on the plaintiff, but where its evidence is sufficient to show there is no defence, the defendant will have to respond if the application is to be defeated: MacLean v Stewart (1997) 11 PRNZ 66 (CA). The Court will not normally resolve material conflicts of evidence or assess the credibility of deponents. But it need not accept uncritically evidence that is inherently lacking in credibility, as for example where the evidence is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable: Eng Mee Yong v Letchumanan [1980] AC 331; [1979] 3 WLR

373 (PC), at p 341; p 381. In the end the Court's assessment of the evidence is a matter of judgment. The Court may take a robust and realistic approach where the facts warrant it: Bilbie Dymock Corp Ltd v Patel (1987) 1 PRNZ

84 (CA).

[9] It is clear that a plaintiff may seek summary judgment in relation to a part of its claim even if it withdraws the application or is unable to prove the necessary prerequisites for the entire claim in a statement of claim – McGechan on Procedure HR12.2.10. That is what the plaintiff proposes here.

[10] As I have noted the plaintiff’s claim against the first defendant, Mr Laurie, and against the third defendants, Mr Laurie and Ms Cammish as trustees of the Laurie Family Trust is based upon written Deeds of Guarantee given by these defendants in favour of the plaintiff for the debts of BFL and BML.

[11] The claims before the Court essentially relate to outstanding loans due to the plaintiff from BFL and BML unconditionally guaranteed by the first defendant and

the third defendant. No issue is taken with the validity of the personal guarantees signed by the defendants.

[12] Both BFL and BML appear to be in liquidation and some steps have been taken to realise their respective assets and effect part repayment of their debts due to the plaintiff.

[13] On the face of it, the present case involves a common situation where directors and shareholders of two companies provide unlimited personal guarantees to the plaintiff bank of monies advanced to the companies.

[14] It would appear from the Notices of Opposition and accompanying affidavits that Mr Laurie and Ms Cammish raise here three alleged defences to the plaintiff’s claim:

(a) That the liquidator’s costs in the liquidation of one of the principal debtors were excessive and should be scrutinised;

(b) That the plaintiff bank prevented the principal debtors BFL and BML from earning income by demanding repayment of the overdrawn accounts which effectively stopped them from trading at a critical time in their business venture.

(c) That the defendants do not agree with the amounts claimed.

[15] By way of general background before me Mr Laurie indicated that BFL and BML over a period of time with the support of the plaintiff bank set up a business of manufacturing and exporting furniture principally to Japan. He indicated that after some time the business obtained a licence to trade in Japan and some 10 container loads of furniture were exported to Japan.

[16] Mr Laurie contended that some 3 weeks before a first container of furniture was to be dispatched from New Zealand to Japan to be sold from the defendants own outlets in Japan the plaintiff bank withdrew support for the operation and the business necessarily collapsed.

[17] Mr Laurie was at pains to indicate that personally he and Ms Cammish had drawn only $20,000.00 per annum approximately from the businesses over this start up period and although he acknowledged that it was the plaintiff bank’s right to do so, it was in his words “Churlish of the bank to withdraw their support at this final hour” which thus withdrew the ability of the defendants and the principal debtor companies to clear the bank’s debts.

[18] In addressing these defences, Mr Broczek for the plaintiff noted the following matters.

[19] As to the issue concerning liquidator’s costs, he noted that the plaintiff bank has not included in its present claim any fees incurred in the liquidation of the principal debtor. The liquidator’s fees and costs were therefore not part of the present claim before the Court and he contended that any potential claim against a third party liquidator is not relevant to the bank’s present claim.

[20] On this, it may be that the defendants could investigate the possibility of a potential claim against the liquidator if they are able to establish the fees charged are excessive. As I see it, however, that is a separate matter to the present claim before the Court. There is nothing in this first defence advanced for the defendant.

[21] As to the second defence noted above that the plaintiff bank effectively stopped the principal debtors from trading at a critical time in the lift of the business venture, there can be no doubt and before me Mr Laurie acknowledged that the plaintiff bank was fully entitled to make demand at any time if the principal debtors were in default in repaying the bank debt due. This is what occurred here and as I understand the position, the plaintiff’s demand followed a reasonably long history of default in making payments on the part of the principal debtors and guarantors. Again there is nothing as I see it in this defence advanced by the defendants.

[22] So far as the third defence noted above is concerned, the complaints regarding the amounts claimed by the plaintiff appear to relate principally to the personal overdraft debts of Mr Laurie and Ms Cammish for which the present summary judgment application is being withdrawn.

[23] No issue was taken before me by either Mr Laurie or Ms Cammish as to the calculation of the guarantee debts due on the BFL and BML accounts. Again there is nothing in this defence advanced for the defendants.

[24] I conclude therefore that no particulars have been advanced by the defendants which could demonstrate any arguable defence either as to liability or quantum in respect of the guaranteed accounts of BFL and BML.

[25] The plaintiff bank’s standard term Deeds of Guarantee signed by the defendants are extensive and note that the defendants as guarantors are liable under the Guarantee as a principal debtor and not merely as a surety.

[26] Under all the circumstances here, I am satisfied that the plaintiff has done enough to satisfy the onus upon it to show the Court that the first defendant and the third defendants have no arguable defence to the claims made against them.

[27] Those aspects of the summary judgment application which remain therefore succeed.

[28] Summary judgment is now granted to the plaintiff against the first defendant, Stuart Peter George Laurie and the third defendant Stuart Peter George Laurie and Margaret Anne Cammish jointly and severally for the sum of $814,914.80 relating to the guarantee of the BFL account and as to $568,984.89 relating to the guarantee of the BML account.

[29] In addition costs on a category 2B basis are totalling $7,708.00 and disbursements totalling $1,530.12 are awarded to the plaintiff against the first defendant and the third defendants.

‘Associate Judge D.I. Gendall’