Permanent Mortgages v Tran [2012] WASC 372

The lender applied for summary judgment but before the matter was heard, it was referred to mediation and a compromise agreement was reached. The borrower breached the agreement by making a series of late payments, which were accepted by the lender. Finally the lender applied for summary judgement. The issue for the court was whether the lender had waived its rights on breach of the settlement agreement by not taking any steps following the first defaults and accepting further instalments.

Waiver is an intentional act, whereby a person abandons a right by acting in a manner inconsistent with it.

The court found that the lender did not abandon its rights because there was no evidence that the lender had said that it would not exercise any right if the defaults were remedied. The defaults were made good of the borrower’s own volition.

The court held that the lender did not elect between inconsistent rights when it accepted the late payments nor did it seek to take only the benefit of the loan and settlement agreements while denying the burden of those agreements. It merely accepted payments that the borrower was obliged to make. Further, nothing passed between the lender and borrower that would estop the lender from exercising its rights under the settlement agreement.

The court ordered summary judgment for the amount owing and possession.

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