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Green Field Contractors Ltd v Credit Corporation Finance Ltd [2025] PGNC 156; N11284 (4 April 2025)

N11284

PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]

WS No. 1097 of 2018 & WS No. 1077 of 2019 (Consolidated proceedings)

BETWEEN:
GREEN FIELD CONTRACTORS LIMITED
Plaintiff

AND
CREDIT CORPORATION FINANCE LIMITED
Defendant

AND
CREDIT CORPORATION FINANCE LIMITED
Plaintiff

AND
GREEN FIELD CONTRACTORS LIMITED
First Defendant

AND
FIONA REINHARDT AS DIRECTOR AND GUARANTOR OF
GREEN FIELD CONTRACTORS LIMITED
Second Defendant

AND
ALBERT REINHARDT as MANAGING DIRECTOR of GREEN FIELD CONTRACTORS LIMITED
Third Defendant

WAIGANI: WOOD J
25 JULY, 19 SEPTEMBER, 2 OCTOBER 2024; 4 APRIL 2025

TRIAL – Certain loans were advanced by Credit Corporation Finance Limited to Green Field Contractors Limited, which loans were guaranteed by Fiona Reinhardt – a number of loans were refinanced and several new loans were provided – the loans were secured by Chattel Mortgages as well as the guarantees by Fiona Reinhardt – Green Field Contractors Limited defaulted on the majority of the loans - Credit Corporation Finance Limited repossessed the goods that were secured by the Chattel Mortgages and sold them and incurred other costs, including in the repossession and security of the goods

As part of the repossession and sale of the secured goods, Credit Corporation Finance Limited acted in accordance with the terms of the Chattel Mortgages to take certain action, including to without notice combine, consolidate or merge any or all the loans held by Green Field Contractors Limited

Held
Green Field Contractors Limited and Fiona Reinhardt are liable to Credit Corporation Finance Limited for damages and interest in relation to the loans that were not paid out as well as certain special damages. Credit Corporation Finance Limited was awarded its costs of the proceeding on an indemnity basis

Counsel
Mr B Mol for the plaintiff
Ms M Saroa for the defendants

1. WOOD J: The trial before the Court related to the hearing of the Amended Writ of Summons and Statement of Claim filed on 27 May 2019 by Green Field Contractors Limited (Green Field) in National Court proceeding WS No. 1097 of 2018 (WS No. 1097 of 2018), as well as the Writ of Summon (sic) and Statement of Claim filed on 2 September 2019 by Credit Corporation Finance Limited (Credit Corporation) in National Court proceeding WS No. 1077 of 2019 (WS No. 1077 of 2019). The two proceedings were previously ordered as consolidated proceedings and so they were heard together at trial on 25 July 2024, 19 September 2024 and 2 October 2024.
   
2. Green Field’s Amended Writ of Summons and Statement of Claim filed on
   27 May 2019 in WS No. 1097 of 2018 (the Amended Statement of Claim) is at tab 4 of the Pleadings Book filed on 24 April 2024. Credit Corporation’s Amended Defence filed on 22 October 2019 in WS No. 1097 of 2018 is in tab 5 of the Pleadings Book.
   
3. Credit Corporation’s Writ of Summons and Statement of Claim filed on
   2 September 2019 in WS No. 1077 of 2019 is at tab 7 of the Pleadings Book, while Green Field’s Defence filed on 16 October 2019 in WS No. 1077 of 2019 is at tab 9 of the Pleadings Book.
   
4. At the trial, Green Field relied upon the following affidavits, namely:
   
   1. Affidavit for Trial of Albert Reinhardt sworn on 17 November 2023 and filed on 22 November 2023;
      
   2. Further Affidavit For Trial of Albert Reinhardt sworn and filed on 1 December 2023;
   100. Affidavit in Support of Albert Reinhardt sworn and filed on 15 October 2018;
        
   4. Affidavit in Support of Albert Reinhardt sworn on 14 November 2018 and filed on 15 November 2018; and
      
   5. Affidavit in Support of Albert Reinhardt sworn on 1 March 2019 and filed on 11 April 2019.
      
5. At the trial, Credit Corporation relied upon the following affidavits, namely:
   
   1. Affidavit of Clement Aukopi sworn on 11 April 2022 and filed on 28 June 2022;
      
   2. Affidavit of Clement Aukopi sworn on 21 October 2019 and filed on 21 October 2019; and
      
   100. Affidavit of Clement Aukopi sworn on 15 May 2019 and filed on 16 May 2019.
        
6. There was no cross examination of witnesses at the trial, nor did either party object to any parts of the other party’s affidavits.
   
7. For the purpose of the conduct of the trial, the parties signed a Statement of Agreed and Disputed Facts and Legal Issues for Trial, which they filed on 3 May 2024 (the Statement and Legal Issues).
   

Background

8. In the Statement and Legal Issues in relation to WS No. 1077 of 2019, the parties agree that Credit Corporation, provides lease purchase and hire purchase financing services) and that Green Field is a road construction and maintenance company. It is also agreed that in or about September 2014, Green Field (through Fiona Reinhardt, who is the second defendant in WS No. 1077 of 2019), approached Credit Corporation and requested finance to purchase several vehicles and heavy machinery for its business operations. It is agreed that Credit Corporation agreed to finance the various vehicles and machinery purchases under 11 Chattel Mortgages on 12 month terms, with interest at the rate of 15% per annum and with Fiona Reinhardt (as the guarantor of the loans). Nine of the Chattel Mortgages were executed in September 2014 and two of them were executed on 1 October 2014.
   
9. In relation to Fiona Reinhardt, a copy of each Guarantee and Indemnity Chattel Mortgage (the Reinhardt Guarantees) between her and Credit Corporation, and the respective ‘Acknowledgement of Proposed Borrower’ by Fiona Reinhardt (the Acknowledgments) are annexed to the affidavit of Clement Aukopi filed on 28 June 2022. It is not necessary to recite the terms of the Reinhardt Guarantees and the Acknowledgements as the terms are clearly set out in the affidavit. For example, a copy of the Reinhardt Guarantee and Acknowledgment for CM302025 form part of annexure CA25 of Mr Aukopi’s affidavit.
   
10. The 11 Chattel Mortgages are summarised below and are referred to in paragraphs 5 and 6 of the Affidavit of Clement Aukopi filed on 28 June 2022. It should be noted that each Chattel Mortgage was also allocated the same loan number by Credit Corporation. For example, Chattel Mortgage no. 301917 had a corresponding loan no. 301917.
    

Chattel Mortgage No. 301917

Chattel Mortgage No. 301918

Chattel Mortgage No. 301919

Chattel Mortgage No. 301921

Chattel Mortgage No. 301923

Chattel Mortgage No. 301929

Chattel Mortgage No. 301930

Chattel Mortgage No. 301931

Chattel Mortgage No. 301932

Chattel Mortgage No. 301933

Chattel Mortgage No.301935

Refinancing of the loan facilities

11. In paragraph 7 of the Affidavit of Clement Aukopi filed on 28 June 2022, he states that Green Field was experiencing financial difficulties and unable to pay the loans under the 11 Chattel Mortgages, whereby Fiona Reinhardt proposed the refinancing of all loan facilities over a longer term. Mr Aukopi states that Credit Corporation subsequently agreed to refinance the loan facilities at the same rate of 15% over 24 and 36 months under new loan agreements. I have summarised the details of those 11 new Chattel Mortgages below, which are also summarised in paragraph 8 of Mr Aukopi’s affidavit. Nine of the Chattel Mortgages were refinanced on 14 November 2014 and two were refinanced on 17 November 2014.
    

Chattel Mortgage No. 302025

Chattel Mortgage No. 302026

Chattel Mortgage No. 302027

Chattel Mortgage No. 302028

Chattel Mortgage No. 302029

Chattel Mortgage No. 302030

Chattel Mortgage No. 302032

Chattel Mortgage No. 302033

Chattel Mortgage No. 302034

Chattel Mortgage No. 302035

Chattel Mortgage No. 302036

The total refinanced amount outstanding amount (as claimed by Credit Corporation) was K677,001.43.

Additional loan facilities

12. In paragraph 9 of the Affidavit of Clement Aukopi filed on 28 June 2022, he states that Green Field also secured five additional loan facilities from Credit Corporation. The Chattel Mortgages were executed between 14 November 2014 and 23 June 2015 and are summarised below:
    

Chattel Mortgage No. 302024

Chattel Mortgage No. 302316

Chattel Mortgage No. 302350

Chattel Mortgage No. 302453

Chattel Mortgage No. 302454

The total outstanding amount (as claimed by Credit Corporation) for the additional loan facilities was K398,066.27.

13. In relation to the above-mentioned Chattel Mortgage Agreements that are listed in paragraph 9, a copy of all the documents are annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Except for the terms and conditions that are detailed in the Schedule to each Chattel Mortgage, clauses 1 to 15 of the Chattel Mortgages have the same terms, including that:
    
    1. the preamble and clauses 1 to 15 of the Chattel Mortgage Agreements provide as follows:
       

BETWEEN: The person(s)or Company described item I of the Schedule
(‘the Customer’)

AND: CREDIT CORPORATION FINANCE LIMITED a company duly
incorporated in Papua New Guinea and having its registered office at Ground Floor, Credit House, Cuthbertson St, Port Moresby, National Capital District (‘the Company’)

WHEREAS:

1. The Customer has requested an advance from the Company equivalent to the amount financed as specified in item 3 of the Schedule forming part of this Deed.
   
2. The amount financed has been requested for the purpose of enabling the Customer to provide for payment of the goods described in item 4 of the Schedule purchased from the supplier named in item 5 of the Schedule.
   

100. The Company has agreed to advance the amount specified in item 3 of the Schedule by satisfying the Customer’s obligations to the said supplier of the goods and the insurer of them who is named in item 6 of the Schedule in such manner as the Company may agree with them.
     

NOW THIS DEED WITNESSES THE FOLLOWING:

1. In this Deed unless the context otherwise requires:
   

“Attorney” means the attorney appointed under Clause 8 and any person appointed as a substitute or delegate,

“Amount financed” means the total in Item 3 of the Schedule,

“Default notice” means a notice under Clause 10;

“Event of default” means any event described in Clause 9;

“Material adverse effect” means a material adverse effect upon either;

1. the ability of the customer to perform its obligations under this Deed.
2. the effectiveness, priority or enforceability of each security required to be provided to the Company pursuant to clause 3 of this Deed;
   

“Secured goods” means the goods in Item 4 of the Schedule and Clause 3(a);

“Secured sum” includes any indebtedness or liability (actual or contingent) relating to this Deed.

2. The Customer Covenants.
   
   1. to make repayments of the amount financed and interest stated in item 7 of the Schedule thereon by instalments stated in item 8 of the Schedule at the place stated in Item 11 of the Schedule.
   2. that moneys received by the Company hereunder shall be applied in satisfaction of, firstly accrued interest, secondly stamp duty, thirdly other accrued liabilities (except principal) and fourthly principal;
   100. to pay to the Company the instalments specified in Item 8 of the Schedule provided that the Customer’s liability in respect of instalments shall cease when the principal has been repaid and if the final instalment does not suffice to repay the balance of the principal, the Customer will pay to the Company such balance along with the final instalment;
   4. that the obligation to make payment hereunder shall be joint and several where there is more than one Customer;
   5. where the Customer now or at any time hereafter holds the goods as trustee and /or whether the Customer entered into this Deed as a trustee, then whether or not the Company has notice of the trust, the Customer warrants that it is the sole trustee under the trust, that it has full and unfettered power to enter into this Deed, that this Deed is executed and entered into as part of the due and proper administration of the trust and the transaction constituted by this Deed is for the benefit of the beneficiaries thereof. The Customer hereby further covenants and agrees that it has entered into this Deed to the intent and effect that all the provisions hereof shall binding on it both in its personal capacity and in its capacity as trustee of the said trust.
      
3. (a) A condition precedent to the Company providing the advance to the Customer is the
   Customer must provide a mortgage to the company in respect of the Secured goods in
   a form satisfactory to the Company before the Company permits a drawdown of any
   of the Amount financed.
   
4. The Customer represents and Warrants:
   

1. if the customer purpose to be a Company, itis duly incorporated in accordance with the laws of Papua New Guinea;
2. this Deed is enforceable by the Company in accordance with its terms;

100. there are no encumbrances over the Secured goods other than permitted encumbrances and no litigation is now current or threatened to the knowledge of the Customer which has or likely to have a material adverse effect;

4. by making this Deed the Customer does not violate any provision of any existing law or treaty, any judgement, trust, regulation, ruling, order or decree of any government agency binding on the Customer and the Deed is made in good faith with out any design to hinder, delay or defraud any existing or future creditors of the Customer.
5. the making of this Deed is not in consequences of any representation, promise or statement by the Company or any person on behalf of the Company except as is expressly contained in this Deed;
6. the Customer does not immunity from the jurisdiction of any Papua New Guinea court or from legal process;
7. the choice of the laws of Papua New Guinea as the governing law of this Deed by or at the direction of the Customer is correct and not misleading; and,
8. all information given to and each statement made to the Company relating to this Deed by or at the direction of the Customer is correct and noy misleading; and
9. no unremedied or unwaived event of default has occurred.
   

5. The Customer Covenants:

1. to keep the secure goods in order and repair provided that the Customer shall have no rights to create any lien or pledge to the goods;
2. to insure the Secured goods at all times during the currency of this agreement to keep them insured with an insurer approved by the Company under an enforceable policy not subject to being defeated or avoided by reasons of any non-disclosure, misrepresentation or breach of warranty in the Company‘s name as mortgage for an amount equal to the full insurable value of the goods against fire, accident, theft, riot, strikes and civil commotion subject to such terms, conditions and exceptions as the company may require; and to pay all premium payable and to produce proof of payment to the Company well before the due date;

100. the Customer shall not cause or permit any person to acquire any interest in the secured goods except permitted encumbrances;

4. the Customer shall not incur any debt or monetary obligations (actual or contingently) to any one, other than the Company in respect of the secured goods, the payment of which is secured by the security interest over the secured goods except financial indebtedness incurred as the consequence of that person granting financial accommodation to the Customer or a person whose obligations are guaranteed by the Customer to hat person in an agreement existing at the date of this Deed,
   
   1. which has been fully disclosed and approved by the Company and
   2. under which the holder is, at the date of this Deed, actually or contingently obliged to grant that financial accommodation.
5. the Customer shall upon execution of this Deed by the Customers deposit with the Company the title documents relating to the secured property;
6. the Company may have possession and control of the title document until the Company is obligated to release the secured property from the security interest created by this Deed;
7. the rights of the Company are subject to the rights of the holder of any other encumbrance over the secured property which ranks in priority before any security interest created by this Deed to have possessions of the title documents;
8. the Customer shall use his best endeavours to delay and prevent any occurrence in relation to the secured goods which has or is likely to have a material adverse effect;
9. the Customer shall duly perform his obligations in relation to the secured goods, including without limitation, under any encumbrance over the secured goods under any law applicable to the secured goods and under any lawful direction from any government body;
10. the Customer shall provide the company with all reasonable assistance and facilities to enable the Company to exercise its rights under this Deed;
11. the Customer shall pay the Company ‘s legal costs and outlays of any one employed or engaged by the Company in preparation of this Deed or the granting of the security required by the company and in the event of default of the customer under either this Deed or the Security together with any goods and services tax related costs or other Government charges which may be paid or payable by the Company in connection with this Deed or the security required by the Company and the establishment fees and documentation, search and registration fees are notified to the Customer by the Company from time to time;

50. the Customer shall pay any stamp duty or registration cost which may be paid or payable by the Company in connection with this Deed or the security required by the Company. In addition, the Customer shall pay any value added tax related costs or other Government charges which may be paid or payable by the company in connection with this Deed or the security required by the Company;

13. the Company shall not alter the Secured goods;
14. the company and its nominees may at any reasonable time carry out an inspection of the secured goods and may at any such time entered on any property owned, used, or occupied by the Customer or any purpose related to this Deed or the security by the Company;
15. the Customer will not without the written consent of the Company first obtained (such consent not to be unreasonable withheld) relocate the goods from the place stated in item 10 of the Schedule.
    

6. The Customer covenants to provide to the Company:

1. full particulars of any event of default or potential event of default immediately after its occurrence;
2. upon receipt a copy of any notice or order received from any government body or any other person relating to any proposal in relation to the secured property which if implemented may have or be likely to have a material adverse effect;

100. as soon as it is commenced or to the knowledge of the Customer is threatened full particulars of any litigation arbitration or administrative proceeding which affects the Customer or the secured property and which have a material effect;
     

7. The Customer shall promptly execute all documents and do all things that the
Company from time to time reasonably requires for a further or more perfectly;

1. establishing the priority of the security required by the Company over the Secured goods and stamping and registering that security;
2. giving to the Company the rights that this Deed or the security required by the Company purports to give or which are contemplated by it.
   

8. For valuable consideration the Customers irrevocably appoints the Company its
Directors, Secretaries, attorneys and Managers jointly and severally as the Customers
attorney to exercise any rights or institute, carry on or enforce:

1. at any time the obligation of the Customers under this Deed or the security required by the company ; to do everything in the attorney’s opinion is necessary or expedient to unable the exercise of any rights to the company or any receiver in relation to this Deed or the security required by the Company ; if the secured property is or is proposed to be the subject of any dealing or other thing which may have a material adverse effect, to do anything in relation to these cured property to prevent or delay that material adverse effect; to appoint substitutes and otherwise delegate its rights;
2. after any event of default has occurred to do everything that the Customer may lawfully authorise an agent to do in respect of the secured property;

100. as attorney the Company may exercise its right notwithstanding the exercise of the rights constitutes a conflict of interest or duty;

4. the power of attorney is granted to secure the performance of the obligations of the Customer to the Company under this Deed, the security required by the Company and any proprietary interests of the Company under this Deed of the security required by the company;
5. each attorney may delegate its powers (including, without limit, this power of delegation) to any person for any period and revoke a delegation and exercise or concur in exercising its power or has a direct or personal interest in the means or result of that exercise its powers
6. that the Customer will be deemed to have ratified anything done by the attorney in accordance with this clause.
   

9. Each of the following is an event of default (whether or not caused by anything
outside the control of the Customer);

1. the Customer does not pay the secured money in accordance with this Deed or perform its obligations under Clause 5;
2. the customer does not perform any of its other obligations under this Deed or the security required by the Company;

100. a representation, warranty or statement made or deemed to be made by the Customer in this Deed or the security required by the company is untrue or misleading in any material respect;

4. this Deed or the security required by the Company is claimed by the Customer to be void, voidable or otherwise unenforceable by the Company;
5. any security required by the Company in respect of the secured goods ceases to have the priority which is purports to have under that security or under any priority agreement between the Customer and the Company or ceases to secure the payment of the moneys or the performance of the obligations which it purports to secure, otherwise than by any act of the Company.
6. a distress attachment or execution is levied or becomes enforceable against any property of the Customer;
7. an authorisation from a government body necessary to enable;
   1. the Customer to perform its obligations under this Deed or the Security required by the Company; or
   2. the Company to exercise its rights under this Deed or the Security required by the Company, is withdrawn.
8. an event or series of events, whether related or not, including, without limitation, any material adverse changes in the property or financial conditions of the Customer occurs which has or is in the opinion of an officer of a Company in his absolute discretion likely to have a material adverse effect;
9. any person who holds a security over any property of the Customer becomes entitled to exercise a right under that security to recover any moneys the payment of which is secured by that security or enforce any other obligation the performance of which is secured by it.
10. the company may, subject to the operation of any applicable law, at any time after the event of default has occurred, exercise any or all of the rights set out in this Clause in any manner and at any time, notwithstanding that a receiver has been appointed;
11. the interpretation of any right set out in this Clause shall not be restricted by reference to or inference from any other right.
    

10.

(a) In the event of default in payment on the due date of any instalment or part thereof or the occurrence of any of the other defaults or events stated in Clause 9 hereof the whole of the balance of principal and stamp duty remaining unpaid together with interest on the principal amount accrued up to the making of a demand shall at the Company‘s option become due and payable on demand.
(b) such demand shall be deemed to be made when delivered or posted to the Customer to the address contained in item 1 of the Schedule notwithstanding the demand is returned unclaimed or by the commencement of proceedings against the Customer seeking to recover the amount so payable on demand.
(c) on default in payment on the due date of any instalment or any sum payable under sub clause (a) above the amount in respect of which default is made or so much as shall from time to time remain unpaid shall bear simple interest at the rate stated in item 9 of the Schedule, such interest, such interest shall accrue and be recoverable from day to day; such interest shall be payable upon any judgement entered against the Customer by the Company.
(d) a statement in writing signed by a director, secretary or officer of the Company stating the amount due or owing by the Customer to the Company or any other act matter or thing arsing under this Deed as at any dates set out in that statement will be prima facie evidence of the facts so stated.

11. If an event of default occurs under this Deed or any other agreement by the Customer or
the Company may at ay time by notice to the Customer declare that:

1. the secured money which is owing; and
2. an amount equal to the part of the secured money which is contingently owing by the Customer to the Company, is immediately due and owing.

100. the Company may.
     1. without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency, are not held by the customer in the capacity the Customer has entered into this Deed or are held by the Customer and or Guarantor jointly with any other persons. The Company may affect any currency conversion necessary or desirable for that purpose.
     2. accelerate the date upon which the Customer and /or the Guarantor accounts or any of them fall due for repayment to or by the Customer to facilitate a set-off.

4. the Company need not allow any set-off between the moneys due under this Deed to the Company and any credit balance of any account conducted with the Company whether by the Customer or any other person.
5. the Company may exercise all rights capable of being conferred by the laws of Papua New Guinea.
   

12. The Company may:

1. take possession or control of and get in the Secured goods pursuant to any security held by the Company over the secured goods.
2. manage, quietly enjoy and otherwise deal with the Secured goods.

100. (i) exercise the rights of the Customer and perform its obligations in respect of the
     Secured goods and cause and permit any other persons to perform their obligations
     in respect of the Secured goods.

(ii) vary, replace, or release any right or interest of the Customer or any other person.

4. exchange any part of the Secured good for any other property and if there is a difference in value between the property exchanged, give or received, as the case may be, any moneys or other consideration equal to the difference in value in order to give or receive equal value for the exchange.
5. vary, replace, rescind or terminated any agreement relating to the Secured goods to which it or the Customer is party.
6. at any time seven (7) days after taking possession of the Secured goods pursuant to any security held by the company over the Secured good , without notice to the Customer, sell the Secured goods at the cost and expense of the Customer by tender, auction or private treaty as in its absolute discretion it deems fit and pursue the Customer by any remedies it deems fit to recover any shortfall left owing after the sale.
7. assign, transfer, change or otherwise deal with the Secured goods pursuant to any security held by the Company over the Secured goods.
   

13. The Customer acknowledges that Customers may from time to time to be

introduced to the Company by a broker agent or other person in such circumstances the Company may pay commission, fees or other remuneration to such broker agent dealer or other person. If the present Deed resulted from any such said introduction the Customer hereby concerns to the payment of commission, fees or other remuneration to such person.

14. Indemnity

The Customer will indemnify, and keep indemnified, the Company from and against:

1. all loss, damages, claims and expenses resulting from seizure, forfeiture or other lawful confiscation of the Secured goods or loss, destruction of, or damage to, the Secured goods through any cause including loss arising from inadequate repair or from the use of the Secured goods, and
2. all liabilities, claims, suits and damages of and incidental to the Secured goods or their use, constituting a breach of any copyright, design, patent or trademark; and

100. any liability, or loss (together with any related interest, penalties, fines and expenses) the Company may incur under stamp duty, customs duty, sales tax or income tax legislation by reason of any act, omission or change of the use of the Secured goods by the Customer or by the reason of the Company relying on information provided by the Customer concerning the Secured goods (including, without limitation, the life of and depreciation rates applicable to the Secured goods);

4. all loss, damages claims and expenses suffered by the Customer resulting directly or indirectly from any breach by the Customer of any of its obligations under this Deed or from the Company acting in good faith on any instructions purporting to originate from the Customer; and
5. any costs, charges and expenses incurred in connection with the ownership of the Secured goods including, without limitation, in registering its interest as owner of the goods.
   

15. Prepayment

1. The Customer may prepay the advance on any date, if the Customer notifies the Company that it wants to do so; and
   1. the notice is in form and substance satisfactory to the Company; and
   2. the Company receives the notice at least three Business Days before the date the prepayment is to be made;
2. If the Customer gives a notice under this subclause, it must make the prepayment that the notice contemplates.

100. If the Customer gives a notice under clause 15(a), it must pay to the Company, on the date specified in the notice:
     1. The amount specified in the notice;
     2. All interest and fees accrued; and
     3. A fee equivalent to three (3) months interest on the amount prepaid at the Standard Rate applicable at the time of prepayment.
        

14. As per item 2 of the Schedule to Chattel Mortgages, Fiona Reinhardt was listed as the guarantor.
    
15. Item 3 of the Schedule to the Chattel Mortgages lists the amount being financed by Credit Corporation.
    
16. Item 4 of the Schedule to the Chattel Mortgages lists the description of the goods, which constituted the ‘Secured goods’.
    
17. As per item 7 of the Schedule to the Chattel Mortgages, the standard rate of interest on each loan is 15% per annum.
    
18. As per item 9 of the Schedule to the Chattel Mortgages, the default rate of interest is 25% per annum (which was made up of the standard rate of 15% per annum and an additional amount of 10% per annum).
    
19. As per item 8 of the Schedule to the Chattel Mortgages, the term of each corresponding loan was stated to be for 24 or 36 months.
    
20. As per item 8 of the Schedule to the Chattel Mortgages, payments on the loans were to be made monthly.
    
21. In the Affidavit of Clement Aukopi filed on 28 June 2024, he stated a number of things, including that:
    
    1. due to the continuous default by Green Field in repayment of the loans, Credit Corporation sent notices to Green Field around September 2015 demanding that it pay-up the arrears, but Green Field made no real attempt to settle the amount;
       
    2. copies of the various default letters were served on Green Field in relation to Chattel Mortgages CM302024, CM302026, CM302029, CM302030, CM302032;
       
    100. no favourable response was received from the defendants and so Credit Corporation conducted the repossession of the security units throughout 2017 in Kavieng, through its agent (Para Legal and Debt Collection Services);
         
    4. despite assurances and undertakings from Fiona Reinhardt and Albert Reinhardt that the arrears on the loan accounts would be brought up to date, all payments were insufficient to settle all arrears or balances except for loan accounts CM302032 and CM302028;
       
    5. as at the date of the filing of WS No. 1077 of 2019, loan accounts CM302028, CM302032, CM302316 and CM302453 have been paid in full and closed;
       
    6. repossession notices were served on Green Field in relation to Chattel Mortgages CM302025, CM302026, CM302027, CM302029, CM302030 and CM302034;
       
    7. Credit Corporation learned through its inquiries that Green Field and Fiona Reinhardt were in breach of their obligations to secure the security units since many of the machinery items and heavy equipment were deteriorating and parts were taken out by vandals in the Belik area where the Green Field operation is located, which log report is contained in annexure CA97 to
       Mr Aukopi’s affidavit;
       
    8. due to the failure of Green Field to secure the security units, Credit Corporation exercised its rights under the Chattel Mortgages to arrange security for the units and engaged the services in this regard from Rommies Security Services, which is based in Kavieng, New Ireland Province;
       
    9. Credit Corporation incurred additional out of pocket expenses in the sum of K8,230.42 to enable Adrian Daniels to travel and conduct a further inspection in May 2016 and ensure the security of the units in Belik Station, New Ireland Province; and
       
    10. As at 28 June 2019, the defendants owed Credit Corporation K1,075,067.70 due to what Credit Corporation claims was the failure to meet their obligations in settling the loan accounts. The amount of K1,075,067.70 is based on the two amounts of K677,001.43 and K398,066.27, that are detailed in paragraphs 8 and 9 of Mr Aukopi’s affidavit.
        
22. Credit Corporation also claims that it has suffered loss of income to generate further business at the loan maturity dates of the outstanding loans and claims that between 14 November 2014 and 28 June 2019, it suffered loss of income to generate further business at loan maturity date, as a direct result of Green Field’s failure to make repayments on time, which would have been secured had Green Field settled its arrears on each of the maturity dates, namely:
    
23. The particulars of Loss of Business for Loan Accounts 302024 to 302032 to 302036, 302316,302350, 302453 and 302454, from the period 14 November 2014 up to maturity date for each loan facility as claimed by Credit Corporation are detailed below.
    

Account Date Open Maturity Date Loan Maturity Amount

Loan Accounts 203024 to 302030

302034 14/11/14 14/10/17 228,543.51

302025 14/11/14 14/10/17 143,756.08

302026 14/11/14 14/10/17 123,459.28

302027 14/11/14 14/10/17 1,397,997,40

302028 14/11/14 14/10/17 595,792.62

302029 14/11/14 14/10/17 234, 934,25

302030 14/11/14 14/10/17 123,410.80

Total Amount 2,847,893.94

Loan Accounts 302032 to 302036

302032 14/11/14 14/10/16 75,411.12

302033 14/11/14 14/10/16 75,411.12

302034 14/11/14 14/10/17 133,054.55

302035 17/11/14 17/10/17 142,936.90

302036 17/11/14 17/10/17 218,412.53

Total Amount 645,226.22

Loan Accounts 302316, 302350, 302453 and 302454

302316 08/04/15 08/03/18 264,997.20

302350 15/05/15 15/05/18 98,192.78

302453 23/06/15 23/05/17 29,121.03

302454 23/06/15 23/05/16 21,536.10

Total Amount 413,847.11

Total loss of business as at loan maturity dates 3,906,967.27

24. In Mr Aukopi’s above mentioned affidavit, I note he annexes the following documents:
    

“CA103” Loan Quote for Loan Account No. CM 302024

“CAI04” Loan Quote for Loan Account No. CM 302025

“CA105” Loan Quote for Laon Account No. CM302026

“CA106” Loan Quote for Loan Account No. CM302027

“CA107” Loan Quote for Loan Account No. CM302028

“CA108” Loan Quote for Loan Account No. CM 302029

“CA109” Loan Quote for Loan Account No. CM302030

“CA110” Loan Quote for Loan Account No. CM 302032

“CA111” Loan Quote for Loan Account No. CM302033

“CA112” Loan Quote for Loan Account No. CM 302034

“CA113” Loan Quote for Loan Account No. CM 302035

“CA114” Loan Quote for Loan Account No.CM302036

“CA115” Loan Quote for Loan Account No. CM302316

“CA116” Loan Quote for Loan Account No. CM302350

“CA117” Loan Quote for Loan Account No. CM302453

“CA118” Loan Quote for Loan Account No. CM302454

25. Credit Corporation also claims that on Wednesday, 14 August 2019, it served a letter dated 13 August 2019 on the defendants at Green Field’s office at section 28 Allotment 21, Vaivai Avenue, Boroko, National Capital District, demanding settlement of the balance on the various outstanding loan accounts, but that it did not receive a reply. In this regard, I have read annexure “CA119” in Mr Aukopi’s affidavit and am satisfied that the letter, together with the attached loan accounts (302024, 302025, 302026, 302027, 302028, 302029, 302030, 302032, 302033, 302034, 302035, 302016, 302350, 302453 and 302454) provide an accurate account of Green Field’s indebtedness to Credit Corporation and that Green Field was served with the letter based on the handwritten acknowledgement details.
    
26. I consider that the letter which constitutes annexure “CA119” adequately informed the defendants that if the debt was not cleared by or before 23 August 2019, that Credit Corporation would claim all incurred costs of the proceedings on an indemnity basis.
    
27. In the Affidavit for Trial of Albert Reinhardt filed on 22 November 2023, he sets out responses regarding the transactions on loan accounts CM302025, CM302026, CM302027, CM302028, 302029, CM302030, CM302032, CM302033, CM302034, CM302035 and CM302036, CM302024, CM302316, CM302350, CM302453 and CM302454.
    
28. I have considered the matters deposed to in Mr Reinhardt’s affidavit, including with reference to the terms of the respective Chattel Mortgages and the loan account statements which are annexed to his affidavit and the Affidavit of Clement Aukopi filed on 28 June 2022.
    
29. I note in the Affidavit for Trial of Albert Reinhardt filed on 22 November 2023 that he makes a number of comments in relation to the loan accounts, including that:
    
    1. Credit Corporation prematurely and unlawfully repossessed vehicle/ machinery the subject of the loans and sold-off and used proceeds (at will) without giving notice and/ or account to Green Field;
       
    2. Credit Corporation sold vehicles and machinery to settle loans, including on certain occasions, where a vehicle or machinery was sold, funds were transferred from one loan account to another to settle a particular loan;
       
    100. Credit Corporation imposed purported or illegal security service fees regarding Rommies Security Services and storage fees in respect of Richard Moni; and
         
    4. Credit Corporation transferred K180,000 from the sale of machinery the subject of loan CM302027 to settle CM3039343 (which is a different loan and not the subject of proceedings between the parties) and breached the terms of the loan agreement.
       
30. In relation to the above-mentioned comments by Mr Reinhardt, it is necessary to consider the terms of the Chattel Mortgages, which are referred to above in this Judgment. Those terms impose strict obligations upon Green Field to comply with the terms of the Chattel Mortgages and the terms give Credit Corporation broad powers in relation to the Chattel Mortgages, the ‘Secured goods’ and any acts of default. In this regard, it is necessary to consider the responses by Green Field and the other defendants regarding each loan, which are detailed in the Affidavit for Trial of Albert Reinhardt filed on 22 November 2023. I do so as follows:
    

CM302025

31. The lumpsum payments that are referred to in paragraph 12 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, July, August, September, October and November of 2015. The payments listed in paragraph 12 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made, for example, in July and December 2015, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
32. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
33. This includes the right to at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302026
    
34. The lumpsum payments that are referred to in paragraph 21 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in June, August, September, October and November of 2015. The payments listed in paragraph 21 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made, for example, in September and December 2016, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
35. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action, including to transfer funds to loans CM302027 and CM302028.
    
36. This includes the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302027
    
37. The lumpsum payments that are referred to in paragraph 31 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in June, August, September, October and November of 2015. The payments listed in paragraph 31 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 15 December 2016 (and at all other relevant times as indicated in the loan statement).
    
38. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
39. In relation to paragraph 34 of the affidavit of Mr Reinhardt, I am satisfied that in relation to the sale of the Kenworth Truck, Dump Trucks and machinery, which constituted ‘Secured goods’ that the transfer of some of the sale proceeds to reduce other loan accounts was permitted under the terms of the Chattel Mortgage. This includes the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
40. I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge those fees that are referred to in paragraphs 37 and 38 of Mr Reinhardt’s affidavit, under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage.
    
    
    CM302028
    
41. The lumpsum payments that are referred to in paragraph 43 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in June, August, September, October and November of 2015. The payments listed in paragraph 43 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
42. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
43. In relation to paragraphs 46 and 49 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to transfer the sale proceeds of the trucks and the John Deere Grader from that loan to other loans in order reduce the amounts owed on those loans based on clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
44. This includes the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    

CM302029

45. The lumpsum payments that are referred to in paragraph 53 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in August, September, October and November of 2015 and some payments between March to July 2016. The payments listed in paragraph 53 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
46. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
47. In relation to paragraphs 56 and 57 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to transfer some of the sale proceeds of the Kenworth truck and the machinery from loan numbers 302316 and 302027 to loan no. 302029 in order reduce the amounts owed on that loan, based on clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. I am also satisfied Credit Corporation was within its rights to use part of the sale proceeds of the Volvo Roller to settle loan no. 302027.
    
48. I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge those fees that are referred to in paragraphs 37 and 38 of Mr Reinhardt’s affidavit, under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This includes the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302030
    
49. The lumpsum payments that are referred to in paragraph 65 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, August, September, October and November of 2015 and some payments between March to July 2016. The payments listed in paragraph 65 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
50. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
51. In relation to paragraph 68 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the Chattel Mortgage to reduce the loan by transferring funds from loan numbers 302316 and 302027, which included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302032
    
52. The lumpsum payments that are referred to in paragraph 74 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, August, September, October and November of 2015 and March to July 2016 . The payments listed in paragraph 74 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 30 December 2016 (and at all other relevant times as indicated in the loan statement).
    
53. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
54. In relation to paragraph 76 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights to charge the security fee under the terms of the Chattel Mortgage and transfer that cost to loan no. 302454 on the basis that Credit Corporation may at clause 11(c)(i) of the Chattel Mortgage, ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302033
    
55. The lumpsum payments that are referred to in paragraph 79 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, August, September, October and November of 2015. The payments listed in paragraph 79 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 23 January 2017 (and at all other relevant times as indicated in the loan statement).
    
56. I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge those fees that are referred to in paragraphs 81 and 83 of Mr Reinhardt’s affidavit under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage.
    
    CM302034
    
57. The lumpsum payments that are referred to in paragraph 89 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, August, September, October and November of 2015. The payments listed in paragraph 89 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
58. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
59. In relation to paragraph 92 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge transfer the amounts from loan numbers 302316 and 302027 to 302034 under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This includes the right at clause 11(c)(i) of the Chattel Mortgage to, ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    

CM302035

60. The lumpsum payments that are referred to in paragraph 98 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, August, September, October and November of 2015. The payments listed in paragraph 98 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
61. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
62. I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge transfer those loan amounts from loan numbers 302316 and 302027 to 302035 under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This includes the right at clause 11(c)(i) of the Chattel Mortgage to, ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.

CM302036

63. The lumpsum payments that are referred to in paragraph 107 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, August, September, October and November of 2015, some payments between March to July 2016 and some payments between February to May 2017. The payments listed in paragraph 107 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
64. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
65. I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge transfer those loan amounts from loan numbers 302316 and 302027 to 302036 under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This includes the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302024
    
66. The lumpsum payments that are referred to in paragraph 116 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March, June, July, August, September, October and November of 2015 and February to May 2017 and July to October 2017. The payments listed in paragraph 116 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made, for example, in September 2016, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
67. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
68. In relation to paragraph 110 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to transfer those loan amounts from loan numbers 302316 and 302027 to 302024 under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This includes the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    

CM302316

69. The lumpsum payments that are referred to in paragraph 125 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in March to July 2016 and some payments in October and November 2016. The payments listed in paragraph 125 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
70. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
71. In relation to paragraph 128 of Mr Reinhardt’s affidavit, I am satisfied that when Credit Corporation sold the Kenworth Truck for K250,000, it properly exercised its rights under the terms of the Chattel Mortgage to transfer those loan amounts on 18 July 2017 to loan numbers 302024, 302025, 302026, 302028, 302029, 302030, 302034, 302035, 302036, 302350, 302453, 302454, 302027 under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
72. I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to charge the fee of K1,188 on 4 July 2017 from Boroko Motors to the loan account under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage.
    
    CM302350
    
73. The lumpsum payments that are referred to in paragraph 131of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in August to November of 2015 and March to July 2016 and October and November 2016. The payments listed in paragraph 131 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
74. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
75. In relation to paragraph 134 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to transfer the credit amounts of K2,868.82 from loan 302316, K3,155.62 from loan no. 302027 and K3,294.96 from loan 302027 to loan 302350, under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    CM302453
    
76. The lumpsum payments that are referred to in paragraph 140 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in August, September, October and November of 2015, March to July 2015 and October and November 2016. The payments listed in paragraph 140 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account, which put Green Field further behind and in continual default of its loan repayment obligations. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made on the loan, those additional payments did not lift the loan out of arrears. Moreso, it was a strict requirement of the Chattel Mortgage that repayments be made each month, and not on an ad hoc basis. I am satisfied that Green Field was in arrears on the loan as at 9 June 2017 (and at all other relevant times as indicated in the loan statement).
    
77. I am also satisfied from the terms of the Chattel Mortgage, including the specific terms under clauses 11, 12 and 14 that Credit Corporation was entitled to repossess and sell the ‘Secured goods’ the subject of that Chattel Mortgage and to use the proceeds to reduce the indebtedness on the loan and take all other relevant action.
    
78. In relation to paragraph 143 of Mr Reinhardt’s affidavit, I am satisfied that Credit Corporation properly exercised its rights under the terms of the Chattel Mortgage to transfer the credit amounts of K1,268.87 on18 July 2017 from loan 302316, K93.72 from loan no. 302027 on 11 December 2017 and K97.91 from loan 302027 on 11 December 2017 and K5,475.61 to loan 302453, under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage. This included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    

CM302454

79. The lumpsum payments that are referred to in paragraph 149 of Mr Reinhardt’s affidavit demonstrate that Green Field did not make monthly payments, each month, as required. For example, monthly payments were missed in August, September, October and November of 2015, some payments were missed between March to July 2016. The payments listed in paragraph 149 also do not reflect an accurate account of all the transactions on the loan, including that when monthly payments were missed, default rates of interest were charged to the account and quite a number of fees were charged in relation to Rommies Security Services, which put Green Field further behind and in continual default of its loan repayment obligations.
    
80. In relation to the payments made to Rommies Security Services, I am satisfied from reading the affidavit of Clement Aukopi filed on 21 October 2019 that it was necessary for Credit Corporation to incur the fees and that it was appropriate that the fees were charged to loan 302454 under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage, which included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
81. For this reason, it is necessary to consider the loan statement for this loan, which is annexed to the Affidavit of Clement Aukopi filed on 28 June 2022. Even though additional payments were made during the term of the loan, those additional payments did not lift the loan out of arrears. I am satisfied that Green Field was in arrears on the loan as at 31 January 2018 (and at all other relevant times as indicated in the loan statement).
    
82. In relation to paragraph 153 of Mr Reinhardt’s affidavit, I am satisfied that it was within the terms of the Chattel Mortgage for CM302454 that Credit Corporation was within its rights to transfer the credit amount of K21,131.11 on 18 July 2017 from loan no. 302317 to loan no. 302454, the credit amount of K23,338.50 on 11 December 2017 from loan no. 302027 to loan no. 302454 and the credit amount of K24, 281.06 on 11 December 2017 from loan no. 302027 to loan no. 302454. I consider that Credit Corporation was within its right to do so under clauses 5, 8, 11, 12 and 14 of the Chattel Mortgage, which included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’.
    
    Liability determined against Green Field and Fiona Reinhardt in
    WS No. 1077 of 2019
    
83. Subject to my reasons detailed further below in this judgment, on the basis of the matters detailed above and pleaded in the Writ filed on 2 September 2019, I am satisfied that Green Field and Fiona Reinhardt are liable for breach of contract in relation to the matters claimed in WS No. 1077 of 2019. Green Field is liable for its breach of the various Chattel Mortgages that are detailed above and pleaded in the Writ, while Fiona Reinhardt is liable under the Reinhardt Guarantees for all money unpaid, the interest that is accruing and all other obligations arising from those guarantees.
    
84. I note that Albert Reinhardt was named as the third defendant in WS No. 1077 of 2019, however, other than being listed as the Managing Director of Green Field, it is not clear from the claim in WS No. 1077 of 2019, how Credit Corporation says that Albert Reinhardt is liable. On the basis, for example, it is not pleaded that the corporate veil should be lifted against him, nor is there any evidence that he provided any guarantees over the loans to Credit Corporation, any claims for liability against Albert Reinhardt in WS No. 1077 of 2019 are dismissed.
    

Dismissal of National Court proceeding WS No. 1097 of 2018

85. In relation to the Amended Statement of Claim in WS No. 1097 of 2018, I determine that the claim must fail and be dismissed based on the issues detailed above in this Judgment. In addition, the claim in WS No. 1097 of 2018 is dismissed for the following reasons:
    
    1. I am not satisfied that there is a recognisable cause of action pleaded in the Amended Statement of Claim. For example, there is no recognisable cause of action pleaded for breach of contract or breach of any of the Chattel Mortgages or any other terms;
       
    2. the Amended Statement of Claim appears to claim that Credit Corporation wrongfully charged fees, however, the factual basis for that claim is not adequately pleaded and particularised;
       
    100. the Amended Statement of Claim and the evidence relied upon by Green Field and Fiona Reinhardt and Albert Reinhardt (the Green Field defendants) at the trial failed to establish any claim against Credit Corporation. In this regard, I consider there was no evidence tendered by the Green Field defendants to show that Green Field had paid out any of the loans, except for those particular loans detailed above in this judgment, namely loan numbers 302028, 302032, 302316 and 302453. In relation to the loans that were paid out, this occurred primarily because Credit Corporation sold the Secured Goods and/ or transferred the proceeds from some or all of those sales to other loans, which it was entitled to do under the terms of Chattel Mortgages.
         
    4. furthermore, in relation to the fees and charges that were charged to the various loans, I am not satisfied that the Green Field defendants demonstrated that the fees and other charges were excessive or unnecessary. Clearly Credit Corporation had to take certain action to recover and sell the Secured Goods, and in doing so, it incurred storage, security and other fees, which were reasonable costs;
       
    5. I note in paragraph 19 of the Statement and Legal Issues that the Green Field defendants state there was a ‘.... massive reduction of the loan balances ..’. While in some cases the loans were significantly reduced, in should be noted that in some instances, this occurred due to the sale of the Secured Goods, however, the fact remained that Green Field was still in arrears under the loans; and
       
    6. in relation to paragraph (e) above, I consider the statement that there was a ‘.... massive reduction of the loan balances ..’, combined with the statement in paragraph 19 of the Statement of Legal Issues that ‘The BPNG policy under clause 3(e) makes provision for the write off of loans that are past 360 days and are classified as loss and as such the Plaintiff’s loans are well over 360 days and should be written off.’, constitutes an admission by the Green Field defendants that Green Field was in default under the loans.
       

Calculation of quantum of damages in WS No. 1077 of 2019

86. I note in paragraph 1 of the Prayer for Relief in the Statement of Claim in
    WS No. 1077 of 2019 that Credit Corporation claims K1,075,067.70 for the ‘outstanding debt’. That amount is the total amount of the loans that were written-off, and which loans are detailed in paragraphs 11 and 12 of the Statement of Claim. I note that by reference to the term ‘wrote-off’, I appreciate it is not conceded by Credit Corporation that it absolved the Green Field defendants of any liability in this matter. Moreover, it is commonly understood in the finance sector, that expressions such as ‘writing-off’ are undertaken for accounting purposes only. In this regard, the bank statements that are attached to the affidavit of Clement Aukopi filed on 28 June 2022 show the following and which details I am satisfied accurately reflect the tables detailed in paragraphs 11 and 12 of the Statement of Claim, namely:
    

87. In the circumstances, I am satisfied that Green Field and Fiona Reinhardt are liable to Credit Corporation in the amount of K1,075,067.70.
    
88. In paragraph 2 of the Prayer for Relief in the Statement of Claim, Credit Corporation seeks the total liquidated sum of K3,906,967.27 for loss of business. In paragraph 3 of the Prayer for Relief in the Statement of Claim Credit Corporation seeks interest at the default rate of 36% per annum on the total accrued interest arrears on all loan accounts (under paragraph 11) from the date of filing the Writ until judgment. Having considered these claims, and noting that in paragraph 7 of the Prayer for Relief that other appropriate orders are sought, I refuse the relief sought in paragraphs 2 and 3 of the Prayer for Relief.
    
89. Instead, I consider it is appropriate that the default rate of interest 25% per annum be charged on the amounts detailed in paragraph 86 above from the dates the loans were written-off. There are a number of reasons for this. Firstly, I am not satisfied from the evidence produced that Credit Corporation would have necessarily been in a position to loan the money to other customers, because this assumes that other customers were in existence and that they would satisfy all lending criteria. It also assumes those potential customers were agreeable to Credit Corporation’s lending rates and other terms and conditions. Furthermore, there have been some challenging economic conditions in the last few years, including with the COVID period, so I am not satisfied that the money which would otherwise be available, would be loaned to other potential customers.
    
90. Secondly, I am not satisfied that the amounts and Loan Quotes that are detailed in annexures CA103 to CA118 of the affidavit of Clement Aukopi filed on 28 June 2022 properly reflect those amounts there were owing on the loans that are detailed in paragraph 86 above. Thirdly, it is unclear how Credit Corporation claims it is entitled to interest at the default rate of 36% per annum. Even if it was clear from the evidence or submissions as to how the rate of 36% was calculated, I consider that rate is excessive and would be punitive in the circumstances.
    
91. Instead, I consider it appropriate that Credit Corporation should be awarded the default rate of interest at 25% per annum on each loan detailed in paragraph 86 above, which is clearly provided for in the Schedules to each of the Chattel Mortgages, from the dates the loans were written-off, until the payment of those damages by Green Field and Fiona Reinhardt as awarded by the Court.
    
92. In relation to the amount claimed in paragraph 4 of the Prayer for Relief for the amount of K8,230.42, and having considered that part of the claim as pleaded in the Prayer for Relief as well as the matters detailed in paragraph 18 of the affidavit of Clement Aukopi filed on 28 June 2022 (together with the annexures to which he refers in that paragraph), I consider those costs were reasonable and that Credit Corporation is entitled to seek that amount on the basis that it was necessary for Adrian Daniels to travel to Belik Station. The right to seek this head of damage is by virtue of clauses 5, 8, 11, 12 and 14 of the Chattel Mortgages, which included the right at clause 11(c)(i) of the Chattel Mortgage to ‘.....without notice combine, consolidate or merge any or all the Customers and /or Guarantors accounts conducted with the Company and may set off any moneys due to the Company under this Deed against them; even if those accounts and the moneys due are not in the same currency......’. I also consider it appropriate that interest at the rate of 8% per annum be charged on the amount of K8,230.42 from 29 May 2019 until payment by Green Field and Fiona Reinhardt.
    
93. In relation to paragraph 5 of the Prayer for Relief, and noting that Credit Corporation gave notice to Green Field and Fiona Reinhardt in its letter dated 13 August 2019 that it would seek its costs of the proceeding on an indemnity basis (which letter is annexure CA119 to the affidavit of Clement Aukopi filed on 28 June 2022), I am satisfied that the positions taken by Green Field and Fiona Reinhardt in these consolidated proceedings were so unreasonable that it warrants the award of indemnity costs against them in both WS No. No. 1097 of 2018 and WS No. 1077 of 2019. In this regard, the award of costs is a discretionary matter and I agree with the principles that are set out in the National Court decision of Opi v Telikom PNG Limited [2020] N8290 regarding the award of indemnity costs.
    

Orders

94. In the circumstances, I make the following orders:
    
    1. The claim in National Court proceeding WS No. 1097 of 2018 is dismissed.
       
    2. In National Court proceeding WS No. 1077 of 2019, Green Field Contractors Limited and Fiona Reinhardt (jointly and severally) shall pay Credit Corporation Finance Limited the amount of K1,075,067.70.
       
    3. In National Court proceeding WS No. 1077 of 2019, Green Field Contractors Limited and Fiona Reinhardt (jointly and severally) shall pay Credit Corporation Finance Limited interest at the rate of 25% per annum from 31 March 2019 on the amount of K52,719.42, regarding loan no. 302024, until the amount owing is paid.
       
    4. In National Court proceeding WS No. 1077 of 2019, Green Field Contractors Limited and Fiona Reinhardt (jointly and severally) shall pay Credit Corporation Finance Limited interest at the rate of 25% per annum from 31 May 2019 on the amount of K43,605.36, regarding loan no. 302035 until the amount owing is paid.
       
    5. In National Court proceeding WS No. 1077 of 2019, Green Field Contractors Limited and Fiona Reinhardt (jointly and severally) shall pay Credit Corporation Finance Limited interest at the rate of 25% per annum from 28 June 2019 on the amount of K978,742.92 regarding loan numbers
       302025, 302026, 302027, 302029, 302030, 302033, 302034, 302036, 302350 and 302454 until the amount owing is paid.
       
    6. In National Court proceeding WS No. 1077 of 2019, Green Field Contractors Limited and Fiona Reinhardt (jointly and severally) shall pay Credit Corporation Finance Limited the amount of K8,230.42 in special damages, with interest accruing at the rate of 8% per annum from 29 May 2019.
       
    7. In National Court proceeding WS No. 1077 of 2019, the claim against Albert Reinhardt is dismissed.
       
    8. Green Field Contractors Limited and Fiona Reinhardt (jointly and severally) shall pay the costs of Credit Corporation Finance Limited in National Court proceedings WS No. 1097 of 2018 and WS No. 1077 of 2019 on an indemnity basis, with such costs to be taxed if not agreed.
       
    9. The terms of these Orders are abridged to the date of settlement by the Court.
       

Lawyers for the plaintiff: Batame Lawyers
Lawyers for the defendants: Credit Corporation Finance Limited Inhouse Lawyers