$70k debt: Former mayor's company could lose property

A FORMER Lismore mayor's company may have a property repossessed after defaulting on another loan.

Reavill Farm Pty Ltd, of which Jeff and Diana Champion are the two directors, have already seen their daughter, Belinda Nott, lose her family home over the company's separate debts.

But in separate matters before Justice Michael Walton in the Sydney Supreme Court, details have emerged on another defaulted loan the company had taken out with Southern Cross Credit Union.

Reavill Farm Pty Ltd - represented by Ms Nott - and the credit union are due to make further written submissions about the extent of "relief to be afforded to the plaintiff" in December.

Justice Walton said in an earlier judgement it was "necessary to clarify the relief sought ... and the basis for the particular orders claimed".

"It is appropriate... the court receive further short submissions on that issue," he said.

Reavill Farm Pty Ltd applied for a loan of $420,000 for vacant land with SCCU in October, 2004.

The credit union had already approved a loan of $502,779 in February, 2001 for the purpose of a refinance.

The new loan was approved, with a property on Hazlemount Lane, Tuckurimba and two rural properties on Wyrallah Rd, Tucki being listed as guarantees.

On October 19, 2016, SCCU gave notice to the Champions about arrears totalling $31,276.52.

They did not remedy this default at the time.

On or about August 4, 2017, the parties agrees to a payment plan that was proposed by the Financial Ombudsman Service.

SCCU wrote to the defendants on August 25 as no action had been taken, and again on September 26 they were given an opportunity to clear the arrears.

As of October 3 last year, the arrears had surpassed $65,000.

The defendants presented SCCU with a cheque for the full amount on October 23, but this was dishonoured three days later.

SCCU had meanwhile filed a notice of motion seeking the company's defence "be struck out" and judgement be made in their favour for possession of the the Hazlemount Lane property.

Reavill Farm Pty Ltd requested a mediation, citing a "farm debt", a week later.

SCCU opposed this, saying the debt was "not a farm mortgage".

Justice Walton said there was a "significant absence of evidence to support" the argument the debt was related to "farming operations".

"From October 17, 2016 to the present, the defendant and the Champions have either partly or wholly failed to make payments as requirement by the loan agreement," he said.

"As at November 20, 2017, the defendant was $70,870.13 in arrears and remains continuing in default."

Later that month, Reavill Farm was ordered to file tax returns and other financial records relating to the 2016-17 financial year and were given until December 1 to produce these.

The company and Ms Nott failed to appear before court on December 8 and in an affidavit to the court, Ms Nott said she could not provide the financial documents.

"I am unable to comply with the Notice to Produce for the following reason, that the financial statements for [the defendant] have not been completed for the year ended 30 June 2017," she said.

Justice Walton previously ordered SCCU to file and serve more submissions and draft orders, the defendant to file a reply.

Subject to further submissions, the defendant is expected to pay SCCU's costs for the proceedings.