An Altona Meadows couple who racked up a $7.7 million debt on a loan secured against their home and a Footscray pizza shop have had their repayments slashed after a court found the wife’s signature on the mortgage documents had been forged.
Titles Strata Management pursued action against Frank and Luisa Nirta for failing to pay back $635,437 lent to pay off an earlier $450,000 loan that was in default.
The Supreme Court of Victoria heard Mr Nirta told his wife he drew the first loan to help associates invest in a Northern Territory camel farm but he told the court the funds were to be used to buy an abattoir in regional NSW.
The second two-month loan was secured in August, 2011, by mortgages over Domenico’s Pizza and Pasta Restaurant in Barkly Street, Footscray, and the couple’s Altona Meadows home.
Interest was charged monthly at eight per cent, the debt reaching $7.75 million by the time of trial and climbing rapidly.
Yet Mrs Nirta, representing herself, told the court she had known nothing about the loan and someone had forged her signatures on the loan agreement, the two mortgages and other loan documents.
She denied meeting in an Altona cafe with Keith William Blackney, the broker who arranged the second loan and who witnessed the signatures.
She was adamant that she would never have put the security of the home in jeopardy as she could not contemplate moving her severely disabled son.
Victoria Associate Justice Melissa Daly said there was a “murky aura surrounding this series of transactions”.
“Overall, my conclusion is that if she is a liar, she is an exceptionally talented liar,” she said of Mrs Nirta.
“I do not believe that she is sufficiently cunning and devious to maintain such a charade over such a long period of time and in such circumstances.”
She also found much of Mr Nirta’s evidence lacked credibility.
“Mr Nirta’s role in this whole transaction is, of course, the elephant in the room … it is quite possible that the forgery of Mrs Nirta’s signature was done by him, or by another at his request or with his connivance. However, on the state of the evidence I cannot make any conclusive findings about Mr Nirta’s role.”
Associate Justice Daly judged the unregistered mortgage over the home to be void but that the Footscray pizza shop should be sold to recover the amount loaned by Titles Strata as it was unaware there had been any fraud.
The eight per cent monthly interest rate was found to be unjustifiable and the statutory interest rate was instead set to have applied from 24 November 2011, the date that Titles Strata made a demand for payment.
