[GRAPHIC OMITTED]
-------------------------------------------------------
LENDERS
MORTGAGE INSURANCE
MASTER POLICY
-------------------------------------------------------
for
ST ▇▇▇▇▇▇ BANK LIMITED
(First Insured)
AXA Australia trustees Limited
(Second Insured)
in relation to
CRUSADE GLOBAL TRUST No. 1 of 1999
Index page 1
--------------------------------------------------------------------------------
Housing Loans Insurance Corporation Pty Ltd
-------------------------------------------
(ACN 071 466 334)
-----------------
LENDERS MORTGAGE INSURANCE
MASTER POLICY
INDEX
-----
Page
--------------------------------------------------------------------------------
Operation of Master Policy 2
Proposals 2
Approval 2
Contract 2
Timely Payment Cover 2
Duty of Disclosure 2
Variation or termination of Master Policy 3
Notices 3
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions 5
1.2 Interpretation 8
1.3 Acts by Others 9
1.4 Approval, Consent or Agreement of the Insurer 9
1.5 Trustee Provisions 9
1.6 Credit Provider 10
1.7 First Insured to act on behalf of Second Insured 10
1.8 Additional Amount 10
2. COVER PROVIDED BY THE POLICY
2.1 Period of Insurance 10
2.2 Cover in respect of the Insured Loan 11
2.3 Cover in respect of Timely Payment Cover 11
3. CALCULATION OF LOSS IN RESPECT OF THE LOAN
3.1 Loss in respect of an Insured loan 11
3.2 Amount Outstanding 11
3.3 Deductions 11
3.4 Unrecouped Timely Payment Cover 12
3.5 Maximum Payable under Limited Cover Policy 13
3.6 Credit Code 13
4. CALCULATION OF LOSS IN RESPECT OF TIMELY PAYMENT COVER
4.1 Loss in respect of a single Repayment Instalment 13
4.2 Aggregate limit and reinstatement 13
4.3 Extension of cover beyond the maturity date 13
4.4 Credit Code Limits 14
Index page 2
--------------------------------------------------------------------------------
5. REPORTING OBLIGATIONS
5.1 Notice of Default 14
5.2 General Reports on all Insured loans 14
5.3 Reports relating to fixed term loans 14
5.4 Reports relating to Borrower, Mortgagor, Mortgage
Guarantor or the Property 15
5.5 Reports relating to a Prior Mortgage 15
5.6 Reports Relating to Year 2000 Communications Issues 15
5.7 Form of Reports 16
6. EXERCISE OF REMEDIES
6.1 The Insurer Notification 16
6.2 The Insurer may require steps to be taken 16
6.3 Due Care 16
7. CLAIMS
7.1 Form of Claim 16
7.2 Information 16
7.3 Timing of claim in respect of the Loan 17
7.4 Timing of claim in respect of a Repayment Instalment 17
7.5 Payment of a claim 17
7.6 Interest on claims 17
7.7 The Insurer may determine to pay a claim 17
7.8 Terms and condition of payment of a claim 17
7.9 Reimbursement of claims paid 18
7.10 Insured in breach of the Policy 18
7.11 Year 2000 Ready 18
8. ACCOUNTING FOR CLAIMS IN RESPECT OF TIMELY PAYMENT COVER
8.1 Accounting for Policy 18
8.2 No diminishing of rights against the Borrower or Mortgagor 18
9. CONDITIONS
9.1 Action requiring the Insurer's consent 18
9.2 The Insurer's other requirements 19
10. EXCLUSIONS 20
11. CANCELLATION OF THE POLICY
11.1 Cancellation by the Insurer 20
11.2 Cancellation by the Insured 20
12. AUDIT 20
13. ASSIGNMENT OF POLICY
13.1 General 21
13.2 Second Insured 21
14 GOVERNING LAW AND SUBMISSION TO JURISDICTION 21
Page 1
--------------------------------------------------------------------------------
Housing Loans Insurance Corporation Pty Ltd
-------------------------------------------
(ACN 071 466 334)
LENDERS MORTGAGE INSURANCE
MASTER POLICY
Housing Loans Insurance Corporation Pty Ltd agrees to issue policies of
lenders mortgage insurance to the First Insured named below in
accordance with the terms and conditions of this Master Policy.
First Insured: St ▇▇▇▇▇▇ Bank Limited (ACN 055 513 070)
Level 4, ▇-▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attention:
Facsimile:
Second Insured:
AXA Australia Trustees Limited (ACN xxx xxx xxx)
Level ▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
Attention:
Facsimile:
Address for notices to First Insured: (if varies from above)
Address for notices to Second Insured: (if varies from above)
Date Master Policy commences: [ date ]
Executed as a Deed in Sydney
Signed sealed and delivered on behalf of Housing Loans Insurance
Corporation Pty Ltd
---------------------------------- -------------------------
Authorised Representative Witness
Signed sealed and delivered on behalf of the First Insured
----------------------------------- -------------------------
Authorised Representative Witness
Signed sealed and delivered on behalf of the Second Insured
---------------------------------- -------------------------
Authorised Representative Witness
Page 2
--------------------------------------------------------------------------------
OPERATION OF THIS MASTER POLICY
This Master Policy sets out the way in which the Insurers will deal
with proposals for lenders mortgage insurance and the terms and
conditions applying to Policies issued to the First Insured. A separate
Policy is issued in respect of each loan approved to be insured. The
Insurer for a particular loan shall be that Insurer selected by the
First Insured and who approves the loan for insurance under this Master
Policy.
PROPOSALS
The First Insured may from time to time provide the information
required by the Insurer about a loan proposed to be an Insured Loan in
the form and manner specified by the Insurer. The Insurer may approve
or reject the proposal or request further information. For this
purpose, the Insurer and the First Insured may agree on a procedure for
the submission and approval of proposals, and in that case proposals
shall only be submitted and approved in accordance with the agreed
procedure. A proposal must identify the Insurer from whom cover is
being sought, or alternatively the identity of the Insurer may be
agreed in advance and form part of the agreed procedure for the
submission and approval of proposals.
Where the Insurer has agreed to receive proposals on terms that the
proposed loans are of a certain type, meet certain conditions or are in
accordance with Lending Guidelines, on making a proposal the First
Insured shall be taken to state that the First Insured has made full
inquiry and that the proposed loan is of that type, meets those
conditions and is in accordance with any applicable Lending Guidelines
other than to the extent expressly stated in the proposal.
Note: Lending Guidelines means the guidelines of the First Insured
for the making of loans which are approved by the Insurer
including any amendments made to those guidelines with the
prior approval of the Insurer.
APPROVAL
On approval of a proposal the Insurer shall:
(a) make an entry in its records of the approval and details of
the Insured Loan Contract; and
(b) if requested by the First Insured, the Insurer will issue
an Acceptance Advice and if agreed by the Insurer within 14
days of the Effective Date issue a Certificate of Insurance
in respect of the Insured Loan/s.
The Insurer may but it is not required to advise the First Insured of
the reason for rejection of a proposal.
CONTRACT
Following approval of a proposal a Policy shall be taken to issue on
the Effective Date in respect of the proposed loan. Each such Policy
will operate as a Deed.
TIMELY PAYMENT COVER
If the Insurer approves a proposal for insurance that includes Timely
Payment Cover then the provisions of the Policy relating to Timely
Payment Cover shall apply. If Timely Payment Cover applies it will be
shown on the Schedule.
DUTY OF DISCLOSURE
The Insured acknowledges its duty under the Insurance Contracts Act
1984, to disclose to the Insurer every matter that it knows, or could
reasonably be expected to know, is relevant to the Insurer's decision
whether to accept the risk of the insurance and, if so, on what terms.
The Insured has the same duty to disclose those matters to the Insurer
before renewing, extending, varying or reinstating a Policy. The duty
applies up until the Effective Date in respect of each Policy.
Page 3
--------------------------------------------------------------------------------
The duty, however, does not require disclosure of a matter:
(a) that diminishes the risk to be undertaken by the Insurer;
(b) that is of common knowledge;
(c) that the Insurer knows or, in the ordinary course of its
business, ought to know;
(d) as to which compliance of this duty of disclosure is waived by
the Insurer.
If the Insured fails to comply with its duty of disclosure, the Insurer
may be entitled to reduce its liability under a Policy in respect of a
claim or may cancel the Policy.
If the Insured's non-disclosure is fraudulent, the Insurer may also
have the option of avoiding the Policy from the beginning.
Note: the Insurer shall treat the Insured as knowing anything that any
person, who is an agent or employee of the Insured or Mortgage Manager
knows or in the ordinary course of its business ought to know.
VARIATION OR TERMINATION OF MASTER POLICY
The Insurer may vary or terminate this Master Policy by giving to the
Insured at least 28 days notice of its intention to do so and in that
event:
(a) any variation set out in the notice shall apply to any
proposal approved by the Insurer on or after the date
specified in the notice; and
(b) the termination shall operate from the date specified in the
notice, but the termination shall not affect any proposal
approved by the Insurer or any Policy issued by the Insurer
prior to the date of termination
The Insurer may not vary this Master Policy for any Insured Loan except
where the variation is generally applied to all insured customers of
the same type in relation to the same type of insurance and where the
variation is necessitated to ensure that, as a consequence of a change
in law, the Insurer is not in breach of the law.
It is expressly understood that the Insurer is not liable for any loss
or damage howsoever caused by, arising from, or attributable to any
failure, neglect, omission or error in communication of any information
which is or is intended to be given to or made by the. Insured arising
from the failure of the Insured's computer systems or other items to be
Year 2000 Ready other than as the result of any failure in the
Insurer's computer systems or other items to be Year 2000 Ready.
NOTICES
Any notice given under this Master Policy or under any Policy issued
under it:
(a) must be in writing addressed to the intended recipient at the
address shown below or the address last notified by the
intended recipient to the sender:
in the case of notices to the Insurer:
Attention: Managing Director
Address: HLIC/GEMICO Australia,
Level 23, AAP Tower,
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
Fax: (▇▇) ▇▇▇▇ ▇▇▇▇
Page 4
--------------------------------------------------------------------------------
in the case of the First Insured:
To the attention of the person and at the address and fax
number shown on the front of this Master Policy;
in the case of the Second Insured:
To the attention of the person and at the address and fax
number shown on the front of this Master Policy;
(b) must be signed by a person duly authorised by the sender,
(c) will be taken to have been given:
(i) (in the case of delivery in person) when delivered or
left at the above address;
(ii) (in the case of facsimile transmission) when recorded
on the transmission result report unless:
(A) within 24 hours of that time the recipient
informs the sender that the transmission was
received in an incomplete or garbled form; or
(B) the transmission result report indicates a
faulty or incomplete transmission; and
(iii) (in the case of post) on the seventh day after the
date on which the notice is ccepted for posting by
the relevant postal authority.
If delivery or receipt is on a day when commercial premises
are not generally open for business in the place of receipt
or is later than 4pm (local time) on any day, the notice
will be taken to have been given on the next day when
commercial premises are generally open for business in the
place of receipt.
(d) In this clause a "notice" includes the giving of any
approval or consent or the provision of any information or
report.
Page 5
--------------------------------------------------------------------------------
POLICY WORDING
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Master Policy and any Policy issued under it, unless the
contrary intention appears:
Acceptance Advice in relation to a loan proposed to be insured,
means:
(a) if agreed by the Insurer an advice by the Insurer
confirming its agreement to insure the loan, the details of
the loan and any special conditions to apply to the Policy;
or
(b) in any other case an entry in the records of the Insurer of
its agreement to insure the loan, the details of the loan
and any special conditions to apply to the Policy;
Additional Advance means any amount which is or becomes owing to
the Insured under the Insured Loan Contract or which is secured by
the Mortgage, in addition to the Loan Amount or which is in
addition to the Loan Amount reduced by any repayments of principal
that is not interest, fees or charges payable under the Insured
Loan Contract;
Approved Additional Advance means an Additional Advance approved
by the Insurer for insurance under a Policy in its absolute
discretion, or which is of a type and in accordance with any
conditions specified in the Schedule.
Approved General Insurance Policy means a policy of insurance:
(a) issued by an insurer authorised to carry on insurance
business in Australia;
(b) which does not preclude any claim under it by virtue of the
Policy;
(c) under which the Property is insured:
(i) in the case where the Property is a lot or unit
under a strata plan, by the body corporate of the
strata plan; and
(ii) in any other case, for the interests of the Insured
and the Mortgagor for not less than the value of all
buildings and improvements on the Property; and
(d) which provides insurance against destruction or damage by
events which include fire, storm and tempest, lightning and
earthquake and such other risks as are:
(i) required under the Insured Loan Contract; or
(ii) reasonably required by the Insurer by notice to the
Insured;
Approved Prior Mortgage means a mortgage or other security ranking
in priority to the Mortgage securing the Insured Loan which was
disclosed to the Insurer prior to the issue of the Acceptance
Advice or subsequently approved by the Insurer;
Note: any subsequent approval of a prior mortgage shall be at the
absolute discretion of the Insurer.
Approved Prior Mortgagee means the person entitled as mortgagee to
the benefit of an Approved Prior Mortgage;
Borrower means the person who is liable to repay the Insured Loan
and who is so named in the Certificate of Insurance;
Certificate of Insurance in relation to an Insured Loan, means:
Page 6
--------------------------------------------------------------------------------
(a) if no certificate is issued to the Insured by the Insurer -
the most recent information in respect of the Policy
contained in the records of the Insurer setting out the
matters specified for inclusion in the Certificate of
Insurance in the policy wording; or
(b) if a certificate is issued to the Insured by the Insurer -
the most recent certificate issued by the Insurer in
respect of the Policy setting out the matters specified for
inclusion in the Certificate of Insurance in the policy
wording;
Collateral Security means any mortgage, charge, encumbrance,
guarantee, Mortgage Guarantee, letter of credit, letter of comfort
or any other right of any description from time to time relied
upon by the Insured as supporting the obligations under the
Insured Loan Contract;
Credit Code means the Consumer Credit Code set out in the appendix
to the Consumer Credit (Queensland) Act 1994 and the regulations
made under that Act as adopted, amended or supplemented in the
relevant state or territory of Australia.
Default in respect of an Insured Loan Contract, means any event on
or following which the Insured's power of sale in relation to the
Property becomes exercisable whether immediately or at the
Insured's option or upon the expiration of any notice or period of
time and whether or not the power of sale only arises if before
the expiration of the notice or period of time the default remains
unremedied;
Effective Date means:
(a) in the case of an Insured Loan other than an Approved
Additional Advance, the latest of:
(i) the date monies are first advanced under the Insured
Loan Contract;
(ii) the date that the Mortgage securing the Insured Loan
is granted to or acquired by the Insured; or
(iii) the date the premium is received by the Insurer in
respect of the proposed Insured Loan; or
(b) in the case of any Approved Additional Advance approved by
the Insurer, the latest of:
(i) the date monies are first advanced on account of the
Approved Additional Advance; or
(ii) any additional premium is received by the Insurer in
respect of the Approved Additional Advance.
Government includes any local government or any government or
local government authority or any body established by statute and
controlled by government;
Insurer means Housing Loans Insurance Corporation Pty Ltd;
Insured means the First Insured, the Second Insured or a person
entitled to the benefit of this Policy;
Insured Loan means the loan described in the Certificate of
Insurance including:
(a) any Approved Additional Advance; and
(b) the Loan or Approved Additional Advance as amended pursuant
to section 66 or 68 of the Credit Code;
Insured Loan Contract means the contract under which the Insured
Loan is made and the Mortgage securing the Insured Loan;
Page 7
--------------------------------------------------------------------------------
Lending Guidelines means the guidelines of the Insured for the
making of loans which are approved by the Insurer including any
amendments made to those guidelines with the prior approval of the
Insurer;
Loan Amount in respect of an Insured Loan, means:
(a) the amount of principal originally advanced, not being
greater than the amount of principal shown in the
Certificate of Insurance; and
(b) the amount of principal advanced under any Approved
Additional Advance,
less any amount of principal repaid (not including any amount the
subject of a claim paid by the Insurer for loss in respect of a
Repayment Instalment) and excluding any capitalised interest, fees
and charges;
Loss Date in respect of an Insured Loan means:
(a) where following a Default the Insured or an Approved Prior
Mortgagee sells the Property, the date on which the sale is
completed;
(b) where following a Default the Insured or an Approved Prior
Mortgagee becomes the absolute owner by foreclosure, the
date on which that event occurs;
(c) where following a Default the Mortgagor sells the Property
with the prior approval of the Insured and the Insurer, the
date on which the sale is completed;
(d) where the Property is compulsorily acquired or sold by a
government for public purposes and there is a Default (or
where the Mortgage has been discharged by the operation of
the compulsory acquisition or sale and there is a default
in repayment of the Insured Loan which would have been a
Default but for the occurrence of that event), the date
being the later of the date of the completion of the
acquisition or sale or the date 28 days after the date of
the default;
(e) where the Insurer has agreed or determined to pay a claim
under the Policy, the date specified in that agreement or
determination;
Mortgage means the mortgage of real property which is security for
the Insured Loan, details of which are set out in the Certificate
of Insurance or a security substituted for the mortgage:
(a) where the Credit Code applies - in accordance with section
47 of the Credit Code; or
(b) in any other case - approved by the Insurer in its absolute
discretion;
Note: In giving any consent or imposing any condition on a
consent under section 47 of the Credit Code the Insured shall have
regard to the interests of the Insurer
Mortgage Guarantee means a guarantee given by a Mortgagor
guaranteeing the obligations of the Borrower under the Insured
Loan;
Mortgage Manager means a person approved by the Insurer who
manages Insured Loans on behalf of the Insured;
Mortgagor means the mortgagor of the Mortgage who is named as such
in the Certificate of Insurance;
Policy means the lenders mortgage insurance policy issued in
respect of an Insured Loan under this Master Policy and shall
consist of:
(a) the policy wording;
(b) the Certificate of Insurance; and
(c) the Schedule and any attachments to it.
Page 8
--------------------------------------------------------------------------------
Property means the real property described in the Certificate of
Insurance and mortgaged under the Mortgage;
Repayment Instalment means a sum payable periodically at monthly
or other intervals on account of amounts outstanding under an
Insured Loan;
Schedule means the most recent Schedule issued to the First
Insured in respect of this Master Policy setting out matters
specified for inclusion in the Schedule in the policy wording and
any special conditions applying to the Policy;
Scheduled Balance means, for the purposes of this Master Policy,
the amount that would have been outstanding if the minimum
Repayment Instalments under the Insured Loan Contract had been
made on the scheduled dates.
Standard Rate means the rate of interest which is charged under an
Insured Loan if Repayment Instalments are paid by a particular
time or within a particular period;
Timely Payment Cover means the insurance provided by clause 2.3;
Trust means if the Second Insured holds the benefit of the Policy
as the Trustee of a Trust, the trust shown in the Schedule.
Year 2000 Ready in respect of a computer system or other items
means that the functionality or performance of that computer
system or those other items is not affected by dates prior to,
during and after the year 2000 (other than functionality or
performance which would have been affected had the relevant items
been able to process dates prior to, during and after the year
2000 in the first place) and in particular:
(a) no value for current date will cause any interruption in
operation of the computer system;
(b) the date-based functionality of the computer system must
behave consistently for dates prior to, during and after
the year 2000;
(c) in all interfaces and data storage in respect of the
computer system, the century in any date must be specified
either explicitly or by unambiguous algorithms or
interfacing rules; and
(d) the Year 2000 must be recognised by the computer system as
a leap year.
1.2 Interpretation
In this Master Policy and any Policy issued under it, unless the
contrary intention appears:
(a) the singular includes the plural and conversely;
(b) a gender includes all genders;
(c) where a word or phrase is defined, its other grammatical
forms have a corresponding meaning;
(d) a reference to a person includes a body corporate or
unincorporated body or other entity;
(e) a reference to any legislation or to any provision of any
legislation includes any modification or re-enactment of
it, any legislative provisions substituted for it, and all
regulations and statutory instruments under it;
(f) a reference to a clause is to a clause of this Policy;
(g) all references to dollars and expressions preceded by the
symbol "$" shall be to Australian currency and all
references to cost, value and price shall be to cost, value
and price expressed in Australian currency;
Page 9
--------------------------------------------------------------------------------
(h) writing and any reference to an advice, consent or approval
includes facsimile transmission and recording or
communicating by electronic or similar means;
(i) a signature includes a copied, stamped or electronic
signature; and
(j) headings are for convenience only and do not affect
interpretation.
1.3 Acts by Others
For the purposes of the Policy, the receipt of any monies by the
Insured, the doing of any act or thing, or the omission to do any
act or thing, by the Insured shall include the receipt of those
monies and the doing of the act or thing or the omission to do the
act or thing by any other Insured or by the Mortgage Manager.
1.4 Approval, Consent or Agreement of the Insurer
Where the approval, consent or agreement of the Insurer is
required under the Policy then:
(a) unless it is expressed that the approval, consent or
agreement is in the absolute discretion of the Insurer or
the contrary intention otherwise appears, the Insurer shall
act reasonably in giving or refusing to give that approval
or consent or in agreeing or not agreeing; and
(b) the Insurer shall not be taken to have given its approval,
consent or agreement unless it has done so in writing or it
is recorded in the Certificate of Insurance in respect of
the Insured Loan.
1.5 Trustee Provisions
(a) The Second Insured holds the benefit of each Policy only in
its capacity as trustee of the Trust and in no other
capacity. A liability or obligation of the Second Insured
to pay money under or in connection with each Policy can be
enforced against the Second Insured only to the extent to
which it can be satisfied out of the property of the Trust
out of which the Second Insured is actually indemnified for
the liability. This limitation of the Second Insured's
liabilities or obligations under this Policy applies
despite any other provision of each Policy and extends to
all liabilities and obligations in any way connected with
any representation, warranty, conduct, omission, agreement
or transaction related to each Policy;
(b) The Insurer may not sue the Second Insured in any capacity
other than as trustee of the Trust, including seeking the
appointment of a receiver (except in relation to the
property of the Trust), a liquidator, an administrator or
any similar person to the Second Insured or prove in any
liquidation, administration or arrangement of, or affecting
the Second Insured (except in relation to the property of
the Trust);
(c) The provisions of this clause 1.5 shall not apply to any
obligation or liability of the Second Insured to the extent
that the Second Insured is not actually indemnified for the
obligation or liability as a result of the Second Insured's
fraud, negligence or breach of trust.
For these purposes, it is agreed that the Second Insured
cannot be regarded as being fraudulent, negligent or in
breach of trust to the extent to which any failure by the
Second Insured to satisfy its liabilities or obligations
under a Policy has been caused or contributed to by a
failure by the First Insured, the Mortgage Manager or the
Trust Manager (being the Manager referred to in the Master
Trust Deed and Supplementary Terms Notice detailed in the
Schedule) or any other person (other than a person in
respect of which the Second Insured is liable for their
acts or omissions under such Master Trust Deed or
Supplementary Terms Notice) to fulfil its obligations in
relation to the Trust or under the Policy or any other act
or omission of any such person.
(d) The Second Insured is not obliged to do or refrain from
doing anything under a Policy (including incur any
liability) unless the Second Insured's liability is limited
in the same manner as set out in paragraphs (a) to (c) of
this clause.
Page 10
--------------------------------------------------------------------------------
(e) For the avoidance of doubt, nothing in this clause affect's
the Insurer's rights under a Policy, or under the Insurance
Contracts Act, to avoid or reduce a claim which may be made
by, or on behalf of, the Second Insured under a Policy (or
to obtain a declaration or any order to that effect).
1.6 Credit Provider
If the Credit Code applies to an Insured Loan in respect of which
the insured is the Second Insured and the Second Insured is not
the credit provider for the purposes of the Credit Code then:
(a) at all times the Second Insured must be entitled to require
the credit provider to do such acts or things or not to do
such acts or things as may be required under this Policy
which may only be done or not done by the credit provider;
and
(b) it shall require the credit provider to do or not do those
acts or things as may be required to be done or not done by
the Second Insured under this Policy if it was the credit
provider or failing that, take whatever steps are necessary
to become the credit provider under the Insured Loan.
1.7 First Insured to act on behalf of Second Insured
The Insurer acknowledges that, and the First Insured agrees with
the Second Insured that whilst the First Insured is the Mortgage
Manager, and while the Trust Manger is the Manager of the
Trust(being the Manager referred to in the Master Trust Deed and
Supplemetary Terms Notice detailed in the Schedule) where this
Master Policy or a Policy requires the Second Insured (either in
that capacity or as an Insured) to do an act or refrain from doing
an act then the First Insured or Trust Manager will do that act or
refrain from doing that act (as the case may be) on behalf of the
Second Insured (other than a requirement for the payment of any
money by the Second Insured). This clause regulates the
arrangement between the First Insured, the Second Insured and the
Trust Manager only and does not affect the rights or obligations
of the Insurer in respect of any Insured.
1.8 Additional Amount
(a) If the Insurer becomes liable to pay goods and services tax
or any like tax ("GST") on any part of the premium payable
by the Insured in respect of the Policies issued under this
Master Policy then the Insurer shall notify the First
Insured of that fact, the date on which the GST is payable
and the amount calculated under this clause (the
"Additional Amount") showing how that amount is allocated
with respect to each Policy issued under this Master
Policy.
(b) The First Insured shall pay to the Insurer the Additional
Amount as specified in the notice at least 30 days prior to
the date on which the GST is payable by the Insurer or, if
the notice is given less than 40 days prior to the date on
which the GST is payable, then within 14 days of the giving
of the notice.
(c) The Additional Amount is in respect of policies issued
under this Master Policy and still in force at the GST
commencement date in respect of which the GST is levied,
adjusted as follows:
(i) If stamp duty is payable in respect of the
Additional Amount then the Additional Amount shall
be increased by a further amount so that after
paying GST on that further amount the amount
remaining is the amount of stamp duty payable;
(ii) The amount payable under this clause shall be
reduced by any refund of stamp duty that has been or
will be received by the Insurer in respect of the
premiums paid or payable in respect of any Policies
issued under this Master Policy; and
(d) For the purposes of this clause the Additional Amount shall
only be payable in respect of that part of the premium in
respect of which the GST is payable.
(e) The Insurer will consider in good faith any reasonable
request by the First Insured to pass on to the First
Insured any material reduction in costs or other benefits
which accrue to the
Page 11
--------------------------------------------------------------------------------
Insurer as a direct result of the introduction of GST or
the associated abolition or reduction of other statutory
charges, levies, duties or taxes (excluding taxes on the
income of the Insurer).
2. COVER PROVIDED BY THE POLICY
2.1 Period of Insurance
The Policy in respect of an Insured Loan applies:
(a) in the case of the First Insured, from the Effective Date
until the earliest of:
(i) if the Insured Loan and the Mortgage securing the
Insured Loan is beneficially assigned to the Second
Insured - midnight on the day immediately preceding
such assignment; or
(ii) the date the Insured Loan or the Mortgage securing
the Insured Loan is assigned, transferred or
mortgaged to a person other than to a person who is
or becomes an Insured; or
(iii) the date the Insured Loan is repaid in full; or
(iv) the date the Insured Loan ceases to be secured by
the Mortgage (other than in the case where the
Mortgage is discharged by the operation of a
compulsory acquisition or sale by a government for
public purposes); or
(v) the maturity date as set out in the Certificate of
Insurance or as extended with the consent of the
Insurer or as varied by a court under the Credit
Code; or
(vi) the date the Policy is cancelled in respect of the
Insured Loan in accordance with the Policy; and
(b) in the case of the Second Insured, on and from the date the
Insured Loan and the Mortgage securing the Insured Loan are
beneficially assigned to it until the earliest of:
(i) the date the Insured Loan or the Mortgage securing
the Insured Loan is assigned, transferred or
mortgaged to a person other than to a person who is
or becomes an Insured; or
(ii) the date the Insured Loan is repaid in full; or
(iii) the date the Insured Loan ceases to be secured by
the Mortgage (other than in the case where the
Mortgage is discharged by the operation of a
compulsory acquisition or sale by a government for
public purposes); or
(iv) the maturity date set out in the Certificate of
Insurance, or as extended with the consent of the
Insurer or as varied by a court under the Credit
Code; or
(v) the date the Policy is cancelled in respect of the
Insured Loan in accordance with the Policy.
Note: in this provision a court includes a Court as defined
under the Credit Code
2.2 Cover in respect of the Insured Loan
In accordance with the Policy, the Insurer shall pay to the
Insured the loss in respect of that Insured Loan if the Loss Date
occurs in respect of that Insured Loan.
Where a Default occurs prior to the expiry date of the Policy or
the cancellation of the Policy, the Insurer shall pay to the
Insured the loss in respect of that Insured Loan even though the
Loss Date occurs after the period of insurance has ended.
Page 12
--------------------------------------------------------------------------------
2.3 Cover in respect of Timely Payment Cover
In accordance with the Policy, and where the Schedule states that
Timely Payment Cover applies, the Insurer shall pay to the Insured
the loss in respect of a Repayment Instalment if:
(a) the Borrower fails to pay all or part of a Repayment
Instalment due under an Insured Loan; and
(b) that failure continues for 14 days after the due date for
payment.
3. CALCULATION OF LOSS IN RESPECT OF THE LOAN
3.1 Loss in respect of an Insured Loan
The loss in respect of an Insured Loan is the amount outstanding
less the deductions calculated under this clause as at the Loss
Date, or where clause 3.4 applies calculated in accordance with
that clause.
3.2 Amount outstanding
The amount outstanding is the aggregate of:
(a) the Loan Amount together with any interest fees or charges
(whether capitalised or not), that are outstanding at the
Loss Date;
(b) fees and charges paid or incurred by the Insured ; and
(c) such other amounts (including fines or penalties) which the
Insurer in its absolute discretion approves;
which the Insured is entitled to recover under the Insured Loan
Contract or any Mortgage Guarantee.
3.3 Deductions
The deduction to be made from the amount outstanding is the
aggregate of:
(a) where the Property is sold, the sale price or where the
property is compulsorily acquired the amount of
compensation less any amount required to discharge any
Approved Prior Mortgage;
(b) where foreclosure action occurs, the value of the Insured's
interest in the Property (treating the Insured's interest
as including the interest of any prior Mortgagee who is not
an Approved Prior Mortgagee);
(c) any amount received by the Insured under any Collateral
Security;
(d) all amounts paid to the Insured:
(i) by way of rents, profits or proceeds in relation to
the Property; or
(ii) under any policy of insurance relating to the
Property and not applied in restoration or repair;
(e) any interest whether capitalised or not that exceeds
interest at the Standard Rate;
Note: if the Credit Code applies to the loan then any interest
greater than the interest calculated and accrued at the
Standard Rate in accordance with the provisions of the Credit Code
shall be excluded.
(f) any fees or charges whether capitalised or not, that are
not of a type or which exceed the maximum amounts specified
below:
(i) premiums for Approved General Insurance Policies,
levies and other charges payable to a body corporate
under a strata title system, rates, taxes and other
statutory charges;
Page 13
--------------------------------------------------------------------------------
(ii) reasonable and necessary legal and other fees and
disbursements of enforcing or protecting the
Insured's rights under the Insured Loan Contract, up
to the maximum amount stated in the Schedule;
(iii) repair, maintenance and protection of the Property,
up to the maximum amount or proportion of the value
of the Property stated in the Schedule; and
(iv) reasonable costs of the sale of the Property by the
Insured, up to the maximum amount stated in the
Schedule;
Note: if the Credit Code applies to the Insured Loan then
fees and charges that exceed the fees and charges
recoverable under the Credit Code (less any amount that
must be accounted for to the Borrower or the Mortgagor)
shall be excluded.
(g) losses directly arising out of physical damage to the
Property other than:
(i) losses arising from fair, wear and tear; or
(ii) losses which were recovered and applied in the
restoration or repair of the Property prior to the
Loss Date or which were recovered under a policy of
insurance and were applied to reduce the amount
outstanding under the Insured Loan;
(h) any amounts by which a claim may be reduced under the Policy;
and
(i) any deductible or other amount specified in the Schedule.
3.4 Unrecouped Timely Payment Cover claim
If prior to the Loss Date the Insurer has paid a claim for loss in
respect of Timely Payment Cover and that claim together with
interest has not been repaid to the Insurer in accordance with
clause 7.9(a) then:
(a) firstly, the amounts specified in paragraphs (a), (b)
or (c) of clause 3.3 shall be applied to repay the Insurer
such claim in accordance with clause 7.9(a);
(b) secondly, the amount outstanding under clause 3.2 is
reduced by the amount applied to repay the Insurer under
paragraph (a) of this clause; and
(c) thirdly, the loss in respect of the Insured Loan is the
amount outstanding so reduced less the deductions
calculated under this clause as at the Loss date.
3.5 Maximum payable under Limited Cover policy
If the Certificate of Insurance states that the Policy provides
"Limited Cover" the maximum amount payable by the Insurer shall
not exceed the percentage of the Loan Amount specified in the
Certificate of Insurance.
3.6 Credit Code
If the Credit Code applies to the Insured Loan then:
(a) the amount outstanding calculated under clause 3.2 shall
not exceed the amount required to pay out the Insured Loan
as calculated in accordance with the provisions of the
Credit Code at the last date prior to the Loss Date on
which such payment could be made less any interest whether
capitalised or not that exceeds the Standard Rate, and if
after payment of a claim by the Insurer it is determined
that no amount or a lesser amount was payable immediately
preceding the Loss Date then the Insured shall immediately
advise the Insurer and promptly pay to the Insurer any
overpayment by the Insurer; and
Note: the maximum amount will normally be the amount calculated
under section 75 of the Credit Code.
Page 14
--------------------------------------------------------------------------------
(b) if any application is made to a court under the Credit Code
in respect of the Insured Loan after a Default or any
application has been made prior to a Default that has not
been finally disposed of prior to that Default then no
claim shall be payable until the application has been
finally disposed of.
Note: in this provision a court includes a Court as defined under
the Credit Code. The type of application to which this provision
may apply is an application under section 68, 69, 70, 72, 77, 88,
101, 102, 107, or 114 of the Credit Code as well as other
proceedings under the Code.
4. CALCULATION OF LOSS IN RESPECT OF TIMELY PAYMENT COVER
4.1 Loss in respect of a single Repayment Instalment
The amount of the Insured's loss in respect of a Repayment
Instalment is the amount by which the amount received by the
Insured on account of that Repayment Instalment is less than the
amount of that Repayment Instalment calculated at the Standard
Rate, less -
(a) any amount by which a claim may be reduced under the
Policy; or
(b) any deductible or other amount specified in the Schedule.
4.2 Aggregate limit and reinstatement
The aggregate amount payable in respect of all losses in respect
of Repayment Instalments under the Policy shall not exceed the
amount specified in or calculated in accordance with the method
set out in the Schedule and that aggregate shall be reinstated by
any amounts subsequently repaid or reimbursed to the Insurer.
4.3 Extension of cover beyond the maturity date
If at the end of the term of the Insured Loan in respect of which
Repayment Instalments are for interest only, all or part of the
Loan Amount remains outstanding then for the purpose of the
insurance for a loss in respect of a Repayment Instalment, an
obligation to make Repayment Instalments under the Insured Loan
Contract of interest only calculated at the Standard Rate
applicable at the end of the term shall be deemed to continue:
(a) at the repayment intervals specified under Insured Loan
Contract;
(b) until the first to occur of the repayment of that Insured
Loan or the expiration of six months from the end of the
term of the Insured Loan.
4.4 Credit Code limits
If the Credit Code applies to the Insured Loan then the maximum
loss in respect of a Repayment Instalment shall be the amount of
the Repayment Instalment calculated in accordance with the
provisions of the Credit Code as if that Repayment Instalment was
paid on the due date and if after payment by the Insurer of a loss
in respect of a Repayment Instalment it is determined that no
amount or a lesser amount was payable by the Borrower in respect
of that Repayment Instalment then the Insured shall immediately
advise the Insurer of that fact and promptly repay to the Insurer
the difference between the amount paid by the Insurer in respect
of the loss and the amount payable in accordance with the
provisions of the Credit Code.
Note: the Repayment Instalment must be calculated in accordance
with the Credit Code without any default interest.
5. REPORTING OBLIGATIONS
5.1 Notice of default
Page 15
--------------------------------------------------------------------------------
Within 14 days after the end of each month the Insured must inform
the Insurer if at the end of month:
(a) where Repayment Instalments are payable monthly or more
frequently, an amount due by the Borrower by way of
interest or otherwise in respect of an Insured Loan which
equals or exceeds at least 90% of the sum of Repayment
Instalments payable in a period of 3 months; and
(b) in any other case, an amount due by the Borrower in respect
of an Insured Loan has remained unpaid for one month,
and must furnish such further information as the Insurer requests.
5.2 General reports on all Insured Loans
The Insured must, within 28 days of receiving a written request
from the Insurer, provide the Insurer with a status report which
sets out:
(a) all Insured Loans or all Insured Loans of a particular type
or location insured under a Policy issued under this Master
Policy;
(b) the Scheduled Balance in respect of those Insured Loans;
(c) the amount outstanding under each of those Insured Loans;
and
(d) other information about those Insured Loans, the Insured
Loan Contracts, any Mortgage Guarantees or Collateral
Securities as the Insurer reasonably requests.
The Insurer may request a status report under this clause no more
than twice a year.
5.3 Reports relating to fixed term loans
Where the Policy applies to an Insured Loan with a fixed term at
the end of which the Loan Amount or any part of it that remains
outstanding is to be repaid then, if the Borrower fails to repay
the Loan Amount or that part of it on or before the end of the
term, the Insured shall within 14 days of the end of the term
notify the Insurer of the default.
5.4 Reports relating to the Borrower, Mortgagor, Mortgage Guarantor or
the Property
The Insured must as soon as possible and, in any event, not later
than 14 days after it becomes aware of the relevant facts, inform
the Insurer in writing of the following events:
(a) the institution of proceedings for the bankruptcy or
winding up of the Borrower, the Mortgagor, any Mortgage
Guarantor or the provider of any Collateral Security;
(b) any material failure of the Borrower, the Mortgagor, the
Mortgage Guarantor or the provider of any Collateral
Security to observe, comply with or perform any of their
obligations or covenants contained in an Insured Loan
Contract, the Mortgage, the Mortgage Guarantee or the
Collateral Security other than those relating to payment of
amounts due by the Borrower in respect of the Insured Loan;
(c) the taking of possession of the Property by the Insured or
any other person (including the date of possession);
(d) if the Credit Code applies to the Insured Loan:
(i) any request to materially vary the terms of the
Insured Loan Contract, any Mortgage Guarantee or any
Collateral Security or to postpone any enforcement
proceedings;
Note: a request under this provision will include a request
under section 66, 69 or 86. Enforcement proceedings has the
same meaning that the term has under the Credit Code.
(ii) any application made in respect of the Insured Loan
to a court and any order of that court;
Page 16
--------------------------------------------------------------------------------
Note: in this provision a court includes a Court as defined
under the Credit Code. The type of application to which
this provision may apply is an application under section
68, 69, 70, 72, 77, 88, 101, 102, 107, or 114 of the Credit
Code as well as other proceedings under the Code.
(iii) if the Insured becomes aware or, in the ordinary
course of business ought to be aware that the terms
of the Insured Loan Contract, any Mortgage Guarantee
or any Collateral Security, or any act or omission
of the Insured, may constitute a contravention of
the Credit Code,
and must furnish to the Insurer such further information about the
events as the Insurer requests.
5.5 Reports relating to a Prior Mortgage
Where a Mortgage is not a first mortgage, the Insured must as soon
as possible and, in any event, not later than 14 days after it
becomes aware, or in the ordinary course of business ought to
become aware of the relevant facts, notify the Insurer if:
(a) the Mortgagor has failed to observe or comply with any of
the Mortgagor's obligations or covenants contained in any
prior mortgage;
(b) a prior mortgagee has entered into possession of the
Property or sold it or commenced foreclosure action or
commenced proceedings against the Mortgagor for recovery of
any amounts owing under the prior mortgage, or proposes to
exercise any of these remedies; or
(c) the principal amount owing under a prior mortgage has
increased since the date of the Acceptance Advice.
5.6 Reports Relating to Year 2000 Communications Issues
If the Insured becomes aware of any failure in its computer
systems or other items to be Year 2000 Ready and which causes or
may reasonably be expected to cause a claim, the Insured must
immediately notify the Insurer with full written details
including, but not limited to the nature of the failure, details
of the relevant Borrower, if applicable, and details of how the
failure may lead to a claim.
5.7 Form of reports
The Insurer may require the notices and reports required under
this clause to be in a form approved by the Insurer.
6. EXERCISE OF REMEDIES
6.1 Insurer notification
The Insured must not, without prior notice to the Insurer:
(a) enter into possession of the Property, sell it, take
foreclosure action or appoint any receiver or manager of
the Property;
(b) commence any legal proceedings in relation to the Insured
Loan Contract, any Mortgage Guarantee or any Collateral
Security; or
(c) if the Credit Code applies to the Insured Loan Contract,
take any enforcement proceedings or make any application to
a court in relation to the Insured Loan Contract, any
Mortgage Guarantee or any Collateral Security.
Note: enforcement proceedings has the same meaning as that term
has under the Credit Code. A court includes any Court as defined
under the Credit Code. Applications to a court may include
applications under section 101 or 102 of the Credit Code.
6.2 The Insurer may require steps to be taken
Page 17
--------------------------------------------------------------------------------
(a) If the Insurer becomes aware (by reason of a report or
otherwise) of an actual or alleged contravention of a key
requirement under the Credit Code the Insurer may request
the Insured to engage (at the Insured's expense) an expert
(acting as an expert and not an arbitrator) to advise in
writing whether there is such a contravention, if so, its
effect and how best to stop it.
In this clause 6.2(a), "expert" means:
(i) a person agreed between the Insurer and the Insured;
or
(ii) failing agreement after such a notice is given to
the Insured, a barrister or solicitor of at least 7
years standing practicing in the Supreme Court of a
State or Territory of Australia who is chosen by the
President for the time being of the Law Society.
The Insured may not unreasonably refuse to comply with such
a request, shall promptly and diligently brief the expert
(with due regard to the interests of, and any material
provided by, the Insurer) and shall promptly provide to the
Insurer a copy of the expert's written advice.
(b) If the Insurer becomes aware (by reason of a report or
otherwise) of any actual or alleged contravention of the
Insured Loan Contract, any Mortgage Guarantee or any
Collateral Security, then the Insurer may require the
Insured to take such steps as it notifies to the Insured
that are in the Insurer's reasonable opinion in accordance
with generally accepted prudent mortgage enforcement
practice.
6.3 Due Care
The Insured must promptly and diligently take and pursue all
action as is required by or notified to the Insurer under this
clause, and shall have due regard to the interests of the Insurer
in exercising or not exercising any power, right or remedy under
the Insured Loan Contract any Collateral Security or under any law
including the Credit Code.
7. CLAIMS
7.1 Form of claim
All claims must be in a form and be accompanied by documents or
information required by the Insurer.
7.2 Information
All information provided in relation to a claim must be provided
honestly and frankly.
7.3 Timing of claim in respect of the Loan
A claim for a loss in respect of an Insured Loan must be lodged
within 28 days after the Loss Date unless in its absolute
discretion the Insurer otherwise agrees. Where a claim is not
lodged within 28 days after the Loss Date the claim shall be
reduced for any loss and damage the Insurer suffers by reason of
the delay in lodgment of the claim.
7.4 Timing of claim in respect of a Repayment Instalment
A claim for the Insured's loss in respect of a Repayment
Instalment shall only be made following 14 days or more after the
due date for payment of that Repayment Instalment by the Borrower.
7.5 Payment of a claim
Payment by the Insurer in settlement of a claim will be made to
the Insured within 14 days of the Insurer's receipt of the
completed claim form and supporting information and documents.
Page 18
--------------------------------------------------------------------------------
7.6 Interest on claims
If a claim is not paid within 28 days of the date on which a
completed claim form and all supporting information and documents
are lodged, the Insurer will pay interest on the amount of the
claim admitted by the Insurer at the Standard Rate from the date
the completed claim form and supporting information and documents
were lodged until payment of the claim.
7.7 The Insurer may determine to pay a claim
Following a Default which remains unremedied for at least 6 months
then the Insurer may in its absolute discretion give notice to the
Insured that it will pay the claim for the loss in respect of that
Insured Loan (whether or not a claim has been made) on a date
specified in the notice (being a date not less than 14 days after
the date of the notice) which date shall be the Loss Date.
7.8 Terms and condition of payment of a claim
Upon payment of a claim for a loss in respect of an Insured Loan
the Insurer shall be subrogated to all the rights and interests of
the Insured in respect of the Insured Loan Contract, any Mortgage
Guarantee or any Collateral Security and where the Insurer has
agreed or determined to pay a claim or agreed to acquire an
Insured Loan under this clause, that agreement or determination
shall be on all or any of the following conditions as determined
by the Insurer:
(a) the Insured Loan Contract, any Mortgage Guarantee and any
Collateral Security is transferred or assigned to the
Insurer or its nominee at the Insured's expense;
(b) the Insured delivers to the Insurer a power of attorney in
a form approved by the Insurer and to the extent permitted
by law under which the Insurer or nominated officers of the
Insurer are severally and irrevocably constituted as the
attorneys of the Insured to exercise, at the Insurer's
discretion, all or any of the rights and powers of the
Insured in relation to the Insured Loan Contract, any
Mortgage Guarantee or any Collateral Security; or
(c) the Insured takes such action (including legal proceedings)
in relation to the Insured Loan Contract, any Mortgage
Guarantee or any Collateral Security as the Insurer
requests; and
(d) the Insured gives to the Insurer such certificates and
undertakings as are necessary in the opinion of the Insurer
to establish that the Insured Loan Contract, any Mortgage
Guarantee or any Collateral Security is valid and
subsisting and that the relevant rights of the Insured
remain undiminished and unimpaired.
If the Insurer recovers an amount in excess of the amount of a
claim paid in respect of an Insured Loan, then the Insurer shall:
(i) refund any excess to the Insured; and
(ii) reassign to the Insured (at the Insured's expense)
any remaining rights and interests assigned to
assigned to the Insurer under this clause.
7.9 Reimbursement of claims paid
All amounts received by the Insured on account of an Insured Loan
(including any amount paid on account of any Additional Advance)
or the property after the date on which any claim is made under
this Policy (whether upon the exercise of powers following a
Default or otherwise) must be notified to the Insurer immediately
and such amounts are held on trust for the Insurer to be:
a) firstly, where the Insurer has wholly or partly paid a
claim, paid by the Insured to the Insurer until the amount
so paid is equal to the amount paid by the Insurer under
the Policy in respect of that Insured Loan; and
b) secondly, applied to reduce the balance of the amount
payable by the Insurer under the Policy in respect of that
Insured loan.
Page 19
--------------------------------------------------------------------------------
7.10 Insured in breach of the Policy
the Insurer may refuse or reduce any claim for loss in respect of
an Insured Loan or a Repayment Instalment by the amount that
fairly represents the extent to which the Insurer's interests have
been prejudiced by the Insured's failure to comply with any
condition, provision or requirement of the Policy.
7.11 Year 2000 Ready
The Insurer may refuse or reduce any claim for loss in respect of
an Insured Loan by the amount that fairly represents the extent to
which the Insurer's interests have been prejudiced by the failure
of any item used or relied upon by the Insured to be Year 2000
Ready other than as the result of any failure in the Insurer's
computer systems or other items to be Year 2000 Ready.
8. ACCOUNTING FOR CLAIMS PAID IN RESPECT OF TIMELY PAYMENT COVER
8.1 Accounting for Policy
For the purposes of the Policy only, all amounts received by the
Insured on account of an Insured Loan (including any amount paid
on account of any Additional Advance) after a claim for the
Insured's loss in respect of any Repayment Instalment has been
paid will be first appropriated and credited to Repayment
Instalments (and interest on those Repayment Instalments at the
Standard Rate) for which claims have been paid and:
(a) where claims have been paid in respect of several Repayment
Instalments, such amounts must be appropriated to those
Repayment Instalments and interest on those Repayment
Instalments in the order in which those Repayment
Instalments became payable by the Borrower; and
(b) any amount so appropriated and credited to a particular
Repayment Instalment or interest on that Repayment
Instalment will be deemed for the purposes of this clause
to have been received by the Insured on account of that
Repayment Instalment or interest on it as the case may be.
8.2 No diminishing of rights against the Borrower or Mortgagor
The Insured must not accept or deal with any amount received from
the Insurer pursuant to a claim made in respect of the Insured
Loan or in respect of a Repayment Instalment or otherwise act in
any way so as to extinguish or diminish its right to claim against
the Borrower, the Mortgage Guarantor, the Mortgagor or any person
providing any Collateral Security for the whole of any claim.
9. CONDITIONS
9.1 Action requiring the Insurer's consent
The Insured must not, without prior approval of the Insurer:
(a) make any Additional Advance upon the security of the
Property that ranks for payment ahead of the Insured Loan;
(b) materially alter the terms of the Insured Loan Contract,
any Mortgage Guarantee or any Collateral Security, other
than an alteration made in accordance with section 66 or 68
of the Credit Code;
(c) allow its rights to be reduced against the Borrower, the
Mortgagor, any Mortgage Guarantor, any provider of any
Collateral Security or the Property by compromise,
postponement, partial discharge or otherwise;
(d) approve any transfer or assignment of the Property without
full discharge of the Insured Loan;
(e) contravene any provision of the Policy; or
(f) consent to a further advance by an Approved Prior Mortgagee
upon the security of the Approved Prior Mortgage.
Page 20
--------------------------------------------------------------------------------
9.2 The Insurer's other requirements
The Insured must:
(a) pay any premium within 28 days of the due date as specified
in the Schedule;
(b) not make any representation or statement (deemed or
otherwise) in a proposal that is incorrect or breach the
duty of disclosure;
(c) ensure there is a Mortgage Manager in respect of the
Insured Loan at all times if the Insured does not manage
and administer the Insured Loan or is not a lender approved
by the Insurer;
(d) ensure there is a condition in the Insured Loan Contract
that the Property is kept insured under an Approved General
Insurance Policy and specifying in case of a failure to do
so that the Insured may insure the Property under an
Approved General Insurance Policy at the cost and expense
of the Borrower or the Mortgagor and not advance any part
of the Insured Loan to the Borrower before the Property is
so insured;
(e) where a Mortgage is not a first mortgage, take such action
as the Insurer may require to oppose any application by any
prior mortgagee for foreclosure against the Mortgagor and
the Insured.
(f) ensure the Mortgage has been duly registered with the land
titles office in the State or Territory in which the
Property is situated;
Note: The Insurer shall not consider it to be a breach of this
provision if the Mortgage has been lodged for registration in
accordance with the normal practice of the jurisdiction and it has
not been rejected.
(g) ensure the Insured Loan Contract, any Mortgage Guarantee or
any Collateral Security is duly stamped in each relevant
State or Territory;
Note:The Insurer shall not consider it to be a breach of this
provision if all steps required by the relevant State or Territory
stamp office have been taken and the Insured pays stamp duty when
it falls due.
(h) if an Insured Loan is for the purpose of (either solely or
partly) or in connection with, the construction,
refurbishment or renovation of any building the Insured
must not, other than in accordance with the lending
Guidelines, make any advance:
(i) before the Borrower (and the Mortgagor if not the
Borrower) and the builder have entered into a
contract which precludes the Borrower (and the
Mortgagor if not the Borrower) from being charged
more than a specified price inclusive of all
expenses other than those incurred in respect of
additional work or variations authorised in writing
by the Borrower (and the Mortgagor if not the
Borrower);
Note: The specified price must not exceed the price stated
in the Acceptance Advice without the approval of the
Insurer and the Insured Loan Contract must not permit the
Borrower (and the Mortgagor if not the Borrower) to
authorise any additional work without the consent of the
Insured.
(ii) intended to be paid to the builder before one of the
Insured's officers or a competent third party has
inspected the building to ensure that construction
is sound and substantially in accordance with plans
and specifications and that the payment is
appropriate having regard to the progress of
construction;
(iii) after a Default without the approval of the Insurer.
(i) notify the Insurer of any Additional Advance made on the
security of the Property, and where the Additional Advance
is an Approved Additional Advance pay any additional
premium required by the Insurer.
Page 21
--------------------------------------------------------------------------------
10. EXCLUSIONS
This Policy does not cover any loss arising from:
(a) any war or warlike activities;
(b) the use, existence or escape of nuclear weapons material or
ionizing radiation from or contamination by radioactivity
from any nuclear fuel or nuclear waste from the combustion
of nuclear fuel;
(c) the existence or escape of any pollution or environmentally
hazardous material;
(d) the fact that the Insured Loan Contract, any Mortgage
Guarantee or any Collateral Security is void or
unenforceable;
(e) where the Credit Code applies, any failure of the Insured
Loan Contract, any Mortgage Guarantee or any Collateral
Security to comply with the requirements of the Credit
Code; or
(f) the failure of the Insured's computer systems or other
items to be Year 2000 Ready other than as the result of any
failure in the Insurer's computer systems or other items to
be Year 2000 Ready
11. CANCELLATION OF THE POLICY
11.1 Cancellation by the Insurer
If the Insurer is so entitled, it may cancel a Policy issued under
this Master Policy by notice to the Insured without any refund of
premium.
11.2 Cancellation by the Insured
The Insured may cancel a Policy issued under this Master Policy by
notice to the Insurer.
Note: if the Insured Loan is fully discharged and the Insurer
is notified within 3 months of that date it may refund such part
of the premium as it determines.
12. AUDIT
The Insurer (or its nominee) at its cost, and after giving the
Insured at least 14 days notice, may audit all or any of the
Insured Loan Contracts, insured under the Master Policy and for
this purpose the Insured shall co-operate with and provide
reasonable assistance to the Insurer or its nominee and provide
security packets and all files relating to the Insured Loan
Contracts to be audited.
13. ASSIGNMENT OF POLICY
13.1 General
Subject to clause 13.2, a Policy issued under this Master Policy
may only be assigned with the prior consent of the Insurer.
Note: if the Credit Code applies to the Insured Loan then the
Insurer's consent will not be given unless the Insurer is
satisfied that the assignee is reasonably capable of complying
with the Credit Code.
13.2 Second Insured
The Insurer acknowledges and agrees that an Insured Loan may be
beneficially assigned to the Second Insured notwithstanding that
the Repayment Instalments under that Insured Loan are in arrears
or that there is Default by a mortgagor in relation to that
Insured Loan and upon assignment of any Insured Loan under this
sub-clause, the Policy in relation to that Insured Loan shall be
for the benefit of the assignee subject to any rights,
entitlements or defences that may have arisen prior to the
assignment.
Page 22
--------------------------------------------------------------------------------
14. Governing Law and Submission to Jurisdiction
This Master Policy and each policy issued shall be governed by the
laws of New South Wales and the Insured and the Insurer shall
submit to the non-exclusive jurisdiction of the courts of New
South Wales.
Schedule
--------------------------------------------------------------------------------
Approved Additional Advance - is in respect of a loan insured under this Master
Policy:
a) any Additional Advance which is approved for insurance by the Insurer
subject to the payment of an additional premium; or
b) any Loan Redraw.
Due Date is the date by which the premium is to be paid to the Insurer, and is:
(a) in respect of individual loans insured under this Master Policy, within
28 days of the date of the first advance of loan funds; and
(b) in respect of any pool of mortgages insured under this Master Policy
for securitisation, the securitisation date.
Special Condition - Existing Insured Loans
Certain loans to be insured under this Master Policy have existing insurance
issued by either Housing Loans Insurance Corporation ("HLIC"), Housing Loans
Insurance Corporation Pty Ltd ("HLIC Pty Ltd") or GE Capital Mortgage Insurance
Corporation (Australia) Pty Ltd (GEMICO) in respect of which a premium has been
paid (the "Existing Insured Loans"). These loans are set out in annexure "A"
Where an Existing Insured Loan is covered by an insurance contract issued by the
Commonwealth of Australia, under this Master Policy the Insurer shall only be
liable for that part of the loss in respect of the Insured Loan which is not
insured under the terms of any policy of insurance issued by the Commonwealth of
Australia.
Where an Existing Insured Loan is insured under a policy issued by HLIC Pty Ltd
or GEMICO then on and from the date that this Master Policy insures that loan
the previous policy issued shall be cancelled and the terms of the insurance
shall be governed by the terms and conditions of this Master Policy.
In respect of any Existing Insured Loans where there is insurance issued by the
Commonwealth of Australia, the Insured agrees that it will provide reports in
respect of that Existing Insured Loan as if the provisions of clause 4 of this
Master Policy were incorporated into and were part of the policy issued by the
Commonwealth of Australia.
It is agreed by the Insurer that in the event of any inconsistency between the
Master Policy wording and the Schedule, with regard to the definition of
Insurer, the Special Condition - Existing Insured Loans or the definition of
Effective Date, for the purposes of this Master Policy the provisions of the
Schedule will prevail.
[GRAPHIC OMITTED]
Loan Redraw - For the purposes of this Master Policy any loan redraw made under
an Insured Loan Contract is an Approved Additional Advance. A loan redraw means,
in respect of any loan not repaid in full, a redraw of repaid principal, where
following the redraw the Loan Amount does not exceed the Scheduled Balance. No
additional premium is payable to the Insurer in respect of a loan redraw. Any
loan redraw will be deemed to have been notified to the Insurer in accordance
with clause 9.2(i) of this Master Policy.
Maximum Enforcement Expenses - $2,000 unless otherwise approved in writing by
the Insurer.
Maximum Repair Maintenance and Protection Costs - $1,000 unless otherwise
approved in writing by the Insurer.
Maximum Sale Costs - $1,000 plus selling agent's commission unless otherwise
approved in writing by the Insurer.
Schedule
--------------------------------------------------------------------------------
Trust Details - The Crusade Global Trust No. 1 of 1999 established under a trust
deed between the First Insured, the Second Insured and Crusade Management
Limited dated on or about xx/xxx/1999 and the related Notice of Creation of
Trust.
Master Trust Deed- the Deed so entitled on or about 14 March 1998 between the
First Insured, the Second Insured, Crusade Management Limited, ▇▇.▇▇▇▇▇▇
Custodial Pty Limited, National Mutual Life Nominees Limited and Bankers Trustee
Company Limited.
Supplementary Terms Notice- the Deed so entitled on or about 14 March 1998
between the First Insured, the Second Insured, Crusade Management Limited,
▇▇.▇▇▇▇▇▇ Custodial Pty Limited, National Mutual Life Nominees Limited and
Bankers Trustee Company Limited.
Acknowledgement
The Insurer acknowledges that the Second Insured may charge the benefit of the
Policies, the Master Policy and rights in Properties to National Mutual Life
Nominees Limited( The "Security Trustee") under the security trust deed dated on
or about 13 March 1998 between the Second Insured ,the Security Trustee, Bankers
Trustee Company Limited and Crusade Management Limited and consents to that
charge. If the Security Trustee so directs the Insurer, the Insurer will pay the
Security Trustee or its nominee any amount payable to the Second Insured. Each
party (other than the insurer) acknowledges that any payment so made by the
Insurer to the Security Trustee shall operate to satisfy the Insurer's
obligations under the Policy with respect to that payment and the Insurer shall
cease to owe any obligations under the Policy to any other party with respect to
that payment. The Insurer shall have no liability to any other party for any
payment so made by it, and is not required to investigate whether the Security
Trustee is entitled to direct it to make any such payment. This change to the
Security Trustee shall not terminate the Second Insured's coverage under any
such Policy pursuant to clause 2.1(b)(i).
Premium - The premium payable (including stamp duty where applicable) in respect
of each loan insured under the Master Policy, as specified in Table 1., must be
paid to the Insurer on or before the securitisation date.
Refund of Premium - To be based on the Insurer's standard refund policy in force
from time to time. Current policy being as set out hereunder:
-----------------------------------------------------------------------------
PREMIUM REFUND RATES
Period from date of contract to date Percentage of standard
of loan repayment premium to be refunded
1 year or less 40%
Over 1 year to 2 years 20%
No refund is payable where:
. the loan is not discharged in full; or
. the loan is repaid within one year of the maturity date of the mortgage; or
. the amount payable is less than $100; or
. a loss has eventuated or a claim has been made on HLIC; or
. the loan has been reported to have had recent arrears.
-----------------------------------------------------------------------------
Timely Payment Cover applies in respect of all loans insured under this Master
Policy, up to an aggregate limit of 24 Repayment Instalments per loan.
Variations - Any variation to an Insured Loan (including substitution of
security and partial release of security) which results in an increase to the
Scheduled Balance or the loan to value ratio based on the Scheduled Balance in
respect of that loan, will be subject to a new proposal form and a new premium.
A special refund on the existing policy (based on the net premium paid) may be
applicable subject to the Insurer's refund variation policy in force from time
to time. Current policy being as set out hereunder:
--------------------------------------------------------------
Period from date of Contract to Refund Payable
date of variation
--------------------------------------------------------------
Schedule
--------------------------------------------------------------------------------
--------------------------------------- -----------------------
3 months or less 80%
--------------------------------------- -----------------------
Over 3 months to 1 year 70%
--------------------------------------- -----------------------
Over 1 year to 2 years 50%
--------------------------------------- -----------------------
Where the calculated refund is less than $100, no refund will be payable
Additional Amount - in respect of any Additional Amount payable by the First
Insured to the Insurer pursuant to clause 1.8 of this Master Policy the Insurer
confirms that it will not take any steps to reduce its liability or deny any
claims (which are in all other respects properly indemnifiable pursuant to the
terms and conditions of this Master Policy) solely as a consequence of any
Additional Amount notified by the Insurer as being due from the Insured
remaining unpaid after the due time for payment. The Insurer's rights and
remedies in respect of unpaid Additional Amounts which arise under this Master
Policy or otherwise remain unchanged.
--------------------------------------------------------------------------------
HLIC/GEMICO Australia MASTER POLICY
CERTIFICATE OF INSURANCE - PARTICULARS TO BE INCLUDED
1. Date of issue
2. Name of Insured
3. Name of the Mortgage Manager
4. Name of Borrower
5. Name of the Mortgagor
6. Principal Loan Amount
7. Description of Mortgaged Property
8. Expiry Date (if applicable)
9. Where Policy Limited Cover and if so percentage
--------------------------------------------------------------------------------
SCHEDULE - PARTICULARS TO BE INCLUDED
1. Category "A" loans
2. Category "B" loans
3. Maximum Legal and Enforcement costs
4. Maximum Repair Maintenance and Protection Costs
5. Maximum Sale Costs
6. Deductible (if any)
7. Trust Details
8. Approved Additional Advances
9. Aggregate Timely Payment Cover Limit