Aces Sogutlu Holdings Pty Ltd (in liq) v Commonwealth Bank of Australia

The appeal before the Court of Appeal of New South Wales concerned a dispute arising from a mortgage and the subsequent exercise of a power of sale. The appellants were Aces Sogutlu Holdings Pty Ltd (in liq), Mr. Jamal Charara, and two other entities, while the respondent was the Commonwealth Bank of Australia. The core of the dispute involved allegations that the Bank had breached its obligations under section 420A of the Corporations Act 2001 (Cth) by failing to exercise reasonable care in the conduct of a mortgagee sale.

The Court was required to determine several legal issues. These included whether a notice of discontinuance filed by the liquidator of two of the appellants, without the consent of the remaining appellants, was effective. The Court also had to consider the Bank's conduct in advertising the sale as a "mortgagee sale" and allegedly misdescribing the suburb, and whether the Bank was obliged to delay the sale to allow the mortgagor to complete a proposed sale. Furthermore, the Court examined the validity of a mortgage granted by a trustee of property held on trust, and whether the trustee's failure to disclose the capacity in which the mortgage was granted rendered it invalid. The Court also addressed the inclusion of material in the appeal books that was not before the primary judge.

In its reasoning, the Court held that the notice of discontinuance was ineffective because it had not been consented to by all active parties to the appeal. Regarding the exercise of the power of sale, the Court found no breach of section 420A of the Corporations Act, concluding that the advertising and sale process did not fall short of the required standard of reasonable care. The Court also determined that the mortgage granted by the trustee was valid and enforceable, as a trust does not possess separate legal personality and the registered mortgage was validly executed. The Court granted Mr. Charara leave to explain the inclusion of extraneous material in the appeal books.

The Court of Appeal dismissed the appeal with costs and dismissed a notice of motion filed on 31 March 2014 with costs. Leave was granted to the fourth appellant, Mr. Jamal Charara, to file written submissions or an affidavit explaining the inclusion of material not before the primary judge.