Legal Research
Cases
Bonanno v Finamore

Bonanno v Finamore

Case [2021] NSWSC 1558 1 December 2021

Breach of Contract

Unconscionable Conduct

Mortgages & Security Interests

Repudiation & Termination

Clogs on equity of redemption

Contract Law

Property Law

No judgment structure available for this case.

Type to search within this case.

Supreme Court

New South Wales

Medium Neutral Citation: Bonanno v Finamore [2021] NSWSC 1558
Hearing dates: 29 March to 1 April 2021; 6 and 7 April 2021; final submissions received 7 July 2021
Decision date: 01 December 2021
Jurisdiction: Equity
Before: Robb J
Decision:
The defendants have established their case to have the transfer provisions in the deed set aside. See pars [89], [105], [144], [161], [187], [190], [217], [234], [235], [237], [349], [384]-[388]. The parties are required to confer and agree short minutes of order to give effect to these reasons for judgment and to provide draft short minutes of order to my Associate.

Catchwords:
CONTRACTS — Termination — Breach of term — Where the plaintiff sought enforcement of a deed — Where the defendants argued that there were additional oral terms that operated in conjunction with the deed — Where the defendants argued that the plaintiff seriously breached an additional oral term and that the plaintiff had repudiated the deed — Where the defendants claimed that they terminated the deed in response to the plaintiff’s breach or in acceptance of the plaintiff’s repudiation — Where the defendants argued that they had effectively communicated termination of the deed — Where the Court found that the defendants had not effectively communicated termination of the deed — Where the Court held that deed had not been terminated
EQUITY — Unconscionable conduct — Special disability or disadvantage — Where the defendants argued that a deed should be set aside in its entirety because it was procured by the plaintiff taking unconscientious advantage of special disadvantages suffered by the defendants — Where the Court found that the defendants did suffer from some special disadvantages — Where the Court found that the plaintiff was not in a powerful bargaining position when the deed was entered into — Where the Court held that the conduct of the plaintiff in entering into the deed was not sufficiently unconscientious to justify the Court setting the deed aside
MORTGAGES AND SECURITIES — Mortgages — Whether a deed recorded a transaction that was in substance a mortgage — Where the plaintiff argued that the transaction was not a mortgage but rather a loan document with an added facility similar to an option — Where on its face the deed was an amalgam of a loan secured by an option granted to the plaintiff to call for a transfer of a one third interest in property, plus a collateral right to receive one third of the net price of the property on sale — Where the Court found that the transaction was in substance a mortgage — Where the Court held that the obligation to transfer the one third interest in property was a collateral advantage
MORTGAGES AND SECURITIES — Mortgages — Mortgage contracts — Clogs on equity of redemption — Where the plaintiff and defendants executed a deed which would give the plaintiff a one third interest in property in consideration of the plaintiff lending the defendants money —…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Bonanno v Finamore

Details

AGLC: Bonanno v Finamore [2021] NSWSC 1558
Case: [2021] NSWSC 1558
Decision Date: 01 December 2021

CaseChat Overview and Summary

In the matter of Bonanno v Finamore, the plaintiff sought to enforce the terms of a deed against the defendants. The defendants argued that the deed should not be enforced as it had been procured by the plaintiff taking unconscientious advantage of the defendants' special disadvantages. The defendants also claimed that the deed had been effectively terminated by them in response to the plaintiff's breach or repudiation. The court was required to determine whether the deed was enforceable and whether the transfer provisions contained within it were a clog on the equity of redemption.

The court found that the transaction documented in the deed was in substance a mortgage, despite the plaintiff's argument that it was a loan document with an added facility. The court held that the obligation to transfer the one third interest in property was a collateral advantage. The court also found that the defendants did suffer from some special disadvantages and that the plaintiff was not in a powerful bargaining position when the deed was entered into. However, the court held that the conduct of the plaintiff in entering into the deed was not sufficiently unconscientious to justify the court setting the deed aside. The court further found that the transfer provisions were a clog on the equity of redemption and were therefore void.

The court held that the deed had not been effectively terminated by the defendants and that it was enforceable. The transfer provisions were void, but this did not affect the enforceability of the other terms of the deed. The court made orders in favour of the plaintiff, enforcing the terms of the deed and declaring that the transfer provisions were void.

Orders