Cameron v Arcobaleno Pty Ltd - [2024] QSC 111

SUPREME COURT OF QUEENSLAND

CITATION:

Cameron v Arcobaleno Pty Ltd [2024] QSC 111

PARTIES:

JILL ALEXIA CAMERON

(applicant)

v
ARCOBALENO PTY LTD ACN 086 120 201

(first respondent)

MICHAEL CALILE MALOUF AND HEIDI BELINDA MIDDLETON

(second respondents)

FILE NO/S:

BS 1200 of 2024

DIVISION:

Trial Division

PROCEEDING:

Originating Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

6 June 2024

DELIVERED AT:

Brisbane

HEARING DATE:

26 April 2024

JUDGE:

Cooper J

ORDER:

1. The amended originating application filed by leave on 26 April 2024 is dismissed.

2. The applicant pay the respondents’ costs of and incidental to the amended originating application filed by leave on 26 April 2024 to be assessed on the standard basis if not agreed.

CATCHWORDS:

REAL PROPERTY – TORRENS TITLE – MORTGAGES, CHARGES AND ENCUMBRANCES – TRANSFER OF MORTGAGE – where the applicant and respondent were registered owners of the subject land in varying portions – where the first respondent held a registered mortgage over the land – where the mortgage secured a debt owed to it by the previous owners of the land but was subsequently transferred to the first respondent – where the respondents contend that a deed of covenant between the mortgagee and the first respondent assigned to the first respondent the right to recover the mortgage debt and that after the applicant received her interest in the land, the applicant became liable to repay the mortgage – where the mortgage terms provided that the mortgage was required to be repaid to the original mortgagee, which included any transferees of the original mortgagee – where the applicant contends that the mortgage does not secure any debt because upon completion of the assignment of the mortgage, no further amount was owing to the original mortgagee such that payment by the first respondent under the deed was a payment to discharge the debt owed by the mortgagors – where the applicant also contends that the mortgage does not secure any debt because an overdraft facility that gave rise to the debt was not assigned to the first respondent – whether the subject deed operated to assign the debt owed under the overdraft facility to the first respondent – whether the mortgage secures any debt such that the first respondent is entitled to recover the mortgage debt pursuant to the terms of the mortgage

LIMITATION OF ACTIONS – LIMITATION OF PARTICULAR ACTIONS – MORTGAGES AND CHARGES – EFFECT OF LIMITATION STATUTES – where the applicant submits that the action to recover the mortgage debt accrued to the first respondent no later than 26 May 1999 – where the applicant submits that the limitation period to recover the mortgage debt has expired, such that the first respondent’s title to the land is extinguished and any claim for payment of the debt by the first respondent is statute-barred – whether the first respondent’s title to the land has been extinguished by operation of s 24 of the Limitation of Actions Act 1974 (Qld)

LIMITATION OF ACTIONS – EXTENSION…

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 Cameron v Arcobaleno Pty Ltd

Details

AGLC: Cameron v Arcobaleno Pty Ltd [2024] QSC 111
Case: [2024] QSC 111
Decision Date: 6 June 2024

CaseChat Overview and Summary

The case of Cameron v Arcobaleno Pty Ltd involved a dispute between the applicant and the respondents over the validity and enforceability of a mortgage held by the respondents over certain land. The applicant, who owned a portion of the land, contested the respondents' right to recover a debt secured by the mortgage, arguing that the mortgage did not secure any debt and that the limitation period for recovering the debt had expired. The respondents, in turn, contended that they were entitled to recover the mortgage debt under the terms of the mortgage and that any limitation period had been extended by the applicant's acknowledgments.

The primary legal issues before the court were whether the deed of covenant assigned the debt owed under the overdraft facility to the respondents and whether the mortgage secured any debt such that the respondents were entitled to recover the mortgage debt. Additionally, the court had to determine whether the limitation period for recovery of the mortgage debt had expired or been extended by the applicant's acknowledgments.

In resolving these issues, the court examined the terms of the mortgage, the deed of covenant, and the correspondence between the parties. It found that the deed of covenant did indeed assign the debt owed under the overdraft facility to the respondents, and that the mortgage did secure a debt. The court also concluded that the limitation period for recovery of the mortgage debt had been extended by the applicant's acknowledgments of the respondents' right to recover the debt, as evidenced by the email correspondence and the Cameron Deed. Therefore, the court dismissed the applicant's amended originating application.

The court's reasoning was based on the explicit terms of the deed of covenant, which assigned the debt to the respondents, and the acknowledgments made by the applicant, which extended the limitation period. Given that the applicant had not established a basis for the requested order, the court dismissed the application and ordered the applicant to pay the respondents' costs.

Orders

Orders of the court

1. The amended originating application filed by leave on 26 April 2024 is dismissed.

2. The applicant pay the respondents’ costs of and incidental to the amended originating application filed by leave on 26 April 2024 to be assessed on the standard basis if not agreed.

Background

Background to the litigation

The recitals to the Cameron Deed provided as follows:“BACKGROUNDA [The applicant] owns the Land.B The mortgage is registered over the Land.C [The applicant] has agreed to sell 50% of her interest in the Land to [Noosa North Shore Investments Pty Ltd] and to transfer 50% of her interest in the Land to [Ian Cameron] on the terms of this Deed to be held by them as tenants in common.D [Noosa North Shore Investments Pty Ltd] and [William Cameron] will be responsible for negotiating a release of the Mortgage and for paying all money due and owing to the Mortgagee in order to secure that release. …” The operative part of the Cameron Deed also provided that Noosa North Shore Investments Pty Ltd and William Cameron would:(a)pay the Mortgagee whatever was outstanding in order to secure a release of the Mortgage: cl 4(a); and (b)use their best endeavours to secure a release of the Mortgage prior to the date of settlement of the proposed sale to Noosa North Shore Investments Pty Ltd: cl 4(b). The applicant executed the Cameron Deed in circumstances where she must have been aware of the terms of the Mortgage. In addition to the express references to the Mortgage in the Cameron Deed, this is to be inferred from the fact that, on 15 June 2020, the applicant’s solicitor sent an email to Ms Cohen attaching the Mortgage (see [87](a) above). On that basis, I am satisfied that the terms of the Cameron Deed extracted above amounted to an acknowledgement of the existence of the Mortgage and, consequently, an acknowledgement of the first respondent’s right to recover monies duly payable under cl 1 of the Mortgage. The acknowledgement was in writing and signed by the applicant. I am further satisfied that, by filing the affidavit of Mr Cameron which exhibited the Cameron Deed and serving that affidavit on the first respondent as a party to the present proceeding, the acknowledgments were made to the first respondent. It does not matter that the applicant might not have intended to communicate those acknowledgements to the first respondent, so long as the document which contains the acknowledgements is actually delivered to the first respondent.[39][39]Manicaros, [209] citing Stage Club Ltd v Millers Hotels Pty Ltd (1981) 150 CLR 535, 566. The conclusions I have reached in [88] and [93] above mean that I am satisfied that the applicant acknowledged the first respondent’s title as mortgagee, with the result that a right of action to recover the Land accrued to the first respondent in 2020 or 2024 pursuant to s 35(1) of the Limitation of Action Act. That is of little relevance on the present application, however, because the relief sought by the applicant is for a declaration that a “claim … for payment” of any monies owing under the Mortgage is statute-barred. This raises consideration of s 35(3) of the Limitation of Action Act and, specifically, the requirement that the debtor acknowledge the first respondent’s claim to recover the debt. Despite acknowledging both the existence of the Mortgage and the first respondent’s right to recover monies duly payable under cl 1 of the Mortgage, neither the email correspondence from the applicant’s solicitor nor the Cameron Deed expressly accepts a liability to repay the NAB debt in a particular sum. That may not be fatal to the first respondent’s argument that the applicant acknowledged its claim to recover the NAB debt. Such acknowledgement need not specify the amount of the debt precisely, provided that the amount is ascertainable from extrinsic evidence.[40][40]Manicaros, [134] (citing VL Finance Pty Ltd v Legudi [2003] VSC 57, [60]), [197], [202] and [206].

Evidence

Evidence Before The Court

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Decision

Reasons for decision

That relief would only be appropriate if I had concluded that the Mortgage does not secure any debt or that a claim by the first respondent for payment of monies owing under the Mortgage is statute-barred. As I have not reached either of those conclusions, I am not satisfied that the applicant has established a basis for making an order requiring that the first respondent lodge an instrument releasing the Mortgage.Conclusion For the reasons given above, the amended originating application will be dismissed. Both parties submitted that there was no reason why costs should not follow the event. I agree that it is appropriate in the circumstances for costs to follow the event. I will order that the applicant pay the respondents’ costs of and incidental to the amended originating application filed by leave on 26 April 2024 to be assessed on the standard basis if not agreed.

Ratio Decidendi

Legal Principle Established

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CITATION:	Cameron v Arcobaleno Pty Ltd [2024] QSC 111
PARTIES:	JILL ALEXIA CAMERON (applicant) v ARCOBALENO PTY LTD ACN 086 120 201 (first respondent) MICHAEL CALILE MALOUF AND HEIDI BELINDA MIDDLETON (second respondents)
FILE NO/S:	BS 1200 of 2024
DIVISION:	Trial Division
PROCEEDING:	Originating Application
ORIGINATING COURT:	Supreme Court at Brisbane
DELIVERED ON:	6 June 2024
DELIVERED AT:	Brisbane
HEARING DATE:	26 April 2024
JUDGE:	Cooper J
ORDER:	1. The amended originating application filed by leave on 26 April 2024 is dismissed. 2. The applicant pay the respondents’ costs of and incidental to the amended originating application filed by leave on 26 April 2024 to be assessed on the standard basis if not agreed.
CATCHWORDS:	REAL PROPERTY – TORRENS TITLE – MORTGAGES, CHARGES AND ENCUMBRANCES – TRANSFER OF MORTGAGE – where the applicant and respondent were registered owners of the subject land in varying portions – where the first respondent held a registered mortgage over the land – where the mortgage secured a debt owed to it by the previous owners of the land but was subsequently transferred to the first respondent – where the respondents contend that a deed of covenant between the mortgagee and the first respondent assigned to the first respondent the right to recover the mortgage debt and that after the applicant received her interest in the land, the applicant became liable to repay the mortgage – where the mortgage terms provided that the mortgage was required to be repaid to the original mortgagee, which included any transferees of the original mortgagee – where the applicant contends that the mortgage does not secure any debt because upon completion of the assignment of the mortgage, no further amount was owing to the original mortgagee such that payment by the first respondent under the deed was a payment to discharge the debt owed by the mortgagors – where the applicant also contends that the mortgage does not secure any debt because an overdraft facility that gave rise to the debt was not assigned to the first respondent – whether the subject deed operated to assign the debt owed under the overdraft facility to the first respondent – whether the mortgage secures any debt such that the first respondent is entitled to recover the mortgage debt pursuant to the terms of the mortgage LIMITATION OF ACTIONS – LIMITATION OF PARTICULAR ACTIONS – MORTGAGES AND CHARGES – EFFECT OF LIMITATION STATUTES – where the applicant submits that the action to recover the mortgage debt accrued to the first respondent no later than 26 May 1999 – where the applicant submits that the limitation period to recover the mortgage debt has expired, such that the first respondent’s title to the land is extinguished and any claim for payment of the debt by the first respondent is statute-barred – whether the first respondent’s title to the land has been extinguished by operation of s 24 of the Limitation of Actions Act 1974 (Qld) LIMITATION OF ACTIONS – EXTENSION…