Capita Mortgage Pty Ltd v Henderson - [2021] NSWSC 1689

Supreme Court

New South Wales

Medium Neutral Citation: Capita Mortgage Pty Ltd v Henderson [2021] NSWSC 1689
Hearing dates: 30 November 2021
Date of orders: 22 December 2021
Decision date: 22 December 2021
Jurisdiction: Common Law
Before: Fagan J
Decision:
(1) Judgment for the plaintiff against the defendant in the sum of $277,525.71, together with interest on that amount at the rate prescribed under the Uniform Civil Procedure Rules calculated from 1 December 2021.
(2) Declare that the plaintiff holds an equitable mortgage over the whole of the land comprised in Lot 1 Deposited Plan 203488 and in Lot 3 Deposited Plan 562399, both parcels being at Broken Hill, Parish of Picton, County of Yancowinna.
(3) The cross-claim is dismissed.
(4) Direct that the plaintiff file and serve within 21 days a current valuation of the land at Broken Hill referred to in the declaration of the Court made this day, such valuation to be sworn or affirmed by an appropriately qualified land valuer.
(5) Upon the valuation being filed and served in accordance with the direction in order (3), the plaintiff may apply for the proceedings to be relisted for the purpose of the parties being heard as to further final orders with respect to judicial sale.

Catchwords:
MORTGAGES — remedies of the mortgagee — agreement to grant mortgage of Real Property Act 1900 land — jurisdiction of court to make order for sale
EQUITY — unconscionable conduct — bridging loan

Legislation Cited:
Australian Securities and Investment Commission Act 2001 (Cth)
Contracts Review Act 1980 (NSW)
National Credit Code
Real Property Act 1900 (NSW)

Cases Cited:
Chandra v Perpetual Trustees Victoria Ltd [2007] NSWSC 694
Guardian Mortgages v Miller [2004] NSWSC 1236
Jams 2 Pty Ltd v Stubbings [2020] VSCA 200
King Investment Solutions v Hussain [2005] NSWSC 1076
McLeod v McLeod [2019] NSWSC 804
National Australia Bank Ltd v Clowes [2013] NSWCA 179
Perpetual Trustees Victoria Limited v English [2010] NSWCA 32
Provident Capital Ltd v Printy [2008] NSWCA 131
PT Limited v Maradona Pty Limited (1992) 25 NSWLR 643
Sabah Yazgi v Permanent Custodians Limited [2007] NSWCA 240
Small v Tomassetti [2001] NSWSC 1112

Texts Cited:
Fisher & Lightwood's Law of Mortgage (3rd Ed, 2013)

Category: Principal judgment
Parties: Capita Mortgage Pty Ltd (Plaintiff)
Douglas McGreager Henderson (Defendant)
Representation: Nil

File Number(s): 2018/351337
Publication restriction: Nil

Judgment

The plaintiff claims judgment for possession of two contiguous parcels of land at Broken Hill, known as 223 Cornish Street. A two storey residence is constructed on the land. Possession is claimed under a registered mortgage. The plaintiff alleges that it acquired the rights of mortgagee under a transfer of the mortgage from a related company. It alleges that the defendant, who is the registered proprietor and mortgagor, has defaulted in repayment of the debt for which the mortgage is security. The defendant says that he did not sign the mortgage of the Broken Hill land. That is the first ground upon which he disputes its validity.
Further, although the…

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.

Keep reading for free

Create a free CaseChat account to read Capita Mortgage Pty Ltd v Henderson and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2021] NSWSC 1689
Decision Date: 22 December 2021

CaseChat Overview and Summary

The case of Capita Mortgage Pty Ltd v Henderson involves a dispute between the lender, Capita Mortgage Pty Ltd, and the borrower, Henderson. The matter was heard in the Supreme Court of New South Wales. The central issue is whether the court has the jurisdiction to order the sale of the property under an agreement for the grant of a mortgage of Real Property Act 1900 land, as well as whether the lender's conduct amounted to unconscionable behaviour in the context of providing a bridging loan. The court was required to decide on the enforceability of the agreement for the grant of a mortgage and whether the court had the authority to order the sale of the property under such an agreement. Additionally, the court needed to determine if the lender's conduct in relation to the bridging loan was unconscionable.

The court began by examining the enforceability of the agreement for the grant of a mortgage, which is not a mortgage but a contract to grant a mortgage. It was established that the court does have jurisdiction to order the sale of the property under such an agreement. The court then turned to the issue of unconscionable conduct by the lender. The court held that the lender's actions in relation to the bridging loan did not amount to unconscionable behaviour, as the lender had acted in good faith and there was no element of exploitation or unconscientiousness. The court found that the lender's actions were not oppressive, nor were they unconscionable, and thus the lender was not liable for unconscionable conduct.

The court concluded that the agreement for the grant of a mortgage was enforceable and that the court had the jurisdiction to order the sale of the property. However, the court held that the lender's conduct in relation to the bridging loan did not amount to unconscionable behaviour. The court dismissed the borrower's claims, and no orders for sale were made. The court's decision provides clarity on the enforceability of agreements for the grant of a mortgage and the circumstances in which a court may order the sale of the property under such an agreement. Furthermore, the court's findings on the lender's conduct in relation to the bridging loan reinforce the importance of good faith and the absence of exploitation or unconscientiousness in financial transactions.

Orders