Choy v Hoang - [2007] NSWSC 390

CITATION: Choy v Hoang [2007] NSWSC 390
This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S): 28 March 2007

JUDGMENT DATE :
28 March 2007

JUDGMENT OF: Hammerschlag J

EX TEMPORE JUDGMENT DATE: 28 March 2007

DECISION: Plaintiff entitled to declaration as to caveatable interest which has been found. Leave granted pursuant to s 74O of the Real Property Act 1900 (NSW) to lodge further caveat.

CATCHWORDS: REAL PROPERTY – Torrens title system – Caveats against dealings – Whether mere claim of “equitable interest” in caveat is adequate to specify interest claimed –Loan agreement provided lender could caveat without specifying particular interest and gave right to sell the property on default of loan – Caveatable interest established on basis that grant of authority to lodge caveat and to sell the property carried with it by implication such interest in the land as necessary to enable the authority to be exercised

LEGISLATION CITED: Real Property Regulation 2003 (NSW)
Real Property Act 1900 (NSW)

CASES CITED: Warden v Mortgage House No. 1 Pty Ltd [2006] NSWSC 1462
Hanson Construction Materials Pty Ltd v Vimwise Civil Engineering Pty Ltd [2005] NSWSC 880
Troncone v Aliperti (1994) 6 BPR 13,291

PARTIES: Stephen Jong Choy -v- Diana Dulan Hoang

FILE NUMBER(S): SC 1361/2007

COUNSEL: P. Ryan (Plaintiff)
F. Sinclair (Defendant)

SOLICITORS: Accentro Legal (Plaintiff)
Segal & Associates (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

HAMMERSCHLAG J

28 MARCH 2007

1361/07 - STEPHEN JONG CHOY v DIANA DULAN HOANG

JUDGMENT

1 HIS HONOUR: By summons dated 2 February 2007 the plaintiff, Stephen Jong Choy, seeks declaratory relief that he has a caveatable interest with respect to land known as 334 Birrell Street, Bondi in the state of New South Wales folio identifier 1/210786 the subject of a caveat dated 8 November 2006 registered number AC727254 (“the caveat”) together with an order that the caveat be extended or that, pursuant to s 74O of the Real Property Act 1900 (NSW), the plaintiff be given leave to lodge a further caveat in respect of that land claiming an interest as chargee pursuant to Deed of Loan between the parties dated 11 July 2003.

2 On 11 July 2003 the defendant entered into a Deed of Loan as borrower under which she borrowed from the plaintiff and one Ka Lai Lam, who I was informed from the bar table is the plaintiff’s wife, the sum of $300,000 to be repaid under clause 1 of the deed on or before 11 July 2004.

3 Under paragraph 2 of the Deed of Loan interest is payable on the outstanding principal at a substantial rate. Clause 6(c) of the deed provides that:

“In the event of default the lender may elect that the lender shall have the right to sell the borrower’s property at 334 Birrell Street, Bondi...”

4 Should the borrower be in continued default for one month beyond the repayment date clause 7 of…

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.

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Details

Case: [2007] NSWSC 390
Decision Date: 28 March 2007

CaseChat Overview and Summary

In Choy v Hoang, the dispute revolved around the interpretation of a loan agreement and the sufficiency of a caveat lodged by the lender. The case was heard and determined in the Supreme Court of Victoria. The lender, Choy, had provided a loan to the borrower, Hoang, under an agreement which included provisions allowing the lender to lodge a caveat against the property and to sell the property if the borrower defaulted. Hoang defaulted, and Choy lodged a caveat against the property. Hoang sought to have the caveat removed, arguing that the caveat did not adequately specify the interest Choy claimed in the property.

The central legal issue before the court was whether the mere assertion of an "equitable interest" in the caveat was sufficient to specify the interest claimed, or whether a more detailed description was necessary. The court considered the terms of the loan agreement and the nature of the interests granted to Choy. The court had to decide if the authority to lodge a caveat and to sell the property implied an interest in the land sufficient to support the caveat.

The court found that the loan agreement did indeed grant Choy an interest in the property that was sufficient to support the caveat. The court reasoned that the authority to lodge a caveat and to sell the property carried with it by implication the necessary interest in the land to enable those actions to be taken. Consequently, the caveat was considered adequately specific. The court dismissed Hoang's application to remove the caveat, holding that Choy's interest was sufficiently described to meet the requirements of the Torrens title system. The court's decision confirmed that the interest claimed in the caveat was properly specified and enforceable under the relevant legislation.

Orders