CKM (Mortgages) Limited v McDonnell

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION

No. 6313 of 2008

BETWEEN:
CKM (MORTGAGES) LIMITED (ACN 089 263 310)	Plaintiff
and
NADIA DIANE McDONNELL and PETER JOSEPH McDONNELL	Defendants
AND BETWEEN:
NADIA DIANE McDONNELL and PETER JOSEPH McDONNELL	Plaintiffs by Counterclaim
and
CKM (MORTGAGES) LIMITED (ACN 089 263 310)	Defendant by Counterclaim
and
RORY JOSEPH McDONNELL and YORK STREET CAPITAL PTY LTD (ACN 114 404 689)	Third Parties by Counterclaim

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JUDGE:	OSBORN J
WHERE HELD:	Melbourne
DATE OF HEARING:	30 November 2010
DATE OF JUDGMENT:	30 November 2010
CASE MAY BE CITED AS:	CKM (Mortgages) Limited v McDonnell
MEDIUM NEUTRAL CITATION:	[2010] VSC 576

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PRACTICE AND PROCEDURE – Appeal from Associate Justice – Leave to counterclaim refused – Release from counterclaim contained in terms of settlement – Issue estoppel from judgment previously entered – Plaintiffs right to enforce mortgage pursuant to terms not subject to counterclaim - Observations as to res judicata – Appeal dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff and Defendant by Counterclaim	Mr D Williams SC with Mr S Woolley	Hall & Wilcox
For the Defendants and Plaintiffs by Counterclaim	Mr M Stirling	S V Law
For the Third Parties by Counterclaim	No appearance

HIS HONOUR:

1. This is an appeal from orders of Associate Justice Zammit dismissing an application for leave to file and serve a new counter claim in a proceeding in which final orders have previously been made pursuant to terms of settlement.  There is some urgency in the matter because the plaintiff has taken possession of the defendant's property and proposes to sell it as a mortgagee next week.  Accordingly, I propose to give an ex tempore judgment today.

1. The background to the proceeding is set out in paragraphs 1-13 of Associate Justice Zammit's judgment:

1Nadia and Peter McDonnell were married.  At the time when this claim was settled Peter was 79 years old and Nadia 75 years old.  Peter was suffering from dementia and his daughter, Patricia Tranter, was appointed as litigation guardian.  Peter died on 4 April 2010 after Terms of Settlement were signed and approved by the Court.

2Peter and Nadia were the registered proprietors of a number of properties including 390‑392 Hampton Street, Hampton Victoria.  They received rent from the tenants at the Hampton Street property. No monies were owed in early 2007 with respect to the Hampton Street property. In January 2007 the Hampton Street property was mortgaged to CKM (Mortgages) Limited to secure a loan to Nadia and Peter in the sum of $759,000. Nadia and Peter’s son, Rory McDonnell, was instrumental in organising the loan and the benefit of the loan was for Rory so that he could pursue a development in South Australia known as “Wirrina Cove”.  Nadia and Peter allege that all  contact with CKM relating to the loan of $795,000 was by Rory. They also allege that they never received the benefit of the loan and that the benefit was for Rory and York…