Clarey v Thomson
[2000] VSC 400
•4 October 2000
| SUPREME COURT OF VICTORIA | |
| COMMERCIAL AND EQUITY DIVISION | Not Restricted |
PRACTICE COURT
No. 6844 of 2000
| ELIZABETH CLAREY | Plaintiff |
| v | |
| NICK THOMSON and Ors | Defendants |
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JUDGE: | Eames J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 22 September 2000 | |
DATE OF JUDGMENT: | 4 October 2000 | |
CASE MAY BE CITED AS: | Clarey v Thomson and Ors | |
MEDIUM NEUTRAL CITATION: | [2000] VSC 400 | |
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Conveyancing – vendor/plaintiff seeks interlocutory injunction against Registrar of Titles to restrain registration of transfer and mortgage – plaintiff claims her signature on Transfer is a forgery – whether serious question to be tried – balance of convenience.
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APPEARANCES: | Counsel | Solicitors |
For the Plaintiff | Mr J. Arthur | John Sayers & Associates |
For the sixth and seventh Defendant | Mr M. Bevan-John | Anderson Rice |
| For the fifth Defendant | Mr D. Manly (Solicitor) | Russell Kennedy |
HIS HONOUR:
This is an application for an injunction to restrain the Registrar of Titles, until the trial of the action, from registering any dealing with the property situated at and known as 1 St Andrews Crescent, Bulleen, being the land described in Certificate of Title Volume 8616 Folio 019.
An interim injunction was granted by Smith J on 14 September 2000 and extended by me on 19 September 2000, and has now returned before me in anticipation of the expiration of the interim injunction. The plaintiff has commenced proceedings by writ against seven defendants. The proceedings arise out of the sale of the abovementioned property, which was an investment property owned by the plaintiff since November 1997. By a Contract of Sale dated June 2000 the plaintiff agreed to sell the property to the firstnamed defendant, Nick Thomson. The sale price was $520,000 with a deposit of $52,000 paid on 29 June 2000. The vendor’s conveyancing agent is shown in the Contract of Sale as being Middle East Investment Pty Ltd, the secondnamed defendant. In an affidavit sworn 22 September 2000 the plaintiff said of this document, “I am not able to say whether [the contract] is a true document without examining the original”. That curious choice of words left open the issue whether the plaintiff was alleging that her signature on the contract of sale was a forgery, whether there was another document which represented a Contract of Sale, or in what way she was uncertain as to it being a “true document”. Having made this observation, I was subsequently advised that the plaintiff’s contention was that the signature on the document was a forgery.
The purchaser, Thomson, required funding and in due course a mortgage loan of $468,000 was provided by Permanent Trustee Company Ltd (the seventh defendant), the mortgage manager of which was Morbanc Securities Ltd (the sixth defendant). The property was subject to an existing registered mortgage held by National Australia Bank Ltd (the fifth defendant) as mortgagee, with the plaintiff as mortgagor. That mortgage secured a sum owing of approximately $150,000. In seeking to obtain finance Thomson employed the services of Mr Peter Chalhoub, the third defendant, being the principal of Middle East Investments Pty Ltd. By her statement of claim the plaintiff alleges that prior to the sale of the property she, too, had engaged Chalhoub, to act as her agent for the purposes of the sale of property. The plaintiff deposes in an affidavit that she never met Chalhoub but engaged him through her husband, Guiseppe Verduci, who had contact with Chalhoub. Chalhoub, according to Verduci, had asserted that he had knowledge of conveyancing and that, for minimal cost, he could both conduct the sale and also act on behalf of Thomson as purchaser. The plaintiff deposes that the deposit of $52,000 was paid by Thomson to Chalhoub to be held on trust for her. Chalhoub, the plaintiff says, has since failed to account to the plaintiff for that sum.
The balance of the purchase price was to be paid at settlement in September 2000. The plaintiff deposed that as the time for settlement drew close her husband informed her that he had given details to Chalhoub as to how the balance of proceeds of sale of the property were to be disbursed, namely, in payment of National Australia Bank for its mortgage and then with the balance to go to the plaintiff.
The plaintiff said that her husband was informed by the secretary to Mr Chalhoub on 4 September 2000 that settlement was due to take place the following day, 5 September 2000. According to the plaintiff (recounting what she was told by her husband), the secretary advised that they would be notified where the settlement would take place, but on the following day, 5 September, when her husband rang the secretary to find out where the settlement was - “so that I could attend to collect my cheque for the balance of the purchase price” the plaintiff said her husband was told the time of settlement but the secretary said it was unnecessary for the plaintiff to attend and she would not provide the location of settlement to the plaintiff’s husband.
The plaintiff said that she and her husband then became concerned, and wrote a letter to Chalhoub “confirming previous telephone instructions from my husband that the balance of the sale proceeds, after paying out the NAB mortgage over the property, were to be paid to me by bank cheque and that no funds were to be used for any other purpose”. That letter was faxed to Chalhoub’s office at 1.55 pm on 5 September, in advance of the time of settlement. On the day of settlement the plaintiff’s husband also contacted a solicitor, and expressed concern to him about the settlement. He requested the solicitor to contact Chalhoub and stop the settlement. After making enquiries, the solicitor advised that the settlement had concluded, but that they could collect the cheque the following morning.
Attempts to recover funds from Chalhoub proved unsuccessful. The net proceeds of the sale due to the plaintiff were paid to Chalhoub by Morbanc on behalf of Permanent Trustee Company Ltd, by a cheque made out to Middle East Investment Pty Ltd. The plaintiff says that the funds have now disappeared, as appears to be the case also for Mr Chalhoub and Mr Thomson. Neither Chalhoub nor Thomson appeared in these proceedings nor sought to resist the application brought by the plaintiff. The plaintiff now asserts that settlement was achieved by the handing over of a transfer of land document on which her signature was forged. It is that alleged forgery which is the basis for the application before me. The plaintiff submits, through her counsel, that the transfer document is null and void and is incapable of supporting registration of title in favour of Thomson and that the mortgage by Permanent Trustee Company Ltd should, likewise, not be registered as it was procured by the fraud of Chalhoub, either with the assistance of Thomson or acting on his own behalf.
On 7 September 2000 the plaintiff lodged a caveat at the Titles Office, which was lodged after the Certificate of Title, transfer of mortgage and discharge of mortgage had already been lodged. On 13 September 2000 the Registrar of Titles wrote to the plaintiff’s solicitor to advise:
“My usual practice in case of injunction is to suspend processing of all pending dealings and await the decision of the court.”
On 6 September the plaintiff and her husband reported the matter to the police and the plaintiff’s husband made a statement to the police on 10 September.
The plaintiff says that she does not wish to proceed with the sale of the property to Thomson and in her proceedings seeks a declaration that the transfer is null and void and an order that the property be retransferred to herself.
The plaintiff’s cause of action with respect to Morbanc and/or Permanent is not at all clear. In paragraph 8C of the statement of claim the plaintiff alleges:
“Morbanc and/or Permanent:
(a)ought to have known that the loan application was false and/or fraudulent; further or in the alternative
(b)failed to exercise any proper care in assessing the loan application.”
In support of those allegations the particulars given are that the documents lodged by Thomson and/or Chalhoub in support of the loan application were “patently and obviously false and/or fraudulent” and that if Morbanc and/or Permanent had carried out any or any proper, reasonable and/or prudent enquires then they would have discovered that the documents lodged in support of the loan application (or some of them) “were false and/or made with a fraudulent design”.
In paragraph 12 of the statement of claim it is alleged that Morbanc, as agent of Permanent, paid moneys to the second defendant company and did so wrongfully and without the plaintiff’s agreement or permission.
By paragraph 16A of the statement of claim the plaintiff alleges that the Contract of Sale was vitiated by fraud and was void from its inception.
In the course of argument I sought clarification of the basis for the claim identified in paragraph 8C of the statement of claim as against Morbanc and/or Permanent. Eventually it was put that those two defendants were “tainted” by the fraud of Chaloub and/or Thomson. It was submitted that the tainting arose by virtue of what was said to be the negligence of the defendants, Morbanc and/or Permanent, in investigating the provenance of the documents lodged by or on behalf of the purchaser. In paragraph 20A it is alleged that Chalhoub (the second defendant) and/or Thomson conspired to “defraud, cheat, deceive and to injure Morbanc, Permanent and/or the plaintiff”. The allegation that Morbanc and/or Permanent were tainted by fraud does not sit well with the allegation that those companies were themselves the victims of a conspiracy to defraud them. If the allegation against the sixth and seventh defendants was no more than that they were negligent in their conduct in procuring the execution and registration of the relevant documents that would not have been sufficient to set aside registration, had registration been effected, on grounds of fraud, by virtue of s.42 of the Transfer of land Act.[1]
[1]Pyramid Building Society v Scorpion Hotels Pty Ltd [1998] 1 VR 188
In his affidavit, Guiseppe Verduci, supports his wife, the plaintiff, by swearing that the signature on the transfer of land is not that of his wife but is a forgery, and he also deposes that the documents which accompanied Thomson's application for finance were “largely false and fraudulent”. In addition, taxation returns and financial records which were advanced by Thomson in support of the loan application are said to also be fraudulent, and he says that Chalhoub and/or Thomson had falsified the documents.
In his application for finance Thomson gave an address for a business of which he said he was the proprietor, namely, "Koala Manchester". This address is the location at which the plaintiff’s husband resides. Verduci says it was not the address of Koala Manchester which, in any event, is a business run by another person and not by Thomson, and is located in another suburb.
By the principle of subrogation the seventh defendant, upon paying out the mortgage of NAB, gained the right in equity to stand in the shoes of NAB so as to have a right to enforce as mortgagee the interest which NAB had held against the plaintiff.[2] Registration of its own mortgage will, of course, protect the much greater sum which Permanent advanced to Thomson.
[2]Vassos v State Bank of South Australia [1993] 2 VR 316 at 330
On behalf of the sixth and seventh defendant it is not conceded that the plaintiff was a victim of fraud. Serious doubt exists as to that, so it is submitted, given the apparently close connection between the plaintiff, her husband, Thomson and Chalhoub.
Attached to the documents exhibited to the plaintiff’s affidavit is a copy of the statement made by Verduci to the police concerning this matter. He told the police that he had business dealings with Nick Thomson who, to his knowledge, was using more than one name. He referred also to arrangements he had made with Thomson to rent out the property to a Harley Davidson bikie group for the purpose of the establishment of “a high class escort agency for or on behalf of the Harley Davidson group”. He described the circumstances surrounding his meeting with the defendant, Chalhoub, who expressed concern that he, Chalhoub, was in financial difficulties, and who borrowed money on a number of occasions from Mr Verduci. Notwithstanding those inauspicious signs he continued to engage Chalhoub as his agent, and that of his wife, for the sale of the property.
On 5 September the plaintiff says she faxed a note addressed to Mr Chalhoub (which she does not dispute was signed by her) which read:
“As discussed in our telephone conversation I now confirm in writing the instructions given to you and your secretary, Miss Henne, how the balance of the settlement of the moneys of the property in Bulleen where (sic) going to be dispersed the residue of money after paying secured mortgage to National Bank, where (sic) to be paid to me Elizabeth Clarey by bank cheque. No funds are to be used for any other purposes.”
That fax was sent at 13.55 on 5 September. By letter dated 6 September 2000 Elizabeth Clarey (the plaintiff) faxed to Anderson Rice (attention Mr Archer), the solicitors for Morbanc/Permanent, as follows:
“Further to your discussion with Mr Adicho please be advised that I suspect fraudulent activities from Middle East Finance. The balance of $270,000 was to be dispersed to myself Mrs Elizabeth Clarey. Enclosed is a copy of the disbursement request. The police attended Middle East Finance offices at 131 Plenty Road, Preston this morning. That is when Mr Peter Chalhoub of Middle East Finance finally revealed certain papers to me I am now in the process of reporting this to the fraud squad. Please stop the cheque of $270,000 if it has not yet been cashed. Thank you for your assistance. Mr John Adicho will be in contact with you shortly.”
By a fax dated 31 August to the solicitor acting for Morbanc/Permanent, Peter Chalhoub, who had identified himself as “finance director and conveyancer" of Middle East Investment Pty Ltd advised that he had been informed by National Australia Bank that, as then advised, settlement was to take place at 2.30 pm on Monday, 4 September and he added:
“We advise you to please have the balance of settlement paid to Middle East Investments Pty Ltd as we are the conveyancer for both parties. If you need an authority of the vendor please inform us as we will fax same to you today.”
It was submitted on behalf of the plaintiff that the failure of the sixth and seventh defendants, through their solicitor, to request such an authority constituted negligence.
There were a number of other documents leading up to the settlement which the plaintiff apparently does not dispute contain her signature. However, she asserts that the deposit statement to the purchaser given pursuant to s. 27 of the Sale of Land Act 1962 and the deposit receipt dated 12 June 2000 are both false documents containing, in the latter case, a forged signature in her name.
The plaintiff does not deny signing an authority to the National Bank dated 5 June 2000 authorising the bank to surrender relevant documents at the settlement. In her affidavit of 22 September 2000 she said of the statutory declaration as to chattels lodged with her transfer: "I believe that my signature thereon would be a forgery."
The plaintiff did not assert forgery until after the lodging of the caveat. In particular, when he made his statement to the police her husband made no allegation that forged documents were used.
On behalf of the defendants, Morbanc/Permanent, it is submitted that the plaintiff’s complaints (assuming that she was not herself party to an elaborate conspiracy to defraud Morbanc/Permanent) is against the first, second and third defendants and that Morbanc/Permanent are merely innocent bystanders in these events. There is no basis for any claim against those parties, it is submitted. There is, thus, no arguable case against them.
The first matter which the plaintiff must establish if she is to obtain the interlocutory relief is that there is a serious question to be tried, and, next, that the balance of convenience is in favour of granting the injunction.[3] Counsel for the sixth and seventh defendants submits that neither test is satisfied. In the first place, it is submitted that since the Registrar of Titles has indicated his intention to suspend processing of all proceedings whilst awaiting the decision of the court, there is no need for injunctive relief. Furthermore, it is noted that the caveat which is lodged by the plaintiff was lodged after the discharge of mortgage of the National Bank, the transfer documents and mortgage documents had been lodged at the Titles Office. Thus, the caveats can have no effect, so it was submitted. The last point is correct, but I am satisfied that if I deemed it otherwise appropriate to grant injunctions neither of these factors would prevent my making such an order, although they might bear upon the question of the balance of convenience.
[3]Nicholas John Holdings Pty Ltd v ANZ Banking Group [1992] 2 VR 715, at 722
Mr Bevan-John, counsel for the sixth and seventh defendants, submitted that having regard to the evidence placed before the court, at this stage, and the claims pleaded by the plaintiff, the plaintiff simply had no case. He submitted that on the material before the court, if the plaintiff had any claim at all, then it was against the second and third defendants (as her own agents) for their failure to account to her with the settlement proceeds. He submitted that on her own affidavit evidence the plaintiff knew that the settlement was proceeding, did not seek to stop the settlement, and had instructed her agents as to how they were to deal with the settlement moneys. In those circumstances, he submitted, it could only be a breach of duties by the agents which gave rise to any cause of action. Any such cause of action could not involve the sixth or seventh defendants, he submitted. He noted that the plaintiff and her husband did not initially make any complaint of forgery but merely complained that the plaintiff had been defrauded by her agent.
Mr Bevan-John submitted, for the sixth and seventh defendants, that, in any event, the court should conclude that the relationship between the plaintiff and Thomson is not at arms length. He submitted that there were clear links between the plaintiff, her husband, and Thomson which would be consistent with the plaintiff herself being party to a conspiracy to defraud Morbanc/Permanent.
It is not my task in dealing with such an interlocutory application to resolve conflicts in evidence, nor to resolve difficult questions of law which may require more elaborate exposition than is appropriate in an application before the Practice Court.[4]
[4]American Cyanamid v Ethicon Ltd (1975) AC 396, at 407
On behalf of the plaintiff it is submitted that Morbanc/Permanent were negligent in failing to conduct any proper, prudent or reasonable enquiries as to the provenance of the documents which were lodged by and on behalf of Thomson, through Chalhoub, in support of the loan application. Had the defendants exercised proper care in assessing the loan application then the false documents would have been exposed and the loan would not have proceeded and/or the signature on the transfer would have been exposed as a forgery. The defendants were negligent, so it was submitted, because Morbanc and the seventh defendant failed to take up the offer made by Chalhoub to provide written authority, if requested, for his proposal that a settlement cheque for the balance of funds be made payable to his company, (the second defendant). However, even assuming that the offer should have been accepted, if it was the case that Chalhoub had already forged the signature of the plaintiff on several documents then had the sixth defendant requested that Chalhoub supply a written authority from the plaintiff that would no doubt have been accommodated by the production by Chalhoub of yet another forged document.
The primary contention of the plaintiff as to there being a serious question to be tried, is that the transfer, as a forgery, is a document which is null and void and is incapable of being registered. Counsel referred to Daniell v Paradiso,[5] a case decided by the Court of Appeal in South Australia. In that case a fraudulent mortgage document was sought to be registered but, before it had been registered the owner of the property lodged a caveat seeking to restrain registration. The court held that the mortgage should be deemed to be void. In that case one of the signatures on the mortgage was forged and the other had only been placed on the document by virtue of the nature of the document being misrepresented to the signatory. In his judgment King CJ held, at 365:
“Even if Zonef had ostensible authority to mortgage this property on behalf of the appellant and even if the appellant were estopped from denying that he executed the mortgage, the mortgage document will remain a false document incapable of creating legal rights. It purports to be a mortgage of the estate in fee simple in the whole of the land owned by the appellant and his brother, Hugo, as tenants in common. Hugo has never executed the document. His purported signature on the document is a forgery. There is no allegation of estoppel against Hugo nor that Zonef had any ostensible authority to act on his behalf and indeed Hugo is not a party to this action. It is clear therefore that the so called mortgage is a nullity and incapable of registration.”
[5](1991) 55 SASR 359
Counsel for the plaintiff submitted that it is only the act of registration that gives the innocent party an indefeasible title.[6] Furthermore, counsel submitted, the seventh defendant is liable in negligence because it was not entitled to presume that Chalhoub had authority to act on behalf of the plaintiff and to be paid the funds in his own name or that of his company. Section 69 of the Property Law Act now provides that where a banker or a barrister and solicitor produces a deed which is executed, or produces a duly executed instrument under the Transfer of Land Act, the deed or instrument is sufficient authority to permit the person who is liable to pay to make payment to the banker or barrister and solicitor, without the need for the production of any other authority. Given that Chalhoub was neither banker nor barrister and solicitor the sixth and seventh defendants could not rely on that ostensible authority, the plaintiff submitted. This was a situation, so it was submitted, where the sixth and seventh defendants were obliged to ascertain the extent of the authority of the person purporting to be an agent with authority to receive the funds.[7]
[6]See Voumard “Sale of Land”, 5th Ed at par. 11,190
[7]See Maffey v Hobart (1988) 14 VLR 880; Voumard, supra, at par. 13,150
Mr Bevan-John submitted that the plaintiff's claim against the sixth and seventh defendant can not stand when one considers her fax to the solicitors for Morbanc (Ex. "PC 22") on 6 September 2000 requesting that the cheque for the balance of settlement funds be stopped by the sixth and/or seventh defendants. Accompanying that fax was a copy of the plaintiff’s authority to Chalhoub which authorised him to act as her agent in receiving the balance of purchase funds at settlement, but which directed that those funds be payable by bank cheque to her. That authority coupled with her authority to NAB (Ex "PC 13") meant that the plaintiff notified NAB and the sixth defendant that Chalhoub was indeed her agent, Mr Bevan-John submitted. In my view, these documents can not, on their face, resolve the areas of factual dispute.
It may be observed that if one is to accept that the signature on the transfer was a forgery the plaintiff was well aware that a settlement was due to take place and must have therefore known or believed that no transfer document had been signed by her. Yet her actions prior to and following the settlement all suggested that she fully expected, and desired, that the settlement would conclude successfully, subject to ensuring that the funds were paid to her as she required. In that regard, her failure to initially complain that the transfer signature must have been a forgery may be thought to be significant, as is her initial coyness about whether she was asserting before me that the signature on the contract of sale was also a forgery. Those are matters which will no doubt be the subject of debate at trial, but on an interlocutory application I am not concerned with resolving disputed questions of fact, only in determining whether there is an arguable case.
The questions whether the sixth and seventh defendants owed any duty of care in negligence, or were liable on any other basis, to the plaintiff and whether they acted in breach of that duty of care seem to me to be arguable and to be questions of fact and law to be determined at the trial, and not on the application for interlocutory relief. Furthermore, there seems to me to be an arguable question as to whether the transfer document, if proved to be a forgery, is therefore null and void and incapable of registration. I am satisfied, therefore, that there are serious questions to be tried, with more than merely a “rough chance of success”.[8] I turn then, to the balance of convenience.
[8]Magna Alloys and Research Pty Ltd v Coffey (1981) VR 23, at 29
Counsel for the plaintiff placed reliance on a decision of Hayne J in Coomber v Curry and Ors.[9] In that case the plaintiff denied that she had signed a mortgage document and said that her signature on the second mortgage was a forgery, as was the signature appearing on the first mortgage. She took action to set aside the first mortgage and also sought to set aside the second mortgage and to obtain an injunction to restrain registration of the transfer of the second mortgage. Hayne J noted that in determining whether there was a serious question to be tried he was not called upon to decide whether it was more probable than not that the plaintiff would succeed at trial. His Honour held that there was a serious question to be tried as to whether the mortgagee ought to have been on notice that the signature was a forgery. As to the balance of convenience his Honour noted (at p.65,419):
“If an injunction does not go, then it seems inevitable that the assignment of the mortgage will be completed by registration of its transfer. At the very least that will adversely affect any claim that Mrs Coomber may have against Mr Curry for in personam relief, in that it would present another very substantial hurdle in her way to obtaining orders of the kind contemplated by Barwick CJ in the passage from Breskvar v Wall that I cited earlier. To be balanced against that is the fact that the mortgagee in the meantime will stand out of his money and, it seems plain, will stand out not only of principal but also of interest, for the plaintiff is unable to offer any undertaking that interest would be paid pending hearing and determination of this action. The degree to which that hardship will bear upon the defendant is to be judged according, first, to how long it will persist and, secondly, whether ultimately it would turn out to be irremediable.”
[9](1993) V Conv R 54,464
Hayne J concluded that the mortgagee was acting in a commercial undertaking in which it undertook to run a risk that in the event that the mortgage was not paid out as required, there was sufficient equity in the property to ensure that it would recover its funds. Counsel for the plaintiff submits that the situation here is similar, and that in the event of the plaintiff failing in her action there is sufficient equity in the property to pay out the principal and interest due to the sixth and seventh defendants.
If, as a matter of law, the transfer document should have been held to have been null and void, but registration was nonetheless effected before the plaintiff was able to argue her case against the validity of the transfer, then the plaintiff would have suffered irremediable damage by virtue of registration of title in the name of Thomson. That prejudice would remain notwithstanding the possibility that the principles of indefeasibility might not preclude in personam proceedings being available against Thomson by the plaintiff, as was discussed by Hayne J in Coomber v Curry.[10] Thomson, may well prove to be a man of straw, in any event.
[10]At 65,417-65,418
On the other hand, it was pointed out by counsel for the sixth and seventh defendants that this is a mere investment property, that the plaintiff was quite happy to sell the property, and that there is no emotional or other attachment to the property. In those circumstances, counsel for the defendants submitted, the plaintiff’s expressed desire to remain on the title carries little weight.
Mr Bevan-John submitted that it is of no importance whether Thomson is registered as proprietor of the land. The plaintiff had been content for him to be registered and even if there was a fraud perpetrated by Chalhoub, and even if Thomson was party to that fraud, the issues in this trial can be resolved notwithstanding registration of the transfer and of Permanent's mortgage. Whilst that may be so, if Thomson was a party to fraud then it is arguable that he should not be registered as proprietor in the face of objection by the vendor/plaintiff. Why should Thomson, in those circumstances, gain any potential benefits that might accompany his registration as owner of the land?
Counsel for Morbanc/Permanent estimated that the loss to his clients, which they would need to recover if the injunction was granted, but if his clients subsequently succeeded on the action and then proceeded to sell the property, would be in the order of $67,680.00, together with selling expenses and the costs of all proceedings. The figure of $67,680.00 represented the loss or delay of interest from now until the likely time of the sale of the property after successful completion of the Supreme Court proceedings. In response, counsel for the plaintiff submitted that all this was mere speculation. In particular, it involves speculation as to when the trial would be likely to be heard.
There was a dispute between the parties, also, as to what the likely value of the property would now be. I have no valuation evidence before me, but in the absence of evidence counsel nonetheless sought to debate the likely value of the property. Counsel for Morbanc/Permanent suggested a street value in the order of $500,000, whereas counsel for the plaintiff suggested the property was worth in the order of $540,000 to $560,000 and that since Morbanc/Permanent had lent 90 percent of the value of the property that was a more reasonable estimate of the value. Accordingly, Morbanc/Permanent had taken a commercial risk in lending that sum. There was ample value in the asset, so counsel for the plaintiff submitted, to meet any loss which the defendants might suffer by the imposition of the injunction until trial, were the plaintiff’s claim to eventually fail. The loss to the plaintiff, however, if the injunction was not granted, was that the title would be registered in the name of Thomson, whose title would be indefeasible.
Additionally, as to the balance of convenience, counsel for the sixth and seventh defendants submitted that the plaintiff had made no offer to pay into court the sum representing interest delayed, as a price of receiving her injunctions.[11]
[11]See Inglis v Commonwealth Trading Bank (1971) 126 CLR 161
I was minded to adopt the approach that I would grant injunctive relief in the terms sought by the plaintiff only on condition that she made payment into court of a sum representing, so far as may be assessed, the whole or portion of the amount of interest which would be lost or delayed should the defendants succeed in the trial. I have concluded, however, that it is unnecessary to require security in addition to an undertaking as to damages and that it is appropriate to adopt the approach adopted by Hayne J in Coomber v Curry.
This was a purely commercial investment by the seventh defendant. I am persuaded on the evidence before me (albeit, allowing for the absence of valuation evidence) that the seventh defendant will more than likely recover most if not all of any sums lost or delayed by way of principal and interest, and any sums with respect to costs, should the plaintiff fail in her action. I am not persuaded that an order for security is necessary.
I conclude, therefore, that, I will grant the injunction sought, subject, first, to an undertaking as to damages from the plaintiff with respect to loss or damage sustained by any of the defendants, subject, secondly, to the plaintiff agreeing to an accelerated timetable for the completion of interlocutory steps, so that the trial may be expedited.
I will hear counsel as to the terms of the order, and as to costs.
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