Coleman v Hart-Hughes - [2017] NSWSC 656

Supreme Court

New South Wales

Medium Neutral Citation: Coleman v Hart-Hughes [2017] NSWSC 656
Hearing dates: 17 May 2017
Date of orders: 26 May 2017
Decision date: 26 May 2017
Jurisdiction: Equity
Before: Darke J
Decision:
Declaration made as to existence of an equitable charge.

Catchwords:
REAL PROPERTY – mortgages and charges – equitable charges and liens – where joint venture deed acknowledges that plaintiff has caveatable interest – whether terms of deed support implication of grant of equitable charge – whether deed frustrated or vitiated by illegality – declaration of equitable charge made
EQUITY – equitable remedies – injunctions – where plaintiff seeks injunction restraining registration of plan of sub-division without written agreement – whether terms of injunction would be inconsistent with operation of deed – grant of injunction not appropriate
Cases Cited: Aged Care Services Pty Ltd v Kanning Services Pty Ltd (2013) 86 NSWLR 174; [2013] NSWCA 393
Ainsworth v Criminal Justice Commission (1992) 175 CLR 564
Bellissimo v JCL Investments Pty Ltd [2009] NSWSC 1260
Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337
Coleman v Bone (1996) 9 BPR 16,235
Complex Scaffolding Solutions Pty Ltd v Doueihi (2014) 17 BPR 32,753; [2014] NSWSC 230
Davis Contractors Ltd v Fareham Urban District Council [1956] AC 696
Industrial Equity Ltd v Lyons (Supreme Court of New South Wales, Cohen J, 15 October 1991, unrep)
Muschinski v Dodds (1985) 160 CLR 583
Nudd v Official Trustee in Bankruptcy (2002) 11 BPR 20,163; [2002] NSWSC 399
Taleb v National Australia Bank Ltd (2011) 82 NSWLR 489; [2011] NSWSC 1562
Troncone v Aliperti (1994) 6 BPR 13,291
Category: Principal judgment
Parties: James Robert Coleman (Plaintiff)
Gai Hart-Hughes (First Defendant)
First Mortgage Managed Investments Pty Ltd (Second Defendant)
First Mortgage Investments Pty Ltd (Third Defendant)
VMC Consulting Pty Ltd (Fourth Defendant)
Representation:
Counsel:
Mr A Ogborne (Plaintiff)
In person (First Defendant)
Mr R Lewin (solicitor) (Second and Third Defendants)
Solicitors:
Bruce and Stewart Lawyers (Plaintiff)
Gadens Lawyers (Second and Third Defendants)

File Number(s): 2016/122345
Publication restriction: None

Judgment

Introduction

By an Amended Summons filed on 9 November 2016 the plaintiff, Mr Coleman, seeks declaratory relief to the effect that the first defendant, Ms Hart-Hughes, granted a valid equitable charge to the plaintiff over certain property she owns at Bangalow, being Lot 2 in Deposited Plan 1086364. The charge is said to arise from the terms of a deed dated 4 July 2012 entered into by the plaintiff, the first defendant and others (“the Deed”). The Deed records the terms of a joint venture for the development and sale of the property. The plaintiff also seeks an injunction against the first defendant to restrain her from registering any varied plan of sub-division of the property without obtaining the written agreement of the plaintiff. That claim is also based upon the terms of the Deed, in particular cl 4. The plaintiff’s claims are opposed by the first defendant.
The second, third and…

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: [2017] NSWSC 656
Decision Date: 26 May 2017

CaseChat Overview and Summary

In the matter of Coleman v Hart-Hughes, the plaintiffs sought to establish an equitable charge over certain land and an injunction against the registration of a plan of subdivision. The defendants, Hart-Hughes, were the registered proprietors of the land in question and had entered into a joint venture deed with the plaintiffs, Coleman, regarding the development of the property. The defendants had subsequently sought to register a plan of subdivision of the land without the plaintiffs' written agreement, prompting the Colemans to seek equitable relief. The Federal Court of Australia was called upon to determine whether the joint venture deed gave rise to an equitable charge and whether an injunction should be granted to prevent the registration of the plan of subdivision.

The primary legal issues before the court were whether the joint venture deed acknowledged the plaintiffs' caveatable interest in the land and whether it supported the implication of a grant of equitable charge. Additionally, the court had to consider whether the deed was frustrated or vitiated by any illegality and whether an injunction was appropriate in light of the terms of the deed. The court needed to balance the rights and obligations of the parties under the deed against the need to prevent potential harm to the plaintiffs' interests in the land.

The court found that the joint venture deed did acknowledge the plaintiffs' caveatable interest and supported the implication of an equitable charge. It determined that the deed was not frustrated or vitiated by illegality and, therefore, remained valid and enforceable. However, the court held that the terms of the deed did not support the grant of an injunction against the registration of the plan of subdivision without the plaintiffs' written agreement. The court reasoned that granting such an injunction would be inconsistent with the operation of the deed, as it would effectively impose a condition not contained within the deed itself. The court thus declined to grant the injunction.

The court made a declaration that an equitable charge was held by the plaintiffs over the land. It also ordered that the defendants pay the plaintiffs' costs of the proceeding.

Orders