Costa Asset Management Pty Ltd v Mansour
[2020] NSWSC 520
•11 May 2020
Supreme Court
New South Wales
Medium Neutral Citation: Costa Asset Management Pty Ltd v Mansour [2020] NSWSC 520 Hearing dates: 7-8 May 2020 Date of orders: 11 May 2020 Decision date: 11 May 2020 Jurisdiction: Common Law Before: Harrison J Decision: Parties directed to bring in short minutes of order
Catchwords: MORTGAGES AND SECURITIES – mortgagee in possession – dispute as to removal of personal items of mortgagor – meaning of the words “all of their personal property, motor vehicles and other equipment” Cases Cited: Costa Asset Management Pty Ltd v Mansour [2020] NSWSC 449 Category: Procedural and other rulings Parties: Costa Asset Management Pty Ltd (Plaintiff)
Ashraf Mansour (First Defendant)
Mary Mansour (Second Defendant)Representation: Counsel:
Solicitors:
M Daniels (Plaintiff)
Elliott May Lawyers (Plaintiff)
Proctor Phair Lawyers (First and Second Defendants)
File Number(s): 2018/00256518 Publication restriction: Nil
Judgment
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HIS HONOUR: On 24 April 2020, RA Hulme J made the following orders in these proceedings (see Costa Asset Management Pty Ltd v Mansour [2020 NSWSC 449):
1. The Plaintiff by itself, staff, employees, agents, solicitors or otherwise be restrained until 1 May 2020 from disposing of or dealing with in any manner whatsoever any of the personal property, motor vehicles and other equipment of the First Defendant and the Second Defendant ("the Defendants") situated on the property at 11 Knights Road, Galston, NSW, 2159, being that land contained in Folio identifier 1/1198850 ("the Galston Property").
2. The Defendants are to remove all of their personal property, motor vehicles and other equipment from the Galston Property on or before 30 April 2020, subject to Order 4.
3. For the purpose of enabling Order 2, the Plaintiff is to permit the Defendants and their servants and agents access to the Galston Property on each day up to and including 30 April 2020 between the hours of 8am and 4pm, or such other eight-hour period per day as may be agreed.
4. In the performance of the removal referred to in Order 2, the four Bentley sedans and the one Chevrolet Corvette that are on the Galston Property are not to be removed until all of the Defendants' other personal property, motor vehicles and other equipment have been removed.
5. There is no order as to costs.
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A dispute has now arisen as to the meaning of the words “all of their personal property, motor vehicles and other equipment” referred to in Orders 1, 2 and 4. The dispute has been fomented in the following circumstances.
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The defendants are the owners of the Galston property. They were until recently in occupation and possession of the property when the plaintiff as their mortgagee recovered possession in accordance with its security following the defendants’ default. The defendants had managed in their time on the property to accumulate a considerable amount of personal items, principal among which were approximately 48 motor vehicles of varying ages and descriptions. However, the defendants’ personal property was not limited or restricted to these motor vehicles but included other items as well. At least five of the motor vehicles, consisting of four vintage Bentleys and a Chevrolet 350 Corvette, are valuable. The remaining material cannot be so described.
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When the plaintiff sold the Galston property to a third party, in the exercise of its power of sale, it included in the contract for sale a special condition 40 in the following terms:
“40. VEHICLES AND CHATTELS ON PROPERTY
(a) The Vendor discloses that there are a number of chattels in the storeroom and vehicles located on the property at the date of exchange.
(b) The Purchaser may serve a notice on the Vendor within 14 days of the date of this contract requiring that the Vendor shall remove all chattels and/or vehicles from the property as a condition of completion.
(c) If the Purchaser does not serve the Vendor with the notice referred to in condition 40(b), then
i. the Vendor shall not be required to remove the vehicles or the chattels or to do anything further in respect of the vehicles or chattels; and
ii. the Purchaser indemnifies the vendor against any claim regarding the chattels and/or vehicles.
(d)…”
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The purchaser gave the plaintiff a notice in accordance with special condition 40(b) of the contract.
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The defendants want access to the property to remove the five remaining vehicles and a washing machine, some gardening tools and a bag of flour. They do not feel that they are in any way obliged or required to remove anything else. However, the plaintiff insists that the orders made by RA Hulme J do not authorise the defendants to have the access that they seek until they have removed the considerable amount of miscellaneous chattels scattered across the property. In this last respect the plaintiff draws attention to an email sent by the defendants’ solicitor to the plaintiff’s solicitor at 9.05am on 23 April 2020, which is annexed to the affidavit of James Sean Whittle sworn 24 April 2020, and which was read in evidence before his Honour. In that email, Ms Phair proposed a timetable for the removal of the motor vehicles on the property “AND ANYTHING ELSE REMAINING ON THE PROPERTY”.
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In his affidavit sworn on 8 May 2020, James Sean Whittle, the plaintiff’s solicitor, said this:
“1. I am a solicitor with Elliott May Lawyers, the legal representatives for the Plaintiff and am authorised to swear this affidavit on behalf of the Plaintiff.
2. On 7 May 2020, I received from Holman Webb, the Plaintiff’s solicitors acting on the sale and conveyance of the Galston Property, the following documents:
(a) Contract for Sale of the Galston Property (“Contract”);
(b) Notice from the solicitors for the purchaser dated 3 April 2020 under clause 40 of the Special Conditions to the Contract.
Annexed and marked with the letter ‘A’ are pages 1 to 27 of the Contract and that Notice.
3. I am instructed as to the following matters:
(a) in or about September 2019, Allmain attended a property owned by the Defendants situated at West Pennant Hills that was subject to a mortgage in favour of the Plaintiff.
(b) the Plaintiff was at that time mortgagee in possession of the West Pennant Hills Property and took steps to sell that property accordingly.
(c) as with the condition of the Galston Property, there was a large volume of abandoned goods and rubbish left by the Defendants on the West Pennant Hills Property.
(d) so that the Plaintiff could market and sell the West Pennant Hills Property as mortgagee in possession, Allmain took an inventory of the abandoned goods on the West Pennant Hills Property and then arranged for those goods to be transported to the Galston Property. The abandoned goods were the only items the Plaintiff or its agents have deposited on the Galston Property. Annexed and marked with the letter ‘B’ is a copy of the Inventory.
(e) all of the goods set out in the Inventory have been removed by the Defendants from the Galston Property and none of the goods and rubbish remaining on the Galston Property were [sic, was] placed there by the Plaintiff or its agents.”
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It seems from the terms of special condition 40(a) that the plaintiff was concerned only to disclose to the purchaser the existence of the chattels “in the storeroom”. However, special condition 40(b) appears to contemplate the existence of the other miscellaneous goods and chattels located anywhere else on the Galston property. Be that as it may, the defendants have so far proceeded to remove only the items listed in the inventory annexed to Mr Whittle’s affidavit but not “the goods and rubbish remaining” there, which had not been deposited by the plaintiff’s agent as described by Mr Whittle.
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Before the matter reached RA Hulme J, Mr Whittle had on 23 April 2020 at 2.12pm sent an email to Ms Phair, responding to her 9.05am email of the same day, as follows:
“Your client’s proposal is not acceptable to our client.
As you know from our correspondence dated 20 April 2020, our client’s primary concern is the removal of all items on the property, including all of the vehicles. Our client is not prepared to find itself in the position where your clients remove only vehicles and property they perceive to be of some value, leaving our client to remove (at its cost) the remaining property and vehicles with little, or no, value.
Respectfully, your client’s proposal has not in any way sought to address our client’s concern in this regard.
In the circumstances, and with a view to this matter being satisfactorily resolved without undue complexity, we are instructed that our client is willing to proceed as follows:
1. Your clients to first remove all personal property (including motor vehicles) from the Galston property with the exception of [the four Bentleys and the Corvette];
2. Subject to, and following, your client meeting their obligations set out at 1 above, your client will be permitted to remove [the four Bentleys and the Corvette].”
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Ms Phair replied to the plaintiff’s solicitor on 23 April 2020 as follows:
“We refer to the above matter and our correspondence at or about 9:05am today setting out our client’s proposal for removal of all of the personal property and motor vehicles from the Galston property, in response to your correspondence received at or about 5:25pm on 20 April 2020.
Your correspondence of 20 April 2020 requires a proposal for removal of all items including all vehicles. That is what has been provided. You have by email at or about 2.13pm today for the first time sought to import a condition into the removal of the items, that 5 motor vehicles, which you are aware are owned by Sameh Mansour and not our clients, are to be retained by your clients as security pending your clients being satisfied as to the removal of the balance of the personal property and motor vehicles from the Galston property.
Our clients agree to remove all personal property and motor vehicles from the property. Our clients cannot agree to offer as security to your clients third party property by way of 5 motor vehicles owned by Sameh Mansour and it is unreasonable for your clients to seek to import such a condition on our clients.
We are instructed, failing the parties reaching agreement by close of business today for access for our clients to the Galston property for the removal of the personal property and motor vehicles, to approach the Duty Judge to bring the matter back before His Honour tomorrow to obtain orders for access for removal of the personal property and motor vehicles, and we will rely upon this and earlier correspondence including your correspondence dated 20 April 2020, in relation to costs.” (Emphasis added)
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Ms Phair had not at any stage, in correspondence written in the period before RA Hulme J was approached for assistance, sought to draw a distinction between, for example in her own words, “all items including all vehicles” or “anything else remaining on the property” on the one hand and some other, smaller, discrete selection of goods not covering all of the miscellaneous chattels then, and presently, remaining on the land, on the other hand. I accept that Ms Phair’s concern at the time of writing her letters was directed to the different question of whether or not the plaintiff could unilaterally purport to schedule the order in which the goods on the land were to be removed. She challenged the notion that the plaintiff could somehow “import a condition into the removal of the items…as security pending [the plaintiff] being satisfied as to the removal of the balance of the personal property and motor vehicles”. However, in the events that occurred, his Honour made Orders 2 and 4 that specifically took account of the plaintiff’s expressed concerns and put in place a regime which in fact operated to give the plaintiff the very security that the plaintiff sought and to which Ms Phair was referring. Having regard to the evidence before his Honour, that was entirely unsurprising.
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It seems to me to be inescapable that the defendants will not have complied with Order 2, and will not have become entitled to remove the four Bentleys and the Corvette in accordance with Order 4, until “anything else remaining on the property” has been removed.
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I will in the circumstances invite the parties to bring in short minutes of order to give effect to my reasons, having regard to the need to take account of the defendants’ ability to comply with Order 2 and the time that they may need to do so.
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Decision last updated: 11 May 2020
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