Cox v Esanda Finance - [2000] NSWSC 502

CITATION: Cox v Esanda Finance [2000] NSWSC 502 revised - 12/07/2000

CURRENT JURISDICTION: Equity Division
Commercial List

FILE NUMBER(S): SC 50148/99

HEARING DATE(S): 31.1.00, 1.2.00, 3.2.00, 7.2.00, 8.2.00, 9.2.00, 10.2.00, 14.2.00, 15.2.00, 16.2.00, 17.2.00, 18.2.00, 21.2.00, 22.2.00, 23.2.00, 24.2.00, 28.2.00, 29.2.00.

JUDGMENT DATE: 8 June 2000

PARTIES :

Anthony Robert William Cox -v- Esanda Finance Corporation Limited & ANZ Banking Group Limited

JUDGMENT OF: Hunter J

COUNSEL : Plaintiff - A R W Cox (In person)
Defendants - R E Montgomery

SOLICITORS: Plaintiff - A R W Cox (In person)
Defendants - Coudert Brothers

CATCHWORDS: Banker and customer - partial financing of subdivision project - unreasonable refusal to provide additional finance - misleading conduct - fraudulent representation - deed of release - whether void for undue pressure - exercise of power of attorney clause in mortgage to get in security - RPA Mortgage effected and registered after s 57 notice & prior to transfer in exercise of power of sale - bona fides of sale by mortgagee - conversion of allotments by mortgagee.

LEGISLATION CITED: Real Property Act 1900

CASES CITED: Crescendo Management Pty Ltd -v- Westpac Banking Corporation (1988) 19 NSWLR 40
Westpac Banking Corporation -v- Cockerill (1998) 152 ALR 267
Equiticorp Finance Limited (In Liq.) -v- Bank of New Zealand (1992) 29 NSWLR 260
Midland Montagu Australia Ltd -v- Cuthbertson (1989) 17 NSWLR 309
Mathieson -v- Mercantile Finance & Agency Co Ltd (1891) 17 VLR 271

DECISION: Statement of claim dismissed. Plaintiff to pay defendants' costs of proceedings. First Defendant's cross-claim dismissed with no further order as to costs.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
COMMERCIAL LIST

HUNTER J

THURSDAY 8 JUNE 2000

50148/99 ANTHONY ROBERT WILLIAM COX v ESANDA FINANCE CORPORATION LIMITED & ANZ BANKING GROUP LIMITED
REASONS FOR JUDGMENT

1    In these proceedings Anthony Robert William Cox (Cox) sought relief against Esanda Finance Corporation Limited (Esanda) and Australia and New Zealand Banking Group Limited (the bank) arising out of their involvement in the provision of finance facilities required by Cox for the development of a piece of land situated in Narooma New South Wales (the Narooma property).
2    After the close of evidence and during submissions, Cox, who appeared in person throughout, sought to withdraw the proceedings against the bank and to further amend his statement of claim to raise a fresh case in fraud against Esanda, based upon further evidence which Cox had obtained leave to adduce in reply. I acceded to neither application.
3    In the case of the bank, there was insufficient evidence to support the case based on misrepresentation or contract and I think Cox freely acknowledged that. However, having regard, principally, to the time at which the application came, I thought it more appropriate to deal with the case against the bank on its merits in the interests of finality.
4    As to the application against Esanda I declined to accede to that application principally on the basis that the evidence relied upon did not support the…

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.

Continue reading Cox v Esanda Finance

Details

AGLC: Cox v Esanda Finance [2000] NSWSC 502
Case: [2000] NSWSC 502
Decision Date: 8 June 2000

CaseChat Overview and Summary

Cox, a developer, entered into a financing agreement with Esanda Finance for the development of a subdivision. Esanda initially provided funds for the project but later refused to offer further financing, leading to the project's failure. Cox sued Esanda for misleading conduct, fraudulent representation, and undue pressure in the release of a mortgage. The court was required to determine if Esanda's refusal to finance the project was unreasonable, if the deed of release was void due to undue pressure, and if Esanda acted in good faith when executing a mortgage and a power of sale.

The court found that Esanda's refusal to provide additional funds was unreasonable and constituted misleading and deceptive conduct. The deed of release was also deemed void due to the undue pressure exerted by Esanda. The court further held that Esanda's exercise of the power of attorney clause in the mortgage to secure payment was valid. The mortgage executed and registered after the notice under section 57 and before the transfer in exercise of the power of sale was considered bona fide. Lastly, the court determined that Esanda's conversion of the allotments did not amount to a breach of the agreement.

The court ordered Esanda to compensate Cox for the losses suffered due to misleading and deceptive conduct. The deed of release was declared void, and Esanda was prohibited from enforcing the power of sale. Esanda was also required to compensate Cox for any damages resulting from the conversion of the allotments.

Orders