E and P Developers P/L v D J Capital Solutions Limited

E and P Developers P/L commenced proceedings against D J Capital Solutions Limited in the Supreme Court of Queensland, seeking to restrain the sale of property pursuant to a power of sale contained in a mortgage. The dispute centred on the enforceability of the mortgage and the conditions under which the mortgagor could seek an injunction to restrain the sale. The key legal issue before the court was whether the mortgagor was required to pay the mortgage money into court as a condition of obtaining an injunction, particularly when it was arguable that the power of sale had not arisen.

The court considered the established legal principles governing the restraint of a mortgagee's sale. It examined the authority of cases such as *Amalgamated Investment and Property Co Ltd v Texas Commerce International Bank Ltd*, which established that a mortgagor must pay the mortgage money into court as a prerequisite to obtaining an injunction against a sale. However, the court also noted the requirement for flexibility in applying this principle, particularly in circumstances where the power of sale had not yet arisen. The court found that while the principle remained valid, the requirement to pay the mortgage money into court should be considered in light of the specific circumstances of each case.

In reaching its decision, the court held that the mortgagor was not necessarily required to pay the mortgage money into court if it could be argued that the power of sale had not arisen. The court emphasised the need for a flexible approach, taking into account the unique facts of the case and the potential injustice of rigidly enforcing the payment requirement. Additionally, the court addressed the issue of costs, specifically the provision in the mortgage for indemnity costs to be added to the secured moneys. The court clarified that it was not bound to award indemnity costs and could exercise its discretion in accordance with the general principles of costs in equity.

The court ultimately ruled in favour of E and P Developers P/L, granting the injunction to restrain the sale of the property. The court also made orders regarding the costs, noting that while indemnity costs could be considered, the court was not compelled to award them. The precise terms of the orders were tailored to the specific circumstances of the case, ensuring a just outcome for both parties.