The parties are to bring in Short Minutes of Order to reflect my reasons for judgment.
Catchwords:
ESTOPPEL – estoppel by deed or convention – estoppel by convention – plaintiff mother sought possession of property owned by defendant daughter pursuant to Deed of Loan and mortgage executed in favour of plaintiff – whether Deed of Loan and mortgage were sham documents intended by parties merely to deceive defendant’s estranged husband in respect of any family law property proceedings – whether defendant was induced to sign documents by a representation that neither document was intended to have its apparent, or any, legal consequences – defendant did not meet “heavy onus” of proving a sham
EQUITY – general principles – rules and maxims of equity – unclean hands – effect of defendant’s complicity in alleged sham on availability of equitable relief – defendant could not rely on personal equity to overcome effect of registration pursuant to Real Property Act 1900 (NSW) s 42
INTERPRETATION – general rules of construction of instruments – Deed of Loan provided that defendant “must pay principal and interest” – term not uncertain because interest rate, principal and duration of loan were specified – plaintiff not required to give oral or written direction in relation to payment of instalments
INTERPRETATION – general rules of construction of instruments – whether Deed of Loan incorporated into registered mortgage – whether contra proferentum rule applied – reference to “Deed of Acknowledgement of Loan” in annexure to registered mortgage clearly a falsa demonstratio for the words “Deed of Loan”
CONTRACTS – general contractual principles – harsh and unconscionable contracts and statutory remedies – defendant mortgagor was financially and emotionally dependent on plaintiff mortgagee – plaintiff knew that defendant had no ability to comply with provisions of Deed of Loan such that transaction amounted to “asset lending” – same solicitor acted for mortgagee and mortgagor - interests of plaintiff and defendant diverged considerably – defendant asked to sign Deed of Loan and mortgage without independent legal advice, explanation or negotiation of terms – transaction was unjust within meaning of Contracts Review Act 1980 (NSW) s 9(2)
[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 Egan v Egan
Sign in free to access the full text
Details
AGLC
Egan v Egan [2018] NSWSC 202
Case
[2018] NSWSC 202
Decision Date
CaseChat Overview and Summary
The case of Egan v Egan involved a dispute between a mother and her daughter over the ownership of a property. The plaintiff sought possession of the property, which was owned by the defendant, on the basis of a Deed of Loan and a mortgage executed in favour of the plaintiff. The defendant argued that the documents were sham, intended only to deceive the defendant's estranged husband in any family law property proceedings. The primary issue for the court was whether the Deed of Loan and mortgage were genuine, or if they were a sham intended to deceive the estranged husband. Additionally, the court had to determine whether the defendant was induced to sign the documents based on a representation that they would not have legal consequences. The court found that the defendant had not met the high burden of proving the documents were a sham.
The court also considered the implications of equity and the doctrine of unclean hands. It examined whether the defendant's involvement in the alleged sham would prevent her from obtaining equitable relief. The court held that the registration of the mortgage under the Real Property Act 1900 (NSW) s 42 precluded the defendant from relying on personal equity to overcome the effect of the registration. The court further interpreted the terms of the Deed of Loan, noting that the obligation to pay principal and interest was not uncertain as the interest rate, principal amount, and duration of the loan were specified. The court clarified that the plaintiff was not required to provide oral or written direction regarding payment of instalments.
Regarding the incorporation of the Deed of Loan into the registered mortgage, the court found that the reference to a "Deed of Acknowledgement of Loan" in the annexure to the registered mortgage was a misdescription for the words "Deed of Loan". The court also considered whether the contra proferentum rule applied but found it unnecessary to do so. The court addressed the defendant's claim that the transaction was unjust under the Contracts Review Act 1980 (NSW) s 9(2), finding that the defendant was financially and emotionally dependent on the plaintiff, and that the plaintiff was aware of the defendant's inability to comply with the Deed of Loan's provisions. The court concluded that the transaction was indeed unjust.
The court's final orders were that the Deed of Loan and mortgage were valid, and the plaintiff was entitled to possession of the property. The court rejected the defendant's claims regarding the sham nature of the documents and her right to equitable relief.