Egan v Egan (No. 2)

The case of Egan v Egan (No. 2) involved a dispute between the plaintiff, who sought possession of certain land, and the defendant, who raised cross-claims asserting that the loan deed and mortgage were a sham, or alternatively, that they constituted an unjust contract. The matter was heard in the Supreme Court of Victoria, where the plaintiff successfully established a default under the mortgage, but the defendant's claims regarding the nature of the mortgage were dismissed. However, the court held that the contract was unjust and ordered that it be varied.

The primary legal issues before the court included whether the defendant's cross-claims regarding the sham nature of the contract or its unjust nature were valid, and if the plaintiff was entitled to costs following the unsuccessful cross-claims. A further issue involved the interpretation and application of Calderbank offers made by both parties during the proceedings. The court had to determine whether these offers were reasonable and if either party was entitled to an order for costs.

In addressing these issues, the court noted that while the defendant's claims about the sham nature of the contract were unsuccessful, the contract was indeed unjust. Consequently, the court ordered the contract to be varied. Regarding the Calderbank offers, the court found it difficult to ascertain whether the offerees obtained a better result from the judgment. The defendant's offer was made before any evidence was served and was stated to be open for 21 days but was withdrawn without warning after five days. The court concluded that it was not unreasonable for the plaintiff not to accept the defendant's offer. Therefore, no order for costs was made.

The final orders of the court were that the plaintiff was entitled to possession of the land, the loan deed and mortgage were varied to correct their unjust nature, and no costs were awarded to either party.