Garafano v Reliance Finance Corporation Limited

This matter concerned applications for special leave to appeal to the High Court of Australia from decisions of the Court of Appeal. The applicants, Mr Clinton Garafano and Mrs Helga Garafano, sought to appeal against the respondent, Reliance Finance Corporation Limited. The core of the dispute revolved around issues of indefeasibility of title under the Real Property Act, the application of section 124 of the relevant legislation, and the equitable principle of "doing equity".

The legal issues before the High Court included whether the principle of indefeasibility of title applied in the circumstances, the proper interpretation and application of section 124, and the extent to which the equitable maxim of "doing equity" should be applied, particularly in modern contexts and when an order might otherwise be made in favour of the appellant. The applicants also raised a point concerning the factual findings of the lower courts regarding offers to do equity.

The applicants argued that the Court of Appeal had erred in its findings on indefeasibility and section 124. Crucially, they contended that the lower courts were wrong to conclude that there was no offer to do equity. They submitted that Mr Garafano had made an offer to do complete equity by allowing for the full amount of Reliance's moneys applied to discharge an earlier mortgage. For Mrs Garafano, a partial offer was made concerning the proportion of Reliance's moneys she understood had been borrowed under the earlier mortgage. The applicants also argued that the maxim of doing equity should not necessarily be applied in all circumstances, citing *Amadio's* case where the High Court held it was not appropriate to require the doing of equity. The question of priorities of interests was also a significant consideration.