Garnock v Black

In the matter of *Garnock v Black*, the Court of Appeal of New South Wales considered a dispute between purchasers of land and judgment creditors who had registered a writ for the levy of property against the vendor. The purchasers had exchanged contracts for the sale of the land but had not yet completed the transfer when the judgment creditors sought to enforce their writ. The central issue was whether the purchasers' equitable interest in the land took priority over the rights of a purchaser who might acquire the land through the execution of the writ.

The court was required to determine the meaning of "title" in section 112(2) of the *Civil Procedure Act 2005* (NSW) and the effect of sections 105, 105A, and 105B of the *Real Property Act 1900* (NSW) in the context of a registered writ for levy of property. Specifically, the court had to decide whether the purchasers' equitable interest, arising from the contract of sale, had priority over any interest acquired by a Sheriff's purchaser under the execution of the writ.

The Court of Appeal held that the purchasers' equitable interest in the land, acquired upon exchange of contracts, took priority over the rights of the judgment creditors. The court reasoned that the registration of a writ for levy of property under the *Civil Procedure Act* does not, in itself, create an equitable interest in the land for the judgment creditor. Instead, it is a step towards enforcing a judgment, and the ultimate acquisition of title by a Sheriff's purchaser is contingent on the completion of the sale process. The court found that the purchasers' prior equitable interest was not defeated by the subsequent registration of the writ.

Consequently, the appeal was upheld, and the orders of the primary judge were set aside. The Court of Appeal declared that the purchasers, as holders of equitable interests, were entitled to priority over the judgment creditors. The judgment creditors were restrained from executing the writ against the land for a period of 60 days, and they were ordered to pay the costs of the appeal and the trial proceedings.