Gellert v Bellamy

[1999] NSWCA 123

CITATION:	Gellert v Bellamy [1999] NSWCA 123
FILE NUMBER(S):	CA 40369/98
HEARING DATE(S):	15 March 1999
JUDGMENT DATE:	10 May 1999
PARTIES :	Robert Gellert v Edith Bellamy
JUDGMENT OF:	Meagher JA at 1; Handley JA at 10; Giles JA at 11

LOWER COURT JURISDICTION:	Supreme Court - Equity Division
LOWER COURT FILE NUMBER(S) :	2534/95
LOWER COURT JUDICIAL OFFICER:	Hulme J

COUNSEL:	Appellant: B.R. McClintockSC Respondent: D.I. Cassidy QC/B. Glennon
SOLICITORS:	Appellant: Minter Ellison Respondent: J. Weller
CATCHWORDS:	Mortgages - negligence solicitor/client - solicitor acting for all parties to a loan transaction - duty to advise nominal borrower of consequenses of default - finding open to trial judge on evidence - no error reasons of trial judge.
CASES CITED:	Commercial Bank of Australia Limited v Amadio (1982) 151 CLR 447; Waimond Pty Limited v Byrne (1989) 18 NSWLR 642. Citicorp Australia v O'Brien (1996) 40 NSWLR 398; Amadio Pty Limited v Henderson (1998) 1 FCR 149;
DECISION:	Appeal dismissed with costs.

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IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL
CA: 40369/98
ED: 2534/95

MEAGHER JA
HANDLEY JA
GILES JA

Monday, 10 May 1999

Robert GELLERT v Edith BELLAMY

JUDGMENT

1 MEAGHER JA: This is an appeal from a decision of Hulme J which was adverse to the appellant, Mr Gellert, who was one of five defendants in the Court below. He is a solicitor of this Court.
2 Mrs Bellamy, the plaintiff/respondent, sued the appellant under the Contracts Review Act. The plaintiff lost this issue, and no appeal arises out of it. She also sued the appellant in negligence. On this issue she won, and out of her victory arises the present appeal. Every cause of action she brought against the 2nd, 3rd, 4th and 5th respondents she lost, and she has not appealed from that result.
3 Mrs Bellamy, a 69 year old woman, mortgaged her home (which was her only asset”) to the defendants so that she could pay the moneys advanced to her by the defendants to her son-in-law. His name was Tom Barton. He had been married to her daughter from upwards of 25 years. His name was well known in financial circles, but not entirely favourably. At the time of entering the loan his last financial venture had failed and he possessed no assets; yet his mother-in-law was under the impression that he was reasonably prosperous. He fancied that he could re-establish himself with the $250,000 the defendant lent to him (via his mother-in-law).
4 The appellant was the solicitor for the (nominal) borrower (Mrs Bellamy), the lenders (the second, third, fourth and fifth defendants), and for the (real) borrower Mr Barton.
5 The end came quickly. Mr Barton exhausted the $250,000, and more besides; the lenders sought to exercise their security against Mrs Bellamy’s house; and she, realizing for the first time what a quandary she was in, sought to do something to save her home. The question for Hulme J was, what…