Golden Mile Property Investments Pty Ltd (in liq) v Cudgegong Australia Pty Ltd

The dispute before the Court of Appeal of New South Wales concerned the determination of which entity held a compensable interest in land that had been compulsorily acquired. The competing parties were Golden Mile Property Investments Pty Ltd (in liquidation) (the registered proprietor and mortgagor in default), Cudgegong Australia Pty Ltd (the incoming purchaser under an uncompleted contract for sale), and the mortgagee exercising its power of sale.

The primary legal issues before the court were: (a) whether the mortgagor's interest in the land was subject to a properly exercised power of sale by the mortgagee at the time of the compulsory acquisition; and (b) whether the mortgagee breached its duty owed to the mortgagor, either under s 420A of the *Corporations Act 2001* (Cth) or under general law, when exercising that power of sale. These issues were central to determining who was entitled to the compensation payable for the compulsory acquisition.

The court considered the principles of priority and notice in equity, particularly in the context of a competition between the interests of a mortgagor and a purchaser under an uncompleted contract for sale. It was held that where a mortgagee validly exercises its power of sale, the mortgagor's equity of redemption is extinguished. The court found that the mortgagee had validly exercised its power of sale prior to the compulsory acquisition, and that the sale to Cudgegong Australia Pty Ltd was effective. Consequently, Golden Mile Property Investments Pty Ltd no longer held a compensable interest in the land at the time of the acquisition.

The appeal was dismissed with costs, with leave to appeal granted only in respect of specific grounds.