Jensen v Bank of Queensland

The appeal concerned a dispute between Jensen, the plaintiff and mortgagee, and the Bank of Queensland, the second defendant, regarding the exercise of a power of sale over land registered under the Real Property Act 1900. The core of the dispute involved the ability of the mortgagee to proceed with a sale despite the lodgement of caveats that prevented the registration of dealings. The matter was heard by Beazley, Hodgson and Macfarlan JJA in the Court of Appeal of New South Wales.

The legal issues before the Court of Appeal were whether an injunction could be granted to restrain the Registrar-General from accepting certain caveats that would prevent the exercise of a mortgagee's power of sale, and whether a specific caveat lodged by the third defendant should be withdrawn. The court was required to consider the requirements for the lodgement and effect of caveats under the Real Property Act 1900 in the context of a mortgagee's statutory rights.

The Court of Appeal reasoned that it was appropriate to grant an injunction to prevent the Registrar-General from accepting caveats that would unduly obstruct the mortgagee's exercise of its power of sale. This involved balancing the rights of a caveator to protect their interest against the statutory rights of a mortgagee to enforce their security. The court applied principles relating to the proper operation of the Torrens system and the circumstances in which injunctive relief is available to prevent the abuse of the caveat system. The court also ordered the withdrawal of a specific caveat.

The Court of Appeal set aside part of an earlier order and substituted it with an order that the Registrar-General not accept for lodgement any caveat prohibiting the mortgagee from recording a dealing effected in the exercise of a power of sale, unless with leave of the Court. The court also ordered the withdrawal of a specific caveat by a set date. The appeal was otherwise dismissed, with no order as to costs.