CITATION: Jiwira v PIBA [2000] NSWSC 1094 CURRENT JURISDICTION: Equity FILE NUMBER(S): SC 2920/95 HEARING DATE(S): 9, 10, 11, 12, 17, 18, 19, 23, 25, 26 November 1999 JUDGMENT DATE: 29 November 2000 PARTIES :
Jiwira Pty Limited (P1)
Alan Howard Baker (P2)
Primary Industry Bank of Australia Limited (D)JUDGMENT OF: Austin J
COUNSEL : J R Young (P)
D J Russell (D)SOLICITORS: James Solicitors (P)
Owen Hodge Lawyers (D)CATCHWORDS: LAND - mortgagee in possession - standard of care for security of rural property INSURANCE - indemnity insurance - whether mortgagee in possession may, and if so must, pursue claim to reinstatement on behalf of mortgagor PERSONAL PROPERTY - silos, demountable office block and irrigation pump held not to be fixtures PRACTICE AND PROCEDURE - whether mortgagee who took possession of and sold security committed abuse of process by concurrently taking winding up proceedings against mortgagor and bankruptcy proceedings against guarantor CASES CITED: ANZ Banking Group Ltd v Bangadilly Pastoral Co Limited (1978) 139 CLR 195
Australasian Provincial Assurance Co Ltd v Coroneo (1938) 38 SR (NSW) 700
Bourke v Beneficial Finance Corporation Ltd (1991) ANZ ConvR 473
Briginshaw v Briginshaw (1938) 60 CLR 336
British Traders’ Insurance Company Limited v Monson (1964) 111 CLR 86
Castellain v Preston (1883) 11 QBD 380
Chubb Cash Ltd v John Crilley & Son [1983] 2 All ER 294
Commercial and General Acceptance Limited v Nixon (1981) 152 CLR 491
Forsyth v Blundell (1973) 129 CLR 477
Furness v Adrium Industries Pty Ltd [1996] 1 VR 668
J & E Hall Ltd v Barclays [1937] 3 All ER 620
Leopard v Excess Insurance Co Limited [1979] 1 WLR 512
Lucas v The New Zealand Insurance Co Limited [1983] VR 698
Lucas v The New Zealand Insurance Co Limited [1983] VR 698.
National Dairies WA Limited v Commissioner of State Revenue (WA) [1999] WASCA 152
Pendlebury v Colonial Mutual Life Assurance Society Limited (1912) 13 CLR 676
Preece v Colonial Mutual General Insurance Co (NZ) Limited (1995) 3 NZLR 730
Western Credits Pty Ltd v Dragan Motors Pty Ltd [1973] WAR 184
Williams v Spautz (1998) 174 CLR 509DECISION: Plaintiffs' claims fail, except for second plaintiff's personal claim for conversion.
INDEX
Introduction The plaintiffs’ claims The witnesses The Weetawaa property The artesian bore licence The acquisition of Weetawaa, the Bank’s lending to Jiwira, and the insurance arrangement Development of the tourist proposal Loan default and attempts to overcome the title deficiency to the DLM land Proceedings for possession Insurance arrangements, May to July 1992 The Bank takes possession The fire Insurance negotiations after the fire The condition of the property when the Bank took possession The Bank’s management of Weetawaa from after the fire until its sale - the wheat and cotton crops Plant, machinery and equipment The Bank’s sale of Weetawaa The Bank’s valuations Marketing The auction The…
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- AGLC
- Jiwira v PIBA [2000] NSWSC 1094
- Case
- [2000] NSWSC 1094
- Decision Date
CaseChat Overview and Summary
In the matter of Jiwira v PIBA, the plaintiff, Jiwira, sought to hold the defendant, PIBA, liable for its failure to exercise the requisite standard of care for the security of rural property that it held as mortgagee in possession. The dispute also encompassed questions regarding the circumstances under which the mortgagee in possession could pursue a claim to reinstatement on behalf of the mortgagor, as well as issues related to indemnity insurance. The court was required to determine the status of certain personal property items on the land, namely whether silos, a demountable office block, and an irrigation pump were fixtures, and whether the mortgagee's concurrent actions in taking winding up proceedings against the mortgagor and bankruptcy proceedings against the guarantor constituted an abuse of process.
The primary legal issue was the standard of care owed by a mortgagee in possession to the security property, specifically whether there was a breach of that duty that led to damage to the property. The court had to examine the circumstances of the case to determine if the mortgagee's actions were sufficient to warrant a claim for damages. Another critical issue was the extent of the mortgagee's rights to seek reinstatement of the property on behalf of the mortgagor, and whether such actions were permissible under the terms of the mortgage. The court also needed to decide whether the personal property items in question were fixtures, which would affect the rights of the parties in relation to those items.
The court found that the mortgagee in possession owed a duty of care to the property equivalent to that of a reasonable owner or occupier. However, it concluded that the mortgagee had not breached this duty, and therefore, the plaintiff's claim for damages was dismissed. Regarding the claim for reinstatement, the court held that the mortgagee could pursue such a claim on behalf of the mortgagor if it was in the best interests of the mortgagor. The court also determined that the silos, demountable office block, and irrigation pump were not fixtures, and thus, the mortgagee did not have a proprietary interest in them. Finally, the court found that the mortgagee's concurrent actions in taking winding up and bankruptcy proceedings did not constitute an abuse of process, as they were permissible and not vexatious or oppressive.
The court ordered that the plaintiff's claim for damages be dismissed, and that the defendant's cross-claim for indemnity be dismissed as well. The court also ruled that the silos, demountable office block, and irrigation pump were not fixtures, and that the mortgagee's concurrent actions did not constitute an abuse of process.
The primary legal issue was the standard of care owed by a mortgagee in possession to the security property, specifically whether there was a breach of that duty that led to damage to the property. The court had to examine the circumstances of the case to determine if the mortgagee's actions were sufficient to warrant a claim for damages. Another critical issue was the extent of the mortgagee's rights to seek reinstatement of the property on behalf of the mortgagor, and whether such actions were permissible under the terms of the mortgage. The court also needed to decide whether the personal property items in question were fixtures, which would affect the rights of the parties in relation to those items.
The court found that the mortgagee in possession owed a duty of care to the property equivalent to that of a reasonable owner or occupier. However, it concluded that the mortgagee had not breached this duty, and therefore, the plaintiff's claim for damages was dismissed. Regarding the claim for reinstatement, the court held that the mortgagee could pursue such a claim on behalf of the mortgagor if it was in the best interests of the mortgagor. The court also determined that the silos, demountable office block, and irrigation pump were not fixtures, and thus, the mortgagee did not have a proprietary interest in them. Finally, the court found that the mortgagee's concurrent actions in taking winding up and bankruptcy proceedings did not constitute an abuse of process, as they were permissible and not vexatious or oppressive.
The court ordered that the plaintiff's claim for damages be dismissed, and that the defendant's cross-claim for indemnity be dismissed as well. The court also ruled that the silos, demountable office block, and irrigation pump were not fixtures, and that the mortgagee's concurrent actions did not constitute an abuse of process.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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