Leedman v Chahhoud

Case [2024] NSWSC 1284


Supreme Court


New South Wales

Medium Neutral Citation: Leedman v Chahhoud [2024] NSWSC 1284
Hearing dates: 23-26, 29, 31 July, 7 August 2024
Date of orders: 16 October 2024
Decision date: 16 October 2024
Jurisdiction: Equity - Real Property List
Before: Williams J
Decision:

See orders at [344].

Catchwords:

EQUITY – Equitable charges – Enforceability – Order for judicial sale.

CONTRACTS – Formation – Intention to be bound.

DURESS – Whether the first defendant signed deed under duress exerted by second defendant – Where the evidence does not establish duress – Where the plaintiffs (being the parties seeking to enforce the deed) did not have actual or constructive knowledge of the alleged duress, – Where plaintiffs did not use the second defendant as their agent to procure the first defendant’s execution of the deed.

EQUITY – Undue influence – Whether the first defendant signed the deed as a result of undue influence of the second defendant – Where the evidence does not establish undue influence –

Equity – Yerkey v Jones – Where the first defendant was not a volunteer.

EQUITY – Unconscionable conduct – Whether the first defendant suffered from a special disadvantage, ­ Whether the plaintiffs had actual or constructive knowledge of any special disadvantage.

CONTRACTS – Unjust contracts – Whether the terms of the deed are unjust under the Contracts Review Act 1980 (NSW) – Where the proper law of the deed is the law of Queensland.

Legislation Cited:

Australian Securities and Investments Commission Act 2001 (Cth) ss 12BAB, 12CA, 12CB, 12CC

Civil Procedure Act 2005 (NSW) s 101

Contracts Review Act 1980 (NSW) ss 6(2), 17(3)

Property Law Act 1974 (Qld) s 45

Cases Cited:

Abdallah v Baygan [2019] NSWSC 1507

Abdallah v Baygan (No. 4) [2020] NSWSC 1075

Akai Pty Ltd v People’s Insurance Co Ltd (1996) 188 CLR 418; [1996] HCA 39

Australia and New Zealand Banking Group Ltd v Karam (2005) 64 NSWLR 149; [2005] NSWCA 344

Boutros v Nationwide Capital Pty Ltd [2013] NSWCA 246

Braam v BBC Hardware Ltd [2020] VSCA 164

Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447

Dunwoodie v Teachers Mutual Bank Ltd [2014] NSWCA 24

Elkofairi v Permanent Trustee Co Ltd (2002) 11 BPR 20,841; [2002] NSWCA 413

Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95; [2002] HCA 8

ET-China.com International Holdings Ltd v Cheung (2021) 388 ALR 128; [2021] NSWCA 24

Fox v Percy (2003) 214 CLR 118; [2003] HCA 22

Garcia v National Australia Bank Ltd

(1998) 194 CLR 395; [1998] HCA 48

Ghannam v BB&B Penrith Pty Ltd [2022] NSWSC 1588

Helou v Chahhoud [2021] NSWSC 878

Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8

King Investment Solutions Pty Ltd v Hussain (2005) 64 NSWLR 441; [2005] NSWSC 1076

MSPR Pty Ltd v Advanced Braking Technology Ltd [2013] NSWCA 416

Morris Finance Ltd v Free (2017) 18 BPR 37,223; [2017] NSWSC 1417

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AGLC
Leedman v Chahhoud [2024] NSWSC 1284
Case
[2024] NSWSC 1284
Decision Date

CaseChat Overview and Summary

Leedman v Chahhoud is a case where the plaintiff, Leedman, sought to enforce a charge against the defendants, Chahhoud and another, over a property. The matter was heard in the Supreme Court of New South Wales. The central issue was whether the plaintiffs were entitled to a judicial sale of the property due to the defendants' failure to repay a loan. The defendants argued that the charge was unenforceable due to duress, undue influence, and unconscionable conduct during the execution of the deed.

The court had to determine whether the first defendant was coerced or unduly influenced by the second defendant when signing the deed. The court found that there was insufficient evidence to establish that the first defendant signed under duress or undue influence. Furthermore, the plaintiffs were not aware of any duress or undue influence and did not act as agents for the second defendant to obtain the signature. The court also considered whether the first defendant was a volunteer or suffered from a special disadvantage, but found no evidence to support these claims.

The court ruled that the charge was enforceable and ordered a judicial sale of the property. The defendants' arguments regarding duress, undue influence, and unconscionable conduct were not substantiated by the evidence. The court found that the deed was valid and binding, and the plaintiffs were entitled to enforce the charge. The first defendant was not a volunteer, and there was no special disadvantage or knowledge of such on the part of the plaintiffs. The court also dismissed the argument that the terms of the deed were unjust under the Contracts Review Act 1980 (NSW), as the proper law of the deed was the law of Queensland.

The final orders of the court were that the charge over the property was enforceable, and a judicial sale of the property was ordered to recover the outstanding debt. The defendants' claims of duress, undue influence, and unconscionable conduct were rejected, and the plaintiffs were granted the relief they sought. The court found no merit in the defendants' arguments and confirmed the enforceability of the charge.

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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