McIvor v Westpac Banking Corporation

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SUPREME COURT OF QUEENSLAND

CITATION:

McIvor v Westpac Banking Corporation [2012] QSC 404

PARTIES:

JANICE ELLEN McIVOR
(plaintiff)
v
WESTPAC BANKING CORPORATION
ABN 33 007 457 141

(defendant)

FILE NO:

1676 of 2012

DIVISION:

Trial Division

PROCEEDING:

Claim

ORIGINATING COURT:

Supreme Court of Queensland

DELIVERED ON:

14 December 2012

DELIVERED AT:

Brisbane

HEARING DATE:

19, 20 & 21 November 2012

JUDGE:

Applegarth J

ORDER:

1.   Judgment for the defendant in the principal proceeding.

2.   Judgment for the defendant on its counterclaim against the plaintiff in the sum of $9,542,484.09 inclusive of interest up to and including 14 December 2012.

3.   The defendant recover vacant possession of the land described as Lot 20 on RP 842700, County of Ward, Parish of Tallebudgera.

4.   The plaintiff pay the defendant’s costs of and incidental to the proceeding and the counterclaim to be assessed on the standard basis.

CATCHWORDS:

EQUITY – GENERAL PRINCIPLES – UNDUE INFLUENCE AND DURESS – GENERAL PRINICPLES – where the plaintiff granted various guarantees and mortgages to the defendant bank at her son’s request – where the plaintiff contends that the guarantees and mortgages were procured by her son’s undue influence – where the plaintiff is an elderly parent with little formal education – where the plaintiff’s son is a lawyer and moneylender – whether the nature of the antecedent relationship between the plaintiff and her son gave rise to a presumption of undue influence – whether the defendant was on notice of the exercise or possible exercise of undue influence by the plaintiff’s son – whether independent solicitors’ certificates received by the defendant and acknowledgements signed by the plaintiff displaced any such notice – whether the defendant reasonably believed that the purport and effect of the documents had been explained to the plaintiff by a competent, independent and disinterested stranger – whether it would be unconscionable for the defendant to enforce the 2003 guarantee and mortgage

Agripay Pty Ltd v Byrne [2011] 2 Qd R 501, cited
ANZ Banking Group Ltd v Alirezai [2004] QCA 6, cited
Banco Exterior Internacional v Mann [1995] 1 All ER 936, cited
Bank of Baroda v Rayarel [1995] 2 Fam Law R 376, cited
Bank of Baroda v Shah [1988] 3 All ER 24, cited
Bridgewater v Leahy (1998) 194 CLR 457, cited
Brusewitz v Brown [1923] NZLR 1106, cited
Burrawong Investments Pty Ltd v Lindsay [2002] QSC 82, cited
Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447, cited
Esanda Finance Corporation Ltd v Tong (1997) 41 NSWLR 482, cited
Garcia v National Australia Bank Ltd (1998) 194 CLR 395, followed
Johnson v Buttress (1936) 56 CLR 113, cited
Kranz v National Australia Bank Ltd (2003) 8 VR 310, followed
Massey v Midland Bank Plc [1995] 1 All ER 929, cited
National Mutual Trustees Ltd v Dedrion Pty Ltd (Hansen J, Supreme Court of Victoria, 18 August 1997, unreported), cited
Permanent Mortgagees Pty Ltd v Vandenbergh (2010) 41 WAR 353,…

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Details
Case
[2012] QSC 404
Decision Date

CaseChat Overview and Summary

McIvor brought an action against Westpac Banking Corporation, alleging that certain guarantees and mortgages granted to the bank were procured by undue influence exercised by her son, who was both her child and a lawyer. McIvor, an elderly individual with limited formal education, claimed that her son, who was also a moneylender, exerted undue influence over her to secure the guarantees and mortgages. The primary issues before the court were whether the relationship between McIvor and her son created a presumption of undue influence, whether the bank had notice of or was on notice of potential undue influence, and whether the bank reasonably believed that the documents had been properly explained to McIvor. The court also had to determine if enforcing the guarantees and mortgages would be unconscionable.

The court examined the relationship between McIvor and her son to determine if it warranted a presumption of undue influence. Given the son's professional status as a lawyer and moneylender, and his position of trust and dependency relative to his elderly mother, the court found a relationship of influence. However, the court concluded that the bank was not on notice of undue influence due to the presence of independent solicitors' certificates and signed acknowledgements by McIvor. The court further found that the bank reasonably believed that the documents had been explained to McIvor by a competent, independent party. Consequently, the court ruled that it would not be unconscionable for the bank to enforce the guarantees and mortgages.

The court's decision resulted in a judgment for the defendant bank, with the bank also prevailing on its counterclaim against McIvor. The court ordered that the bank recover possession of the mortgaged property and that McIvor pay the bank's costs of the proceeding and counterclaim. The bank was awarded the sum of $9,542,484.09, inclusive of interest up to 14 December 2012.

Orders

Orders of the court

1. Judgment for the defendant in the principal proceeding.

2. Judgment for the defendant on its counterclaim against the plaintiff in the sum of $9,542,484.09 inclusive of interest up to and including 14 December 2012.

3. The defendant recover vacant possession of the land described as Lot 20 on RP 842700, County of Ward, Parish of Tallebudgera.

4. The plaintiff pay the defendant’s costs of and incidental to the proceeding and the counterclaim to be assessed on the standard basis.

Background

Background to the litigation

Full text does not contain this section.

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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