McMahon v Permanent Custodians Ltd

The applicants, McMahon, sought interim injunctive relief from the Supreme Court of New South Wales to prevent the respondent, Permanent Custodians Ltd, from disposing of two properties. The dispute arose from the applicants' default on loans secured by these properties, which were subject to the *Farm Debt Mediation Act 1994* (NSW). The primary judge had previously found that a valid certificate had been issued, permitting the respondent to proceed with enforcement action. The applicants subsequently filed a summons seeking leave to challenge this decision.

The central legal issue before the court was whether the applicants should be granted interim injunctive relief to restrain the sale of their properties pending the determination of their challenge to the validity of the certificate issued under the *Farm Debt Mediation Act 1994* (NSW). This involved considering the applicants' prospects of success in their challenge and whether the balance of convenience favoured granting the injunction.

Basten JA considered the applicants' arguments that the certificate was invalid. While acknowledging that the applicants had raised arguable points regarding the validity of the certificate, the court noted that the applicants had not yet demonstrated a strong prima facie case. However, the court found that the balance of convenience favoured granting interim relief. The potential prejudice to the applicants if the properties were sold before their challenge was heard was significant, whereas the prejudice to the respondent was limited to a short delay in exercising its enforcement rights.

Consequently, the court ordered that Permanent Custodians Ltd be restrained from auctioning, selling, alienating, leasing, or otherwise disposing of the properties known as "Wyrallah" and "Summerdowns" until 5pm on Tuesday, 2 July 2013. The matter was listed for further consideration on that date.