My Financier Securities Pty Ltd v Chen

The plaintiff, My Financier Securities Pty Ltd, sought a declaration that a mortgage over a property owned by the defendant, Chen, was valid and enforceable. The dispute arose when Chen challenged the mortgage's validity, asserting that the solicitor acting on behalf of the plaintiff did not have proper authority to deliver the executed mortgage instrument. The matter was heard in the Supreme Court of Victoria.

The court was required to determine whether the solicitor had the necessary authority to deliver the mortgage instrument, and if the mortgage was therefore valid and enforceable. This involved examining the terms of the retainer between the plaintiff and its solicitor, and whether there was any indication that the solicitor had ad hoc authority to deliver the mortgage instrument. The court also considered whether the mortgage complied with statutory requirements and whether any formal requirements were met.

The court held that the solicitor did not have ad hoc authority to deliver the mortgage instrument, as there was no explicit or implied authority in the retainer agreement. The court found that the mortgage was not valid and enforceable due to the lack of proper authority. The court further noted that the mortgage did not comply with statutory requirements, as it was not signed by two witnesses in the presence of the mortgagor. The plaintiff's claim was dismissed with costs.

The court ordered that the plaintiff pay the defendant's costs of the proceeding, which were assessed at $25,000. The court also made a declaration that the mortgage over the property was invalid and unenforceable. This decision underscores the importance of clear and explicit instructions when granting authority to solicitors, and the need for compliance with statutory requirements for the validity of mortgages.