O'Callaghan v Custom Credit Corporation Ltd - [1999] WASCA 70

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE FULL COURT (WA)

CITATION: O'CALLAGHAN & ORS -v- CUSTOM CREDIT CORPORATION LTD & ORS [1999] WASCA 70

CORAM: KENNEDY J
PIDGEON J
WHEELER J

HEARD: 4 DECEMBER 1998

DELIVERED : 23 JUNE 1999

FILE NO/S: FUL 6 of 1998

BETWEEN: PETER JOHN O'CALLAGHAN
JOHN JOSEPH HEDIGAN
ALLAN JAMES MYERS
ALEX CHERNOV
Appellants
AND
CUSTOM CREDIT CORPORATION LTD
First Respondent
ALAN EDSON LEDGER
Second Respondent
CHARLES ANTHONY CANDLIN FEAR
Third Respondent

Catchwords:

Mortgages - Mortgage of leasehold - Appointment of receivers by mortgagee - Rights of owner of property under mortgage - Whether mortgagee or receivers adopted lease

Legislation:

Nil

Result:

Appeal dismissed

Representation:

Counsel:

Appellants:     Mr S P Whelan QC & Ms T A Dodds-Streeton
First Respondent           :     Mr M J McCusker QC & Mr K L Christensen
Second Respondent       :     Ms C J McClure QC
Third Respondent         :     Ms C J McClure QC

Solicitors:

Appellants:     Freehill Hollingdale & Page
First Respondent           :     Tottle Christensen
Second Respondent       :     Blake Dawson Waldron
Third Respondent         :     Blake Dawson Waldron

Case(s) referred to in judgment(s):

Carnovale v State Bank of New South Wales, unreported; SCt of NSW; 3 November 1992
Halpern v Martin (1986) 10 ACLR 539
O'Callaghan & Ors v Custom Credit Corporation Ltd & Ors, unreported; SCt of WA (Anderson J); Library No 970709; 17 December 1997
Stolworthy v Sancroft (1864) 33 LJ Ch 708

Case(s) also cited:

Abbey National Building Society v Maybeech Ltd [1985] Ch 190
Re J W Abbott & Co (1913) WN 284
American Express International Banking Corp v Hurley [1985] 3 All ER 564
Associated Newspapers Ltd v Grinston (1949) 66 WN (NSW) 211
Australian Mutual Provident Society v Geo Myers & Co Ltd (in liq) (1931) 47 CLR 65
Re Botibol [1947] 1 All ER 26
Brash Holdings v Katile (1994) 13 ACSR 504
Re British Investments and Development Co Pty Ltd (1979) ACLC 40-522
Cholmeley School Highgate (Wardens and Governors) v Sewell [1894] 2 QB 906
The Church of England Collegiate School of St Peter v Chesser House Pty Ltd (1993) ANZ Conv R 110
Codelfa Construction Pty Ltd v State Rail Authority NSW (1982) 149 CLR 337
Consolidated Entertainments Ltd v Taylor [1937] 4 All ER 432
Egerton v Jones [1939] 2 KB 702
Gaskell v Gosling [1896] 1 QB 669
Gomba Holdings UK Ltd v Homan [1986] 1 WLR 1301
Gooch v London Banking Association (1886) 32 Ch D 41
Re Good's Lease [1954] 1 All ER 275
Grand Junction Co Ltd v Bates [1954] 2 QB 160
Hand v Blow [1901] 2 Ch 721
Hay v Swedish & Norwegian Railway Company Ltd (1892) 8 TLR 775
Jones v Dunkel (1959) 101 CLR 298
Lam Soon Australia Pty Ltd v Molit (No 55) Pty Ltd (1996) 22 ACSR 169
Re Leyland DAF Ltd [1994] 4 All ER 300
Re New Oriental Bank Corp (No 2) [1895] 1 Ch 753
Olsson v Dyson (1969) 120 CLR 365
Peat Marwick Ltd v…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read O'Callaghan v Custom Credit Corporation Ltd and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [1999] WASCA 70
Decision Date: 23 JUNE 1999

CaseChat Overview and Summary

In the case of O'Callaghan v Custom Credit Corporation Ltd, the court was asked to determine whether a mortgagee or the receivers appointed by the mortgagee adopted the lease under which the property was held. The dispute arose from a mortgage of a leasehold property, where the mortgagee appointed receivers to manage the property. The issue before the court was whether the receivers, by virtue of their appointment, adopted the lease held by the mortgagor or if the mortgagee remained the lessor under the lease.

The legal issues that the court had to decide included the interpretation of the mortgage agreement and the effect of the appointment of receivers on the lease. The court had to determine whether the receivers, as agents of the mortgagee, adopted the lease, thereby becoming the new lessor to the tenant, or whether the mortgagee retained the lease and remained the lessor. The court also needed to consider the rights and obligations of the mortgagor and the tenants in the context of the appointment of receivers.

The court held that the receivers did not adopt the lease. Instead, the mortgagee, as the original lessor, remained the lessor under the lease. The court reasoned that the appointment of receivers did not alter the relationship between the mortgagee and the tenants. The receivers were appointed to manage the property and enforce the security of the mortgage, not to alter the existing lease. The court concluded that the receivers were agents of the mortgagee and did not acquire the rights and obligations of the mortgagee under the lease. Consequently, the mortgagee remained the lessor to the tenants.

The court's decision was that the mortgagee, Custom Credit Corporation Ltd, remained the lessor under the lease. The court did not find it necessary to make any further orders as the decision on the adoption of the lease was determinative of the rights of the parties. The court's ruling clarified the position that the appointment of receivers does not result in the receivers adopting the lease, thereby preserving the original lessor's rights and obligations under the lease.

Orders