Paradise Constructors & Co Pty Ltd v Poyser - [2007] VSC 496

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

PRACTICE COURT

No. 8994 of 2007

PARADISE CONSTRUCTORS & CO PTY LIMITED (ACN 101 824 104)	Plaintiff
v
MAXWELL ANDREW POYSER	Defendant

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JUDGE:	BYRNE J
WHERE HELD:	Melbourne
DATE OF HEARING:	2 November 2007
DATE OF JUDGMENT:	2 November 2007
CASE MAY BE CITED AS:	Paradise Constructors & Co Pty Ltd v Poyser
MEDIUM NEUTRAL CITATION:	[2007] VSC 496

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Sale of land – Amendment to mortgage – Whether material amendment – Whether mortgage void – Interlocutory injunction to restrain mortgagee’s sale refused.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A.W. Sandbach	Alfred P. Mayuka
For the Defendant	Mr P.G. Willis	Wainwrights

HIS HONOUR:

This is an application brought by the plaintiff, Paradise Constructors & Co Pty Limited (“Paradise Constructors”), against Maxwell Andrew Poyser. The circumstances very shortly are as follows:

The case concerns a property at 36 Curlew Point Drive, Patterson Lakes, which property stands in the name of Milava Gagic. She has, over the years, granted various securities over the property in order to obtain loans. On 31 January 2005 she borrowed an unspecified sum from Hill Stephens & Associates Pty Ltd (“Hill Stephens”) on the security, it would seem, of the property. The security is described in Caveat No. AD448193P which is said to be dated 16 February 2005. On that day, 16 February 2005, Hill Stephens assigned the debt to the plaintiff, Paradise Constructors & Company Pty Limited.

On 3 March 2005 the defendant, Maxwell Andrew Poyser, lodged a caveat over the property as evidence of a loan which had previously made by him to Mrs Gagic.

The loan had been agreed to in October 2004 but the advance took place on 29 November 2004. On 29 November the solicitor for Mrs Gagic settled with Bruce Wainwright, the solicitor for Mr Poyser, and handed to him an executed mortgage. Mr Wainwright said that interest had been prepaid. The mortgage as it stood at that stage is Exhibit PC1 to the affidavit of Mr Strangio of 2 November 2007. Mr Wainwright said that he inserted the date of settlement as the date of the mortgage. The instrument of mortgage which was in fact lodged in the Titles Office on 25 May 2005, some months after this date, contains further changes to the document which was produced at the settlement.

First, in the document Exhibit PC1, the commencing date of the mortgage is simply an unspecified date in October 2004. The mortgage also requires payment of interest in these terms: "The whole of the interest payable in advance" and in the box dated first payment there is an unspecified date in October 2004.

In each of these boxes Mr Wainwright made entries in his own handwriting so that date for the payment of interest became the first of each month and the date of the first payment was to be 29 November 2004. As I have indicated Mr Wainwright says that the interest was in fact…

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.

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Details

Case: [2007] VSC 496
Decision Date: 2 November 2007

CaseChat Overview and Summary

Paradise Constructors & Co Pty Ltd, a contracting firm, initiated legal proceedings against Poyser, a lender, concerning a mortgage over certain property. The dispute centred on whether the lender had materially altered the mortgage agreement without the borrower’s consent, leading to the mortgage's nullification. The matter was heard by the Supreme Court of New South Wales.

The court had to determine if there had been a material alteration to the mortgage agreement, which would render the mortgage void, and whether an interlocutory injunction should be granted to prevent the lender from proceeding with the sale of the property. The primary focus was on whether the changes made to the mortgage terms by the lender were substantial enough to invalidate the mortgage and whether, in the interim, the court should restrain the lender from selling the property.

The court held that while there were changes to the mortgage, they did not constitute a material alteration that would void the mortgage. The changes were considered to be within the permissible scope of modifications that could be made under the original mortgage agreement. The court found that the borrower had not demonstrated a strong case for the relief sought, and therefore, refused to grant an interlocutory injunction. The court reasoned that the borrower had not shown a clear risk of irreparable harm if the injunction was not granted, nor had they shown a balance of convenience favouring an injunction.

The Supreme Court declined to issue an interlocutory injunction to restrain the lender from selling the property. The court's decision was based on the finding that the mortgage had not been materially altered and that the borrower had not established the necessary grounds for such an injunction.

Orders