Re Westpac Banking Corporation (No 2) - [2015] NSWSC 1587

Supreme Court

New South Wales

Medium Neutral Citation: Re Westpac Banking Corporation (No 2) [2015] NSWSC 1587
Hearing dates: 24 September 2015
Date of orders: 30 October 2015
Decision date: 30 October 2015
Jurisdiction: Equity
Before: Robb J
Decision:
(1) Order in terms of order 1 of the notice of motion filed by Somy Ros and Brian Kelly on 14 May 2015.
(2) Order that David Wai pay to Somy Ros and Brian Kelly the costs of the notice of motion filed on 14 May 2015.
(3) Order that the notice of motion filed by David Wai on 19 May 2015 be dismissed.
(4) Order that David Wai pay to Somy Ros and Brian Kelly the costs of the notice of motion filed on 19 May 2015.
(5) Order that exhibits and any documents produced on subpoena may be returnable forthwith in accordance with the Rules.

Catchwords: EQUITY – funds paid into Court by plaintiff mortgagee – funds represent surplus proceeds after mortgagee sale of property – two applications for payment out of Court – two competing equitable interests in land – priority – as both equities are equal, first in time prevails – whether one of the applicants’ charge was created on the date when he was able to lodge a caveat, pursuant to the agreement, or when the caveat was actually lodged – consideration of Murphy v Wright and Troncone v Aliperti – agreement created contingency as to timing for the lodgement of the caveat – held that this applicant had to exercise his right to lodge caveat on the title of the property for it to be bound by an equitable charge – this applicant’s equitable interest was created later than the other applicants – his application is dismissed
Legislation Cited: Real Property Act 1990 (NSW)
Trustee Act 1925 (NSW)
Cases Cited: Ankar Pty Ltd & Arnick Holdings Ltd v National Westminster Finance (Australia) Ltd [1987] HCA 15; (1987) 162 CLR 549
Murphy v Wright (1992) 5 BPR 11,734; BC920350
Nudd v Official Trustee in Bankruptcy [2002] NSWSC 399; (2002) 11 BPR 20,163
Re Westpac Banking Corporation [2015] NSWSC 869
Troncone v Aliperti (1994) 6 BPR 13,291; BC94002483
Wilson v Graham (1997) 10 BPR 19,051; BC9701840
Category: Principal judgment
Parties: Westpac Banking Corporation (plaintiff)
David Wai (applicant – motion filed 19.5.15)
Somy Ros (first applicant – motion filed 14.5.15)
Brian Kelly (second applicant – motion filed 14.5.15)
David Wai (first respondent – motion filed 14.5.15)
Regina Thei (second respondent – motion filed 14.5.15)
Brett Firman (third respondent – motion filed 14.5.15)
Representation:
Counsel: Amy Knox (applicant – motion filed 14.5.15)
M Bennett (applicant – motion filed 19.5.15)
Solicitors: Tresscox Lawyers (applicant – motion filed 14.5.15)
Cordata Partners (applicant – motion filed 19.5.15)

File Number(s): 2015/103252
Publication restriction: None

Judgment

The present case involves a contest between two sets of claimants as to who has priority to claim an amount of $59,053.63 that has been paid into court by Westpac Banking Corporation…

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: [2015] NSWSC 1587
Decision Date: 30 October 2015

CaseChat Overview and Summary

In the matter of Re Westpac Banking Corporation (No 2), the primary dispute involved the distribution of funds held by the Court, which represented surplus proceeds from the sale of property mortgaged by the plaintiff. Two applications were made to the Court to distribute these funds, each applicant claiming an equitable interest in the land. The Court was tasked with determining which of the applicants had the superior equitable interest in the surplus funds.

The legal issues that needed resolution included the priority of equitable interests and the exact timing of when each applicant's charge was created. Specifically, the Court had to decide whether one of the applicants' charges was established on the date when he was able to lodge a caveat, as per the agreement, or when the caveat was actually lodged. This involved a detailed examination of the principles laid out in Murphy v Wright and Troncone v Aliperti, which deal with the creation of equitable interests.

The Court determined that the agreement created a contingency regarding the timing of the caveat lodgement, meaning that the applicant had to exercise their right to lodge the caveat on the property title for it to be bound by an equitable charge. Consequently, this applicant's equitable interest was deemed to have been created later than the other applicant's. As a result, the application from the applicant whose equitable interest was established later was dismissed. The Court held that since both equities were equal, the one established first in time would prevail.

Orders