Solid Holdings v IMFML Finance - [2008] NSWSC 573

CITATION: Solid Holdings v IMFML Finance [2008] NSWSC 573

HEARING DATE(S): 05/06/08

JUDGMENT DATE :
5 June 2008

JURISDICTION: Equity

JUDGMENT OF: White J

EX TEMPORE JUDGMENT DATE: 5 June 2008

DECISION: Application to extend the injunction refused.

CATCHWORDS: MORTGAGES – mortgagee’s power of sale – injunction sought to restrain sale – injunction sought to protect the equity of redemption – where no challenge to the mortgagee’s right to exercise its power of sale nor as to the mode of sale - necessity to pay amount owing into Court in the ordinary case – injunction refused

LEGISLATION CITED: Real Property Act 1900 (NSW)

CASES CITED: Inglis v Commonwealth Trading Bank of Australia (1972) 126 CLR 161
Harvey v McWatters (1948) 49 SR (NSW) 173
Parist Holdings Pty Ltd v Perpetual Nominees Ltd [2006] NSWSC 599
Notaras v Sly & Weigall [2005] NSWCA 275

PARTIES: Solid Holdings Pty Ltd
v
IMFML Finance Pty Ltd & 2 Ors

FILE NUMBER(S): SC 2940/08

COUNSEL: Plaintiff: F Kunc SC
Defendants: D R Stack

SOLICITORS: Plaintiff: Gadens Lawyers
Defendants: Deacons Lawyers

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
DUTY JUDGE LIST

WHITE J

Thursday, 5 June 2008

2940/08 Solid Holdings Pty Ltd v IMFML Finance Pty Ltd & 2 Ors

JUDGMENT

1 HIS HONOUR: The plaintiff is the registered proprietor of land at 525 Illawarra Road, Marrickville. The first defendant is the mortgagee of the land. The second and third defendants are receivers and managers appointed to the plaintiff by the mortgagee.

2 On 23 May 2008, the plaintiff obtained ex parte an interim injunction to restrain the defendants from entering into any contract for the sale of the land. The injunction was continued on 26 May 2008 and again - and this time by consent - on 29 May 2008 until today. At least the last extension of the injunction was given on the basis of the plaintiff’s proposal to discharge the mortgage debt by the close of business yesterday.

3 The defendants oppose the continuation of the injunction.

4 The initial loan facility provided by the first defendant was entered into on 9 November 2007. It was provided in order for the first defendant to refinance an existing mortgage secured over the land in Illawarra Road, Marrickville and was for a short time only. The loan was to expire on 28 December 2007.

5 On 27 December 2007, the agreement was varied. The loan facility was extended to 28 February 2008. It was a condition of the deed of 27 December 2007 that by 31 January 2008 the plaintiff supply to the first defendant a formal letter of offer from another institution that would provide sufficient funding to refinance the plaintiff's term of borrowings under their facilities with the plaintiff. That was not done.

6 On 20 February 2008, the solicitors for the first defendant gave notice that the plaintiff was in default of the condition and required the default to be remedied.

7 On 29 February 2008, Mr…

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.

Continue reading Solid Holdings v IMFML Finance

Details

AGLC: Solid Holdings v IMFML Finance [2008] NSWSC 573
Case: [2008] NSWSC 573
Decision Date: 5 June 2008

CaseChat Overview and Summary

In the matter of Solid Holdings v IMFML Finance, the court was presented with a dispute involving a mortgagee's power of sale. Solid Holdings sought an injunction to restrain the sale of a property that was subject to a mortgage held by IMFML Finance. Solid Holdings also sought an injunction to protect its equity of redemption. The dispute was heard in the Supreme Court of Queensland.

The central legal issues before the court involved whether an injunction should be granted to restrain the mortgagee from exercising its power of sale and to protect the mortgagor's equity of redemption. The court had to consider the circumstances in which a court may intervene to protect a mortgagor's equity of redemption and the conditions under which an injunction may be granted to restrain a sale. Notably, there was no challenge to the mortgagee's right to exercise its power of sale or the mode of sale, which were key factors in the court's decision.

The court held that an injunction would not be granted unless there were exceptional circumstances justifying such an intervention. The court emphasised that in the ordinary case, the mortgagor must pay the amount owing into court. The court found that Solid Holdings had not demonstrated the exceptional circumstances necessary to warrant an injunction. Consequently, the court refused the injunction sought by Solid Holdings.

The final orders of the court were that the application for an injunction to restrain the sale of the property and to protect the equity of redemption was dismissed. Solid Holdings was ordered to pay IMFML Finance's costs of the application.

Orders