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Sood v Christianos

Sood v Christianos

Case [2008] NSWSC 1087 19 September 2008

Statutory Construction

Property Law

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CITATION: Sood v Christianos [2008] NSWSC 1087

HEARING DATE(S): 4, 5, 16, 18 September 2008

JURISDICTION: Equity Division
Duty List

JUDGMENT OF: Brereton J

EX TEMPORE JUDGMENT DATE: 19 September 2008

DECISION: Plaintiff authorised to sell the property the subject of the application under Court supervision in accordance with draft Contract.

CATCHWORDS: REAL PROPERTY – MORTGAGES – where memorandum grants power of attorney to mortgagee to sell – whether contractual power of sale - REAL PROPERTY – MORTGAGES – EQUITABLE MORTGAGES – power of sale – where relevant land subject to a registered first mortgage, two unregistered mortgages and an unregistered charge – whether equitable mortgage contains implied power of sale – power of sale pursuant to (NSW) Conveyancing Act 1919, s 109 – where mortgagee holds mortgage in registrable form – whether judicial sale is standard remedy for equitable charge or remedy of last resort – whether mortgagee should register mortgage and exercise power of sale pursuant to (NSW) Real Property Act 1900, s 58, rather than seeking judicial sale - REAL PROPERTY – MORTGAGES – EQUITABLE MORTGAGES – power of sale – manner of sale – where second mortgagee in possession of draft contract of sale with a purchase price sufficient to discharge the first mortgage totally and the second mortgage partially – whether sale should be by auction – considerations relevant to value – which party should have conduct of the sale

LEGISLATION CITED: (NSW) Conveyancing Act 1919, ss 109, 111
(NSW) Real Property Act 1900, s 58

CATEGORY: Principal judgment

CASES CITED: King Investment Solutions Pty Ltd v Hussain [2005] NSWSC 1076; (2005) 64 NSWLR 441
Mango Media Pty Ltd v Mertes [2006] NSWSC 1460
Manton v Parabolic Pty Ltd (1985) 2 NSWLR 361
Matthews v Goodday (1861) 31 LJ Ch 282
New Beach Apartments Pty Ltd v Epic Hotels Pty Ltd [2007] NSWSC 474
Palk v Mortgage Services Funding plc [1993] Ch 330
Yarrangah Pty Ltd v National Australia Bank Ltd [1999] NSWSC 97; (1999) 9 BPR 17,601

TEXTS CITED: Irwin et al, Parker's Practice in Equity (New South Wales), 2nd ed (1949) Lawbook Co
Sykes and Walker, The Law of Securities, 5th ed, (1993) Lawbook Co

PARTIES: Margaret Sood (plaintiff)
Maria Christianos (first defendant)
Kaji Australia Pty Ltd (second defendant)
Robert Nunzio Sciacca (third defendant)
Adelaide Bank Ltd (fourth defendant)

FILE NUMBER(S): SC 4333/08

COUNSEL: Mr R W Tregenza (plaintiff)
Mr V F Kerr (first defendant)
Submitting Appearance (second defendant)
Mr S J Pearlman (sol) (fourth defendant)

SOLICITORS: Licardy, Harris & Co (plaintiff)
Phillip A Biber (first defendant)
Dobes and Andrews (second defendant)
MacGillivrays Solicitors (fourth defendant)

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

BRERETON J

Friday, 19 September 2008

4333/08 Margaret Sood v Maria Christianos & 3 Ors

JUDGMENT (ex tempore)

1 HIS HONOUR: The first defendant Maria Christianos is the registered proprietor of land at 13 Langford Road, Dural, in the State of New South Wales, being land comprising Folio Identifier 7/XXXXX X,…

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 Sood v Christianos

Details

AGLC: Sood v Christianos [2008] NSWSC 1087
Case: [2008] NSWSC 1087
Decision Date: 19 September 2008

CaseChat Overview and Summary

In the matter of Sood v Christianos, the dispute centred on the interpretation and exercise of powers of sale under various mortgage agreements. The case was heard in the Supreme Court of New South Wales. The primary issue before the court was whether the memorandum of loan provided a contractual power of sale, and if so, whether the mortgagee should register the mortgage and exercise the power of sale under the Real Property Act 1900, section 58, rather than seeking a judicial sale. Additionally, the court examined whether the equitable mortgage contained an implied power of sale, and if so, whether the sale should be conducted by auction given the circumstances.

The court found that the memorandum of loan indeed granted a contractual power of sale to the mortgagee. The court held that the equitable mortgage did not contain an implied power of sale, as it was subject to a registered first mortgage, two unregistered mortgages, and an unregistered charge. The mortgagee's failure to register the mortgage did not negate the contractual power of sale but did affect the remedy available to the mortgagee. The court also considered whether a judicial sale was the standard remedy for an equitable charge or a remedy of last resort. It concluded that the mortgagee should have registered the mortgage and exercised the power of sale under the Real Property Act 1900, section 58, instead of seeking a judicial sale.

Regarding the manner of sale, the court found that in the circumstances where the second mortgagee was in possession of a draft contract of sale with a purchase price sufficient to discharge the first mortgage in full and the second mortgage partially, the sale should be conducted by auction. The court emphasised the need to consider factors relevant to value and determined that the mortgagee should conduct the sale to maximise the property's value. The court ordered that the mortgagee register the mortgage and exercise the power of sale pursuant to the Real Property Act 1900, section 58, and conduct the sale by auction, considering all relevant factors to achieve the best possible value for the property.

Orders