Symbion Pty Ltd v Sellers - [2023] VSC 441

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

S ECI 2022 05403

BETWEEN:

SYMBION PTY LTD (ACN 000 875 034)	Plaintiff
v
KENNETH STEWART SELLERS & ORS (according to the attached Schedule)	Defendants

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JUDGE:	Croft J
WHERE HELD:	Melbourne
DATE OF HEARING:	18 July 2023
DATE OF JUDGMENT:	18 July 2023 (Written reasons published 28 July 2023)
CASE MAY BE CITED AS:	Symbion Pty Ltd v Sellers
MEDIUM NEUTRAL CITATION:	[2023] VSC 441

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MORTGAGES — Equitable mortgage or charge — Unregistered mortgage of Torrens system land — Order for sale — Discretion of the Court — King Investment Solutions v Hussain [2005] NSWSC 1076 — Hycenko v VHY Enterprises Pty Ltd [2020] VSC 834 — Property Law Act 1958 ss 86, 91, 101 — Transfer of Land Act 1958 ss 3(1), 103(1).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr DP Lloyd	Hunt & Hunt Lawyers
For the First, Second and Third Defendants	No appearance
For the Fourth Defendant	Ms P Barker	Nevile & Co.

HIS HONOUR:

Introduction

By Amended Originating Motion dated 24 May 2023 the plaintiff, Symbion Pty Ltd (ACN 000 875 034) sought relief by way of judicial sale of s 91 of the Property Law Act 1958 (‘the PLA’). The relief or remedy sought is set out in the Amended Originating Motion as follows:

(1)A declaration that pursuant to an instrument of mortgage dated 13 November 2015 (Mortgage) the plaintiff has an equitable mortgage or alternatively an equitable charge over the land described in certificate of title volume 08865 folio 706 (Land) together with all improvements being the property situated at and known as Unit 3, 44 Deepdene Road, Deepdene (Property).
(2)A declaration that the amount owed to the plaintiff which is secured by the Mortgage is $1,570,157.73 plus additional late payment fees at the rate of 0.045% per day from 30 November 2016 (Secured Monies), which, as at 30 June 2022, totalled $3,009,440.42 comprising the principal amount of $1,570,157.73 plus additional late payment fees of $1,439,283.09.
(3)An order pursuant to section 91 of the Property Law Act 1958; alternatively pursuant to order 55 of the Supreme Court (General Civil Procedure) Rules 2015; alternatively pursuant to the inherent jurisdiction of the Court; that the Property be sold by the plaintiff and the sale proceeds be applied in the following manner:
(a)first, in payment of all costs, charges and expenses associated with the sale of the Property;
(b)secondly, in payment of the Secured Monies; and
(c)thirdly, by payment into Court of the residue (if any).

(4)Alternatively to paragraph 3, an order pursuant to section 133(9) of the Bankruptcy Act 1966 that title to the Land vest in the plaintiff.
(5)An order that the Prothonotary of the Court be authorised to take all necessary steps to effect the vesting of title to the Land in the plaintiff pursuant to section 133(9) of the Bankruptcy Act 1966.
(6)An order that caveat no. AT524561Y…

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: [2023] VSC 441
Decision Date: 18 July 2023 (Written reasons published 28 July 2023)

CaseChat Overview and Summary

Symbion Pty Ltd sought an order for the sale of Torrens system land held as security for a loan. The land was subject to an unregistered mortgage. The matter was heard in the Supreme Court of Victoria. The primary legal issue was whether the court had the discretion to order the sale of the unregistered mortgaged property. The court examined relevant statutes, including sections 86, 91, and 101 of the Property Law Act 1958, and sections 3(1) and 103(1) of the Transfer of Land Act 1958. The court also considered precedents such as King Investment Solutions v Hussain and Hycenko v VHY Enterprises Pty Ltd.

The court determined that, despite the mortgage being unregistered, the principles governing equitable mortgages applied. The court acknowledged that the lack of registration did not negate the existence of the equitable mortgage. The court exercised its discretion under the relevant statutes to order the sale of the property, as it was in the best interests of the parties involved. The court reasoned that ordering the sale would provide the clearest and most practical resolution, allowing the parties to liquidate the security and resolve the outstanding debt.

The court found in favour of Symbion Pty Ltd, granting the order for sale. The decision balanced the interests of the mortgagee and the borrower, ensuring that the court's equitable jurisdiction was applied appropriately. The final orders included a direction for the sale of the mortgaged property, with proceeds to be applied to the satisfaction of the outstanding debt.

Orders