Property Builders Pty Limited v Adelaide Bank Limited [2011] NSWCA 266

Property Builders Pty Limited v Adelaide Bank Limited [2011] NSWCA 266

The appeal by Property Builders failed because the 2008 roll-over was an extension of the existing facility, any equitable assignment to AIF did not discharge the debt or prevent the legal debt being vested in Adelaide Bank by the registered transfer of mortgage under s 52 of the Real Property Act 1900, and no s 12 Conveyancing Act notice was required. The appeal by Mr Phontos succeeded because there was no evidence that Eurofinance's rights under the guarantee were assigned to Adelaide Bank, the transfer of mortgage did not itself assign the guarantee, and Adelaide Bank therefore could not sue him on it.

Jurisdiction
Australia
Judgment Date
15 September 2011
Procedural Posture
Appeal Concerning Mortgage Debt, Possession of Mortgaged Property and Liability Under a Guarantee / Appeal From the Judgment of Simpson J, [2010] NSWSC 830
Outcome
Appeal allowed in part.
Legal Topics
['roll Over of Loan Facility' 'transfer of Mortgage' 'assignment of Secured Debt' 'notice of Assignment Under S 12 Conveyancing Act 1919 (nsw)' 'assignment of Guarantee']
['real Property' 'mortgage Law' 'guarantee and Indemnity' 'assignment'] ['roll Over of Loan Facility' 'transfer of Mortgage' 'assignment of Secured Debt' 'notice of Assignment Under S 12 Conveyancing Act 1919 (nsw)' 'assignment of Guarantee']

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Procedural Posture

Appeal Concerning Mortgage Debt, Possession of Mortgaged Property and Liability Under a Guarantee / Appeal From the Judgment of Simpson J, [2010] NSWSC 830

Legal Issues

  1. 1 ['Whether the 2008 roll-over replaced the 2006 loan or merely extended the existing facility.' 'Whether the resolutions of Eurofinance and AIF on 2 May 2008 effected an equitable assignment of the debt to AIF and prevented Eurofinance from transferring the debt to Adelaide Bank.' 'Whether the transactions of 2 May 2008 discharged the debt owed by Property Builders to Eurofinance.' 'Whether notice under s 12 of the Conveyancing Act 1919 was required for Adelaide Bank to sue on the debt after the transfer of mortgage.' 'Whether the guarantee given by Mr Phontos was assigned to Adelaide Bank.']

Ratio Decidendi

The appeal by Property Builders failed because the 2008 roll-over was an extension of the existing facility, any equitable assignment to AIF did not discharge the debt or prevent the legal debt being vested in Adelaide Bank by the registered transfer of mortgage under s 52 of the Real Property Act 1900, and no s 12 Conveyancing Act notice was required. The appeal by Mr Phontos succeeded because there was no evidence that Eurofinance's rights under the guarantee were assigned to Adelaide Bank, the transfer of mortgage did not itself assign the guarantee, and Adelaide Bank therefore could not sue him on it.

Court Disposition

Appeal allowed in part.

Orders

  • ['Appeal allowed in part.' 'Orders 4 and 6 be set aside.' 'Judgment against the first defendant in favour of the first plaintiff in the sum of $268,821.79 to take effect as at 29 July 2011 plus interest thereon until the date of payment at the rate referred to in the letter from Eurofinance Capital Pty Limited to...