RCD Super Fund Pty Ltd t/as Trustee for Red Gum Super & Anor v Morris [2016] NSWSC 83

RCD Super Fund Pty Ltd t/as Trustee for Red Gum Super & Anor v Morris [2016] NSWSC 83

The agreement to provide a registered mortgage amounted to the granting of a charge over the property, so the declaration was made. However, the mortgage was not registered and neither the loan agreement nor the mortgage contained a promise by the mortgagor to give up possession on default; as a mere equitable chargee the plaintiffs had no entitlement to possession. The claim for judicial sale was not made out, including because no order for vacant possession would be made and there was no evidence of value. The plaintiffs' debt claim had merged in the Local Court judgment, leaving only an entitlement to post-judgment interest at the prescribed rates.

Jurisdiction
Australia
Judgment Date
05 February 2016
Procedural Posture
Application for Declaration, Possession of Property and Judicial Sale in Mortgage Proceedings / Principal Judgment
Outcome
Declaration made; remaining claims dismissed; costs to be heard.
Legal Topics
['second Mortgage' 'equitable Charge' 'possession' 'judicial Sale' 'evidence of Value' 'post Judgment Interest']
['mortgages' 'equity' 'real Property'] ['second Mortgage' 'equitable Charge' 'possession' 'judicial Sale' 'evidence of Value' 'post Judgment Interest']

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Procedural Posture

Application for Declaration, Possession of Property and Judicial Sale in Mortgage Proceedings / Principal Judgment

Legal Issues

  1. 1 ['Whether the first defendant charged the Lake Haven property with repayment of amounts owing under the loan agreement.' 'Whether the plaintiffs, as holders of an unregistered mortgage or equitable charge, were entitled to an order for possession.' 'Whether an order for judicial sale should be made without an order for vacant possession and without evidence of value.' 'Whether the plaintiffs were entitled to claim the debt amount and interest alleged in their affidavits after obtaining Local Court judgment.']

Ratio Decidendi

The agreement to provide a registered mortgage amounted to the granting of a charge over the property, so the declaration was made. However, the mortgage was not registered and neither the loan agreement nor the mortgage contained a promise by the mortgagor to give up possession on default; as a mere equitable chargee the plaintiffs had no entitlement to possession. The claim for judicial sale was not made out, including because no order for vacant possession would be made and there was no evidence of value. The plaintiffs' debt claim had merged in the Local Court judgment, leaving only an entitlement to post-judgment interest at the prescribed rates.

Court Disposition

Declaration made; remaining claims dismissed; costs to be heard.

Orders

  • ['Declare that the first defendant charged the property situated at and known as Lake Haven in the State of New South Wales being the whole of the land described in Folio [xxx]/[yyyyyy] with repayment of all amounts owing to the plaintiffs pursuant to a loan agreement dated 23 April 2015 between the plaintiffs,...