Mitchell Morgan Nominees Pty Ltd & Anor v Vella & Ors (No 2) [2012] NSWCA 38

Mitchell Morgan Nominees Pty Ltd & Anor v Vella & Ors (No 2) [2012] NSWCA 38

The cancelled auction date was the appropriate date for quantifying damages because the counterfactual required assessing what the actual borrower would have done had Hunt & Hunt not been negligent, not what a hypothetical genuine borrower would have done. There was no evidence that the sale was delayed by a dispute or that Mitchell Morgan unreasonably delayed sale and failed to mitigate. Hunt & Hunt had undertaken to prepare a mortgage protecting the lender, knew the loan terms and interest rates, and its liability extended to loss of interest at those rates where that loss was caused by its negligence.

Jurisdiction
Australia
Judgment Date
15 March 2012
Procedural Posture
Appeal in Professional Negligence Proceedings Concerning Damages for Financial Loss Arising From a Forged Mortgage / Consequential Orders on the Papers After Principal Appeal Judgment
Outcome
Mitchell Morgan's appeal against Hunt & Hunt was allowed and judgment was entered for Mitchell Morgan against Hunt & Hunt in the amount of $2,370,601.54.
Legal Topics
["solicitors' Negligence" 'forged Mortgage' 'financial Loss' 'interest Component of Damages' 'scope of Liability Under S 5 D Civil Liability Act 2002' 'mitigation of Loss']
['torts' 'professional Negligence' 'damages' 'civil Procedure'] ["solicitors' Negligence" 'forged Mortgage' 'financial Loss' 'interest Component of Damages' 'scope of Liability Under S 5 D Civil Liability Act 2002' 'mitigation of Loss']

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Procedural Posture

Appeal in Professional Negligence Proceedings Concerning Damages for Financial Loss Arising From a Forged Mortgage / Consequential Orders on the Papers After Principal Appeal Judgment

Legal Issues

  1. 1 ["What date should be used to quantify the interest component of Mitchell Morgan's damages against Hunt & Hunt." "Whether Hunt & Hunt's scope of liability under s 5D of the Civil Liability Act 2002 extended to interest calculated at the mortgage rates until the cancelled auction date." 'Whether Mitchell Morgan failed to mitigate its loss by delaying sale of the property.']

Ratio Decidendi

The cancelled auction date was the appropriate date for quantifying damages because the counterfactual required assessing what the actual borrower would have done had Hunt & Hunt not been negligent, not what a hypothetical genuine borrower would have done. There was no evidence that the sale was delayed by a dispute or that Mitchell Morgan unreasonably delayed sale and failed to mitigate. Hunt & Hunt had undertaken to prepare a mortgage protecting the lender, knew the loan terms and interest rates, and its liability extended to loss of interest at those rates where that loss was caused by its negligence.

Court Disposition

Mitchell Morgan's appeal against Hunt & Hunt was allowed and judgment was entered for Mitchell Morgan against Hunt & Hunt in the amount of $2,370,601.54.

Orders

  • ["Allow Mitchell Morgan's appeal in its proceedings against Hunt & Hunt." 'Set aside order 12 made on 3 July 2009 in the Supreme Court Equity Division proceedings numbered 4059 of 2006 and in lieu thereof enter judgment for Mitchell Morgan against Hunt & Hunt in the amount of $2,370,601.54.' "Set aside orders 13 and...