ACN 063 346 707 Pty Ltd (formerly known as South Passage Pty Ltd) v Douglas James Marshall [2022] NSWSC 1597

ACN 063 346 707 Pty Ltd (formerly known as South Passage Pty Ltd) v Douglas James Marshall [2022] NSWSC 1597

The Court found that the lease, mortgage and variation of mortgage were shams, not intended to create legally effective rights or obligations, but designed to give appearance of interests for purposes of vexation. As such, they were void and of no legal effect; consequently, Mr Marshall had no caveatable interest...

Source-derived case information.

Parties
Plaintiff: ACN 063 346 707 Pty Ltd (formerly known as South Passage Pty Ltd); First Defendant: Douglas James Marshall; Second Defendant: Registrar General of NSW
Jurisdiction
Australia
Judgment Date
21 November 2022
Procedural Posture
Equity Proceedings – Real Property List / Final Orders and Judgment After Hearing; Ex Tempore Judgment
Outcome
Dealings declared to be shams and void; Register to be amended; Indemnity costs ordered against Mr Marshall; Orders for correction of register stayed for a short period.
Legal Topics
Equitable Fraud, Sham Transactions, Torrens Title, Correction of Register, Real Property Act 1900 (nsw) S 138
Equity Land Law Equitable Fraud Sham Transactions Torrens Title Correction of Register Real Property Act 1900 (nsw) S 138

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Parties

ACN 063 346 707 Pty Ltd (formerly known as South Passage Pty Ltd)

Plaintiff

Douglas James Marshall

First Defendant

Registrar General of NSW

Second Defendant

Procedural Posture

Equity Proceedings – Real Property List / Final Orders and Judgment After Hearing; Ex Tempore Judgment

Legal Issues

  1. 1 Whether dealings (lease, mortgage, variation of mortgage) are shams and void of legal effect
  2. 2 Whether consequential order should be made to amend the register and cancel dealings and caveat

Ratio Decidendi

The Court found that the lease, mortgage and variation of mortgage were shams, not intended to create legally effective rights or obligations, but designed to give appearance of interests for purposes of vexation. As such, they were void and of no legal effect; consequently, Mr Marshall had no caveatable interest and the caveat was also unsupportable. Orders for removal of these instruments from the register were warranted.

Court Disposition

Dealings declared to be shams and void; Register to be amended; Indemnity costs ordered against Mr Marshall; Orders for correction of register stayed for a short period.

Orders

  • Declaration that the lease, mortgage, and mortgage variation are void and of no effect as shams.
  • Order that the Registrar General amend the folio relating to the property to cancel each notation referring to the impugned instruments (lease, mortgage, mortgage variation, and caveat lodged by Mr Marshall).