Brown v Hodgkinson; Bluestone Property Services Pty Ltd v Abadeen Group Pty Ltd; [2012] NSWSC 1627

Brown v Hodgkinson; Bluestone Property Services Pty Ltd v Abadeen Group Pty Ltd; [2012] NSWSC 1627

Because the proposed mortgage would raise funds to pay Bluestone the amount of the varied statutory demand, and Bluestone had elected to proceed by creditor's statutory demand rather than enforce its mortgage security, Bluestone could not reasonably oppose an order freeing enough security to enable satisfaction of its own demand. The proposed dealing would not be adverse to Bluestone in substance because its loss of priority would correspond to receipt of the funds.

Jurisdiction
Australia
Judgment Date
17 December 2012
Procedural Posture
Interlocutory Applications / Notice of Motion Filed on 13 December 2012 Seeking Orders to Permit a Mortgage and Caveat to Fixx Commercial Pty Limited and Caveator Consent to Registration
Outcome
Order made that caveators consent to registration of the mortgage to Fixx Commercial Pty Limited upon tender of $294,689.67 to Bluestone Property Services Pty Ltd, subject to undertakings.
Legal Topics
['caveats' 'equitable Mortgage' "creditor's Statutory Demand" 'stay Pending Appeal' 'priority of Mortgages']
['equity' 'corporations' 'property' 'insolvency'] ['caveats' 'equitable Mortgage' "creditor's Statutory Demand" 'stay Pending Appeal' 'priority of Mortgages']

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Procedural Posture

Interlocutory Applications / Notice of Motion Filed on 13 December 2012 Seeking Orders to Permit a Mortgage and Caveat to Fixx Commercial Pty Limited and Caveator Consent to Registration

Legal Issues

  1. 1 ['Whether the Court should permit Justin John Brown to grant a mortgage and caveat to Fixx Commercial Pty Limited with priority over the existing mortgage to enable funds to be raised to pay Bluestone Property Services Pty Ltd.' 'Whether the caveators should be required to consent to registration of the proposed mortgage despite their existing security priority.']

Ratio Decidendi

Because the proposed mortgage would raise funds to pay Bluestone the amount of the varied statutory demand, and Bluestone had elected to proceed by creditor's statutory demand rather than enforce its mortgage security, Bluestone could not reasonably oppose an order freeing enough security to enable satisfaction of its own demand. The proposed dealing would not be adverse to Bluestone in substance because its loss of priority would correspond to receipt of the funds.

Court Disposition

Order made that caveators consent to registration of the mortgage to Fixx Commercial Pty Limited upon tender of $294,689.67 to Bluestone Property Services Pty Ltd, subject to undertakings.

Orders

  • ['Upon the undertaking to the Court of Justin John Brown, First Equilibrium Limited and Abadeen Group Australia Pty Limited as Trustee of the Brown Family Trust, that they will not further encumber the properties affected by the mortgage dated 30 November 2009, including by further advances beyond the principal sum...