COCKBURN & ORS v GIO FINANCE LTD (No 2) [2001] NSWCA 177

COCKBURN & ORS v GIO FINANCE LTD (No 2) [2001] NSWCA 177

The liabilities of GIO and the solicitor were not co-ordinate, because GIO's liability arose only upon the setting aside of the mortgage due to undue influence, whereas the solicitor's liability depended on the mortgage being affirmed. There was thus no common burden. Additionally, rescission for undue influence avoided the mortgage ab initio, so neither McNally nor GIO suffered the relevant loss to activate a right of contribution. As such, GIO's claim for equitable contribution against the solicitor failed.

Jurisdiction
Australia
Judgment Date
14 June 2001
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From Supreme Court Decision
Outcome
Appeal upheld. Orders of the trial judge set aside. Respondent's claim for contribution dismissed.
Legal Topics
['equitable Contribution' 'recoupment' 'undue Influence' 'rescission' 'mortgage and Guarantee' 'void Ab Initio' 'loss and Liability' 'negligence of Solicitor' 'coordinate Liabilities']
['equity' 'contract Law' 'tort Law'] ['equitable Contribution' 'recoupment' 'undue Influence' 'rescission' 'mortgage and Guarantee' 'void Ab Initio' 'loss and Liability' 'negligence of Solicitor' 'coordinate Liabilities']

Case Brief

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Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From Supreme Court Decision

Legal Issues

  1. 1 ['Whether the liabilities of GIO and the solicitor were co-ordinate such as to give rise to a right of contribution.' 'Whether McNally suffered a relevant loss, and if so, whether GIO had any relevant liability to McNally.' 'Whether the discharge of the mortgage by GIO gave rise to a right of contribution as against the solicitor.']

Ratio Decidendi

The liabilities of GIO and the solicitor were not co-ordinate, because GIO's liability arose only upon the setting aside of the mortgage due to undue influence, whereas the solicitor's liability depended on the mortgage being affirmed. There was thus no common burden. Additionally, rescission for undue influence avoided the mortgage ab initio, so neither McNally nor GIO suffered the relevant loss to activate a right of contribution. As such, GIO's claim for equitable contribution against the solicitor failed.

Court Disposition

Appeal upheld. Orders of the trial judge set aside. Respondent's claim for contribution dismissed.

Orders

  • ['Appeal upheld.' 'Judgment and orders of Foster AJ set aside.' "Respondents' claim for contribution dismissed." "Respondents to pay Appellant's costs of the trial and appeal."]