Mizzi v Reliance Financial Services Pty Ltd & Ors [2007] NSWSC 37

Mizzi v Reliance Financial Services Pty Ltd & Ors [2007] NSWSC 37

The Reliance loan agreement and mortgage were not unjust contracts within the meaning of s 7 Contracts Review Act 1980 (NSW), and no relief should be granted against Reliance. However, upon effective transfer of the North Parramatta property to Lords, Reliance was obliged under clause 11.3 of the January 2002 deed to release Mrs Mizzi from all obligations; Stefan held the benefit of this promise upon trust for Mrs Mizzi, who was entitled to enforce it. The non-joinder of Lords is not an obstacle to enforcement.

Jurisdiction
Australia
Judgment Date
15 February 2007
Procedural Posture
Civil / Final Judgment
Outcome
Plaintiff succeeds on release issue but fails on Contracts Review Act issue. Plaintiff released from all obligations under the loan agreement and mortgage to Reliance. Cross-claim dismissed. Costs apportioned; defendant pays one-third of plaintiff's costs, with order for set-off and further adjustments for...
Legal Topics
['unjust Contracts' 'unconscionable Dealings' 'privity of Contract' 'trusts and Beneficiaries' 'mortgage' 'release and Discharge' 'costs']
['contract Law' 'equity'] ['unjust Contracts' 'unconscionable Dealings' 'privity of Contract' 'trusts and Beneficiaries' 'mortgage' 'release and Discharge' 'costs']

Case Brief

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Procedural Posture

Civil / Final Judgment

Legal Issues

  1. 1 ['Whether the loan agreement and mortgage between Mrs Mizzi and Reliance Financial Services Pty Ltd are unjust contracts within the Contracts Review Act 1980 (NSW)' 'Whether the mortgage constitutes an unconscionable dealing in equity' 'Whether Mrs Mizzi has been released from her obligations under the loan agreement and mortgage due to the operation of the release clause in the January 2002 deed and subsequent events' 'Whether Mrs Mizzi, not being a party to the release agreement, can enforce the obligation to release']

Ratio Decidendi

The Reliance loan agreement and mortgage were not unjust contracts within the meaning of s 7 Contracts Review Act 1980 (NSW), and no relief should be granted against Reliance. However, upon effective transfer of the North Parramatta property to Lords, Reliance was obliged under clause 11.3 of the January 2002 deed to release Mrs Mizzi from all obligations; Stefan held the benefit of this promise upon trust for Mrs Mizzi, who was entitled to enforce it. The non-joinder of Lords is not an obstacle to enforcement.

Court Disposition

Plaintiff succeeds on release issue but fails on Contracts Review Act issue. Plaintiff released from all obligations under the loan agreement and mortgage to Reliance. Cross-claim dismissed. Costs apportioned; defendant pays one-third of plaintiff's costs, with order for set-off and further adjustments for...

Orders

  • ['Declare that upon proper construction of clause 11 of the agreement dated 16 January 2002, and in the events which have happened, the plaintiff was released from any obligation owed to the first defendant in respect of moneys advanced, including all obligations under the Loan Agreement (Secured) dated 22 December...