Mango Media Pty Ltd v Mertes & anor [2006] NSWSC 1460

Mango Media Pty Ltd v Mertes & anor [2006] NSWSC 1460

The February 2005 conversation varied the fixed term loan into a loan repayable on demand but did not vary the mortgage interest provisions, so the higher 7.5% monthly rate remained applicable if interest was not paid within seven days of the due date. The alleged 6 September 2005 compromise was not binding because the parties intended only an in principle arrangement to be documented by solicitors, and in any event Mr Mertes gave no consideration because he only promised to pay an undisputed existing debt. With both defences failing and no sufficient discretionary ground to refuse relief, Mango was entitled to judicial sale and possession orders.

Jurisdiction
Australia
Judgment Date
13 October 2006
Procedural Posture
Equity Division Proceedings Seeking Orders for Possession and Judicial Sale of Real Property by Way of Specific Performance of a Mortgage Provision / Ex Tempore Judgment After Hearing
Outcome
Orders made for judicial sale; the first defendant's defences failed.
Legal Topics
['intention to Create Legal Relations' 'preliminary or in Principle Agreements' 'consideration' 'promise to Perform Existing Obligation' 'mortgagee Remedies' 'judicial Sale' 'specific Performance']
['contract Law' 'mortgages' 'equity'] ['intention to Create Legal Relations' 'preliminary or in Principle Agreements' 'consideration' 'promise to Perform Existing Obligation' 'mortgagee Remedies' 'judicial Sale' 'specific Performance']

Case Brief

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Procedural Posture

Equity Division Proceedings Seeking Orders for Possession and Judicial Sale of Real Property by Way of Specific Performance of a Mortgage Provision / Ex Tempore Judgment After Hearing

Legal Issues

  1. 1 ['Whether in or about February 2005 Mango Media Pty Ltd and Gerd Rolf Mertes agreed to vary the mortgage so that principal and interest at the lower rate were to be repaid at a later date or on demand.' 'Whether on or about 6 September 2005 the parties made a binding agreement that Mango Media Pty Ltd would terminate the proceedings, recalculate the mortgage debt at 4% interest, and accept instalment payments.' 'Whether the alleged 6 September 2005 agreement was supported by consideration moving from Gerd Rolf Mertes.' 'Whether discretionary considerations justified refusing orders for judicial sale and possession.']

Ratio Decidendi

The February 2005 conversation varied the fixed term loan into a loan repayable on demand but did not vary the mortgage interest provisions, so the higher 7.5% monthly rate remained applicable if interest was not paid within seven days of the due date. The alleged 6 September 2005 compromise was not binding because the parties intended only an in principle arrangement to be documented by solicitors, and in any event Mr Mertes gave no consideration because he only promised to pay an undisputed existing debt. With both defences failing and no sufficient discretionary ground to refuse relief, Mango was entitled to judicial sale and possession orders.

Court Disposition

Orders made for judicial sale; the first defendant's defences failed.

Orders

  • ['Orders in accordance with subparas (a) to (k) and (m) of the paragraph entitled "Relief Claimed" in the amended statement of claim filed 28 November 2005, subject to the substitution in subpara (c) of "28 days" for "14 day".' 'The writ of possession referred to in para (b) of those orders is to lie in the Registry...