Prime Capital Securities Pty Ltd v Metafax Pty Ltd [2016] NSWSC 1826

Prime Capital Securities Pty Ltd v Metafax Pty Ltd [2016] NSWSC 1826

The application was sufficiently analogous to a mortgagor seeking to restrain a mortgagee's sale that the Inglis principle applied, placing the onus on the Defendants to show that the Plaintiff's mortgagee position would remain protected. The Defendants did not establish that the challenged ledger items were obviously wrong. However, the Plaintiff was not entitled to have security assessed by reference to a projected debt in 12 months or by adding future legal costs not presently due. Using midpoint valuation figures, deducting the ANZ mortgage and selling costs, and adding the controlled moneys balance showed a surplus over the Plaintiff's presently claimed debt. Some of that surplus...

Jurisdiction
Australia
Judgment Date
16 December 2016
Procedural Posture
Mortgage Possession Proceedings With Defence and Cross Claim; Interlocutory Application by Defendants for Access to Part of Settlement Proceeds Held in a Controlled Moneys Account for Legal Fees. / Procedural and Other Ruling Before Final Determination of the Proceedings.
Outcome
Application allowed in part; further funds ordered to be paid out to the Defendants' solicitors.
Legal Topics
['rights and Liabilities of Mortgagor and Mortgagee' 'possession Proceedings' 'controlled Moneys Account' 'release of Security Proceeds for Legal Costs' 'mortgagee Security Protection' 'obviously Wrong Exception' 'valuation of Security Properties']
['real Property' 'mortgages' 'civil Procedure' 'equity'] ['rights and Liabilities of Mortgagor and Mortgagee' 'possession Proceedings' 'controlled Moneys Account' 'release of Security Proceeds for Legal Costs' 'mortgagee Security Protection' 'obviously Wrong Exception' 'valuation of Security Properties']

Case Brief

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Procedural Posture

Mortgage Possession Proceedings With Defence and Cross Claim; Interlocutory Application by Defendants for Access to Part of Settlement Proceeds Held in a Controlled Moneys Account for Legal Fees. / Procedural and Other Ruling Before Final Determination of the Proceedings.

Legal Issues

  1. 1 ['Whether the Defendants should be permitted to have further funds released from the controlled moneys account for past and future legal costs.' 'Whether the principle in Inglis v Commonwealth Trading Bank of Australia applies by analogy to an application for release of funds from settlement proceeds of a security property.' "Whether components of the Plaintiff's claimed debt were obviously wrong so as to reduce the amount that had to be secured." "Whether the Court should assess the Plaintiff's security by reference to the debt presently claimed or the amount projected to be owing at the likely time of judgment." "Whether the Plaintiff's future legal costs should be taken into account when assessing the adequacy of security."]

Ratio Decidendi

The application was sufficiently analogous to a mortgagor seeking to restrain a mortgagee's sale that the Inglis principle applied, placing the onus on the Defendants to show that the Plaintiff's mortgagee position would remain protected. The Defendants did not establish that the challenged ledger items were obviously wrong. However, the Plaintiff was not entitled to have security assessed by reference to a projected debt in 12 months or by adding future legal costs not presently due. Using midpoint valuation figures, deducting the ANZ mortgage and selling costs, and adding the controlled moneys balance showed a surplus over the Plaintiff's presently claimed debt. Some of that surplus...

Court Disposition

Application allowed in part; further funds ordered to be paid out to the Defendants' solicitors.

Orders

  • ["$60,000 is to be paid out of the controlled moneys account referred to in the orders of 16 September 2016 to the Defendants' solicitors."]