BANK OF NEW ZEALAND v GLOVER NO 2 LIMITED [2015] NZHC 3366

BANK OF NEW ZEALAND v GLOVER NO 2 LIMITED [2015] NZHC 3366 [22 December 2015]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV-2015-404-1295[2015] NZHC 3366BETWEEN BANK OF NEW ZEALANDApplicantAND GLOVER NO 2 LIMITEDRespondentHearing: 10 December 2015Appearances: F Barton and A Cunninghame for the ApplicantR C Knight and T Kelly for the RespondentJudgment: 22 December 2015JUDGMENT OF ASSOCIATE JUDGE SARGISSONThis judgment was delivered by me on 22 December 2015 at 4.00 p.m.pursuant to Rule 11.5 of the High Court Rules.Registrar/Deputy RegistrarDate.......................................Solicitors / Counsel:Anderson Lloyd, DunedinLane Neave, AucklandR Knight, Auckland[1] Bank of New Zealand has applied for orders for the removal of two caveats lodged by the caveator, Glover No. 2 Limited, against nine adjoining properties at Waimarie Street, St Heliers, over which it wishes to exercise its power of sale as mortgagee. It relies on two mortgages and a GSA.[2] Consent orders were made on 9 October 2015 in respect of one caveat, which corresponds to the five properties secured by one of the mortgages. When the matter first came before me for hearing on 22 September 2015, it was agreed that such orders would be the appropriate means of resolving the dispute over that caveat. Theorders require the removal of the caveat upon presentation of the BNZ's transfer to its purchaser, in the exercise of BNZ's power of sale as mortgagee under the firstmortgage, and they are subject to conditions requiring the Court's approval of any transfer to a list of named persons, and requiring that any surplus after the sale be held on trust for the registered proprietor, CIT Holdings Limited, and its creditors pending further order of the Court.[3] The parties requested time to reach a similar settlement for the second caveat, but were unable to reach agreement. The balance of the application therefore required further argument, and that is what I deal with now. The second caveat is No. 964584.2.1, and it is lodged against the following four certificates of title:(a) 163298 (Lot 1, DP 86277)(b) NA44A/276 (Lot 2, DP86277)(c) 31658 (Lot 1, DP 41983); and(d) NA34D/425 (Lot 1, DP78798).[4] BNZ seeks orders in essentially identical terms to those made on 9 October 2015 relating to the first caveat.[5] Glover opposes such an order. It contends in the alternative that if such an order is made, that it should be subject to a condition that BNZ is to issue a new notice under ss 119 and 120 Property Law Act 2007, to replace the one it issued on20 April 2015. Glover says the original Property Law Act notice was incorrect in the sum it identified as currently owing under the mortgage. In the alternative, Glover contends that the caveat should stand on the basis that it will soon commence a proceeding seeking a declaration that BNZ's security over the second tranche offour properties is limited to a smaller amount than that named in the notice. Glover has also raised a contention BNZ should be allowed to sell only one property, which will be sufficient to realise its security under the second mortgage; that contention depends on my finding that, as Glover contends, the second mortgage does not secure the entire liability.[6] For reasons I will come to, I am convinced that, though the mortgage alone would not provide BNZ with security over the whole liability it has claimed, the general security agreement (GSA) does. BNZ is entitled to realise its security according to its rights as mortgagee under the GSA.Introduction[7] CIT Holdings Ltd is the registered proprietor of nine properties located at Waimarie Street in St Heliers, Auckland, which were bought in 2009 in two tranches. The properties comprise a block of land almost 10,000 square metres in area.[8] The respondent, Glover, has lodged caveats against the titles to all nine properties. There are two caveats, the first being against the titles to five properties (the first tranche of properties), and the second being against the titles to the remaining four properties (the second tranche of properties). It is common ground that Glover has a caveatable interest in the properties pursuant to a joint venture agreement between the trustees of two trusts, the Waimarie Trust and the Glover Trust; and that CIT holds the properties as bare trustee for the beneficiaries of the two trusts.[9] BNZ holds two mortgages in relation to the properties. Both are now in default, and BNZ has issued Property Law Act notices in relation to each. Under each Property Law Act notice it claims $10.956,462.86 plus accruing interest, that being the total debt.[10] The first mortgage is registered against the five titles comprising the first tranche of properties pursuant to a loan agreement of 9 March 2009 to secure an advance of $6.75 million, which was used by CIT to partially fund the acquisition of those particular properties. Around this time, CIT and BNZ also signed a GSA,which gave BNZ additional security in the form of "all present and after-acquiredproperty" of CIT.[11] The advance matured on 31 July 2012 and BNZ required repayment. CIT has been in default since then. BNZ says that on any realistic valuation the likely proceeds of sale will not cover the current indebtedness under the mortgage.[12] On 9 October 2015, as I have mentioned, orders were made by consent to enable BNZ to proceed with a mortgagee sale in respect of the first tranche properties, in the knowledge that when it presents its transfer to a purchaser of theproperties, Glover's caveat will lapse. It was not in dispute that, though Glover has acaveatable interest in the properties, BNZ's rights as mortgagee would overcome thatinterest.[13] BNZ acquired rights as mortgagee over the second tranche of properties pursuant to an assignment of a mortgage held by Southern Cross Finance. The mortgage has an interesting history. In April 2009 CIT acquired the second tranche properties without notifying BNZ, in breach of an obligation under the GSA linked to the first tranche of properties to notify the BNZ of any property acquisition. It paid 100% of the purchase price.[14] In March 2011 Ms Sparks (who is the sole director and shareholder of Glover, and together with her lawyer, Mr Thomas, was a director of CIT at the time) transferred the second tranche properties out of the ownership of CIT and into the ownership of Glover. Glover borrowed $500,000 from Southern Cross and gave security against the second tranche properties. In April 2013 CIT lodged a caveat over these properties. Glover subsequently lodged its caveat against the first tranche.[15] CIT's shareholders commenced a proceeding in November 2012 to obtain an order requiring Glover to transfer the second tranche of properties back to CIT. TheCourt of Appeal upheld the High Court's judgment ordering the transfer, subject tothe indefeasible Southern Cross mortgage.1[16] On 17 February 2014, Glover lodged its caveat to protect its interest in the second tranche properties.[17] Subsequently on 20 March 2015, Southern Cross assigned its mortgage to BNZ. The outstanding sum owing on the $500,000 advance is approximately $275,000 plus accruing interest.The underlying issue[18] The essential position in relation to the mortgages is that BNZ holds its interest under the first mortgage as the original mortgagee, and its interest under the second pursuant to an assignment from the original mortgagee, Southern Cross Finance Limited.[19] BNZ considers that the entire debt is payable under each mortgage. Glover considers that the mortgages remain separate, and only the $275,000 debt it originally owed to Southern Cross is payable under the second mortgage. BNZ says that the GSA secures the entire debt against all nine properties. Glover disagrees. That is the crux of the dispute.[20] It is common ground that Glover has a caveatable interest in respect of both tranches of properties, but one that is subject to the BNZ's power of sale; that the caveat will serve a legitimate purpose in protecting Glover's caveatable interests pending transfer to BNZ's purchaser or purchasers; and that, until a transfer ispresented in the exercise of the power of sale, it is appropriate to impose suchconditions as have been agreed to safeguard Glover's interests.1 Glover No 2 Ltd v Glover Trust Ltd [2013] NZCA 608; leave to appeal refused in Glover No 2 Ltd v Glover Trust Ltd [2014] NZSC 54.[21] The conflict over the amount payable under the second mortgage has led to a dispute over the validity of the second Property Law Act notice (that issued in respect of the second tranche of properties). The dispute at this point is over whether the Court should impose a condition that would require the applicant to issue a new Property Law Act notice to replace the notice issued on 20 April 2015, such new notice to identify that the sum currently owing under the mortgage is $275,000 plus any interest accrued.[22] If BNZ has rights under the assigned mortgage to apply the proceeds of itsmortgagee sale of the second tranche properties to CIT's overall indebtedness, then the original notice, which named the entire debt, is correct. If the second mortgage only secured the second tranche properties, then it may apply the proceeds of sale of those properties only to the advance that was made under the assigned mortgage (now approximately $275,000), and penalties and interest related to that advance; and the Property Law Act notice was incorrect. On that basis Glover argues that the Court should impose a condition that BNZ may only sell one of the second tranche properties, and that it must elect which one. That submission is aimed at protectingthe majority of Glover's interests in the second tranche of properties.DiscussionCaveats – general principles[23] It is well established that the Court's jurisdiction is subject to the same principles in relation to applications under ss 143, 145 and 145A of the Land Transfer Act 1952. Those principles were succinctly summarised by Master Faire (as he then was) in Ball v Fawcett:21. Section 145 of the Land Transfer Act 1952 gives no guidance as to the circumstances in which the Court may make an order that a caveat not lapse.32. Extensions of caveat will be refused only where it is plain:"that the caveator has no prospect of supporting the interest claimed."42 [1997] 1 NZLR 743 at 746.3 Castle Hill Run Ltd v NZI Finance Ltd [1985] 2 NZLR 104, at 106.4 Castle Hill Run, above n 2, at 106.3. The onus is on the caveator to show he has an arguable case in claiming an interest in land.54. The summary procedure for removal of a caveat against dealing is wholly unsuitable for the determination of disputed questions of fact. Accordingly it has been said:". . . that an order for the removal of such a caveat will not be made under s 143 unless it is patently clear that the caveat cannot be maintained either because there was no valid ground for lodging it or that such valid ground as then existed no longer does so."6The same principles apply in relation to an application under s 145.75. Once the onus is satisfied the balance of convenience will in the normal course and in the absence of any special consideration be in favour of leaving the caveat in existence until the proceedings to enforce the interest claimed are tried.8[24] When the caveator has discharged the burden upon it to show that it has a reasonably arguable case to support the interest in the land that it claims, the Court retains a discretion to remove the caveat. It exercises that discretion on a cautiousbasis, and before it does so, it must be satisfied that the caveator's legitimate interestwould not be prejudiced by removal.9[25] Section 143 affords the Court a discretion to make an order that the caveat be removed, or otherwise to make "such order in the premises, either ex parte or otherwise, as to the court seems meet". This provides jurisdiction to impose conditions upon the maintenance of a caveat. Various cases have confirmed that this includes the ability to impose conditions upon the maintenance or removal of caveats.10[26] It is trite law that the function of a Property Law Act notice is to warn the mortgagor of the nature of its default and the action required to remedy it. Though a minor misstatement of the amount due which causes no prejudice to the mortgagor may not invalidate a notice, if the notice is incorrect by a substantial amount, it will not meet the requirements of s 119 of the Property Law Act. A purported exercise of5 Castle Hill Run, above n 2, at 106.6 Sims v Lowe [1988] 1 NZLR 656 at pp 659-660.7 Holt v Anchorage Management Ltd [1987] 1 NZLR 108.8 Castle Hill Run, above n 2, at 106.9 Stewart v Kaipara Consultants Limited [2000] 3 NZLR 55 (CA) at [23]; Philpott & Ors v Noble Investments Limited [2015] NZCA 342 at [26].10 See for example Philpott v Noble Investments Ltd, above n 8, Viaduct Waterfront Investment Ltd v Patel [2012] NZHC 2316.the mortgagee's power of sale pursuant to a defective notice will not be authorisedunder the statute.11[27] BNZ says that the mortgages were all obligations mortgages, and that that means that each mortgage secured not only all the borrowings associated with it when it was taken out, but all borrowings which subsequently became associated with it, including the other mortgage. Alternatively, if the all-obligations mortgagesdid not have that effect, the GSA (which named as security "all present and after- acquired property") did. Upon CIT's failure to comply with the Property Law Act notice, and the commencement of the mortgagee sale process, BNZ's rights as mortgagee superseded Glover's rights as caveator and as beneficiary, meaning thatGlover no longer has an arguable interest in the property and its caveat may be removed.[28] If BNZ is correct, and the Property Law Act notice correctly referred to theentire debt, then it is not in dispute that Glover's caveat may be removed. The Court may order the removal of the caveat where a mortgagee has sold the interests the caveat protects.12 In Southern Cross v Lee I said:13[59] Therefore since there is no evidence to support a finding of fraud or consent, the mortgagee is entitled to use the power of sale over the land, the effect of which will confer on the purchaser an indefeasible title. See Frazer v Walker [1967] NZLR 1069 (PC).[60] I raised the question as to whether it could be said that the mortgagee was only exercising its power of sale when a transfer was actually presented for registration. Counsel for the plaintiff argued that this was not the case; rather in the present case the power of sale has already been exercised as a contract has been entered into between the mortgagee and the Salthouses. Support for this contention was drawn from the decision of Bisson J inMacDiarmid v Burton (1980) 1 NZCPR 238 at 241 where it was said:"However, with the greatest respect there might be another situation in which the Court would order the removal of the caveat, namely when the estate or interest protected by the caveat no longer exists in the sense that it has been sold by a mortgagee in exercise of his power of sale, the caveator's interest in such land being subject to the said power of sale."11 See for example TSB Bank Ltd v Burgess [2013] NZHC 3291.12 See MacDiarmid v Burton (1980) 1 NZCPR 238l; Jenssen & Anor v Jenssen & Ors CA 246/90, 13 December 1990.13 Southern Cross v Lee HC Auckland M979-IM02, 20 December 2002.[61] This quote was referred to by the Court of Appeal in Jenssen & Anor v Jenssen & Ors (Court of Appeal, Wellington, CA 246/90, 13 December 1990) with approval by Richardson J in delivering the judgment of the Court.[62] Counsel for the interested party acknowledged that assuming the Lees have a caveatable interest, the caveat would serve a legitimate purpose in protecting it in the event that for any reason the mortgage's transfer is not proceeded with. It is not entirely clear to me that the mortgagee's sale is unconditional in all respects.[29] So the position is a simple one. Glover retains an interest which it is prima facie entitled to protect unless and until the Court is presented with a transfer following the valid exercise of the power of sale, which of course requires a valid Property Law Act notice.[30] I note in passing that the notice identified the second mortgage as the one under which the debt was owing. However, I consider that regardless of the basis upon which the debt is owed, what is crucial in terms of identifying the nature and amount of the default in terms of ss 119 and 120 is the amount said to be owing. That is particularly so since Glover, as a caveator who is not a mortgagor, has only limited rights in respect of the content of such a notice, as per s 121; and I cannot see how a failure to name the general security agreement could have prejudiced it. CIT itself has raised no issue as to the validity of the notice.Effect of the second mortgage[31] I cannot see why the existence of the assigned mortgage (even if it is an all-obligations mortgage) should allow a mortgagee to expand the mortgagor'sliability. BNZ has not provided me with any examples of occasions where that hasoccurred in New Zealand. It can hardly have been within Glover's contemplation at the time it signed the mortgage with Southern Cross that that mortgage might, by virtue of the contractual machinations between two lenders, come to secure a much larger liability to a different lender. I do not consider, on the basis of ordinary statutory interpretation, that the all obligations status of the mortgage means that Glover and CIT should be taken to have intended that.[32] That appears, too, to be the consensus of relevant decisions in this type of situation.14 In each case, the question is a matter of interpretation. What was eachagreement intended to catch? The mere fact that an agreement is an "all obligations"one does not, in and of itself, necessarily expand liability to the extent of supporting a security over the obligations incurred under a separate agreement, though it is certainly a relevant factor in interpreting the agreement. Brooking J, in the Victorian decision of Re Clark's Refrigerated Transport, eloquently summed up the essential concern in this area:15In the first place, considering the matter generally and without regard to the detailed provisions of the particular instruments here in question, I cannot help thinking that when a person gives an "all obligations" mortgage or debenture he does not ordinarily contemplate that the property the subject of the security will secure not only his present and future obligations to the mortgagee or debenture holder but also any debt or liability of his which may be assigned by a third person to the secured creditor. It does seem strange that a man may lock up his counting-house and go home for the night, in the comfortable knowledge that his only secured creditor is his banker, to whom he owes a trifling sum secured by the usual boundless bank instrument, and unlock the door in the morning to find that, by virtue of assignments of the large but unsecured debts owed by him his fellow merchants, and indeed to the butcher, the baker and the candlestick maker, all his unsecured debts have gone to feed his banker's insatiable security, so that every one of his debts is now secured.[33] New Zealand decisions have pointed out the potential complications of so-called "mix and match agreements":16Arguments similar to those advanced on behalf of Mr McGaveston have surfaced before. The cases have involved a number of factual permutations revolving around the common theme of mixing and matching, via assignment, of securities and debts which, prior to assignment, were not related. Sometimes it is the secured creditor who takes an assignment of a pre-existing unsecured debt and then seeks to assert that the assigned debt is within the scope of the security. In other cases, an unsecured creditor has taken an assignment of an existing security and, relying on arguments broadly akin to those advanced by Mr McGaveston, claimed that the security extends to the pre-existing debt.Mix and match arguments, if successful, are subversive of commercial expectations in a number of respects:-14 McGaveston v NMFM Mortgages Ltd CA 24/02, 11 December 2002; Re Clark's RefrigeratedTransport Pty Ltd (in liq) [1982] VR 989 (VSC); Kerr v Ducey [1994] 1 NZLR 577 (HC);Clarke v Japan Machines (Australia) Pty Ltd [1984] 1 Qd R 404.15 Re Clark's Refrigerated Transport, above n 7, at 995 (treated positively in New Zealand in Kerr v Ducey, above n 7, which also involved an all obligations mortgage; McGaveston, above n 12;Official Assignee v Pavan [2012] NZHC 1315).16 McGaveston, above n 12, at [16]-[19].1.As between the debtor and the secured creditor. This is a point well discussed and illustrated in Re Clark's Refrigerated Transport Pty Ltd (in liquidation) [1982] VR 989 at 995-996.2.As between secured creditors. In this case, it is perfectly clear that acceptance of Mr McGaveston's argument would be contrary to normal expectations as between Elders and NMFM.3.As between secured creditors and unsecured creditors. There is not much point having a second security (as NMFM does) if unsecured creditors, by the simple expedient of acquiring the first security, can leap-frog the second charge.4.In a liquidation context as between a liquidator and unsecured creditors.Mix and match arguments have usually been addressed by the Courts as standing or falling by reference to the construction of the security document concerned.[34] Indeed, this type of agreement, if interpreted the way BNZ asks me to interpret it, has been referred to as being, from the point of view of the mortgagor, a"time bomb".17[35] As a matter of construction, the mortgage agreement simply does not supporta "mix-and-match" expansion of liability. In fact, it does not even appear to be an allobligations mortgage. "Loan" is defined thus:"Loan" means the loan of $500,000.00 to be made by the Lender to the Borrower inaccordance with the terms and conditions of this Agreement.[36] The rest of the agreement is also consistent with the understanding that the mortgage secured only a set sum.[37] I agree with the submission that BNZ's rights under the mortgage are subject to the same limits as Southern Cross's, being a $500,000 plus interest maximum liability. The right being assigned to BNZ is the contractual right held by SouthernCross under the mortgage. The assignment cannot, of itself, expand BNZ's rights.Those rights do not give BNZ a right of security over the second tranche propertiesin respect of the much greater advance secured against the first tranche under BNZ'sown mortgage.17 Katsikalis v Deutsche Bank (Asia) AG [1988] 2 Qd R 641 (QSC).Effect of the general security agreement[38] BNZ also says that even if its rights are subject to such limits, the GSA includes an agreement to mortgage, meaning that since 2009 it has had an equitable mortgage over all the land owned by CIT (including the second tranche properties). The GSA allows the BNZ to claim the full amount owing under either mortgage,though it does not impact on Glover's liability as borrower; the BNZ can only claim $275,000 against Glover. It says this was clearly set out in the letter accompanying the Property Law Act notice.[39] It is trite that such agreements can expand the rights originally conferred by the mortgages. For example, in McGaveston, though it was able to resolve the matter based on a different issue, the Court noted:18It might be thought to be unsatisfactory that acceptance or rejection of Mr McGaveston's argument should rest on narrow questions of construction of a mortgage prepared by Elders. Indeed, there are broader points of principle involved and there are at least two other lines of argument upon which Mr McGaveston's argument might founder even if the construction point could be resolved in his favour:-1.By reference to general principles of equity applying as between mortgagor and mortgagee, see for instance the judgment of Santow J inRe Modular Design Group Pty Ltd (1994) 35 NSWLR 96 at 106; and2.By reference to principles of public policy relating to the principled administration of the insolvency regime; see for instance the argument referred to but not ruled on in Re Clark's Refrigerated Transport Pty Ltd (in liquidation), at 993.[40] The GSA was signed by BNZ and CIT Holdings on 10 March 2009, in conjunction with the purchase of and mortgage over the first tranche properties. It stipulates:1 Secured PropertyThe "Secured Property" is all of our [CIT's] present and after-acquired property, and all personal property in which we have rights, whether now or in the future.[]18 McGaveston, above n 12, at [19].2.6 Secured AmountsThe "Secured Amounts" are all amounts that at any time are due and owing by us toyou, or we owe you but are not then due, or we owe you upon a contingency (directly or indirectly and for any reason, including all amounts:[]2.6.2 for which we are or may become actually or contingently liable to you for any reason.[41] Secured property is defined by reference to the definition of security, that being:"Security" means any "security interest" (as defined in section 17 of the PPSA andfor this purpose the reference to "personal property" in that section shall be read as areference to all property.[42] Clause 14.1 and its subclauses provide for the exercise of a power of sale atany time after an "event of default", subject to the provision of written notice and compliance with the applicable statutory regime. The second tranche properties are said to have been acquired in breach of this agreement, which would, under the GSA, be an "event of default" which entitles the bank to call up the mortgage. There is no apparent dispute that the BNZ was entitled to call up the mortgage. The relevant statutory process with which the BNZ must comply is the issue of the Property Law Act Notice, and as discussed, the only dispute over the validity of that notice is as to the sum claimed to be owing on the mortgage.[43] At the time the GSA was signed, CIT did not own the second trancheproperties. BNZ's argument, however, is that that is irrelevant; the reference to "after-acquired properties" catches the second tranche properties. Therefore, BNZcan use the security under the GSA to recoup the whole of the debt under the first mortgage, and there is no dispute that BNZ was entitled to the remaining debt of $275,000 under the second mortgage as the current mortgagor. It therefore follows that the PLA notice was valid, and BNZ is entitled to exercise its power of sale,ousting Glover's interest in the process.[44] It seems to me, on the face of the GSA and considering the situation in which the properties were acquired, that that must be correct. I cannot see any othersensible interpretation of the GSA. Moreover, the existence of the GSA in addition to the mortgage tends to suggest that further acquisitions were contemplated by both parties; and that those acquisitions should reinforce BNZ's securities in respect ofthe first tranche mortgage.Condition as to which properties BNZ may sell[45] Nor does Glover have a right to impose a condition limiting the exercise ofthe mortgagee's power of sale. Section 182 of the Property Law Act makes this quite clear. It states:182 Sale together with other property at single price(1) A mortgagee or receiver who is entitled to sell mortgaged property may sell the whole or any part of the property, together with other property that is the subject of any collateral security from the current mortgagor to the mortgagee, at a single price.(2) The mortgagee or receiver must, in a case referred to in subsection (1), fairly and equitably apportion all expenses and purchase money between the properties.(3) However, any failure by the mortgagee or receiver to make an apportionment under subsection (2) does not affect the purchaser or thepurchaser's interest in the property.[46] If BNZ is entitled to use the second tranche of properties as security for the whole debt, therefore, it must logically be entitled to sell whichever property or properties it prefers.Conclusion[47] Once the mortgagee sale process is complete, BNZ's rights as mortgageeexercising a power of sale will trump Glover's caveat. In the meantime, however, Glover retains an interest which is at least arguable against all the world except for BNZ. The presumption in such cases is that there is a valid reason to maintain thecaveat unless and until BNZ's superior interest comes to the fore.19 I therefore consider it appropriate that the caveat remain unless and until the mortgagee sale process is complete and BNZ wishes to proceed to settlement with the purchaser. As was the case with the consent orders made in respect of the caveat over the first19 Castle Hill Run v NZI Finance Ltd [1985] 2 NZLR 104 (CA) at 106.tranche properties, BNZ will be able to present the judgment of this Court to potential purchasers in order to reassure them of their rights, while Glover will retain the protection of the caveat as against any other potential transfer.Result[48] I order that caveat no. 964584.2.1, which is lodged against the following four certificates of title:(a) 163298 (Lot 1, DP 86277)(b) NA44A/276 (Lot 2, DP86277)(c) 31658 (Lot 1, DP 41983); and(d) NA34D/425 (Lot 1, DP78798).shall be removed on presentation of the applicant's transfer in exercise of its powerof sale.[49] If the following persons themselves, or through an intermediary or agent, bid at auction, tender for sale, or otherwise seek to negotiate a purchase of the properties described in the abovementioned certificates of title, then any agreement entered into between the mortgagee and such person shall be subject to the condition that it isconditional upon the Court's approval:(a) Gregory Martin Olliver;(b) Errol Wayne Bailey;(c) Donald Bruce Thomas;(d) Sarah Patricia Sparks; or(e) Any other person or entity associated with them.[50] Any surplus after full repayment of all amounts owing to the applicant by CIT Holdings Limited, following realisation of the first and second mortgages, either by mortgagee sale by the applicant or by a receiver appointed by the applicant under its GSA dated 10 March 2009 shall be held undisbursed, on interest-bearing deposit, on trust, for the benefit of CIT Holdings and its creditors, pending further order of the Court.[51] Leave is reserved to the parties to seek further orders if needed to give effect to the above orders. For that purpose a memorandum may be filed and served ontwo days' notice.[52] Counsel are to confer as to costs. If agreement cannot be reached, counsel are to file memoranda within 15 working days._____________________Associate Judge Sargisson