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Mortgage Document: Should Lenders Be Concerned About Quality?
The mortgage document is important but complex. Often these documents contain difficult to understand legal terms, phrases and concepts.
How can lenders protect their rights and interests? What does a good mortgage look like? Let’s define what key items should be included in all mortgage documents.
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Courts Won’t Assist Borrowers with Imprudent Transactions
The courts will not intervene to assist borrowers who become the victim of their own imprudent transactions, even where they have not been advised to seek independent legal and financial advice.
In the matter of Donnelly v Australia and New Zealand Banking Group Ltd [2014] NSWCA 145 the court held that a borrower who voluntarily engages in risky business is not entitled to call upon equitable principles to be redeemed from the consequences inherent in taking those risks.
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Judicial Sale of a Mortgaged Property
The Court will not ordinarily make an order for judicial sale of a mortgaged property against the wishes of the mortgagee unless the mortgagee’s conduct would otherwise prejudice the mortgagor.
In the matter of Koovousis v Tony, trustee in bankruptcy of the Estate of Vrkic, Elliott May Lawyers convinced the court that the rights of its mortgagee client should prevail over the rights asserted by a purchaser seeking specific performance of a contract of sale over the mortgaged property. -
Mortgagor Unlawfully Takes Possession of Security Property
What happens when a mortgagor unlawfully re-takes possession of a security property?
In J P Morgan Trust Australia Limited v Anthony Robert Bridge [2013] NSWSC 668, the Court was required to consider the rights and standing of a mortgagor who re-enters possession of a property after execution of a writ by the sheriff.
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Execution of a Writ of Possession Stayed by Supreme Court
The NSW Supreme Court exercises its discretion and stays the execution of a writ of possession.
In Secure Funding Pty Ltd v Colin West [2013] NSWSC 746 a short stay of execution was granted by the Supreme Court to allow the borrowers to make the missed payments and to provide evidence of the progress of an application for further finance. The decision demonstrates the scope of the court’s discretionary power to stay proceedings.
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Mortgagee Delays in Selling Security Property Impacts Rights
Delays by the mortgagee in selling a security property may impact its rights against the borrower and guarantor.
Is a lender precluded from enforcing its rights against a guarantor if there is a period of inactivity after it takes possession of a security property? The Supreme Court of News South Wales was recently required to consider this issue in the matter of Commonwealth Bank of Australia v Thompson [2013] NSWSC 149.
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Judgment for Possession: Compromise if Mortgagee Delays?
Does a mortgagee compromise its rights under a judgment for possession if it allows the mortgagor time in which to discharge the debt rather than immediately taking possession of the mortgaged property?
In Wolfe v Permanent Custodians Limited [2012] VSC 275 the Supreme Court of Victoria dismissed several claims made by a plaintiff borrower. An agreement whereby the lender agreed to refrain from enforcing a judgment and warrant for possession over the borrower’s property in return for payment of the owed money was held to not interfere with the lender’s right to enforce a judgment and Warrant of Possession.
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Competing Interests in Security Property
Competing interests in security property – will the court allow the holder of a registered caveat to interfere with the rights of a prior registered mortgagee to sell the security property as mortgagee in possession?
In Bateson v Jones [2013] WASC 8, Justice Pritchard of the Supreme Court of Western Australia was required to determine an application for the extension of a caveat filed by a lender in response to a lapsing notice issued by a prior registered mortgagee. The reasons for the Judge’s dismissal of the application are discussed below.
