Supreme Court New South Wales Medium Neutral Citation: Barrington Winstanley Group Pty Ltd v Edmonds [2022] NSWSC 531 Hearing dates: 19-20 April 2022 Date of orders: 4 May 2022 Decision date: 04 May 2022 Jurisdiction: Equity Before: Darke J Decision: Plaintiff entitled to a monetary judgment, in an amount to be calculated, against the first and second defendants. Catchwords: CONTRACTS – deeds – where third defendant retained plaintiff finance broker in relation to proposed refinancing transaction – where first and second defendants guaranteed third defendant's obligations under agreement – dispute as to whether a service fee became payable under agreement – where defendants subsequently executed a deed acknowledging plaintiff's right to service fee under agreement – where deed contains undertaking to pay service fee plus interest – where second defendant claimed to have executed deed due to abuse and intimidation by plaintiff – held that execution of deed not procured by unfair or illegitimate pressure – held that first and second defendants obliged to pay service fee plus interest in accordance with deed MORTGAGES AND SECURITIES – charge – where charge expressed to secure moneys that become due and payable under agreement – where service fee did not become due and payable under agreement – where subsequent deed acknowledges that service fee is payable under agreement and refers to charging clause in agreement as valid – whether defendants precluded by estoppel by deed from asserting that there is no amount secured by the charge – where enforcement of charge is not an action on deed to enforce rights arising under deed – held no estoppel by deed precluded defendants from asserting that no moneys became due and payable under the agreement such as to be secured by the charge – plaintiff held not to be entitled to enforce charge to recover amount due under deed Legislation Cited: Corporations Act 2001 (Cth), s 127 Cases Cited: Australia and New Zealand Banking Group Ltd v Bragg (No 3) [2017] NSWSC 208 Burkett v Bendigo and Adelaide Bank Ltd (No 2) (2018) 133 ACSR 411; [2018] VSC 723 Minassian v Minassian [2010] NSWSC 708 Offshore Oil NL v Southern Cross Exploration NL (1985) 3 NSWLR 337 Pittmore Pty Ltd v Chan (2020) 104 NSWLR 62; [2020] NSWCA 344 Re Quality Blended Liquor Pty Ltd [2015] 2 Qd R 381; [2014] QSC 234 Segboer v AJ Richardson Properties Pty Ltd (2012) 16 BPR 31,235; [2012] NSWCA 253 Category: Principal judgment Parties: Barrington Winstanley Group Pty Ltd (Plaintiff) Sandra Henri Edmonds (First Defendant) David James Edmonds (Second Defendant) DSJSE Pty Ltd (Third Defendant) NWC Finance Letter of Offer Pty Ltd (Fourth Defendant) Jason Mark Hulbert (Fifth Defendant) Representation: Counsel: Mr M R Pesman SC (Plaintiff) Solicitors: Ark Legal (Plaintiff) ERA Legal (Fourth Defendant) File Number(s): 2021/112414 Publication restriction: None Judgment Introduction 1. By a Statement of Claim filed on 22 April 2021, the plaintiff ("BWG") seeks a monetary judgment against the first and second defendants (Mrs and Mr Edmonds) pursuant to a Deed of Acknowledgement of Debt entered into on 27 April 2018. BWG further contends that the amount owed to it is secured by a charge over a property owned by Mrs and Mr Edmonds ("the Property"). 2. Mention should be made of the other three defendants to the proceedings. The third defendant, DSJSE Pty Ltd ("the company") is a company associated with Mrs and Mr Edmonds. Mrs Edmonds was the sole director and secretary of the company when the events relevant to these proceedings occurred. The Court was informed that the company is in liquidation. BWG no longer seeks to proceed against the company. The fourth defendant, NWC Finance Letter of Offer Pty Ltd, is a caveator in respect of the property. The fourth defendant did not actively participate in the hearing. The Court was informed that, subject to the protection of its claimed interest, the fourth defendant did not oppose the making of an order for the sale of the property. The fifth defendant, Jason Hulbert, ceased to be a party to the proceedings prior to the hearing. 3. The matters remaining for determination were thus confined to BWG's claims for relief against Mrs and Mr Edmonds. At the hearing, Mr Pesman SC appeared for BWG. Mrs Edmonds appeared for herself and, with the consent of BWG, also for Mr Edmonds. Mrs Edmonds, who is currently an inmate of the North Coast Correctional Centre, participated in the hearing using audio-visual link technology. 4. BWG is a finance broker. The claims it makes are essentially based upon an Exclusive Mandate and Fee Agreement dated 3 November 2017, and a Deed of Acknowledgement of Debt executed on 27 April 2018. For convenience, these documents will be referred to as "the Agreement" and "the Deed" respectively. 5. In brief summary, BWG alleges that, pursuant to the Agreement, a Service Fee of $211,200 became payable to it by the company, and that Mrs and Mr Edmonds were similarly liable as guarantors of the company's obligations. BWG further alleges that Mrs and Mr Edmonds provided a charge in its favour over various properties, including the Property, to secure payment of any monies that become due and payable to BWG under the Agreement. In relation to the Deed, BWG alleges that the company and Mrs and Mr Edmonds made various acknowledgments including that a Service Fee of $211,200 was payable under the Agreement, and undertook that the amount of the fee plus interest (referred to in the Deed as the "Debt") would be paid to BWG upon the happening of certain events. 6. The claim for monetary relief rests primarily upon the Deed. The Agreement is relied upon only in the alternative in that regard. The claim to enforce the charge rests upon the provisions of the Agreement, although, as will be seen, BWG asserts that estoppels arise from the Deed that preclude Mrs and Mr Edmonds from contending that the charge they granted pursuant to the Agreement does not secure payment of the money claimed. 7. Mrs and Mr Edmonds filed a Defence dated 18 June 2021. The Defence contains denials of most of the allegations made by BWG. Mrs and Mr Edmonds deny that they were parties to the Deed, and it is alleged that Mrs Edmonds signed the Deed in circumstances of coercion and intimidation on the part of BWG. It is further alleged that the coercion and intimidation resulted in her mental condition becoming unstable to the extent that she was unable to make decisions, and that this was known by BWG. No Cross-Claim was filed by either Mrs or Mr Edmonds. 8. In BWG's case, three affidavits of a director, Kelwyn Hough, were read (25 June 2021, 22 July 2021 and 29 March 2022), as well as an affidavit of Ms Suyu Dai, solicitor (17 March 2022). Mr Hough was cross-examined. In the case of Mrs and Mr Edmonds, two affidavits of Mrs Edmonds were read (8 July 2021 and 14 March 2022). Mrs Edmonds was cross-examined. Summary of salient evidence 1. Mrs Edmonds was the sole director and secretary of the company between 12 June 2014 and 18 October 2019. 2. On 2 November 2017, Mrs Edmonds signed an Exclusive Mandate and Fee Agreement with BWG. Mrs Edmonds signed the Agreement as borrower. This agreement related to a proposed refinancing loan of $925,000 in respect of a property described as "1549 Boorolong Road, Dumaresq NSW 2350". This proposed refinancing did not proceed, and BWG makes no claim pursuant to that agreement. As already mentioned, the claims made by BWG arise from a further Exclusive Mandate and Fee Agreement dated 3 November 2017 ("the Agreement"). The Agreement was signed by Mrs and Mr Edmonds for the company as borrower, and again by Mrs and Mr Edmonds as guarantors. 3. Prior to the execution of the Agreement, Mrs Edmonds sent an email to Mr Hough on 1 November 2017 which included the following: As stated on the telephone I want to disclose everything so it is all on the table. Things are in a mess at the moment and I want it known the situation with PMA Holdings and I am in arrears with Coastline Credit Union and there is a full explanation as to why. I need to refinance these loans and have some working capital. … Please I need desperate help I want something done this week. I have paid for so many valuation reports if someone was to contact MVS Valuers in Armidale they know these properties they are global rural valuers they would be able to confirm valuation prices. This is my private e-mail address and can reach me at any time and you have my mobile number. 1. Shortly thereafter, Mrs Edmonds sent another email to Mr Hough which provided various details of amounts owing. These included almost $1.7 million owed to Coastline Credit Union (secured over 74 Dumaresq Road, Armidale and 136 Bellbrook Road, Armidale); $586,000 owed to PMA Holdings; and $1,132,000 owed to Hubertus Bobbert (secured over 134 Bellbrook Road, Armidale). The email continued: So Valuation Report $6.4 million Total owing under mortgages $3,415,542.03 Surplus roughly $3 million dollars I need to push for some working capital and to cover costs and fees as stated. My Solicitor who has been working for me with PMA Holdings has stated he needs something by tomorrow to give a bit of time if he can state that there is finance being arranged then he can request an extension of a couple of days otherwise PMA Holdings will push for a Judgement which I do not want. As stated he has confirmed all the above parties have their discharges of mortgage ready to settle, if the Lender can please see their way clear about the valuations as this will take precious time I do not have. Once again thank you this journey into the finance world has been a nightmare. 1. On 3 November 2017 (at 6:06pm) Mr Hough sent an email to Mrs Edmonds in the following terms: I have just received an amended letter of offer. Prior to issuing same to you, would you please sign my amended exclusive mandate to act and fee agreement reflecting the new deal. Important changes since last letter of offer; Amount has been increased to $3,840,000 Amount limited to 60% Loan to Valuation Ratio Funds now being provided via a mix of 1st and 2nd Mortgage loans Rate has increased from 1.25% to 1.67% per month (15% to 20%pa) Please ring me if you wish to discuss 1. Shortly thereafter (at 6:23pm), Mrs Edmonds sent an email to Mr Hough which attached the Agreement, described as "duly executed dated and witnessed Mandate document". 2. The cover page of the Agreement referred only to BWG and Mrs Edmonds. However, it is clear from page 1 that the Agreement is between BWG and the parties described in Items 1 and 2 of Schedule A, namely, the company as borrower and Mrs and Mr Edmonds as guarantors. The Agreement relevantly provides: RECITAL The Borrower has requested the services of BWG to obtain and/or source finance for them upon the terms and conditions herein. CONSTRUCTION The schedules attached to this Agreement shall be incorporated into the Agreement as terms and conditions thereof; and Headings are for convenience only and do not affect the interpretation of the Agreement. DEFINITIONS The following capitalised [sic] words are defined as follows; loan: arranged finance pursuant to clause 1. loan offer: any document issued by a lender that indicates a loan offer as contemplated by clause 1. OPERATIVE PROVISIONS Exclusive Mandate The Borrower hereby exclusively contracts the services of BWG to arrange on behalf of the Borrower, finance within the ambit of the instructions set out at Item 3 of Schedule A. … BWGs Fees In exchange for its service, the Borrower agrees to pay BWG the fees as set out in Item 4 of Schedule A subject to the following: - … 2.2 Service Fee (Item 4b) Becomes due and payable, subject to clause 1.2 and 4.2, by the Borrower upon BWG obtaining a loan offer within the ambit of the instructions set out at Item 3 of Schedule A irrespective of whether the Borrower takes up the offer. 2.2.1 BWG may in its' [sic] sole discretion; agree to delay payment of the fee but only upon the terms and conditions as set out at clause 3. 2.2.2 In the event the Lender fails to comply with its' [sic] loan offer, then the fee is not payable to BWG and any part of the service fee paid shall be refundable by BWG to the Borrower subject to clause 8. 2.2.3 In the event the Borrower fails to disclose all material information resulting in BWG being unable to fulfill its obligations under clause 1, the service fee becomes immediately due and payable, irrespective of BWG not yet complying with its obligations under clause 2.2 … Delayed Payment – BWG Service Fee BWG may delay payment of the Service Fee due to it under this Agreement at clause 2.2 until the loan is drawn by the Borrower subject to; 3.1 Written Request The Borrower makes a written request to BWG, in the same form as Appendix 1. 3.2 Irrevocable Authority The Borrower executes a written Authority irrevocable by them, authorising the Lender to pay the service fee and all other amounts due to BWG directly from the loan proceeds. The Authority should be in the same form as Appendix 2. 3.3 Security for payment The Borrower consents to the lodgment of a Caveat or any other form of legal instrument as BWG sees fit in accordance with clause 5 and sub clauses 5.1 & 5.2. 3.4 Maximum Deferral Period The Borrower must draw down the loan within 2 calendar months of the date of any loan offer. 3.5 Loan not drawn within Deferral Period If BWG agrees to delay payment of the Service Fee and the fee is not paid within the maximum deferral period then the fee shall become immediately due and payable irrespective that the Borrower has not drawn down the loan for whatever reason. … 7 Interest on Monies Owing The Borrower agrees that Interest will apply on all monies owing to BWG if not paid within 7 days of invoice. Interest will be calculated daily at the rate of 2.5% per month from the date of invoice and will compound to the principal at the end of each calendar month. … 13 Guarantee, Indemnity & Third Party Provisions The Guarantor is liable for all the obligations of the Borrower under this agreement. 13.1 The Guarantor acknowledges that it is responsible for making itself aware of the financial position of the Borrower and any other person who guarantees payment of any amount payable to BWG pursuant to this agreement, and seeking appropriate legal advice relating to the Guarantor's obligations under this agreement. 13.2 The Guarantor acknowledges incurring obligations and giving rights under this agreement for valuable consideration received from BWG. 13.3 The Guarantor unconditionally and irrevocably guarantees to BWG the due and punctual payment and satisfaction of the Service Fee and any other amount owing to BWG arising out of this agreement by the Borrower. … 13.8 BWG shall not be required to proceed against the Borrower or exhaust any remedies it may have against the Borrower or enforce this agreement, but shall be entitled to demand and receive payment from the Guarantor when any payment is due under this agreement and/or to proceed directly against charged property as referred to in clause 13.9 and sub clauses. 13.9 If any monies become due and payable to BWG under this agreement for any reason; 13.9.1 Charge against Property: The Guarantor specifically charges the payment of those monies as against the title of the properties referred to at Item 5 of Schedule A and BWG is entitled to lodge a Caveat, to which the Guarantor hereby consents, against the title of those properties recording its interest and has a right to maintain that Caveat until all monies owing are paid. 13.9.2 Charge against all Real and Personal Property: The Guarantor further charges the payment of those monies against all its right, title and interest in all of its real and personal property, whatever [sic] situated, and whether that property or interest exists presently or exists at any time in the future and BWG is entitled to lodge a Caveat, to which the Guarantor hereby consents, against the title of those properties recording its interest and has a right to maintain Caveats until such time as all monies owing are paid. … 14 Governing Law This Agreement shall be governed by the laws of the [sic] Victoria 1. Schedule A to the Agreement is in the following terms: SCHEDULE A TO THE AGREEMENT BETWEEN BARRINGTON WINSTANLEY GROUP PTY LTD AND THOSE REFERRED TO AT ITEM 1 and ITEM 2 OF THIS SCHEDULE Item 1 – Borrower(s): DSJSE Pty Ltd ACN 600 083 789 Item 2 – Guarantor(s): David James Edmonds and Sandra Henri Edmonds Item 3 – Loan Instructions: Facility Type: First Mortgage Purpose: Refinance Amount Sought: $3,840,000 or 60% of valuation, whichever is the lessor [sic] Loan to Value Ratio: maximum 60% Term: 12 months Application Fee: 2.2% Interest Rate: 1.67% per month Valuation Costs: at cost but estimated at $6,400 +gst Legal Fees: at cost but estimated at $6,000 +gst Item 4 – BWG Fees: 4(a) Processing & Commitment Fee: Not Applicable 4(b) Service Fee: 5% + gst of the loan amount approved 4(c) Non-Compliance Fee: Not Applicable 4(d) Loan Facilitation Fee: Not Applicable Item 5 – Security Property(s): 1549 Boorolong Road, Dumaresq NSW 2350 1551 Boorolong Road Dumaresq NSW 2350 134 Bellbrook Road Armidale NSW 2350 136 Bellbrook Road Armidale NSW 2350 74 Dumaresq East Road Dumaresq NSW 2350 and Item 6 – Term of this agreement: 21 days Next to the striking out under Item 5 there is a handwritten note, likely to have been made by Mrs Edmonds, in the following terms: I do not own this next door property. 1. Mrs and Mr Edmonds also signed Appendices 1 and 2 to the Agreement. A request was thereby made for BWG to delay payment of the Service Fee (see cll 2.2.1 and 3). There is no evidence that BWG ever agreed to delay payment in accordance with those provisions. 2. The Letter of Offer, referred to in Mr Hough's email of 3 November 2017, was an offer by In Base Investments Pty Ltd to lend $3,840,000 to the company. The letter relevantly included the following: LETTER OF OFFER BORROWER/MORTGAGOR: DSJSE Pty Ltd ACN 600 083 789 and the guarantor directors all of 1549 Boorolong Road Armidale NSW 2350 LENDER AND MORTGAGEE: In Base Investments Pty Ltd and others all of Level 2, 180 Queen Street Melbourne VIC 3000 RE: Loan amount of $3,840,000.00 SECURITY: Registered first and second Mortgage over the property known as 1549 Boorolong Road Armidale NSW 2350, 74 Dumaresq East Road Dumaresq NSW 2350 and 1549 Boorolong Road Dumaresq NSW 2350 DATE OF OFFER 3RD November 2017. The terms of such Mortgage will be: Principal Sum: $3,840,000.00, or 60% of LVR, whichever is the lesser Term of Loan: 3 Months Interest Rate: 1.67% per calendar month on the first mortgage and 2.17% per calendar month if paid on time Default Interest Rate: 2.67% per calendar month on the first mortgage and 3.17% per calendar month if not paid on time Interest Payable: Interest is capitalized for the three months of the loan advance (deducted from the total loan advance) and then payable Monthly in advance thereafter … Legal Fees: The sum of $6,000.00 plus GST is payable by the mortgagee [sic] plus disbursements on preparation of mortgage and ancillary documentation estimated at $900.00 plus GST. The sum of $13,000.00 is to be paid upon acceptance of this offer by the borrower into the solicitor Trust Account. Borrower to pay all legal costs and disbursements on an indemnity basis. 1. It appears that Mrs Edmonds signed the Letter of Offer on 3 November 2017. I infer from the terms of Mr Hough's email that the signing occurred after the letter had been issued to her by Mr Hough, after the Agreement had been signed. Mrs Edmonds sent the signed Letter of Offer to BWG on 4 November 2017 (and again on 6 November 2017) together with up-to-date title searches and rate notices in respect of the properties involved. These included a title search and rate notice in respect of the land contained in folio identifier 45/755811 which was (and remains) jointly owned by Mrs and Mr Edmonds. The rate notice describes the property address as 74 Dumaresq Road, Saumarez Ponds NSW 2350. There is no real doubt that this property (which I refer to as "the Property") is the property that is described in the Agreement and the Letter of Offer as "74 Dumaresq East Road, Dumaresq NSW 2350". Mrs Edmonds seemed to concede that there was but one property, variously described, being "the property in DP45/755811". 2. The title search showed that the Property was encumbered by a registered mortgage to Coastline Credit Union Ltd, and that caveats had been lodged by PMA Holdings Pty Ltd and Directline Finance Pty Ltd. 3. The signed Letter of Offer was sent to the lender's solicitors on 6 November 2017. 4. The Letter of Offer required the sum of $13,000 to be paid by the borrower into the trust account of the lender's solicitors. Those solicitors were DSA Lawyers. On 8 November 2017, DSA Lawyers requested BWG to have the borrower make that payment, and BWG passed the request on to Mrs Edmonds. Mrs Edmonds sent an email to BWG on 8 November 2017 stating that she was "now proceeding to the payment of funds into the provided account and will e-mail receipt". It appears, however, that the $13,000 payment was never made. That is so even though Mrs Edmonds stated in her email: As stated this morning, settlement is required urgently as I have been contacted again by the present Lenders and have stated that we are moving forward to have the matters settled. Please have the mortgage documents sent by e-mail as soon as possible for execution and return. 1. It further appears that on 8 November 2017 Mrs Edmonds signed and returned a revised version of the Letter of Offer. The revisions (including those to the description of the properties to be provided as security) are not material to the issues that arise in the case. 2. It is evident that, at about this time, there were communications between BWG and DSA Lawyers concerning the obtaining of valuations of the proposed security properties. 3. On 14 November 2017 BWG advised Mrs Edmonds that a valuer had been found, and requested that $16,850 be paid into the account of the lender's solicitors to "start the process". That amount consisted of a valuation fee of $14,850 and $2,000 for "legal documentation". Again, it seems that no such payment was made. 4. On 21 November 2017, DSA Lawyers sent an email to BWG in which it was stated that if no money is received in the next 48 hours the matter should be considered "at an end". Also on 21 November 2017, Mr Hough sent an email to DSA Lawyers which attached some "desktop" valuations obtained by Mrs Edmonds. In the email it was stated, inter alia, that arrangements were being made "to pay the upfront fee tomorrow". Later that day, Mr Hough also forwarded to DSA Lawyers some appraisals of the properties that had been prepared by real estate agents, and supplied by Mrs Edmonds. However, in their response, DSA Lawyers stated that they wanted to appoint their own valuers, and noted that they had still not received payment of the "application fees". 5. On 24 November 2017 Mrs Edmonds made a payment of $5,000. This payment seems to have been made directly to BWG rather than into the DSA Lawyers' trust account, but the evidence (including the indecipherable Credit Transfer Form) is unclear on that matter. The evidence is also not entirely clear as to the circumstances in which this payment was made, but it seems likely that the payment was intended to be put towards the obtaining of valuations. In any event, the evidence suggests that the proposed loan from In Base Investments Pty Ltd was not actively pursued after about 29 November 2017. Mr Hough deposed that at about that time the offer was withdrawn. 6. Mrs Edmonds thereafter continued to engage with BWG concerning the obtaining of finance. On 12 December 2017 Mr Hough forwarded to Mrs Edmonds a Provisional Offer of Loan Funding from Portcullis Capital Pty Ltd, for a loan to the company of $2.8 million for which Mrs and Mr Edmonds would be guarantors. This document appears to have been executed on 13 December 2017 by Mrs Edmonds for the company, and by Mrs Edmonds and Mr Edmonds as guarantors. It was sent by Mrs Edmonds to Mr Hough by email sent on that day at 1:13pm. I note, however, that in the course of cross-examination Mrs Edmonds stated that Mr Edmonds did not sign the document, and she gave answers that suggested that she had forged his signature. When pressed on the matter, Mrs Edmonds was not prepared to admit distinctly that she forged the signature, but went as far as to say that she assumed that she did. I also note that it appears from Mr Hough's email to Mrs Edmonds on 13 December 2017 (at 1:03pm) that it was proposed to accept the offer on the basis that only a part payment (of $5,000) of a required valuation fee would be paid, with the balance of that fee to follow later. The terms of the email seem consistent with the proposition that the $5,000 paid by Mrs Edmonds on 24 November 2017 was indeed paid to BWG. This is reinforced by the evidence that on 3 January 2018 Mr Hough transferred $3,000 from the BWG trust account to Mr O'Sullivan of Portcullis Capital towards valuation fees. 7. There is evidence that Mrs Edmonds sought to pay a further sum of $6,000 to Portcullis Capital on 11 January 2018, but the latter claimed on 18 January 2018 that the funds had still not been received into its account. In any event, it appears that the proposed Portcullis Capital loan did not proceed. Neither did a proposed loan from Universal Finance, which was to be made to a different company and secured over properties including the Property. 8. On about 24 February 2018, Mr Hough travelled from Melbourne to Coffs Harbour to meet Mrs Edmonds face-to-face. It seems that Mr Hough agreed to do so only on the basis that the cost of his airfares be reimbursed. 9. In the meantime, on about 18 December 2017, BWG, through its solicitors JHK Legal, lodged a caveat (AM983914) against the titles to various properties, including the Property (i.e. Folio Identifier 45/755811). The form of caveat initially referred to 45/755818, but the number appears to have been amended by hand. There is no doubt that the caveat was recorded against the title to 45/755811. By the caveat, BWG claimed an interest as an equitable mortgagee by virtue of the Agreement. 10. On 29 March 2018, Wordsworth Lawyers, acting for Mrs and Mr Edmonds, sent a letter to JHK Legal. The letter, which was received on 5 April 2018, was in the following terms: We act for David James Edmonds and Sandra Henri Edmonds. We attach and serve Lapsing Notice in respect of Caveat Registered AM983914. 1. Mr Hough became aware of the lapsing notice on about 5 April 2018. He deposed that he then had a telephone conversation with Mrs Edmonds. Mrs Edmonds deposed: Sometime between the 5th April and 10th April 2018 BWG called me and verbally abused, intimidated and bullied me for engaging a solicitor and sending the Lapsing Notice to them. He advised that he was going to instructing [sic] his solicitor to "come after" me. He demanded and threatened further that I contact my Solicitor and withdraw the Lapsing notice. I became so scared, frightened and anxious from the verbal attack by BWG and the threats against me because of the domestic violence which had been suffered by me as a child that I felt no other option other than to comply with the BWG demand and I instructed Wayne Chaffey to withdraw the lapsing Notice even though he had advised me not to give in. I did inform BWG that I could not cope with such threats because of the life experiences with Domestic Violence. 1. In answer to the above, Mr Hough denied that there was any verbal abuse or attack, intimidation or bullying towards Mrs Edmonds. Mr Hough deposed that in the telephone conversation: (a) I asked why this [the lapsing notice] was happening and I did state that it was poor form. (b) Mrs Edmonds stated that her lawyer told her to issue lapsing notices to the caveats lodged by various parties on her properties, however not on BWG's caveat because I was the only one who helped and stuck by her. (c) Mrs Edmonds at that time undertook to have it removed. (d) I asked her did she acknowledge my debt. She said yes. 1. Mr Hough further denied that Mrs Edmonds told him that she could not cope with threats because of her experiences of domestic violence. Mr Hough said that he had no knowledge of the alleged domestic violence until he received Mrs Edmonds' affidavit. 2. On 6 April 2018 Mrs Edmonds sent an email to Mr Hough in the following terms: I advise that at 7:55am this morning I we [sic] have given instructions to Wayne Chaffey Solicitor of Wordsworth Lawyers to lodge a Withdrawal of the Lapsing Notice today and advise your legal representative accordingly. 1. On 11 April 2018 JHK Legal sent an email to Wordsworth Lawyers which included the following: We refer to the above matter and advise we act on behalf of Barrington Winstanley Group Pty Ltd. Our office was served with your clients Lapsing Notice in respect of Caveat AM983914 (the Caveat) on 5 April 2018. Our client received email correspondence from Sandra Henri Edmonds on 6 April 2018 advising she had instructed your office at 7:55am on same date to withdraw the Lapsing Notice in respect of the Caveat. We enclose Ms Edmonds email correspondence for your attention. Please advise the basis by which your clients' maintain our client was not entitled to register the Caveat over properties owned by your clients, particularly in light of the email correspondence received from Ms Edmonds and in circumstances in which your clients executed the enclosed Exclusive Mandate and Fee Agreement in their personal capacities as guarantors on 3 November 2017. In the event your clients Lapsing Notice in respect of the Caveat is not formally withdrawn by written notice received from your office by 4pm on Monday, 16 April 2018, we are instructed to commence proceedings in the Supreme Court of NSW seeking the Caveat be extended. 1. Wordsworth Lawyers responded later on 11 April 2018 in the following terms: We refer to your letter dated 11 April 2018. We have advised our client that we do not agree with your client's assertions that it has an enforceable interest in our clients [sic] land or a claim against our client for alleged fees due- which appear to exceed $200,000.00. Notwithstanding this we are instructed to withdraw and confirm that our client will not rely or act further in respect to Lapsing Notice AN211762 served on your firm relating to Caveat AM983914. 1. On 16 April 2018 Ms Faulkner of JHK Legal sent an email to Wordsworth Lawyers which contained a request that the attached Deed of Acknowledgement of Debt and Irrevocable Authority be executed and returned by no later than 4:00pm on 19 April 2018. Mr Chaffey of Wordsworth Lawyers replied shortly thereafter stating that he would send the deed to his client. 2. Mr Hough and Mrs Edmonds were at that time still in communication with each other in relation to the obtaining of finance. I note that in an email sent to Mr Hough on 16 April 2018, Mrs Edmonds thanked Mr Hough for his support and loyalty. 3. However, on 20 April 2018 Mr Hough sent an email to Mrs Edmonds in the following terms: Sandra, You continue to treat me with contempt. 1) You have not reimburse [sic] me for my airfare. Jenny called me last Friday and said that it was done at the CBA. I have waited a few days, however a week is enough and there is still no money. 2) Fee Agreement and Security Interest Under your instruction, your solicitor disputed my fee and endeavoured to lapse my caveat. You then said it was a mistake, however I had to push you to withdraw your lapsing notice. You might recall you told me that you had issued the instruction, however your solicitor told mine that he had no such instruction. Given your initial action to dispute my fee and and [sic] lapse the caveat, I was not, and I am not prepared to continue working for you unless you willingly entered into a Deed of Acknowledgement of Debt and Irrevocable Authority. Other than the personal disappointment, given the enormous amount of time I have devoted to you both in a professional but also personal capacity, I don't care what you do. Pay the money or don't pay the money. Sign the deed or don't sign the deed. It's taken a long time and a number of deceitful actions, however I have now had enough. 1. Mrs Edmonds promptly responded by email that included the following: This e-mail is with disappointment as the only real person out there that we believed in has now decided to walk away. I do not treat you with contempt far from that I have always trusted you and sincerely care. I acknowledge that you have worked hard and have never denied your efforts. The airfare has been paid and I hold in my possession an actual receipt from the Commonwealth Bank stamped and dated the 13th April 2018 where the cash money was placed into your account in the sum of $596.00. So I do not understand how this is deceitful and that hurts. 1. Mr Hough sent an email in response later in the morning of 20 April 2018. This email included the following: I remain of the view that your decision to dispute my fee and lapse my caveat was contemptuous and has not yet been fully rectified. At some point you express regret at your decision and told me you had instructed your layer [sic] to withdraw the notice immediately. Days later your solicitor advised my solicitor, that he held no such instructions. It might not have been you and might have been your solicitor, however I was told something had been done when it had not. ("deceitful"). The issue is not whether it is now done, the issue is it wasnt when I was told that it was so I had to push for it. Bad karma! You asked for my forgiveness which I gave unconditional on a personal level. On a business level, I stated that given you had disputed the debt and sought to lapse the caveat, the only way I could continue to work for you was if you willingly acknowledge your debt to me and my right to a security interest in the properties. I used the word willinging [sic] because if you acknowledged the debt and security begrudgingly, I did not, and do not want those sort of relationships. My solicitor wrote to yours a week ago with a deed of acknowledgement and ask for it to be returned by cob yesterday. In my view, a week is long enough to review the deed and form an opinion as to whether you want to sign it or not. In the interim, as you are aware, I have continued working diligent in your best interest over the last week. The date to return the deed has past [sic] and it has not been returned. Silence from your side, and I am following up again rather than doing productive things. I have done an inordinate amount of work without payment, in what other profession would you expect that? You have also dealt with many other brokers & lenders who have dump you the moment they could not make a quick easy dollar. Under the fee agreement you signed with me, I say the fee became due and payable along time ago and does not require me to keep working, however I have. But as a result of my airfares not being paid, you[r] failure to acknowledge the debt owing to me I can't keep working for you, I must move on and spend the hours you are absorbing working on matters that will pay me and without dispute. This is not personal, it's not blackmail, its just the way it is. If you genuinely have no dispute with my fee and caveat, sign the deed, pay my airfares and I remain committed to the cause. Alternatively, if there is a dispute dont sign it and we move on. 1. Later on 20 April 2018 Mrs Edmonds sent an email to Mr Hough that included the following: I am totally aware of the time and effort that you have devoted to try and resolve the issue of re-financing and being their along the way with the PMA Holdings Issue and the Coastline Issues and all the other issues that life has thrown to me along the way. It is and always will be sincerely appreciated. The Lapsing Notice has been withdrawn upon my instructions. I have no Deed to sign and attach THIS E-MAIL IS TO ACKNOWLEDGE THAT THE DEBT IS OWING TO YOU OR YOUR FIRM. As stated this morning I wanted this resolved today prior to going into the weekend period. I send my warmest regards, and sincerely appreciate everything including all your efforts for trying to assist in a very helpless situation and send my best wishes to you for the future. Take care It appears that Mrs Edmonds had not by that stage received a copy of the proposed deed. 1. On 21 April 2018 Mr Hough attached a copy of the proposed deed to an email he sent to Mrs Edmonds. However, he advised that as there had been discussions since the deed had been provided to Wordsworth Lawyers, "in all likelihood this is not the final document". The email continued: I repeat, this is not the final document, but so as to resolve this impasse as quickly as possible, I have forwarded it to you so that you may get a feel for the nature and general substance of the document. On Monday when your solicitor has returned, I will confirm the final document and then you can obtain legal advice and decided whether you want to sign it or not. In the interim I am continuing to work in good faith. 1. Despite the terms of the above email, on 22 April 2018 Mrs Edmonds sent to Mr Hough a copy of the proposed deed, said to have been signed by both Mrs and Mr Edmonds. 2. Later on 22 April 2018, Mr Hough sent an email to Mrs Edmonds which included the following: The deed I copied to you, given I did not get a response from my solicitor on Friday, was only the original draft and my words impressed upon you it was not the final document. More importantly, because you involved them, I must have it resolved between the solicitors. The last correspondence from your solicitor to mine was, that under instruction from you the lapsing notice would be withdrawn, however the debt was still disputed. You are clearly in a distressed state, emotionally and financially, and I do not want to, or be accused later of, taking advantage of your current state and situation. Again, thank you for your intent and signing the document, however I must still confirm the final document to you, and I still require that you sign it with your lawyer who should then forward it to my solicitor. 1. On 24 April 2018 JHK Legal sent an email to Wordsworth Lawyers which attached an updated version of the proposed deed. The email contained a request that it be executed and returned by no later than 4:00pm on 27 April 2018. 2. At 9:37am on 27 April 2018, Mrs Edmonds sent an email to Mr Hough which attached "the final Deed of Acknowledgement of Debt". The Deed was apparently executed by Mrs Edmonds for the company, and separately by Mrs and Mr Edmonds. The email included the following: I advise that at 9:15 this morning both my husband David Edmonds and my self- discussed the contents of the Deed of Acknowledgement. Present in the room at the time was my sister Jennifer Marshall and her husband. We advise that in full acknowledgment that David and myself are aware of the contents of the Deed of Acknowledgement of the Deed. We acknowledge that Kelwyn has been with us all the way through this journey even to the extent where he attended upon us in Coffs Harbour face to face. Once the Deed has been signed by Barrington Winstanley could I please have a copy of same e-mailed to us. 1. The parties to the Deed are expressed to be BWG, the company and Mrs and Mrs Edmonds. The recitals to the Deed included: A. Pursuant to an Exclusive Mandate and Fee Agreement dated 3 November 2017 (the Agreement), DSJSE requested the exclusive services of BWG in obtaining and/or sourcing finance for DSJSE (the Services). B. In consideration of BWG providing the Services to DSJSE, Sandra and David unconditionally and irrevocably guaranteed the due and punctual payment and satisfaction of DSJSE's obligations under the Agreement to BWG by executing the Agreement in their personal capacities as guarantors on or around 3 November 2017. C. Clause 2.2 of the Agreement provided: "2.2 Service Fee (Item 4b) Becomes due and payable, subject to clause 1.2 and 4.2, by [DSJSE] upon BWG obtaining a loan offer within the ambit of the instructions set out at Item 3 of Schedule A irrespective of whether the Borrower takes up the offer." D. Clause 7 of the Agreement provided: "7 Interest on Monies Owing [DSJSE] agrees that Interest will apply on all monies owing to BWG if not paid within 7 days of invoice. Interest will be calculated daily at the rate of 2.5% per month from the date of invoice and will compound to the principal at the end of each calendar month." … F. Item 3 of the Agreement specified a Service Fee calculated at 5% + GST of the loan amount approved. G. On or about 3 November 2017, BWG facilitated finance for DSJSE from In Base Investments Pty Ltd which proceeded to issue a Letter of Offer for a loan amount of $3,840,000.00 to DSJSE and Sandra and David on same date (the Letter of Offer). H. On 8 November 2017, DSJSE executed the Letter of Offer. I. As at 3 November 2017, being the date of the Letter of Offer, the Service Fee payable by DSJSE and guaranteed by Sandra and David pursuant to the Agreement was $211,200.00. … M. As at 12 April 2018, the Service Fee plus accrued interest calculated in accordance with the Agreement totals $240,520.00 (the Debt), which continues to accrue at the interest rate. N. DSJSE, Sandra and David, jointly and severally, acknowledge their respective obligations under the Agreement, including the repayment of the Service Fee, interest and all other amounts payable pursuant to the Agreement, and acknowledge BWG's right to register its caveat over property owned by DSJSE, Sandra and David along with the terms and conditions contained in this Deed. 1. The operative part of the Deed included the following: 2.1 DSJSE, Sandra, and David, jointly and severally, acknowledge the Debt and irrevocably undertake to repay the Debt to BWG on the earlier of any of the following occurring: 2.1.1 On the settlement date of the refinance of the Properties or any one of them; or 2.1.2 On the completion date of the sale of the Properties or any one of them; or 2.1.3 Upon DSJSE, Sandra and/or David being in a position to repay the Debt; or 2.1.4 Immediately upon written demand from BWG. 2.2 DSJSE, Sandra and David, jointly and severally, acknowledge BWG was at all material times entitled to register the Caveat over the Properties pursuant to a valid charging clause granted to BWG and enforceable by BWG. … 3.1 Each of the parties warrants and represents to the others that in respect of their own position: 3.1.1 They have full legal capacity to enter into this Deed and to perform its terms; 3.1.2 They have had adequate opportunity to obtain competent legal and other professional advice concerning the terms and effect of this Deed; 3.1.3 They have had the opportunity to negotiate the terms of this Deed; 3.1.4 They consider that the terms of this Deed are fair in all of the circumstances; 3.1.5 They enter into this Deed voluntarily and without duress; and 3.1.6 The terms of this Deed are binding upon them according to its terms. … 6.6 Independent Advice 6.6.1 The parties acknowledge that prior to the execution of this Deed, they have obtained or were given an opportunity to obtain, independent legal advice regarding the content and effect of this Deed. 1. The execution page is headed "EXECUTED AS A DEED". It provides for execution by BWG and the company in accordance with s 127 of the Corporations Act 2001 (Cth); and for each of Mrs Edmonds and Mr Edmonds to sign, seal and deliver in the presence of a witness. 2. The signatures of Mrs Edmonds and Mr Edmonds were apparently witnessed by Jennifer Marshall, a sister of Mrs Edmonds. 3. On 1 May 2018, Mr Chaffey of Wordsworth Lawyers sent an email to Ms Faulkner of JHK Legal in the following terms: We refer to your email to us dated 24 April 2018 (with attached Deed of Acknowledgment of Debt). We record that we had provided a copy of your email and Deed to our client with advice to not agree to or sign the said Deed. We have been instructed this morning that our client has signed and returned the said Deed (presumably direct to your client). 1. Mrs Edmonds deposed, in relation to the Deed: The Deed came through but I was in no condition to absorb its contents and too scared to seek legal advice again after the barrage of insults and bullying I had already received and the belief that BWG had a new Letter of Offer to refinance our debt with Coastline. I was further told to write the words "and the debt is acknowledged" on the document. David and I, cold and depressed living in a small caravan, with no income or resources wanting to get back to our home that had been in the family for 100 years believed, in this dark part of their lives, that BWG after stating that another opportunity for Finance was coming through decided, without absorbing any of the contents of the document, to sign and return it. My family advised us not to sign it but seek legal advice. All we wanted was to go back home and be off the street living in a caravan in the middle of winter. I could not face seeing my husband sleeping in the cold in a swag. Determination 1. The first issue to consider is whether BWG is entitled to a monetary judgment against Mrs and Mr Edmonds pursuant to the Deed. In this regard, BWG seeks to recover $240,520 plus interest. The claim rests upon cl 2.1 of the Deed. By their Defence, Mrs and Mr Edmonds deny that they are parties to the Deed and Mrs Edmonds further says that she signed the Deed due to coercion and intimidation by BWG which resulted in her mental condition becoming unstable to the extent that, to the knowledge of BWG, she was unable to make decisions. 2. There is no substance to the argument that Mrs and Mr Edmonds are not parties to the Deed. The evidence is in my view clear that, on the morning of 27 April 2018, Mrs Edmonds signed the Deed for the company as its sole director (and secretary) pursuant to s 127 of the Corporations Act. Further, Mrs and Mr Edmonds executed the Deed in the presence of Mrs Edmonds' sister, Jennifer Marshall. Ms Marshall witnessed the signatures. By so signing the Deed, Mrs and Mr Edmonds can be taken to have signed, sealed and delivered the Deed and evinced an intention to be bound by it immediately (see Pittmore Pty Ltd v Chan (2020) 104 NSWLR 62; [2020] NSWCA 344 at [68]-[71]; Segboer v AJ Richardson Properties Pty Ltd (2012) 16 BPR 31,235; [2012] NSWCA 253 at [51]-[60] and [73]). Moreover, the Deed, so executed, was physically delivered to BWG when it was sent as an attachment to Mrs Edmonds' email to Mr Hough at 9:37am on 27 April 2018. Subject to any argument concerning the validity of the Deed, Mrs and Mr Edmonds thereby became immediately bound by the Deed, and the Deed could be enforced against them by BWG. 3. That is so even if BWG did not sign the Deed. Neither the terms of the Deed, nor the objective circumstances surrounding its execution by Mrs and Mr Edmonds, show that the Deed would only become enforceable if and when BWG executed the Deed. I would add that it is not necessary for an exchange of deeds to occur before the Deed would become enforceable. 4. There is also no substance to the argument advanced by Mrs Edmonds that the Deed was merely a draft, not intended to be binding. Whilst that might have been said in respect of the document sent to Mr Hough on 22 April 2018, it cannot be said in respect of the document sent to Mr Hough on 27 April 2018. It can be inferred from the terms of Mrs Edmonds' email of 27 April 2018 and Mr Chaffey's email of 1 May 2018 that the document executed on 27 April 2018 was the updated form of deed that had been sent to Wordsworth Lawyers on 24 April 2018. That document had been provided by Mr Chaffey to Mrs and Mr Edmonds (with advice to not sign it), and Mrs Edmonds described it as "the final Deed of Acknowledgement of Debt". 5. I turn now to the argument advanced by Mrs Edmonds to the effect that she signed the Deed due to duress, at a time when she was unable to make any decisions. Presumably, the argument is advanced as a reason why the Deed should not be enforced. 6. I should say at once that I find myself unable to accept the evidence of Mrs Edmonds in relation to this issue. In particular, I do not accept her evidence that, at some time between 5 April 2018 and 10 April 2018, BWG (through Mr Hough) verbally abused, intimidated and bullied her for engaging a solicitor and serving a lapsing notice. I prefer, and accept, Mr Hough's denials that he engaged in such conduct. I also accept his denial that Mrs Edmonds told him that she could not cope with threats due to her experiences with domestic violence. 7. Where their evidence is in conflict, I generally prefer Mr Hough's evidence to that of Mrs Edmonds. I think that Mr Hough gave his evidence in a satisfactory manner. He appeared to be trying to give accurate answers to the best of his recollection. Moreover, his evidence was generally consistent with the contemporaneous documents that were adduced in evidence. 8. On the other hand, Mrs Edmonds' evidence is not supported by the documentary evidence of the communications between Mr Hough and herself at around that time. Mrs Edmonds' email of 6 April 2018, advising that she had been given instructions to withdraw the lapsing notice, concludes with her sending her "warmest regards" to Mr Hough. There is no mention in the letters sent by Wordsworth Lawyers of any abuse, intimidation or bullying. Neither does Mrs Edmonds mention such matters in her emails to Mr Hough in the period from 16 April 2018 to 27 April 2018, even where the communications stray into the more personal rather than strictly business side of the relationship. Indeed, Mrs Edmonds' emails in that period contain statements of sincere appreciation of Mr Hough's efforts, warmest regards, and even "our love and friendship", and an acknowledgement that Mr Hough had "been with us all the way through this journey". 9. It was put to Mrs Edmonds in cross-examination that her evidence about being abused, intimidated and bullied was not true. She denied that was so. She also denied that her evidence about being too scared to get legal advice was false. I do not accept those denials. Mrs Edmonds maintained that she did not receive any legal advice at the time of signing the Deed. I do not accept that evidence, which is inconsistent with Mr Chaffey's email of 1 May 2018 the content of which is very likely to be accurate. 10. Mrs Edmonds was confronted in cross-examination with the absence of any references in her emails to abuse and intimidation. She said in response that she told Mr Hough that she could not stand to be bullied or intimidated because of abuse she suffered as a child. Mrs Edmonds was then confronted with the statement in her email thanking Mr Hough for his support and loyalty. She was asked how she reconciled that with her evidence about Mr Hough's intimidating behaviour. To this, Mrs Edmonds said that it had been one of her "core beliefs" that if a man was bullying or intimidating you, "you always did everything that you could to please that person". 11. I do not accept that Mrs Edmonds spoke to Mr Hough about being bullied or intimidated, and I cannot accept her evidence that the terms in which she wrote to Mr Hough were designed to please him as a person who was bullying and intimidating her. 12. I formed an unfavourable impression of Mrs Edmonds as a witness. That impression was formed as a result of various aspects of her testimony, including the following: 1. Mrs Edmonds was evasive in her response to a number of questions about emails that had apparently been sent by her to Mr Hough. She initially declined to answer questions about one email on the ground that her evidence could prejudice some criminal proceedings against another person, in which proceedings she might be a Crown witness. She then suggested, in relation to another email, that it was sent by a person other than herself, and she was not prepared to say who that other person was. Mrs Edmonds then agreed to answer questions after she was told that she might not be able to rely upon her affidavits if she was not prepared to answer relevant and proper questions. There was no apparent justification for any refusal by Mrs Edmonds to answer questions; 2. Mrs Edmonds frequently gave answers that were not truly responsive to the question asked. I gained the impression that many of these answers were of a self-serving character, designed to assist her case; 3. Mrs Edmonds' evidence that by 14 November 2017 she believed that the In Base Investments Pty Ltd Letter of Offer had expired was plainly inconsistent with contemporaneous documents (including an email sent by BWG to Mrs Edmonds on 14 November 2017). Mrs Edmonds maintained that she held such a belief, despite such documents being put to her. I think that Mrs Edmonds gave this evidence because she considered it would assist her case; 4. as mentioned earlier, Mrs Edmonds stated that her husband did not sign the Portcullis Capital offer document, and suggested that she herself had forged his signature; and 5. Mrs Edmonds' denial that she received legal advice in relation to the Deed was implausible in light of Mr Chaffey's email of 1 May 2018. So, too, was her evidence that she was too scared to seek legal advice. 1. The above matters in particular caused me to conclude that Mrs Edmonds' evidence should be treated with great caution. I would not be prepared to accept her evidence on any contentious matter unless it were corroborated by other evidence that was itself reliable and likely to be accurate. My conclusion is not based upon, but it is reinforced by, the fact that Mrs Edmonds is currently serving a prison sentence for offences involving fraud. 2. It should also be noted that, although Mrs Edmonds referred in her affidavit to various mental health issues or conditions, no expert medical or psychiatric evidence was adduced to the effect that at the time the Deed was signed Mrs Edmonds was suffering from any particular medical or psychiatric condition, or that such a condition meant that she was unable to make decisions, including as to whether to sign the Deed. I would accept, based on the documents in evidence, that at the time of the dealings between November 2017 and April 2018 Mrs and Mr Edmonds were under a significant degree of financial pressure, but I do not accept that Mrs Edmonds was at any relevant time suffering from a condition that prevented her from making rational decisions on commercial and financial matters in her own interests. That conclusion is supported by the terms of many of the emails sent by Mrs Edmonds. 3. It is certainly not the case that BWG was aware of any condition suffered by Mrs Edmonds that would impair her ability to make decisions. I do not accept Mrs Edmonds' evidence on this matter, including her denial in cross-examination that she made no disclosure of any mental health issues to Mr Hough; and I reject her evidence that she told Mr Hough that "all documents would have to be explained to me because of the issues I was suffering". 4. In my opinion, consistent with the warranty contained in cl 3.1.5 of the Deed, Mrs Edmonds entered into the Deed voluntarily, and not as a result of any duress on the part of BWG. Mr Hough evidently appreciated that Mrs Edmonds was emotionally and financially in a distressed state in April 2018. However, I do not think that any unfair or illegitimate pressure was placed upon her by BWG in the circumstances. Whilst it was made clear at that time that unless the Deed was signed, BWG would not continue to provide its services, the tenor of a number of Mr Hough's emails was clearly to the effect that there was a choice as to whether the Deed was signed or not, and that the Deed should only be signed if there were no dispute about BWG's fee, and after legal advice was obtained. Mrs Edmonds in fact received legal advice from Mr Chaffey about the Deed. Despite that advice, she chose to sign the Deed. Quite apart from the terms of the Deed itself, Mrs Edmonds acknowledged in her email of 27 April 2018 that she and Mr Edmonds had discussed and were aware of the contents of the Deed. 5. It follows from the above that Mrs Edmonds has failed to establish any reason why the Deed should not be enforced. 6. By cl 2.1 of the Deed, the company and Mrs and Mr Edmonds jointly and severally undertook to repay the Debt to BWG on the earlier of various events. Debt is defined in cl 1.1 of the Deed to include the Service Fee plus all accruing interest. By Recital M, the Service Fee plus accrued interest calculated in accordance with the Agreement was stated to be $240,520 as at 12 April 2018. It is further stated in Recital M that interest continues to accrue on the Service Fee at the interest rate. The reference to the interest rate is plainly a reference to the interest rate that is specified in cl 7 of the Agreement (see Recital D). 7. There is no doubt that the obligation under cl 2.1 of the Deed to repay the Debt has arisen. There is evidence that sales of some of the Properties (as defined in the Deed) have completed (see cl 2.1.2) and in any event the service of the Statement of Claim would constitute a written demand by BWG (see cl 2.1.4). 8. In these circumstances, it is my view that Mrs and Mr Edmonds are obliged to pay BWG $240,520 plus interest accrued on that amount after 12 April 2018 at the rate specified in cl 7 of the Agreement. That is a high rate of interest (2.5% per month compounding each month) but it has not been shown in the circumstances to be penal or unconscionable. 9. A judgment should be entered for BWG against both Mrs and Mr Edmonds for $240,520 plus interest accrued since 12 April 2018 at that rate. The Court will order that an interest calculation be brought in to enable the appropriate judgment sum to be determined. 10. The next issue to consider is whether the money payable by Mrs and Mr Edmonds pursuant to cl 2.1 of the Deed is money that is the subject of the charge granted by Mrs and Mr Edmonds pursuant to cl 13.9 of the Agreement. 11. By cl 13.9, various property, including the Property, was charged with the payment of "those monies", being "monies that become due and payable to BWG under this agreement for any reason". BWG contends that the Service Fee (and interest thereon) became due and payable to it under the Agreement. It relies upon cll 2.2 and 7 of the Agreement in that regard. 12. Under cl 2.2, a Service Fee may become due and payable upon BWG obtaining "a loan offer within the ambit of the instructions set out at Item 3 of Schedule A." Item 3 of Schedule A specifies a number of features of a loan offer including the amount of the loan, the term of the loan and the interest rate. Those features delineate the ambit of the instructions within Item 3 of Schedule A. 13. BWG claims that a Service Fee arose from the Letter of Offer from In Base Investments Pty Ltd that was obtained by BWG and provided on 3 November 2017. However, it seems to me that as the offer concerned a loan for a period of only 3 months rather than the 12 month period specified in Item 3 of Schedule A, it cannot be said to be a loan offer within the ambit of the instructions set out at Item 3 of Schedule A. The period of a loan for refinance purposes is obviously a matter of importance, and there is a significant difference between a 3 month term and a 12 month term. The same point can be made in relation to the updated Letter of Offer obtained by BWG and provided on 8 November 2017. 14. In these circumstances, I do not think that any Service Fee became due and payable to BWG under the Agreement. The amount that is payable by Mrs and Mr Edmonds pursuant to cl 2.1 of the Deed does not bear that description. It follows that it is not an amount of money that is the subject of the charge granted under cl 13.9 of the Agreement. 15. BWG seeks to avoid that conclusion by claiming an estoppel by deed. The estoppel is said to arise from the recitals and operative provisions of the Deed. BWG emphasised that the Deed was entered into in the context of a dispute between the parties as to whether BWG was entitled to the Service Fee, and was intended to resolve that dispute. BWG submitted that Mrs and Mr Edmonds are estopped by the Deed from asserting that the Service Fee was not earned under the Agreement, and therefore from asserting that there is no debt to which the charge attaches. 16. It is true that by the terms of the Deed (in particular, Recitals I, M and N, and cl 2.1) Mrs and Mr Edmonds acknowledged the existence of a Service Fee payable under the Agreement, and agreed to pay it, together with interest, to BWG. An estoppel by deed could thereby arise to preclude Mrs and Mr Edmonds from denying the truth of that which they have acknowledged. 17. However, an estoppel by deed operates only in an action on the deed to enforce rights arising under it. That was the principle applied by Clarke J (as his Honour then was) in Offshore Oil NL v Southern Cross Exploration NL (1985) 3 NSWLR 337 at 340-5. That decision has been approved a number of times in this, and other, courts (see, for example, Minassian v Minassian [2010] NSWSC 708 at [55]; Re Quality Blended Liquor Pty Ltd [2015] 2 Qd R 381; [2014] QSC 234 at [48]; Australia and New Zealand Banking Group Ltd v Bragg (No 3) [2017] NSWSC 208 at [82]; and Burkett v Bendigo and Adelaide Bank Ltd (No 2) (2018) 133 ACSR 411; [2018] VSC 723 at [113]). I think that I should take the same approach here and apply the principle as recognised by Clarke J. 18. It seems to me that in seeking to enforce the charge granted under cl 13.9 of the Agreement to secure payment of the amount payable under cl 2.1 of the Deed, BWG is not taking action on the Deed to enforce rights arising under it. Rather, it is seeking to enforce a right that arises under the Agreement. The charge was created by the terms of the Agreement independently of, and antecedent to, the Deed. There are provisions in the Deed which refer to the clause of the Agreement that gives rise to the charge (e.g. Recital E and cl 2.2). However, it is clear that the Deed merely recognises the effect of the clause (which, by cl 2.2, is acknowledged to be valid), and does not purport to itself create any charge. That is the case even though the operative provisions of the Deed contain acknowledgements to the effect that BWG was and remains entitled to maintain caveats. Clause 2.2 makes it plain that this entitlement was based on the charging clause contained in the Agreement. 19. For these reasons, I have come to the conclusion that Mrs and Mr Edmonds are not precluded by an estoppel by deed from asserting that the amount payable by them pursuant to cl 2.1 of the Deed is not the subject of the charge granted under cl 13.9 of the Agreement. Put another way, I do not think that Mrs and Mr Edmonds are precluded from asserting that there are no monies due and payable to BWG "under this agreement" within the meaning of cl 13.9 of the Agreement. 20. BWG submitted that the provisions of the Deed could still operate as admissions against Mrs and Mr Edmonds. That is so, but the essential question here is whether, on the true construction of cl 13.9 of the Agreement and in the events that actually happened, any monies became due and payable to BWG under the Agreement. In my view it is clear, for the reasons I have already stated, that the Service Fee did not become due and payable to BWG under the Agreement. The provisions of the Deed, including the acknowledgements contained within it, do not alter that reality. In the absence of an estoppel, Mrs and Mr Edmonds were entitled, as they did in their Defence, to deny that the Service Fee became due and payable (see Statement of Claim paragraph 13 and Defence paragraph 7). It is not necessary to consider various other arguments raised by Mrs and Mr Edmonds to the effect that no Service Fee became due and payable, or that the Agreement was somehow not binding or enforceable. I should record, however, that I regard as fanciful Mrs Edmonds' evidence that she was pressured by BWG to return the executed Agreement and Letter of Offer. 21. It follows that BWG is not entitled to enforce a charge over the Property for payment of the amount that is payable to it under cl 2.1 of the Deed. Conclusion 1. BWG is entitled to a monetary judgment against both Mrs and Mr Edmonds for $240,520 plus interest. The Court will direct BWG to bring in an interest calculation to enable the appropriate judgment sum to be determined. The interest calculation will be directed to be served upon Mrs and Mr Edmonds, who will be given an opportunity to either agree to, or dispute, the calculation. 2. Otherwise, BWG's claim will be dismissed. However, as BWG is the successful party, the Court will also order that Mrs and Mr Edmonds pay BWG's costs of the proceedings. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 May 2022