ROBINSON v CAMPBELL [1992] NSWCA 215

ROBINSON v CAMPBELL SUPREME COURT OF NEW SOUTH WALES — COURT OF APPEAL

MEAGHER JA, HANDLEY JA and CRIPPS JA 17 September 1992

[1992] NSWCA 215

Meagher JA. This is an appeal by Mr and Mrs Robinson who as plaintiffs were unsuccessful before Cohen J in their efforts to obtain an order for specific performance of a partition agreement. The agreement was dated 21 December 1988.

The primary purpose of the agreement was to divide a building known as Robell House situate at 287 Elizabeth Street into separate strata titles, some in favour of the appellants and some in favour of the respondent, Mr Campbell, who was the defendant before Cohen J.

All which need be known for this purpose is that the Robinsons and Mr Campbell agreed to build Robell House, to own it in equal shares and to discharge all liabilities connected with it equally.

They operated this scheme through a corporate entity called Soinco Pty Ltd of which Messrs Robinson and Campbell are both directors and whose shareholding is held as to one half by Mr and Mrs Robinson and as to the other half, by Mr Campbell.

At the time of the deed of December 1988 they were indebted to Westpac Banking Corporation in respect of this building in the sum of $11 million which they had borrowed. Westpac had a mortgage over the land to secure that indebtedness.

Clause 6 of the partition agreement reads as follows:

6. Rand C hereby agree with each other and with S that pending completion of the implementation of the partition, all costs payable to Westpac Banking Corporation in respect of the mortgage by S to Westpac Banking Corporation with respect to the Property are paid by R and C equally. Without limiting the generality of the foregoing, such costs shall include all interest payments, all amounts paid by way of discounted bill facility, and all legal costs and disbursements in connection with the aforesaid mortgage to Westpac Banking Corporation or any legal costs and disbursements paid or payable in respect of any consent by Westpac Banking Corporation to either the proposed Strata Plan or this partition or the discharge of its mortgage, R and C agree that upon registration of the Strata Plan, they will each use their best endeavours to procure that the mortgages by S to Westpac Banking Corporation shall be discharged and each of R and C shall contribute equally to the amount required to discharge such mortgage.'"The difficulties which arose in the present case flow from the last sentence of this clause and in particular, from the second half of the last sentence. I might add that there is no dispute but that Mr Campbell is liable under clause 6 to pay one half of $11 million to repay Westpac's debt and to discharge the mortgage. But Westpac's mortgage secures more than that $11 million, it also secures the sum of $5,175 million owing in respect of premises situate at 362 Pitt Street.