Howe v Kwok [2004] NSWSC 869

New South Wales Supreme Court

CITATION : Howe v Kwok [2004] NSWSC 869 HEARING DATE(S) : 13 September 2004; 14 September 2004 JUDGMENT DATE : 28 September 2004 JURISDICTION: Equity Division JUDGMENT OF : Pearlman AJ at 1 DECISION : See par 81 of the judgment

CATCHWORDS : Deed of charge to secure loan - whether security limited in duration - whether operative clauses should be set aside - whether unconscionable to rely on deed - whether deed unjust in the circumstances LEGISLATION CITED : Contracts Review Act 1980 s 7, s 9 PARTIES : Paul Alexander Howe (Plaintiff) Wood Yan Kwok (Defendant) FILE NUMBER(S) : SC 5040/03 COUNSEL : C Harris (Plaintiff) D Sibtain (Defendant) SOLICITORS : Willis & Bowring (Plaintiff) Truman Hoyle (Defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

PEARLMAN AJ

28 SEPTEMBER 2004

5040/03 - PAUL ALEXANDER HOWE v WOOD YAN KWOK JUDGMENT HER HONOUR: Introduction 1 These proceedings concern a deed of charge over certain properties given by the defendant to the plaintiff to secure a loan made by the plaintiff to a third party. 2 The plaintiff seeks to enforce the security because the third party has failed to repay the loan. He seeks a declaration that the defendant has relinquished his right, title and interest in the properties in favour of the plaintiff, and a declaration that the plaintiff is entitled to be registered as the proprietor of the properties. The plaintiff seeks an order directing the mortgagee of the properties to produce the title deeds for the properties so that the plaintiff may register transfers of the properties in his favour. Alternatively, he seeks an order that the properties be sold by the Public Trustee and the proceeds accounted for in part by repayment to him of the loan and any other money to which he may be entitled. 3 The defendant seeks to meet the plaintiff's claim in two ways. First, he asserts that, on the true construction of the deed, the defendant's obligation to secure the repayment of the loan did not continue beyond 90 days after the date of the deed. Secondly, the defendant has instituted a cross-claim against the plaintiff, seeking an order that certain operative clauses of the deed be set aside, or declared void, or varied, on the grounds, first, that it would be unconscionable for the plaintiff to rely upon them in the circumstances, and, secondly that, in terms of the Contracts Review Act 1980, those clauses are unjust in the circumstances relating to the deed at the time it was made.