Saffron Sun Pty Limited v Perma-Fit Finance Pty Ltd (in liq) [2005] NSWSC 1317

Reported Decision : 65 NSWLR 603 (2006) 24 ACLC 14

New South Wales Supreme Court

Saffron Sun Pty Limited v Perma-Fit Finance Pty Ltd (in liq) [2005] NSWSC 1317 CITATION : This decision has been amended. Please see the end of the judgment for a list of the amendments.

HEARING DATE(S) : 9 November 2005

JUDGMENT DATE : 15 December 2005

JURISDICTION : Equity Division

JUDGMENT OF : Windeyer J at 1

DECISION : Judgment for the second defendant. Plaintiff not entitled to payment from the second defendant under s197 of the Corporations Act 2001.

CATCHWORDS : CONTRACTS - vendor and purchaser - contract for sale of land - order for specific performance - claim for damages in addition - vendor unable to convey on agreed terms as moneys secured by mortgage more than the sale price - extent of dmages allowed - whether obligations under contract to convey free of mortgage or encumbrance and to adjust rates were liabilities under s197(1) of the Corporations Act 2001 - EQUITY & SUBROGATION - purchaser under contract for sale of land paying out mortgage and paying more than the purchase price entitled to be subrogated to rights of mortgagee. - CORPORATIONS LAW - Construction of s197(1) of the Corporations Act 2001before amendment - discussion of word "entitled" - whether departure from earlier s233(2) of Corporations Law intended - consideration of decision in Hanel v O'Neill - not followed - COURTS AND JUDGES - Decision of Full Court of Supreme Court of another State - discussion of circumstances in which trial judge could depart from it

Corporations Act 2001 s197(1) Fisher & Lightfoot Law of Mortgage 2nd Australian Ed 2005, at paragraph 42.19 Sheldon: Law of Subrogation 2nd ed 1892 Meagher Gummow and Lehane: Equity Doctrines and Remedies 4th ed at 9-005 LEGISLATION CITED : Usury Bills of Lading and Written Memoranda Act 1902 Local Government Act 1993 s550 Water Management Act 2000 Water Management Act s355