Solid Holdings v IMFML Finance [2008] NSWSC 573

New South Wales Supreme Court

CITATION : Solid Holdings v IMFML Finance [2008] NSWSC 573

HEARING DATE(S) : 05/06/08

JUDGMENT DATE : 5 June 2008

JURISDICTION : Equity

JUDGMENT OF : White J

EX TEMPORE JUDGMENT DATE : 5 June 2008

DECISION : Application to extend the injunction refused.

CATCHWORDS : MORTGAGES – mortgagee's power of sale – injunction sought to restrain sale – injunction sought to protect the equity of redemption – where no challenge to the mortgagee's right to exercise its power of sale nor as to the mode of sale - necessity to pay amount owing into Court in the ordinary case – injunction refused

LEGISLATION CITED : Real Property Act 1900 (NSW)

Inglis v Commonwealth Trading Bank of Australia (1972) 126 CLR 161 CASES CITED : Harvey v McWatters (1948) 49 SR (NSW) 173 Parist Holdings Pty Ltd v Perpetual Nominees Ltd [2006] NSWSC 599 Notaras v Sly & Weigall [2005] NSWCA 275

Solid Holdings Pty Ltd PARTIES : v IMFML Finance Pty Ltd & 2 Ors

FILE NUMBER(S) : SC 2940/08

COUNSEL : Plaintiff: F Kunc SC Defendants: D R Stack

SOLICITORS : Plaintiff: Gadens Lawyers Defendants: Deacons Lawyers

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION DUTY JUDGE LIST

WHITE J

Thursday, 5 June 2008

2940/08 Solid Holdings Pty Ltd v IMFML Finance Pty Ltd & 2 Ors JUDGMENT 1 HIS HONOUR: The plaintiff is the registered proprietor of land at 525 Illawarra Road, Marrickville. The first defendant is the mortgagee of the land. The second and third defendants are receivers and managers appointed to the plaintiff by the mortgagee. 2 On 23 May 2008, the plaintiff obtained ex parte an interim injunction to restrain the defendants from entering into any contract for the sale of the land. The injunction was continued on 26 May 2008 and again - and this time by consent - on 29 May 2008 until today. At least the last extension of the injunction was given on the basis of the plaintiff's proposal to discharge the mortgage debt by the close of business yesterday. 3 The defendants oppose the continuation of the injunction. 4 The initial loan facility provided by the first defendant was entered into on 9 November 2007. It was provided in order for the first defendant to refinance an existing mortgage secured over the land in Illawarra Road, Marrickville and was for a short time only. The loan was to expire on 28 December 2007. 5 On 27 December 2007, the agreement was varied. The loan facility was extended to 28 February 2008. It was a condition of the deed of 27 December 2007 that by 31 January 2008 the plaintiff supply to the first defendant a formal letter of offer from another institution that would provide sufficient funding to refinance the plaintiff's term of borrowings under their facilities with the plaintiff. That was not done. 6 On 20 February 2008, the solicitors for the first defendant gave notice that the plaintiff was in default of the condition and required the default to be remedied. 7 On 29 February 2008, Mr Jim George, a director of the plaintiff, wrote to the first defendant by email and advised, in substance, that the plaintiff had received a cheque which had been banked in an account in Hong Kong and was waiting for that cheque to be cleared in order to discharge the mortgage debt. The plaintiff provided to the first defendant a copy of a letter from Crown Management Holdings Ltd of Hong Kong, advising that it had approved the plaintiff's application for development funding for the erection of units and parking on the property in an amount of US$20 million. The refinance through that company did not proceed. Mr George confirmed in oral evidence that the funds did not clear and that the cheque was stopped. 8 Receivers and managers were appointed on 12 March 2008. 9 On 25 March 2008, Mr George advised the first defendant in substance that he had an approval letter from a funder and that it was only a matter of time before funds were released. 10 On 18 April 2008, the first defendant issued a notice under s 57(2)(b) of the Real Property Act 1900 (NSW). There is no issue that the first defendant is entitled to exercise its power of sale or that as at today the loan is still in default. 11 An affidavit was sworn by the plaintiff's solicitor on 23 May 2008. I infer it was sworn in support of the application made to the duty judge on that day for an interim injunction. In the affidavit the plaintiff's solicitor deposed that the plaintiff was finalising arrangements for the payout of the debt through a joint venture with two other parties; namely, a company called TT Global Invest Ltd and Ms Dewna Hope. He deposed that: " Approximately two weeks ago the JV parties agreed to completely fund both the payout of IMFML Finance and the complete development of the property. The complete funding has only been arranged in the last week, with confirmation being provided to me in the last few days. It is intended that the funding to be received from the JV parties (referred to below) would be used to pay out the debt and completely finance the construction of the development of the property. "