NSW Caselaw
New South Wales Court of Appeal
CITATION: BOFINGER & Anor v KINGSWAY GROUP PTY LTD & Ors [2008] NSWCA 332 This decision has been amended. Please see the end of the judgment for a list of the amendments.
HEARING DATE(S): 7 October 2008
JUDGMENT DATE: 3 December 2008
JUDGMENT OF: Giles JA at 1; Handley AJA at 19; Sackville AJA at 60
DECISION: Appeal dismissed with costs.
CATCHWORDS: EQUITY - rule in Otter v Vaux - extended to guarantors - prevents guarantor keeping first mortgage alive against second mortgage he has guaranteed. - EQUITY - subrogation - unconscionable conduct - guarantor paying off first mortgage - first morgagee holding surplus - not unconscionable for first mortgagee to transfer surplus to second mortgagee where second mortgage also guaranteed. - GUARANTEE - subrogation - guarantor paying off first mortgage - not entitled to subrogation in priority to second morgage guaranteed by himself. - MORTGAGE - rule in Otter v Vaux - guarantor pays off first mortgage - rule extended to prevent guarantor keeping first mortgage alive against second mortgage guaranteed by himself.
LEGISLATION CITED: Law Reform (Miscellaneous Provisions) Act 1965
CATEGORY: Principal judgment
Aldrich v Cooper (1803 8 Ves Jun 382 at 389; 32 ER 402 Alwyn v Witty (1861) 30 LJ Ch 860 Aquilina Holdings Pty Ltd v Lynndell Pty Ltd [2008] QSC 57 Austin v Royal (Giles J, 14 May 1988, unreported; BC 9801770 at 12) Australasian Conference Association Ltd v Mainline Constructions Pty Ltd (in liquidation) (1978) 141 CLR 335 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 Banque Financiere de la Cité v Parc (Battersea) Ltd [1999] 1 AC 221 Barnes v Addy (1874) LR 9 Ch App 244 Challenger Managed Investments Ltd v Direct Money Corporation Pty Ltd (2003) 12 BPR 22,257 Cochrane v Cochrane (1985) 3 NSWLR 403 Dawson v Bank of Whitehaven (1877) 4 Ch D 639 Drew v Lockett (1863) 32 Beav 499; 55 ER 196 Duncan Fox & Co. v North and South Wales Bank (1880) 6 App Cas 1 Forbes v Jackson (1882) 19 Ch D 615 CASES CITED: Gedye v Matson (1858) 25 Beav 310 Highland v Exception Holdings Pty Ltd (in liq) [2006] NSWCA 318; 60 ACSR 223 Liquidation Estates Purchase Co. v Willoughby [1898] AC 321 McColl's Wholesale Pty Ltd v State Bank of New South Wales (1984) 3 NSWLR 365 Mercantile Law Amendment Act 1856 (UK) O'Dey v Commercial Bank of Australia Ltd (1933) 50 CLR 200 Otter v Lord Vaux (1856) 2 K & J 650; 69 ER 943 Platt v Mendel (1884) 27 Ch D 246 re W Tasker & Sons Ltd [1905] 2 Ch 587 Registrar-General v Gill (Court of Appeal, 16 August 1994, unreported) Silk v Eyre (1875) 9 IR Eq 393 Sussman v AGC Advances Ltd (1995) 37 NSWLR 37 CA Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 Thorne v Cann [1895] AC 11 Toulmin v Steere (1805) 3 Mer 210 Whiteley v Delaney [1914] AC 132
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