180 Capital Finance Pty Ltd v Dickinson Street Pty Ltd [2007] NSWSC 398

New South Wales Supreme Court

CITATION : 180 Capital Finance Pty Ltd v Dickinson Street Pty Ltd [2007] NSWSC 398

HEARING DATE(S) : 2 April 2007 JURISDICTION : Equity Division

JUDGMENT OF : Young CJ in Eq

EX TEMPORE JUDGMENT DATE : 2 April 2007

DECISION : Proceedings for declaration that plaintiff had equitable mortgage over defendant's land dismissed with costs.

CATCHWORDS : CONTRACTS [142]- Contract that charge existed if the defendant's representations and warranties were incorrect and misleading- Defendant said it had a valuation report which said land worth $1.4 million- True value nearer $700,000- Valuation never relied on by plaintiff- Held no incorrect representation or warranty.

LEGISLATION CITED : Real Property Act 1900 Trade Practices Act 1974 (Cth)

Biotechnology Australia Pty Ltd v Pace (1988) 15 NSWLR 130 CASES CITED : Drinkwater v Caddyrack Pty Ltd (Young J, 25.9.1997, unreported) Godecke v Kirwan (1973) 129 CLR 629 Peak Construction (Liverpool) Ltd v McKinney Foundations Ltd (1970) 1 BLR 111

PARTIES : 180 Capital Finance Pty Limited (P) Dickinson Street Pty Limited (D)

FILE NUMBER(S) : SC 5356/06

COUNSEL : G George (P) M Ashhurst (D)

SOLICITORS : Huntingdale Smythe Lawyers (P) Hewitts Commercial Lawyers (D)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

YOUNG CJ in EQ

Monday 2 April 2007

5356/06 – 180 CAPITAL FINANCE PTY LTD v DICKINSON STREET PTY LTD JUDGMENT 1 HIS HONOUR: This is an application by the plaintiff for the court to declare that it has an equitable mortgage which is valid and enforceable against certain land of the defendant situated in 45 and 47 Dickinson Street, Charlestown. 2 The summons is probably a little inadequate in making that claim because one does not just declare that there is an equitable mortgage; if there is one, one makes the actual order that the defendant execute a mortgage in proper form so as to confer legal title. 3 The odd thing about the "pleadings" in this case is that they do not follow the established form, but, in a misguided thought that costs might be saved, the parties consented to orders that the plaintiff file a statement of its case and the defendant a statement of its contentions. 4 In the plaintiff's statement of its case, which was filed on 3 November 2006, the plaintiff claims that on or about 20 June 2006 the parties executed an agreement headed "Offer of Term Finance". Pursuant to that agreement, the defendant agreed, upon execution of that agreement, that it would immediately pay to the plaintiff an establishment fee of $5,000 plus GST. That establishment fee was to be payable irrespective of whether or not the plaintiff proceeded with the Term Loan Facility. Further, the defendant promised that it would immediately pay to the plaintiff a "break fee" in the amount of $15,000 plus GST if it did not proceed with the Term Loan Facility, plus any disbursements or other expenses reasonably incurred in connection with the Term Loan Facility. The fees were charged upon any land of which the defendant is or becomes the registered proprietor, including the parcels of land known as 45 and 47 Dickinson Street, Charlestown. 5 The "pleading" goes on to say that pursuant to the agreement the defendant agreed that certain conditions precedent were conditions precedent to the obligation of the plaintiff to make the advance; they included that: "(a) the Plaintiff has received from the Defendant in form and substance satisfactory to the Plaintiff, all information and documentation which the Plaintiff requests from the defendant; and (b) all warranties and representations provided by the Defendant to the Plaintiff are correct and not misleading."