New South Wales Supreme Court CITATION : Agnvet Services v Carter [2009] NSWSC 753 HEARING DATE(S) : 23 July 2009 JURISDICTION : Equity Division JUDGMENT OF : McDougall J at 1 EX TEMPORE JUDGMENT DATE : 23 July 2009 DECISION : See paragraph [13] of the judgment. CATCHWORDS : MORTGAGES - specific performance of agreement to give mortgage. - PRACTICE - order that Registrar execute mortgage if defendant does not comply with order to do so. LEGISLATION CITED : Civil Procedure Act CATEGORY : Principal judgment CASES CITED : Commonwealth Bank of Australia v Gaszewski [2006] NSWSC 772 AGnVET Services Pty Ltd (Plaintiff) PARTIES : Rowen John Carter (First Defendant) Registrar - General, Department of Lands (Second Defendant) FILE NUMBER(S) : SC 2829/09 COUNSEL : J C Hewitt (Plaintiff) SOLICITORS : O'Halloran Deal Lawyers (Plaintiff) Patricia Woodin Solicitors (Second Defendant) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION McDOUGALL J 23 July 2009 (ex tempore – revised 23 July 2009) 2829/09 AGNVET SERVICES PTY LIMITED v ROWEN JOHN CARTER & 1 ORS JUDGMENT 1 HIS HONOUR: This is an application for an order that the defendant execute a mortgage in favour of the plaintiff over certain land owned by the defendant, and for ancillary declarations and orders. 2 The source of the alleged obligation to execute a mortgage is a credit application dated 12 February 2004 made between the plaintiff and the defendant and his then wife. The credit application was made to enable the defendant and his wife (who carried on a primary production business in partnership) to obtain goods and services on credit from the plaintiff. 3 The credit agreement was subject to a number of "Terms and Conditions of Trade" including clause 10, which was headed "Charge". By that clause the "Purchaser" (that is, the defendant and his then wife) charged to the plaintiff "all beneficial interest, freehold (freehold and leasehold) in land held now or in the future by the Purchaser". That charge was given, of course, to secure payment of any indebtedness arising to the plaintiff. Further, clause 10 provided that if the plaintiff made demand "the Purchaser...will immediately execute a mortgage or other instrument of security, or consent to a caveat, as required...". 4 The defendant has not appeared. I am satisfied, on the evidence, that it is likely that he is making himself unavailable, and perhaps that he is overseas. The defendant's brother, who holds an enduring power of attorney from the defendant, has said in effect that the defendant is a very proud man who could not face his indebtedness, and would not return to Australia whilst ever he remained indebted to people. 5 I am satisfied that the defendant's brother was notified personally that the matter would be listed for hearing today, and that the plaintiff would be applying for an order that the defendant execute a mortgage over such real property as is presently registered in his name. 6 There has been tendered, as the subject of the orders that the plaintiff seeks, a form of mortgage prepared by the plaintiff's solicitor. The annexure to that form of mortgage is not the standard memorandum Q860000 registered in the office of the Registrar General and commonly referred to in mortgages. It is a form apparently used by the plaintiff's solicitor as a standard form of mortgage. I have not undertaken a comparison of the terms in that annexure with the terms of the memorandum to which I have referred. It would have been preferable if the document of which the plaintiff sought execution embodied a well known and accepted standard form such as memorandum Q860000. However, I think, it is probably the better construction of clause 10 that the mortgage to be executed is one in a form required by the plaintiff. If that is so, then it matters not that the terms may be harsh or onerous (and of course I am not to be taken as expressing any view that they may be). It seems to me that that construction arises either on or by implication from the words "as required". 7 Thus, whilst this matter is not on all fours with the facts considered by Brereton J in Commonwealth Bank of Australia v Gaszewski [2006] NSWSC 772, I think that it is sufficiently close to render his Honour's reasons in that case a valuable source of guidance. 8 The matters to which I have referred make it unlikely that the defendant will comply with any order that he execute and deliver a form of mortgage. Of course, his brother, as the defendant's attorney under power, could do so. But the Court cannot, I think, compel him to do so. 9 Against the possibility that any order for the execution and delivery of a mortgage will not be obeyed, the plaintiff asks in the alternative for an order under s 94 of the Civil Procedure Act 2005. That section reads as follows: 94 Failure to comply with order to execute instrument (1) If any person does not comply with a judgment or order directing the person: (a) to execute any conveyance, contract or other document, or (b) to endorse any negotiable instrument, the court may order that the conveyance, contract or other document be executed, or the negotiable instrument endorsed, by such person as the court may nominate for that purpose. (2) A conveyance, contract, document or instrument that is executed or endorsed pursuant to an order under subsection (1) operates, and is for all purposes available, as if it had been executed or endorsed by the person originally directed to execute or endorse it. 10 As Brereton J pointed out in Gaszewski at [13], non-compliance with an order directing a person to execute a document is a precondition to the making of an order authorising some other person (usually the Registrar) to do so. However, his Honour said, the order could be made "if the circumstances demonstrate the probable futility of any proper request" to the defendant. I add that it is desirable, to effect the just, quick and cheap resolution of these proceedings (see s 56 of the Civil Procedure Act), to deal with all matters in dispute or likely to arise now, so as to save the plaintiff the expense, inconvenience and delay of a further application to the Court. 11 For the reasons that I have indicated, I am satisfied that it is appropriate now to make an order under s 94, although conditioned (as it should be) upon failure by the defendant to comply with an order directed to him. 12 In short, I am satisfied on the evidence that the plaintiff is entitled to the relief that it claims today. That relief is embodied in terms of certain short minutes of order which, as amended, seem to me to be appropriate. I will note that for the purposes of an order that the defendant execute and deliver a mortgage it is proposed that sufficient service may take place by delivery of a sealed copy of the orders to the defendant's brother. In circumstances where the defendant's brother is fully authorised to act for the defendant, that seems to me to be appropriate. The form of order expressly reserves "the purpose of any application for contempt" from the sufficiency of service for which it otherwise provides. That is an entirely proper exception, and is in accordance with the orders made by Brereton J in Gaszewski. 13 For those reasons, I make declarations and orders in accordance with paragraphs 1 to 9 as amended of the short minutes of order initialled by me and dated today's date. I note firstly that those orders include one for immediate entry, and secondly for the proceedings to be listed before the Registrar on 10 August 2009. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.