Drinkwater v Nadinic [2016] NSWSC 1364

Supreme Court New South Wales

Medium Neutral Citation: Drinkwater v Nadinic [2016] NSWSC 1364 Hearing dates: 20 and 21 September 2016 Date of orders: 30 September 2016 Decision date: 30 September 2016 Jurisdiction: Equity Before: Pembroke J Decision: See paragraph [35] Catchwords: EQUITY – fraudulent non-disclosure – claim to set aside deed and mortgage – rescission Legislation Cited: Australian Consumer Law (Competition and Consumer Act 2010 (Cth) Sch 2) Contracts Review Act 1980 (NSW) Cases Cited: Beach Petroleum NL v Kennedy (1999) 48 NSWLR 1 Brickenden v London Loan & Savings Co [1934] 3 DLR 465 Lazarus Estates Ltd v Beasley [1956] 1 QB 702 Category: Principal judgment Parties: Cheryl Drinkwater as trustee for the Cheryl Drinkwater Trust – plaintiff Andrew Frane Nadinic – defendant Representation: Counsel: S O'Brien – for the plaintiff (20 September) A G Martin – for the defendant

Solicitors: Hewitts Commercial Lawyers – for the plaintiff Summer Lawyers Pty Ltd – for the defendant` File Number(s): 2016/242022

Judgment

Introduction 1. This claim came before me urgently in the Duty List a few weeks ago. There was no pleading but the core of the plaintiff's complaint is that she was induced to enter into a deed of settlement, and to give a related second mortgage to the defendant, by reason of his non-disclosure of certain material facts. The defendant's failure to disclose is said to have been misleading and deceptive, in the statutory sense as well as in the sense that it constituted equitable fraud. 2. The plaintiff's legal submissions ranged rather wider than her statement of issues and her amended summons but it was always clear that the primary issue was whether the plaintiff is entitled to set aside the deed and the mortgage, wholly or in part. In effect, she invokes the equitable remedies known as rescission (the deed) and delivery up and cancellation (the mortgage). She sought, perhaps at a minimum, to vary the mortgage by reducing the amount of her debt to the defendant. 3. Unfortunately, there was no consideration of how or whether rescission could be achieved equitably, having regard to the payments already made and the conduct that has already occurred. The deed of settlement was entered into on 24 November 2015 and much has happened in performance of its terms. If the plaintiff is notionally entitled to rescission, it will be necessary to mould a remedy so as to achieve practical justice between the parties.