Gippsreal v Hanna [2009] NSWSC 169

Perpetual Trustee held the first mortgage and exercised their power of sale. In the meantime Gippsreal who claimed a second ranking equitable mortgage placed a caveat on title. This was sought to be lapsed by Perpetual but was extended by court order. Gippsreal later provided a withdrawal but the LPI wanted proof the extension order had been discharged. Hence why the application before the court on this occasion. Into this mix came the borrower, Mr Hanna, alleging sale at undervalue. The court held that the remedy of Hanna was proceedings for account or for breach of duty but unless he could pay the entirety of the mortgage debt into court the sale would not be restrained. The court further noted he was not a party to the caveat and therefore had no standing to seek its extension.

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