Paino v MDN Mortgages [2009] NSWSC 898

In this case the borrower alleged that she took out a mortgage in order to pay for her mother’s medical costs. She then refinanced six times, each time to avoid enforcement by the outgoing lender. The music stopped with a loan from MDN Mortgages. Unable to refinance the borrower filed the customary Contracts Review Act defence. Additionally, she alleged that the ‘Business Purposes’ declaration that she had signed was false and that the lender knew or ought to have known of her deception. The lender was legally represented by David Magney, solicitor. Mr Magney was also director and major shareholder of MDN Mortgages. The borrower sought a prohibition against David Magney acting as a solicitor in the case. The Judge agreed to the order commenting:

The mere circumstance that a solicitor will be a material witness of itself does not justify restraining the solicitor from continuing to act. The line is only crossed when the solicitor has a personal stake in the outcome of the proceedings beyond the recovery of proper fees for acting. I have come to the view that Mr Magney’s personal interest in the outcome is such that, if he were to continue to act, the Court may be deprived of relevant objectivity in the preparation and presentation of the case.

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