Perpetual Trustees Australia v Richards [2008] NSWSC 658

This case involved a forged mortgage using an all monies clause. The lender, Perpetual Trustees Australia, acknowledged its mortgage was a nullity due to the use of the all monies mortgage. However it sought to recover, via a restitutionary claim, from the previous mortgagee the amount paid to them on the basis that their mortgage was “a nullity and not valid or enforceable”. This was a case of the glass calling the rock fragile because the previous mortgage was not an all monies mortgage.

Associate Justice Harrison held that the Perpetual Trustees claim was hopeless and gave summary judgement in favour of the previous mortgagee. This decision is not however the end of the case, Perpetual Trustees still have an argument of subrogation, and readers should anticipate a further judgement in the remaining case against the borrower and other parties in the future.

Bransgroves Lawyers continually warns lenders not to use all monies mortgages. Despite the raft of recent cases:

  1. Small v Tomasetti [2001] NSWSC 1112
  2. Perpetual Trustees Victoria Ltd v Tsai [2004] NSWSC 745
  3. Permanent Custodians v Yazgi [2007] NSWSC 279
  4. Printy v Provident Capital Limited [2007] NSWSC 287
  5. Chandra v Perpetual Trustees Victoria Ltd [2007] NSWSC 694
  6. Perpetual Limited v Costa [2007] NSWSC 1093
  7. Queensland Premier Mines Pty Ltd v French [2007] HCA 53
  8. Perpetual Trustees Victoria Limited v Ford [2008] NSWSC 29
  9. Perpetual Trustees Victoria Ltd v Van den Heuvel [2008] NSWSC 350
  10. Vella v Permanent Mortgages P/L [2008] NSWSC 505
  11. Provident Capital Ltd v Printy [2008] NSWCA 131
  12. Perpetual Trustees Australia v Richards [2008] NSWSC 658

lenders continue to ignore the peril of using all monies mortgages. Matthew Bransgroves has been warning lenders since 17 November 2003 (in a College of Law paper on Indefeasibility of Mortgages) not to use all monies mortgages.

Click here to read the full judgment

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