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2 swanston mortgage vic ca said that this right was

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2. Swanston Mortgage : Vic CA said that this right was not caveatable because it was a personal equity (purportedly following Latec) 3. This implies that it would also be a personal equity for purposes of a priority dispute (and could be defeated by a bona fide purchaser of an equitable estate for value without notice) Swanston Mortgages v Trepan Investments (Vic SCoA) 1. The mortgagee sold to the lowest bidder (undervalued). Swanston did this, Trepan wanted to caveat their equitable interest, Swanston tried to stop them doing this. Improper sale by a mortgagee did ont give rise to a caveatable interest. Brooking J looked to Latec case for answer on this, arguing Trepan had equitable interest (mere equity), but it could NOT be caveated. Sharon Rodrick feels that they regarded this mere equity as being a personal one. 2. The right of a mortgagor to apply to court under s 77 TLA to set aside a mortgagee’s sale for breach of statutory duty is a mere equity that does not give a caveatable interest 3. Is this consistent with Breskvar v Wall? (B’s right to set aside for fraud was treated as an equitable interest for purposes of priority dispute) Priority Disputes between a Mortgagor and a Purchaser from a Mortgagee. 1. What interest is acquired by the purchaser from the mortgagee? See TLA s. 77(4). The purchaser gets a registered title that can’t be set aside. If they’re registered and not defeasible for fraud, they take free of any rights that the previous mortgagor had. 2. What is the position of a purchaser from a mortgagee who has improperly exercised the power of sale AFTER registration? If the conditions of s. 77 have not been met, the transfer will still take effect. What won’t be effective will be the attempt to transfer the interest of the mortgagee. So, I’ve got a mortgage on my property fro $100,000. Default on this, so mortgagee sells, but fraudulently by selling dodgily to purchaser. Should I therefore get my land back without the mortgage? NO! The mortgage simply passes to the purchaser (subject to any interests the mortgagee was bound to uphold). 3. What is the position of a purchaser from a mortgagee who has improperly exercised the power of sale PRIOR TO REGISTRATION and what is the position of the mortgagor? Forsyth v Blundell 1. Mr. Blundell owned land in Canberra, had a mortgage with ASL, who sold property to lowest bidder. Blundell sought an injunction against this. TJ found it was an improper sale. 2. Can mortgagor obtain an injunction to prevent completion of sale by mortgagee? COURT HELD: Interlocutory injunction – balance of convenience, serious question to be tried. Mortgagor may be required to make payment into court. To obtain permanent injunction, mortgagor must win on priorities. 46
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47 3. Walsh J (Mason J agreeing) treated mortgagor’s interest as a legal interest (still reg’d pter), which prevails over purchaser’s equitable interest. The effect of this is that mortgagor will have a legal interest that PREVAILS against the purchaser.
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