Wilde & Anor v Morgan & Ors [2013] VSCA 250 (20 September 2013) : Mortgage, Default notice, Service, Effect of provision of a ‘new’ address Transfer of Land Act 1958 (Vic) section 113, doctrine of fair notice.

September 23, 2013 |

The court of appeal, per Hansen and Tate JJA, considered the operation of default notices, service and the doctrine of fair notice in Wilde & Anor v Morgan & Ors [2013] VSCA 250. It was an appeal from a decision of AsJ Derhham in Re: Art Pacific Pty Ltd; Wilde v Morgan & Ors [2013] VSC 330 (27 June 2013).


The applicants sought orders, set out at [1], that:

(1) the appointment of the first and second respondents as agents for the third respondent by Deed of Appointment of Agents for Mortgagee in Possession dated 23 October 2012 (the Deed) under a mortgage of land between the second applicant and the third respondent was invalid;

(2) further or alternatively, the first and second respondents entry into possession or assumption of control of the land of the second applicant pursuant to the Deed was invalid.

The issue at the core of the hearing at first instance and on appeal was whether service of the Default Notice was valid. Derham AsJ found the Default Notice had been properly served as per clause 13.01 of the Memornadum of Common Provisions, it was unnecessary to consider section 113 of the Transfer of Land Act (“TLA”) and rejected submissions on the doctrine of fair notice [4].

The mortgaged property is situated at 253-257 Maroondah Highway, Ringwood. the Second Plaintiff (Art) became the sole registered proprietor of the property on 15 November 2002 the same day the mortgage was registered [6]. The address stated in the mortgage is 255 Maroondah Highway, Ringwood. There was no different address  as the address of the mortgagor notices and for other communications [7]. The Default Notice, dated 15 October 2012, was delivered by being placed under the door to the premises at 255 Maroondah Highway, Ringwood and an attempt of service at the registered office of the mortgagor, being at ‘Rear 253 Maroondah Highway, Ringwood.’[8]

The Default Notice stated that Art was in default of its facilities with Bendigo, that Bendigo terminated the facility and demanded payment of all moneys owing, then stated the amount owing to be $1,124,161.37, and that if the demand was not complied with within seven days of service Bendigo may exercise its powers pursuant to the mortgage [9]. Art did not comply with the demand, and on 23 October 2012 Bendigo appointed the first and second respondents by the Deed [10].

Wilde’s evidence was that formal communications from the Bank to Art has been addressed to Art’s post office box.  Wilde says he only found out about the Default Notice when his solicitors were informed, on 23 October 2012, of the appointment of administrators and a copy of the Deed of appointment was provided on 2 November 2012[13].



Compliance with clause 13.01

Clause 13.01 was extracted in the judgment, at [11], and provides as follows:


13.01 Any notice or certificate to be given to or demand to be made on the Mortgagor and any appointment to be made by or on behalf of the Mortgagee shall be deemed to have been duly given or made if it is in writing, signed by an Authorised Officer of the Mortgagee and left at or sent by prepaid mail:

(a) to the address of the Mortgagor as shown in this Mortgage;

(b) where a new address has been notified in writing by the Mortgagor to the Mortgagee, to that new address;

(c) in the case of a corporate Mortgagor, to its registered office or to the address the corporation has notified the Mortgagee in writing; or

(d) in any manner provided by Statute, where applicable.

A communication sent by mail shall be deemed to have been received by the Mortgagor on the second day after posting (excluding days on which no mail deliveries are made).

The Court rejected the appellant’s submissions that the use of “or” between each sub section stating that “each subclause is an alternative or independent basis of service” [22].

Doctrine of Fair Notice

The applicants submittedthat on the evidence the Default Notice did not come to their attention,  that  Bendigo knew that tenants occupied the premises and notice could easily have been posted [31]. At first instance the issue in the case was whether cl 13.01(a) was applicable and satisfied; if so, service was ‘deemed’ to have been duly made, not  whether or when the Default Notice came to the attention of the applicants [32].


 The decision highlighted the difficulty in setting aside a Default Notice which complies with the technical requirements of the Memorandum of Common Provisions.  In a practical sense the appellants may have been able to point to custom and usage regarding the exchange of correspondence between the mortgator and mortgagee however the address for service is what matters in the delivery of the Default or any other Notice under the Mortgage.


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