An assignment of a chose in action by way of security for indebtedness constitutes a legal mortgage and is an 'absolute assignment' not 'purporting to be by way of charge only' under s 12 of the Conveyancing Act 1919 (NSW), even where: (i) the deed does not use the word 'absolutely'; (ii) the assignee is described as being 'subrogated' to the assignor's rights; (iii) the assignor assigns 'as beneficial owner'; and (iv) the deed contains covenants for further assurance. The words 'as beneficial owner' serve to import implied covenants for title under s 78(1)(C) of the Conveyancing Act, not to limit the assignment to a beneficial interest. A party whose chose in action has been legally assigned is not a creditor of the debtor for the purposes of voting at a meeting of creditors in a voluntary administration.
The full text is available to signed-in members, including the 7 later cases that cite this judgment.
1 of the 7 citing cases carry a classified treatment. How each court treated it is available to signed-in members.