Todd Hadley Pty Limited v Lake Maintenance (NSW) Pty Ltd (No 2)

[2020] NSWCA 81

NSW Court of Appeal

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Interrogate

Catchwords

1. Limitation of Actions
2. › Accrual of cause of action
3. › Professional negligence
4. › Valuers
5. › Valuation for mortgage security purposes
6. › Whether cause of action accrues upon sale of mortgaged property or only when inability to recover from borrower under personal covenant becomes reasonably ascertainable
1. Torts
2. › Professional negligence
3. › Valuers
4. › Duty of care
5. › Valuation prepared for mortgage security purposes
6. › Nature of interest protected
7. › Interest in recoupment from proceeds of sale
8. › Whether loss suffered when sale proceeds inadequate to recoup loan
1. Mortgages and Securities
2. › Mortgages
3. › Valuation of property for mortgage security purposes
4. › Accrual of cause of action against valuer
5. › Relevance of borrower's personal covenant to accrual of cause of action
6. › Whether prospect of recovery under personal covenant defers accrual or goes only to quantum

Quick Take

Lenders who receive negligent valuations for mortgage security purposes must commence proceedings against the valuer within the limitation period running from the sale of the mortgaged property (or earlier), and cannot defer the accrual of the cause of action by pointing to the prospect of recovering from the borrower under the personal covenant.