| Duncan v McDonald | |
|---|---|
 | |
| Court | Court of Appeal of New Zealand |
| Full case name | Duncan v McDonald |
| Decided | 11 August 1997 |
| Citation(s) | [1997] 3 NZLR 669 |
| Court membership | |
| Judge(s) sitting | Richardson P, Gault J, Thomas J , Keith J, Blanchard J |
Duncan v McDonald [1997] 3 NZLR 669 is a cited case in New Zealand regarding the granting of relief under the Illegal Contracts Act 1970 for illegal contracts. [1]
The McDonalds entered into an illegal scheme with some Nigerians that in return of an investment of $285,000, they would receive $2,000,000. The McDonalds borrowed the money from an estate that Mr Duncan, a solicitor, was managing, and they used a property as security for the loan. Duncan was aware of the illegal nature of the transaction when he lent the money.
Unsurprisingly, the McDonalds were a victim of a Nigerian scam, leaving the McDonalds unable to repay the mortgage on their property, and Duncan sought to enforce the mortgage.
The McDonalds sought to have the mortgage set aside, as it was the result of financing of a crime, whilst Duncan sought validation.
The court ordered validation of the mortgage, but only to the extent of $75,000.
Footnote: This case is similar to Polymer Developments Group Ltd v Tilialo
In law, conveyancing is the transfer of legal title of real property from one person to another, or the granting of an encumbrance such as a mortgage or a lien. A typical conveyancing transaction has two major phases: the exchange of contracts and completion.
Foreclosure is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan.
A reverse mortgage is a mortgage loan, usually secured by a residential property, that enables the borrower to access the unencumbered value of the property. The loans are typically promoted to older homeowners and typically do not require monthly mortgage payments. Borrowers are still responsible for property taxes or homeowner's insurance. Reverse mortgages allow older people to immediately access the home equity they have built up in their homes, and defer payment of the loan until they die, sell, or move out of the home. Because there are no required mortgage payments on a reverse mortgage, the interest is added to the loan balance each month. The rising loan balance can eventually grow to exceed the value of the home, particularly in times of declining home values or if the borrower continues to live in the home for many years. However, the borrower is generally not required to repay any additional loan balance in excess of the value of the home.
A real estate contract is a contract between parties for the purchase and sale, exchange, or other conveyance of real estate. The sale of land is governed by the laws and practices of the jurisdiction in which the land is located. Real estate called leasehold estate is actually a rental of real property such as an apartment, and leases cover such rentals since they typically do not result in recordable deeds. Freehold conveyances of real estate are covered by real estate contracts, including conveying fee simple title, life estates, remainder estates, and freehold easements. Real estate contracts are typically bilateral contracts and should have the legal requirements specified by contract law in general and should also be in writing to be enforceable.
In trust law, a constructive trust is an equitable remedy imposed by a court to benefit a party that has been wrongfully deprived of its rights due to either a person obtaining or holding a legal property right which they should not possess due to unjust enrichment or interference, or due to a breach of fiduciary duty, which is intercausative with unjust enrichment and/or property interference. It is a type of implied trust.
Flipping is a term used to describe purchasing a asset and quickly reselling it for profit.
In finance, a security interest is a legal right granted by a debtor to a creditor over the debtor's property which enables the creditor to have recourse to the property if the debtor defaults in making payment or otherwise performing the secured obligations. One of the most common examples of a security interest is a mortgage: a person borrows money from the bank to buy a house, and they grant a mortgage over the house so that if they default in repaying the loan, the bank can sell the house and apply the proceeds to the outstanding loan.
Mortgage fraud refers to an intentional misstatement, misrepresentation, or omission of information relied upon by an underwriter or lender to fund, purchase, or insure a loan secured by real property.
Phillip E. Hill Sr. was the ringleader of the largest mortgage fraud scheme ever prosecuted in the State of Georgia.
Frazer v Walker [1967] 1 AC 569 is a landmark New Zealand court case that went to the Privy Council on appeal. The case upheld the concept that an owner of interest in land which was originally obtained from the rightful owner through fraud, still obtains an indefeasible interest in that title if they were unaware of the fraud.
Mall Finance & Investment Co Ltd v Slater [1976] 2 NZLR 685, is a New Zealand case regarding whether a contract entered into to stop a party for filing criminal charge is legally enforceable or not. It is more often cited as Slater v Mall Finance.
Polymer Developments Group Ltd v Tilialo [2002] 3 NZLR 258 is a New Zealand case regarding the legality of contracts created to prevent a prosecution, which unlike the earlier similar precedents of Mall Finance v Slater [1976] 2 NZLR 685 and Barsdell v Kerr [1979] 2 NZLR 731, in this case however, although the contract was clearly illegal, relief was granted to the creditor.
Barsdell v Kerr [1979] 2 NZLR 731 is New Zealand case frequently cited with Mall Finance v Slater [1976] 2 NZLR 685 and Polymer Developments v Tilialo [2002] 3 NZLR 258 regarding illegal contracts prejudicial to the administration of justice under the Illegal Contracts Act [1970].
The Illegal Contracts Act [1970] is a New Zealand law that manages how contracts are deemed illegal under either common law or under Statute.
Harding v Coburn [1976] 2 NZLR 577 was a New Zealand case that was one of the first that upheld that the Illegal Contracts Act 1970 had the power to validate despite the fact that another legal enactment "deemed to be unlawful and shall have no effect".
Ross v Henderson [1977] 2 NZLR 458 is a cited case in New Zealand regarding illegal contracts that were later upheld that the Illegal Contracts Act 1970 had the power to validate despite the fact that another legal enactment "deemed to be unlawful and shall have no effect".
NZI Bank Ltd v Euro-National Corp Ltd [1992] 3 NZLR 528 is a cited case in New Zealand regarding whether a contract illegal under law, can be subsequently validated under the Illegal Contracts Act 1970.
Catley v Herbert [1988] 1 NZLR 606 is a cited case in New Zealand regarding whether a contract illegal under law, can be subsequently validated under the Illegal Contracts Act 1970.
Mercurius Ventures Ltd v Waitakere City Council [1996] 2 NZLR 495 is a cited case in New Zealand regarding whether a contract illegal under law, can be subsequently validated under the Illegal Contracts Act 1970.
Goss v Chilcott[1996] UKPC 17 is a decision of the Privy Council on appeal from New Zealand relating to the law of restitution, and in particular the requirements of total failure of consideration in relation to loans where some repayments had been made, and the defence of change of position.
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