Tanwar Enterprises v Cauchi

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Citation: Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315.

This information can be found in the Textbook: Edgeworth et all, Sackville and Neave's Property Law Cases and Materials, 8th edition, Lexis Nexis, 2008, pp. 302-3 [4.20] or here.


Background Facts

  • The Plaintiff [Tanwar] entered into a contract with the Defendant [Cauchi] to purchase three properties.
  • After some problems with the date of settlement, the parties agreed on a certain date for settlement, which was to be 'of the essence'.
  • The Plaintiff did not have the funds on the date, but said he could have them the next day (he did).
  • On the next day, the Plaintiff was ready to settle but the Defendant already terminated the agreement.


  • The Plaintiff argued that it had equitable interests in the land and therefore seeks specific performance or relief against forfeiture.

Legal issues


  • The court analyses the relationship of a mortgagee and a mortgagor and how equitable interests arise.
    • A mortgagee (the lender) acquires the land in fee simple. The mortgagor (borrower) acquires an 'equity of redemption' which entitles him to receive the title back once he pays the debt.
    • Whilst at common law, a date can be specified for the payment, equity will not deem the equitable interest of the mortgagor lost just because the date has passed.
  • However, this means that the notion in law that a vendor-purchaser relationship is essentially a mortgagee-mortgagor relationship is false.


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