We, the undersigned, respectfully call upon the relevant authorities and decision-makers to ensure that the defendant receives fair, impartial, and transparent treatment throughout all remaining legal proceedings and that all relevant evidence and the responsibilities of every party involved are fully and fairly considered.

For years, the defendant has endured the emotional, financial, and personal burden of prolonged court proceedings. Whatever the final legal outcome, years of uncertainty, stress, legal costs, and damage to his reputation have affected not only the defendant but also those close to him.

Many of us believe that the defendant has endured significant hardship throughout this process and that this matter raises important questions about whether the responsibilities of all participants involved in the electronic conveyancing transaction have been fully examined.

Background: Cui v Salas-Photiadis [2024] NSWSC 1280

The case arose from the sale of a residential property in New South Wales.

• Yi Cui agreed to purchase the property from Simpo Property Services Pty Ltd.
• Westpac was the incoming mortgagee financing the purchase.
• The defendant had previously entered into a loan agreement with the vendor relating to building works and claimed that agreement gave him an equitable security interest over the property. Based on that claimed interest, he lodged a caveat before settlement. 

The settlement proceeded electronically through the PEXA workspace. The transfer documents were lodged, and the settlement funds were distributed. However, after settlement, NSW Land Registry Services advised that the transfer and mortgage could not be registered because the defendant's caveat had been lodged before settlement. According to the Court’s reasons, the settlement proceeded without the caveat being identified before settlement was completed.

Following this, the purchaser applied to the Supreme Court under section 74MA of the Real Property Act 1900 (NSW) seeking an order that the defendant's caveat be removed. The purchaser argued that the caveat was invalid because it did not properly disclose the nature of the claimed interest and that the underlying agreement was unenforceable under the Home Building Act 1989 (NSW). 

Justice Hmelnitsky considered whether the defendant had an arguable equitable interest capable of supporting the caveat. The Court concluded that, at this interlocutory stage, he had an arguable case that the agreement created an equitable charge or equitable mortgage over the property. As a result, the Court declined to order the removal of the caveat, leaving the substantive dispute to be determined later. 

Why this is important:

This matter extends beyond the circumstances of one individual. It highlights the importance of ensuring that electronic conveyancing systems contain appropriate safeguards and that accountability is maintained throughout the settlement process. We believe that public confidence in the justice system and the conveyancing process depends on transparency and fairness for all parties involved.

The decision has been discussed widely in the conveyancing profession because it highlighted that

• A caveat can be lodged shortly before settlement.
• If it is not detected before settlement, registration of the transfer and mortgage may fail even though settlement funds have already been disbursed.

Practitioners should understand and use available title monitoring and lodgment support services in electronic conveyancing.

Importantly, this decision did not determine who, if anyone, was legally responsible for the settlement issues or whether any lawyer, lender, or PEXA participant was negligent. It was concerned with whether the caveat should be removed at that stage of the proceedings, and the court found there was an arguable basis for it to remain.

We further respectfully request that, if the defendant is ultimately vindicated by the courts or found not to be legally responsible, every reasonable step be taken to restore his reputation and acknowledge the impact these prolonged proceedings have had on his personal and professional life. In that event, we believe he should be treated with the utmost dignity and respect, and that any remedies available under the law should be considered where appropriate, having regard to the financial loss, reputational impact, and consequences he has experienced throughout these proceedings.

We believe that when an individual has endured prolonged litigation and is ultimately vindicated, the justice system should not only recognise that outcome but also consider what measures are appropriate to help restore public confidence and ensure fairness to the person affected.

By signing this petition, we respectfully ask that the defendant receive fair and impartial consideration throughout all remaining proceedings, that the responsibilities of all parties involved be fully examined, and that, should he ultimately be vindicated, appropriate steps be taken to restore his reputation and acknowledge the consequences he has experienced.

For further reading:

Lexology article discussing the implications of Cui v Salas-Photiadis.