Shocked couple are forced to move out of their dream home they bought at auction and lived in for FIVE years after discovering it still belonged to the previous owner
- Couple bought house at auction
- They were told to move
- The court ruled that they did not own it
An Australian couple who bought a house and lived there for five years have been told to move out after a court found they never actually owned it.
Jess and Jackie Morecroft paid more than $1.2 million for the property at Mermaid Beach, on the Gold Coast, in a March 2018 auction.
The house is a prime piece of real estate as it is walking distance to the beach and has increased in value to over $2.7 million.
But the couple fought for five years to keep the house after previous owner Hind Issa, 83, took legal action in September 2018 to keep it.
The house was sold at a mortgage auction, where a property is put up for sale because the owner cannot pay his mortgage.
The Supreme Court ruled in February 2023 that Ms. Issa was still the rightful owner after she claimed the mortgage was taken out by a relative who forged her signature.
The house in Mermaid Waters on the Gold Coast (pictured) was bought by the Morecrofts in 2018 for $1.2 million
Jackie and Jess Morecroft (pictured) are entitled to $2.7 million in damages from the Queensland government, a court has said, but could be appealed by government lawyers
The court heard that Ms. Issa’s relative applied for a loan, forged her signature to guarantee the house, and then defaulted.
When the lenders seized the house, Ms. Issa filed a caveat, which is a claim to the Land Titles Office, intended to warn the public that there is a legal interest in the property.
Negotiations between the company that borrowed the money, described in court documents as a “lender of last resort,” and Ms. Issa led to the caveat being dropped in exchange for $40,000.
The Morecrofts, unaware of this, subsequently settled the contract on the property on June 1, 2018 and proceeded to transfer title to their names.
But they were unable to do so because a second caveat had been placed by Ms Issa, who claimed the house was ‘fraudulently mortgaged’.
She also reported the alleged fraud to the police and a legal battle has been raging over the five-year house ever since.
The Supreme Court ruled in February that the home’s mortgage had been “obtained by defrauding another person.”
The court also ruled that the lenders were “completely inadequate” in their efforts to verify whether or not Ms Issa had agreed to the collateral on her home.
The court ruled that the house was still owned by Ms Issa, who has Alzheimer’s disease and was represented in court by her adult daughter.
“I think it’s just been shown to us, you can buy a house at auction, you can settle for that house… you can pay for that house and you still might not get that house,” Mr Morecroft told the ABC.
The house is now worth more than $2.7 million, but a court ruled the Morecrofts didn’t own it after it hit the market because it was fraudulently put up as collateral for a loan
The court ruled that while the Morecroft’s had no legal claim to the home, they were entitled to recover its current value, $2.7 million, from the lenders who wrongly sold it.
The pair have already spent $300,000 in legal fees and were concerned that taking more legal action to recover their money could cost hundreds of thousands of dollars more.
But at its final hearing on Friday, the court said the Queensland government should be held liable for damages because the Morecrofts were victims of a fraudulent sale.
The government can appeal the decision, but the Morecrofts said on Friday it was still a “huge relief”.
“It is now a clear instruction for the state to pay us damages and we hope they accept the arbitrator’s decision,” said Mr. Morecroft.