Above All Rigging & Site Modifications Pty Ltd v Lang [No 2]

[2015] WASC 415

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   ABOVE ALL RIGGING & SITE MODIFICATIONS PTY LTD -v- LANG [No 2] [2015] WASC 415

CORAM:   MITCHELL J

HEARD:   2 NOVEMBER 2015

DELIVERED          :   2 NOVEMBER 2015

PUBLISHED           :  3 NOVEMBER 2015

FILE NO/S:   CIV 2701 of 2015

BETWEEN:   ABOVE ALL RIGGING & SITE MODIFICATIONS PTY LTD

Plaintiff

AND

RUSSELL STUART LANG
KERYN DIANNE LANG
First Defendants

THE REGISTRAR OF TITLES
Second Defendant

Catchwords:

Practice and procedure - Application for further orders following dismissal of application to extend caveat - Reconsideration of unperfected order - Injunction pending proposed appeal

Legislation:

Civil Judgments Enforcement Act 2004 (WA), s 15
Rules of the Supreme Court 1971 (WA), O 58 r 29
Transfer of Land Act 1893 (WA), s 138B, s 138C

Result:

Injunction granted

Category:    B

Representation:

Counsel:

Plaintiff:     Mr B P Wheatley

First Defendants           :     In person

Second Defendant         :     No appearance

Solicitors:

Plaintiff:     Mossensons

First Defendants           :     In person

Second Defendant         :     No appearance

Case(s) referred to in judgment(s):

Above All Rigging & Site Modification Pty Ltd v Lang [2015] WASC 414

Apache Northwest Pty Ltd v Agostini [2009] WASCA 147

Bashford v Bashford [2008] WASC 138

Chiodo v Murphy & Doherty [1996] ANZ ConvR 160

Davies v Davies [2009] WASCA 238

Murphy v Wright (1992) 5 BPR 11

Norman v Norman (1992) 6 WAR 372

Paringa Mining & Exploration Company Plc v North Flinders Mines Ltd (1988) 165 CLR 452

Perdaman Chemicals and Fertilisers Pty Ltd v Griffin Coal Mining Company Pty Ltd [2011] WASCA 188

Porter v McDonald [1984] WAR 271

Re Westpac Banking Corporation [2015] NSWSC 869

MITCHELL J: 

(This judgment was delivered extemporaneously and has been edited from the court's record of the decision.)

1. This is the plaintiff's application by chamber summons dated 30 October 2015, made following my decision on 29 October 2015 to dismiss the plaintiff's originating summons.[1] The originating summons sought orders for the extension of a caveat pursuant to s 138C of the Transfer of Land Act 1893 (WA) and, in the alternative, injunctive relief. The orders which the plaintiff now seeks are that:

   1.The plaintiff's caveat be extended for 21 days from 29 October 2015, provided that if the plaintiff does not file an appeal within that time, the plaintiff's caveat shall lapse at midnight on 19 November 2015.

   2.In the event that the plaintiff files and serves an appeal within 21 days from 29 October 2015, the operation of the caveat shall be extended until further order.

   3.There be liberty to apply on 48 hours' notice.

   [1] Above All Rigging & Site Modification Pty Ltd v Lang [2015] WASC 414.

Jurisdiction

1. The first question which arises is whether I have jurisdiction to make the order sought. It is necessary to consider that question in light of the provisions of s 138B and s 138C of the Transfer of Land Act.

2. Section 138B(1) enables a registered proprietor to apply for the Registrar of Titles to serve a caveator with a notice to the effect that, unless the caveator takes the action referred to in subsection (2) within 21 days after the day on which the notice is served, the caveat will lapse.

3. Section 138B(2) provides that if the notice referred to in subsection (1) is served on the caveator then the caveat lapses 21 days after the day on which the notice was served unless, before that time, the caveator has obtained from the Supreme Court an order extending the operation of the caveat and lodged with the registrar a copy of the order. That is, the lapsing of the caveat is produced directly by the operation of the Transfer of Land Act.

4. Section 138C(1) then provides that a caveator who is served with a notice under s 138B(1) may apply to the Supreme Court for an order extending the operation of the caveat.

5. Section 138C(2) sets out what the court may do on the hearing of such an application. If satisfied that the caveator's claim has or may have substance, the court may make an order extending the operation of the caveat or such other orders as it thinks fit concerning the caveat or land in respect of which the caveat was lodged. If not so satisfied, the court shall dismiss the application. In any case, the court may make such ancillary orders in relation to the application as it thinks fit.

6. Therefore, the court's power to extend the caveat depends on the court being satisfied that the caveator's claim has or may have substance.  If not so satisfied, the court must dismiss the application.

Reconsideration of previous decision under s 138C

1. In my previous decision, I explained that I was not satisfied that the caveator's claim had or may have substance and therefore dismissed the application for extension of the caveat.  My view has not been altered by the additional authorities to which counsel for the plaintiff has referred today.

2. Counsel identified a number of cases where an equitable charge has been recognised in a contract of guarantee.[2]  However, in those cases the contract in effect expressly provided for the secured party to 'attach the debt due to any of the assets of the guarantor'.  Those words seem quite clearly to create an equitable charge and are not present in the current agreement.

   [2] Chiodo v Murphy & Doherty [1996] ANZ ConvR 160; Murphy v Wright (1992) 5 BPR 11,734.

3. I was also referred to a decision of the New South Wales Supreme Court in Re Westpac Banking Corporation,[3] which was said to involve an equitable charge implied by the terms of a guarantee.  However, it seems clear that what was in fact involved in that case was a loan agreement rather than a guarantee.

   [3] Re Westpac Banking Corporation [2015] NSWSC 869, [16] ‑ [20].

4. I am also not persuaded that I erred in concluding that, even if an equitable charge was created, the plaintiff had not established that the charge was still on foot because it had not produced any evidence that the money secured was still owed.

5. Counsel for the plaintiff again submitted that, on an application to extend the operation of a caveat, it is not appropriate for a judge to attempt to resolve conflicts of evidence on affidavit.[4]  As I indicated in my previous decision, in this case there is no relevant conflict because Mr Coward has not said that any amount is owing.  The onus of establishing that fact was on the plaintiff, and the onus was not discharged.[5]

   [4] Porter v McDonald [1984] WAR 271, 276. See also Bashford v Bashford [2008] WASC 138 [48]; Bride v The Registrar of Titles [2015] WASC 11 [13].

   [5] AboveAll Rigging [28].

6. Counsel also submitted that the evidence of Mrs Lang, to the effect that the debt the subject of the deed of acknowledgment of debt had been repaid, was inadmissible.  Although the evidence involved a degree of hearsay, I consider that it was admissible.[6]  In any event, counsel did not object to the evidence when it was given.

   [6] See O 37 r 6 (2)(c) of the Rules of the Supreme Court 1971 (WA).

7. On the evidence before me, I remain unsatisfied that the plaintiff's claim has or may have substance. The condition for my power to extend the caveat referred to in s 138C of the Transfer of Land Act has not been established.

Other sources of power to extend caveat

1. Counsel for the plaintiff submitted that the power to make ancillary orders in relation to the application, conferred by s 138C(2)(c) of the Act, would allow me to dismiss the application subject to an extension of the caveat pending appeal. However, s 138C(2)(c) must be read with the balance of the section, which makes it clear that a caveat can be extended only if the court is satisfied that the caveator's claim has or may have substance, and otherwise must be dismissed. I cannot see how an order extending a caveat is ancillary to the dismissal of an application to extend the caveat.

2. Counsel also referred to the court's discretion to recall an order which has not been perfected.[7] As I have indicated, I am not persuaded that the order I made was incorrect.  Recalling the order would not overcome the requirement for me to be satisfied that the plaintiff's claim has or may have substance before making an order extending the caveat.

   [7] Norman v Norman (1992) 6 WAR 372.

3. Counsel for the plaintiff also relied on O 58 r 29(f) of the Rules of the Supreme Court 1971 (WA), which enables the court, on an application by originating summons, to give any special direction touching the carriage or execution of the judgment, or the service thereof upon persons not parties, as it thinks just. Again, I cannot see that that rule gives me the power to extend the caveat in circumstances where the Transfer of Land Act denies that power.

4. Finally, counsel relied on s 15 of the Civil Judgments Enforcement Act 2004 (WA), which confers power on the court to grant a suspension order in relation to a judgment. However, the refusal of an application to extend the operation of a caveat does not fit within the definition of 'judgment' in s 3 of that Act. Such a decision does not require the payment of money, nor does it require a person to do, not do or cease doing an act. In any event, to stay my order dismissing the application would not assist the plaintiff, because the caveat will lapse by operation of s 138B of the Transfer of Land Act unless an order is made pursuant to s 138C(2)(a) and lodged with the Registrar of Titles.

Injunction

1. There remains a question as to whether the court can grant an interim injunction restraining dealings with the land pending an appeal.  There is clearly a power for me to grant an injunction pending an appeal to the Court of Appeal, by analogy with the power to grant a further injunction pending an appeal to the Court of Appeal against the refusal by a single judge to grant an interlocutory injunction pending trial.[8]

   [8] See Kendall C & Curthoys J, Civil Procedure in Western Australia [52.1.42A].

2. The High Court held in Paringa Mining & Exploration Company Plc v North Flinders Mines Ltd[9] that it is not satisfactory to leave to the judge whose order is under review the exercise of the appellate discretion to grant or refuse the injunction pending the appeal.  The judge appealed from is necessarily disadvantaged when it comes to an evaluation of the strength of the appellant's attack on the judge's original exercise of his discretion.  I recognise that disadvantage, but given that the caveat is about to expire, it seems necessary for me to deal with the application, at least in the short term.

   [9] Paringa Mining & Exploration Company Plc v North Flinders Mines Ltd (1988) 165 CLR 452, 459, cited in Civil Procedure in Western Australia [52.1.42A].

3. In this case, there are three essential considerations:  firstly, whether an arguable ground of appeal is established; secondly, whether the refusal of an injunction would render the appeal nugatory; and thirdly, whether the balance of convenience favours the grant or refusal of an injunction.[10]

Merits of proposed grounds of appeal

[10] Civil Procedure in Western Australia [52.1.43]; Paringa Mining (460); Apache Northwest Pty Ltd v Agostini [2009] WASCA 147 [9]; Perdaman Chemicals and Fertilisers Pty Ltd v Griffin Coal Mining Company Pty Ltd [2011] WASCA 188 [5].

1. As I understood counsel for the plaintiff, there were essentially two grounds of appeal proposed.  The first was that I erred in deciding that the plaintiff's construction of the acknowledgment of debt agreement (as impliedly creating an equitable charge) was not reasonably arguable.  The second was that I erred in admitting Mrs Lang's evidence as to the repayment of the debt and attempting to resolve what is said to be a conflict on the evidence at an interlocutory stage.

2. In relation to the first proposed ground, while I remain of the view I previously expressed, the question now becomes whether it is reasonably arguable that I was wrong to conclude that the plaintiff's construction of the agreement was not arguable.  That is a low threshold.  I am prepared to proceed on the basis that there is at least some prospect that the plaintiff might succeed in convincing the Court of Appeal that its claim has or may have substance.

3. It would remain for the Court of Appeal to consider whether I was correct to conclude that the plaintiff had not discharged its onus of proving that the loan which the charge secured had not been repaid.  I am not presently persuaded that there is any reasonable argument that that decision was incorrect.  The plaintiff has not adduced any evidence that the money was still owing.

Whether refusal of injunction would render appeal nugatory

1. There is some prospect that refusal of an injunction would render the proposed appeal nugatory.  Although there is no evidence of any immediate plans of the first defendants to deal with the property, the removal of the caveat would enable them to do so.

2. It may be that an appeal against refusal to grant the caveat would be of little utility in any event because the caveat will, unless extended, lapse tomorrow. On the other hand, there may be some prospect of the Court of Appeal, if it concludes that I had made an error, giving leave for the lodgement of a further caveat under s 138D(1)(e) of the Transfer of Land Act.[11]

Balance of convenience

[11] But see Davies v Davies [2009] WASCA 238 [17].

1. The balance of convenience very much favours the plaintiff, which risks losing its claimed security interest in the property if it is dealt with between now and the resolution of any appeal.  There is no evidence of the first defendants having any planned dealings in the property which would be interfered with by the grant of an injunction.  The first defendants point only to the inconvenience of having a caveat on their land.

Conclusion

1. I am not satisfied that there are arguable grounds of appeal which will ultimately see the plaintiff obtain the relief which it has sought.  However, refusal to grant an injunction would render any appeal potentially nugatory, and the balance of convenience very much favours the grant of an injunction to preserve the subject matter of the appeal.

2. In those circumstances, it seems to me (bearing in mind the caution given by the High Court in Paringa Mining as to the difficulties of a judge assessing the merits of an appeal against his or her own decision) that I should grant an injunction restraining the first defendants from effecting any dealing in the land for a period which will allow the plaintiff to seek some further relief from a judge of the Court of Appeal (which would appear to be the more appropriate venue for this issue to be considered).

3. I propose to grant an injunction in those terms until 6 November 2015.  The continuation of that injunction will be conditional upon the plaintiff instituting an appeal by 4 November 2015.