ACT Leagues Club Ltd v Australian Capital Territory Rugby League Inc
[1995] FCA 571
•20 Aug 1995
CATCHWORDS
JUDGMENT ON ADMISSIONS: defendants' counter-claim for possession - no defence to counter-claim filed by plaintiff - plaintiff not out of time to file pleading - whether defendants had a clear entitlement to an order for possession under 0 35 r 6 of the Rules of the Supreme Court of the Australian Capital Territory - whether all issues considered by the Court - whether application attended with sufficient doubt
Rules of the Supreme Court of the Australian Capital Territory O 35 r 6
In the Matter of the Trade Marks Act 1955-1958 and In the Matter of the Registered Trade Marks "Certina" and "Certina DS" (1970) 44 ALJR 191
Faith Shipping Co. S.A. v. The Ship Mardina Importer and Anor (1982) 56 ALJR 838
Gilbert v. Smith [1876] 2 Ch D 686
ACT Leagues Club Limited v Australian Capital Territory Rugby League Incorporated and Canberra District Rugby League Football Club Limited
No ACT G 26 of 1995
Higgins, Tamberlin, Kiefel JJ.
Canberra
2 August 1995
IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY
DISTRICT REGISTRY
GENERAL DIVISION No. ACT G 26 of 1995
On appeal from the Supreme Court of the Australian Capital Territory
BETWEEN:ACT LEAGUES CLUB LIMITED
Appellant
AND: AUSTRALIAN CAPITAL TERRITORY RUGBY LEAGUE INCORPORATED
First Respondent
AND:CANBERRA DISTRICT RUGBY LEAGUE FOOTBALL CLUB LIMITED
Second Respondent
BEFORE: Higgins, Tamberlin, Kiefel JJ.
PLACE: Canberra
DATE: 2 August 1995
MINUTES OF ORDERS
THE COURT ORDERS THAT:
1. The appeal be allowed.
2. There be no order as to costs on the appeal or on the hearing of the motion at first instance.
NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY
DISTRICT REGISTRY
GENERAL DIVISION No. ACT G 26 of 1995
On appeal from the Supreme Court of the Australian Capital Territory
BETWEEN:ACT LEAGUES CLUB LIMITED
Appellant
AND: AUSTRALIAN CAPITAL TERRITORY RUGBY LEAGUE INCORPORATED
First Respondent
AND:CANBERRA DISTRICT RUGBY LEAGUE FOOTBALL CLUB LIMITED
Second Respondent
BEFORE: Higgins, Tamberlin, Kiefel JJ.
PLACE: Canberra
DATE: 2 August 1995
REASONS FOR JUDGMENT
(KIEFEL J.)
On 17 March 1995 the primary Judge ordered that the first defendant, Australian Capital Territory Rugby League Incorporated, have possession of land described in the pleadings as "Block 1, Section 30, Division of Braddon, Australian Capital Territory". That order was made on a motion by the defendants under O. 35 r. 6 of the Rules of the Supreme Court of the Australian Capital Territory and on the basis of admissions said to be contained in a document referred to in the pleadings and in the plaintiff's answers to certain interrogatories. The plaintiff, ACT Leagues Club Limited, appeals from that decision.
The proceedings, commenced in 1992, concern rights with respect to the land described above, upon which there is constructed a football oval and facilities of some worth. By its amended statement of claim filed on 21 December 1994, the plaintiff sought relief against both the first and second defendants. It claimed to have been in possession of the land since January 1980 and in that time to have paid all outgoings and rent and to have expended monies for maintenance and improvements. The first defendant had, shortly prior to that date, become entitled to the land as lessee from the Commonwealth. It is common ground that regulation 19 of the Lease Regulations made under the Real Property Act 1925 (ACT) applies with respect to the lands. That regulation provides that the first defendant shall not, except with the previous consent in writing of the Minister, assign, sub-let or part with possession of the leased land and that any assignment, sub-lease, agreement or arrangement made in contravention of the regulation shall be void. On 12 February 1984 the first defendant purported to transfer its interest in the land to the plaintiff and that transfer was registered although later expunged and the memorial cancelled. After that action was taken by the Registrar and on 10th May 1990 the plaintiff and first defendant executed an encumbrance in favour of the plaintiff and a declaration of trust which provided:
".. that while in no way assigning, subleasing or parting with possession of the land, nor in agreeing or arranging so to do, the Trustee so as to bind its properly appointed legal representatives hereby covenants with the Beneficiary that it, the Trustee, has since 12 February 1984 held its interest in the land as Trustee for and on behalf of the beneficiary, and the Trustee shall on demand in writing by the Beneficiary, execute whatever further documents may reasonably be required by the Beneficiary in order to
A Effect a full legal and beneficial transfer and assignment of the land to the Beneficiary or as it may direct in writing,
B Better secure the Beneficiary's interest herein,
C Enable the Beneficiary to deal with the land as if it held the registered legal title to the land. "
Subsequently however it is alleged that the first defendant denied it held its interest as trustee for the plaintiff and on or about 8 December 1994 the first defendant executed a transfer to the second defendant and sought the Minister's consent with respect to it. The second defendant is alleged to have had knowledge of the previous dealings as at the date of execution of that transfer.
The relief sought by the plaintiff in its amended statement of claim included declarations with respect to rights arising under the trust and orders obliging the first defendant to execute all necessary documents to effect a transfer of its interest in the land. A claim for compensation was made in the alternative. The plaintiff did not assert a right nor seek any orders declaring its right, to possession, which it continued to enjoy. That statement of claim was filed after receipt of the original defence and counter-claim of 22 December 1992 which, in substance, denied that the first defendant had power to act as trustee or to declare a trust and sought an order for possession of land. No reply or defence to the counter-claim was filed by the plaintiff. Following the amendment of the statement of claim a further defence and counter-claim was filed on 23 January 1995. By paragraph 11A both defendants raised a matter of law, contending that the terms of the declaration of trust did not entitle the plaintiff to possession of the land and it was that contention which was pursued on the motion before his Honour. The relief sought by the counter-claim included a declaration that the plaintiff was wrongfully in possession and an order that the second defendant have possession of the land. At the time the motion came
before his Honour no reply and defence to this counter-claim had been filed by the plaintiff, but the time within which it might do so had not expired.
His Honour heard the matter late on a motions day and did not provide detailed reasons. A review of the transcript shows that his Honour pronounced the order following an observation that the plaintiff could not point to a present entitlement to possession of the land and acceptance of the defendants' submissions that the terms of the document entitled Declaration of Trust appeared to expressly exclude such a possibility. How the first defendant could claim a present entitlement to possession on the strength only of the plaintiff's limited admissions and in the face of its own claim as to the second defendant's entitlement does not appear to have been the subject of any submission, and the order that the first defendant have possession was not sought on any interlocutory basis. I put this matter to one side for the moment, for it seems to me that the defendant did not have the necessary clear entitlement to any order for possession as against the plaintiff and that the procedure under O. 35 r. 6 was inappropriate. That rule provides:
"Any party may, at any stage of a cause or matter, where admissions of fact have been made, either on the pleadings, or otherwise, apply to the Court or Judge for such judgment or order as upon such admissions he may be entitled to, without waiting for the determination of any other question between the parties, and the Court or Judge may, upon such application, make such order, or give such judgment, as the Court or Judge thinks just."
The purpose of the rule is to save time and costs where a party can be seen, by unambiguous admissions of fact howsoever made, to have a clear entitlement to the relief claimed: In the Matter of the Trade Marks Act 1955-1958 and In the Matter of the Registered Trade Marks "Certina" and "Certina DS" (1970) 44 ALJR 191, 192;
Faith Shipping Co. S.A. v. The Ship Mardina Importer and Anor (1982) 56 ALJR 838, 839 and Gilbert v. Smith [1876] 2 Ch D 686. The power is discretionary and is exercised with great caution: The "Certina", 192. The requirement that the entitlement be "clear" cannot be satisfied where the right asserted is subject to some other contention which cannot be disposed of then and there by legal argument, a course which was not in any event undertaken here. Whilst it is possible that the procedure could be utilised prior to the close of pleadings, an order could only be warranted where the Court could conclude with certainty that no matter could be raised against the right to relief claimed. In my view however there were matters of substance not brought to his Honour's attention and therefore not considered by him. It follows that the discretion was not properly exercised.
The submissions made to his Honour, and which were accepted, did not touch upon issues which might be raised against the claim that the plaintiff was not, and the second defendant was, entitled to possession. Whilst this could have been done by the plaintiff, it was not. Whilst this lack of explanation is relevant to the question of costs it is not a case where it could be concluded that the plaintiff had waived any right to raise matters in defence of the defendants' claim. It still had the right to file a pleading raising those matters. The fact that it had not yet done so was not explored, nor even adverted to. To have done so would have been likely to highlight questions which might be said to arise from the promises contained in the Declaration of Trust, and which might affect the defendants' rights not only to possession but to bring the motion itself.
Regulation 19 may have had the effect that the earlier agreement to transfer the lease was void. And it may have remained open to the Commonwealth or the Minister to take action to remove the plaintiff from possession, although over the years no such step has apparently been taken. The first defendant's position with respect to taking such a step however may well be different. It had a series of dealings with the plaintiff whereby the plaintiff expended considerable sums of money and, whilst not effective to assign the lease, as the parties desired, their position was then stated in the Declaration of Trust. It was not suggested by the defendants that that document or the arrangement it recorded was caught by the prohibition of regulation 19. Indeed it was the attempt of those drafting it to ensure that it did not contravene the regulation that was relied upon by the defendants, who asserted that the only conclusion open from those words was that the plaintiff had no present right to possession and that the first defendant had not parted with, or intended to part, with it. But that is only part of the picture. By the Declaration of Trust the first defendant accepted personal obligations connected with the property which may be capable of enforcement by the plaintiff as beneficiary: see Jacobs Law of Trusts 5th ed [111]; Ford & Lee on Trusts 2nd ed [104] [105]. I do not offer a concluded view as to this, nor as to the wider issues in the plaintiff's draft reply and defence to counter-claim and which it now seeks to raise - as to whether there was an agreement apart from the declaration which is enforceable notwithstanding regulation 19 and as to whether the first defendant is estopped from denying the plaintiff's entitlement to possession so arising. There has not been argument on these matters. But given that it is arguable that there is an enforceable obligation on the part of the first defendant to execute documents necessary to effect an assignment, including those seeking the
Minister's consent, it is not difficult to accept that a necessary corollary would be that the first defendant would not take steps to ensure that it could not fulfil its obligations.
In those circumstances it is not just that the first defendant (and therefore the second defendant as a party with knowledge) cannot show the necessary clear entitlement to possession. Its very right to bring the application seems to me to be attended with sufficient doubt that the matter should not have proceeded under O. 35 r. 6.
None of these matters were raised before his Honour. The response to his Honour's inquiry as to the utility of the order, to the effect that whilst it would not resolve all matters it would resolve a significant question, was not accurate. The practical effect of his Honour's order was to permit the first defendant to have possession whilst the hearing of all matters affecting the entitlement, including those yet to be raised by the outstanding pleading, remained to be determined. It had the effect of an interlocutory order but without undertakings and without reference to matters affecting the balance of convenience which would have required reference to the plaintiff's possession of the land for many years.
As I have said, the question whether matters which could be raised by the plaintiff afford no answer to the defendants' counter-claim, in law or in equity, were not argued before this Court. It was not necessary to do so, given that this was not the course taken before his Honour. If, after the plaintiff has raised these matters by its further pleading, the defendants consider that to be the case there are of course other
procedures open to them. The present order made without reference to the full issues in the case cannot however be sustained.
I propose that the appeal should be allowed and his Honour's order set aside.
As to the question of costs, it was not made clear why the legal representatives for the plaintiff did not raise these matters before his Honour. On the other hand, given that there was a pleading outstanding which could respond to the issue of law raised for the first time in its defence and counter-claim, and given the terms of the declaration of trust itself, it ought to have occurred to the defendants that the final relief sought could not be given. In these circumstances, I would propose that there be no order as to costs in favour of either party on the appeal or on the hearing of the motion.
I certify that this and the preceding seven pages are a true copy of the reasons for judgment of the Honourable Justice Kiefel.
Associate
Date: 2 August 1995
Counsel and Solicitors for
the appellant: Mr C P Comans instructed by Vandenberg Reid
Counsel and Solicitors
for the respondents: Mr P M Donahoe QC and Mr B A Meagher instructed by Colquhoun Murphy
Date of Hearing: 30 June 1995
Date of Judgment: 2 August 1995
IN THE FEDERAL COURT OF AUSTRALIA )
AUSTRALIAN CAPITAL TERRITORY ) No. AG 26 of 1995
DISTRICT REGISTRY )
GENERAL DIVISION )
On appeal from the Supreme Court of the Australian Capital Territory
BETWEEN: ACT LEAGUES CLUB LIMITED
Appellant
AND: AUSTRALIAN CAPITAL TERRITORY
RUGBY LEAGUE INCORPORATED
First Respondent
AND: CANBERRA DISTRICT RUGBY LEAGUE
FOOTBALL CLUB LIMITED
Second Respondent
REASONS FOR JUDGMENT OF HIGGINS J.
I have had the advantage of reading in draft the reasons of Kiefel J. I agree with her honour's conclusion, the orders she proposes and the reasons she has expressed.
I would only wish to add the observation that Regulation 19 might well but need not necessarily have had the effect that the earlier agreement preceding the declaration of trust was void. That is, however, not necessarily so - compare Emmett v Kiely [1946] SASR 17 with Gasiunas v Meinhold (1964) 6 FLR 182 and, generally, Aust. Digest, 3rd ed Conveyancing Title 19[6].
I certify that this page is a true copy of the Reasons for Judgment herein of his Honour Mr Justice Higgins
Associate
Dated: 2 August 1995
IN THE FEDERAL COURT OF AUSTRALIA)
AUSTRALIAN CAPITAL TERRITORY ) No. AG 26 of 1995
DISTRICT REGISTRY )
GENERAL DIVISION )
BETWEEN: ACT LEAGUES CLUB LIMITED
Appellant
AND: AUSTRALIAN CAPITAL TERRITORY
RUGBY LEAGUE INCORPORATED
First Respondent
AND: CANBERRA DISTRICT RUGBY LEAGUE
FOOTBALL CLUB LIMITED
Second Respondent
REASONS FOR JUDGMENT OF TAMBERLIN J
I agree with the conclusions and reasons for judgment given by Kiefel J in this matter and with the proposed orders.
In my view the Reply and Defence to Counter Claim dated 20 June 1995 in this matter raises important issues particularly in relation to the effect of the Declaration of Trust and of the conduct of the respondents. These matters need to be considered before an order is made as to entitlement to possession of the premises and as to the rights arising from the Declaration of Trust and from such conduct.
It is important that, at the time when his Honour made the orders under appeal on 17 March 1995, the prescribed time for pleadings under the Rules had not expired, so that his Honour did not have before him the complete pleadings nor did he have the benefit of hearing argument on all relevant issues before making his determination. Moreover, the order for possession made at the close of proceedings was not that sought in the Counter Claim.
The hearing before his Honour, in my opinion, miscarried because of the procedural irregularity in relation to the pleadings and the way in which the matter was argued. The remarks of Bridge LJ in Weston v Central Criminal Court Courts Administrator [1976] 3 WLR 103 at 113 are apposite in the present case:
"There is a lesson which these proceedings seem to me to teach. The law's insistence on matters of formality in procedure is often derided as pedantic and unnecessary. But the necessity for a procedure whereby the nature of the issues to be determined by any legal process is clearly defined and ascertained is graphically shown in this case.
When counsel appeared for the solicitor before the judge at the Central Criminal Court on November 27 one cannot ascertain what the issues in dispute were other than by an examination of the lengthy dialogue between counsel and the judge because no one had really applied their minds to the question. Of course, if no one - neither the court nor the parties - knows what are the issues to be decided, it is not surprising that they do not direct their minds to the appropriate questions of fact to be answered or to the appropriate principles of law which apply."
Although the Declaration of Trust and the conduct of the respondents may not give rise to a right to immediate possession, it is nevertheless at least reasonably arguable that these matters entitle the appellant to resist proceedings by the respondents for possession. Compare Brown v Heffer (1967) 116 CLR 344 at 347, 350 and 351-352, as to the rights of parties to a contract which requires Ministerial consent.
In these circumstances the appeal should be allowed to enable the matters set out in the Reply and Defence to Counter Claim to be properly raised and fully argued.
I certify that this and
the preceding two (2)
pages is a true copy of the
Reasons for Judgment herein of
his Honour Justice Tamberlin.
Associate:
Date: 2 August 1995
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