Adamopoulos v ASA Nominees Pty Ltd
[2016] VSC 802
•20 December 2016
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
S CI 2016 00366
BETWEEN:
| IRENE ADAMOPOULOS | Plaintiff |
| v | |
| ASA NOMINEES PTY LTD (ACN 084 232 360) (controllers appointed) | First Defendant |
| OWNERS CORPORATION PS513436B | Second Defendant |
S CI 2015 05653
AND BETWEEN:
| ASA NOMINEES PTY LTD (ACN 084 232 306) (Controllers Appointed) | Plaintiff |
| v | |
| OWNERS CORPORATION PS513436B | First Defendant |
| - and - | |
| IRENE ADAMOPOULOS | Second Defendant |
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JUDGE: | Derham AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 24 October 2016, followed by written submissions on 4 and 18 November 2016 |
DATE OF JUDGMENT: | 20 December 2016 |
CASE MAY BE CITED AS: | Adamopoulos v ASA Nominees Pty Ltd & Anor |
MEDIUM NEUTRAL CITATION: | [2016] VSC 802 |
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PRACTICE AND PROCEDURE – Application by plaintiff to re-open application for leave to appeal from Victorian Civil and Administrative Tribunal (‘Tribunal’) after reasons for decision pronounced but before final orders drawn up or entered – Discovery of fresh evidence since hearing of the Supreme Court application – Whether evidence is material and would affect the result of the application for leave to appeal – Whether with the exercise of reasonable diligence the evidence could have been discovered before the Tribunal hearing or the application in the Supreme Court – Re Australian Meat Industry Employee’s Union (WA Branch); ex parte Ferguson (1986) 67 ALR 491; Smith v New South Wales Bar Association (No 2) (1992) 176 CLR 256; Spotlight Pty Ltd v NCO Australia Ltd [2012] VSCA 232; Madden v Madden [2014] NSWSC 1098; Inspector-General in Bankruptcy v Bradshaw [2006] FCA 22.
ADMINISTRATIVE LAW – Application for leave to appeal from the Tribunal to the Supreme Court– Orders to be made in favour of successful appellant under the Victorian Civil and Administrative Tribunal Act 1998 (Vic), s 148(7) (‘the VCAT Act’) – Whether appropriate to make orders under Subdivision Act 1988 (‘Subdivision Act’), s 34D – Whether only one conclusion is open on the correct application of the law to the facts found by the Tribunal – Whether factual matter has to be determined as a consequence of the appeal – Whether the outstanding issue involves a factual, evaluative or ministerial judgment within the Tribunal’s jurisdiction – Whether Tribunal should consider again the exercise of the discretion under s 34D of the Subdivision Act – Proceeding remitted to the Tribunal to be heard and decided again - Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (2001) 207 CLR 72; Osland v Secretary to the Department of Justice [No 2] (2010) 241 CLR 320.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr AP Dickinson | Succession Legal |
| For the Defendant | Mr R Horsley (Solicitor) | HWL Ebsworth Lawyers |
HIS HONOUR:
Introduction
These reasons concern:
(a) an application by the plaintiff (‘Ms Adamopoulos’) in proceeding SCI 2016 366 (‘the Adamopoulos proceeding’) to amend her proposed notice of appeal and to re-open her application for leave to appeal from the Victorian Civil and Administrative Tribunal (‘the Tribunal’), and if leave is granted, her appeal; and
(b) if the application in paragraph (a) above is unsuccessful, for orders to be made consequent upon the reasons for judgment delivered in the Adamopoulos proceeding and in proceeding SCI 2015 05653 (‘the ASA proceeding’), in which the first defendant in the Adamopoulos proceeding (‘ASA’) is the applicant/appellant and Ms Adamopoulos is second defendant/respondent.
Background
On 20 September 2016, I published reasons for decision (‘primary judgment’) following the hearing of two applications for leave to appeal and, where leave was granted, the appeal, from the Tribunal.[1]
[1]ASA Nominees Pty Ltd v Owners Corporation PS 513436B & Adamopoulos [2016] VSC 562.
The proceeding in the Tribunal concerned an application by ASA under s 34D of the Subdivision Act 1988 (‘Subdivision Act’) for the realignment of boundaries between Lots 3B and 3C on the plan of subdivision PS513436B (‘the plan of subdivision’). The position of that boundary drawn on the plan was, through a surveyor’s error, three metres west of the physical wall dividing the Lots. The result was that the tenant of Lot 3B, Australia and New Zealand Banking Group Ltd (‘ANZ’) in fact occupied an area 3 metres deep (‘the disputed land’) on the title of Lot 3C.
Lot 3C is owned by Ms Irene Adamopoulos, who is the plaintiff in the Adamopoulos proceeding and the second defendant in the ASA proceeding. Lot 3C is partly occupied by a tenant, Westcoast Bakeries Pty Ltd, with the disputed land occupied by ANZ. For many purposes, Lot 3B is known as Shop 3 (‘the bank premises’) and is owned by ASA and Lot 3C is known as Shop 4 (‘the bakery premises’) which is owned Ms Adamopoulos.
The substantial effect of the Tribunal’s orders was to re-align boundaries between two Lots on the plan of subdivision to accord with the occupation of those Lots, but subject to certain conditions as to the payment of compensation by ASA to Ms Adamopoulos. ASA sought leave to appeal, and if leave were granted, to appeal, in the ASA proceeding. It was successful in its application for leave and in the appeal.
In the Adamopoulos proceeding, Ms Adamopoulos sought leave to appeal the Tribunal’s decision on the ground that it had no jurisdiction to entertain ASA’s application and that, on other grounds, the decision of the Tribunal should not have been made. She failed in her application for leave to appeal.
No orders were made at the time reasons were published and the parties were asked to prepare and submit minutes of proposed orders (by consent if possible). If there was any argument as to the appropriate orders, my chambers would set a date for a hearing. As the parties were not able to agree upon appropriate orders, a day was appointed for considering argument.[2]
[2]Monday, 24 October 2016.
Shortly before the appointed day, Ms Adamopoulos’ solicitors sought leave to issue a summons applying to re-open the matter as a result of fresh evidence that was said to have come to light since the hearing of the two proceedings. The summons sought leave to amend Ms Adamopoulos’ proposed notice of appeal and was supported by the affidavits of Ms Adamopoulos’ solicitor, Amy Beth Fisher, sworn 19 and 20 October 2016.[3] It was heard on 24 October 2016 and directions were made for the filing of written submissions as to the appropriate orders to be made in the event the application to re-open was unsuccessful.
[3]Filed on 20 October 2016.
The proposed amended notice of appeal and further evidence
Ms Adamopoulos sought leave to introduce three new questions of law as follows; whether the Tribunal:[4]
[4]See Exhibit AF-6 to the affidavit of Amy Beth Fisher sworn 20 October 2016. The grounds of appeal correspond with the questions of law.
(a) failed to act fairly and in accordance with the substantial merits of the case as required by s 97 of the Victorian Civil and Administrative Tribunal Act 1998 (‘VCAT Act’) by, in effect, finding that the cost to alter the existing occupation boundary was more than the value of the disputed land when there was no evidence in relation to this issue;
(b) erred, in effect, by finding that the cost to alter the existing occupation boundary was more than the value of the disputed land without first informing itself as to that cost, in relation to this issue, as it was required to do by s 98 of the VCAT Act; and
(c) in exercising its original jurisdiction was obliged to canvass a solution which would not require the orders to be made altering the occupation boundary so that it accorded with the title boundary.
The evidence sought to be introduced concerns the structure of the wall between the bakery premises and the bank premises. After I heard the applications for leave to appeal in the Adamopoulos proceeding, and the application for leave and the appeal in the ASA proceeding, information became available to Ms Adamopoulos’ solicitors concerning water damage to the wall between those two premises. That information revealed that the wall between the bakery premises and the bank premises was not a structural element of the building that cannot be removed, contrary to the assertion by ASA’s solicitors in the course of the hearing in the Tribunal.[5] The wall was a wooden stud and plaster wall that can be moved and, in fact, has been removed as a result of water damage. It was submitted on behalf of Ms Adamopoulos that this was material evidence affecting the outcome of the hearing in the Tribunal and the application for leave to appeal.
[5]In correspondence to Ms Adamopoulos’ solicitors dated 9 April 2014, which is said to have been tendered as Exhibit C in the trial in the Tribunal.
Submissions
Ms Adamopoulos
Ms Adamopoulos says that this further information is contrary to the evidence adduced by ASA. Counsel for Ms Adamopoulos pointed in particular to paragraph [88] of the Tribunal’s reasons, where the Tribunal found:
An alternative solution to the boundary discrepancy would be to alter the occupation boundary so that it accords with the title boundary: to remove the internal wall so that Shop 4 was expanded to include the disputed land, or to do something else that would enable Ms Adamopoulos or her tenant to occupy the disputed land. If that alternative solution were feasible, there would be no need to alter the title boundary or to make the orders sought.
Ms Adamopoulos submits that:
(a) it is implicit in the Tribunal’s findings that the cost to alter the existing occupation boundary was more than the value of the disputed land;
(b) in making that finding without enquiring into the feasibility of the alternative of moving the dividing wall, the Tribunal failed to act fairly and in accordance with the substantial merits of the case as required by s 97 of the VCAT Act; and
(c) rather than find that there was no evidence that would justify finding that the alternative solution is feasible or realistic, the Tribunal was bound to inquire into the alternative solution as a part of its obligation to act in accordance with the substantial merits of the case.
Ms Adamopoulos further submitted that the Tribunal erred in not informing itself as to:
(a) the true nature of the dividing wall;
(b) the possibility of ASA’s liability to compensate its tenant;
(c) whether the amount of such compensation would be more or less than any sum which Ms Adamopoulos could claim to be the value of the disputed land;
(d) the feasibility of removing the dividing wall so that the bakery premises included the disputed land; and
(e) the feasibility of doing something else that would enable Ms Adamopoulos or her tenant to occupy the disputed land.
It was submitted that had the Tribunal made these enquiries and informed itself about those matters, it may not have come to the conclusion that the cost to alter the existing occupation boundary was more than the value of the disputed land. Ms Adamopoulos’ affidavit in support of the application shows that the cost of removing the wall and replacing it was not significant.
If Ms Adamopoulos is permitted to re-open the hearing of the application for leave to appeal, and the appeal if leave is granted, she submits that the only just course is for the proceeding to be remitted to the Tribunal to be reheard.
In relation to the lateness of the application, Ms Adamopoulos submits that all of the fresh evidence was in ASA’s possession before the hearing on 6 April 2016. ASA knew that the Tribunal had proceeded on the basis that there was no evidence regarding the feasibility of the alternative solution of removing the dividing wall, yet before the hearing of the application for leave to appeal in this Court, ASA had come into possession of evidence directly affecting that issue and did not disclose it to Ms Adamopoulos or to the Court. In these circumstances, Ms Adamopoulos submits that ASA cannot be heard to say that it is prejudiced by the late application to re-open her application for leave to appeal.
ASA Nominees
Counsel for ASA submitted that:
(a) it must be established that the matter to which the fresh evidence relates is material to the decision, and if accepted will probably affect the result;
(b) in the context of the hearing before the Tribunal, it was never asserted that the wall was structural and ASA never maintained in the Tribunal that it was impracticable or impossible to move the wall. It is true that in a letter from ASA’s solicitors dated 9 April 2014 it was asserted that the wall was a structural element of the building and cannot be removed, and that letter was tendered as an exhibit. However, neither counsel referred to it and the Member did not refer to it or take it into account in his reasons;
(c) the feasibility referred to by the Member is the feasibility of moving the wall to accord with the boundaries on title. The Member clearly stated that the feasibility of this solution was not canvassed during the hearing;
(d) the application is nothing more than a ‘red herring’ as the basis of the Tribunal’s reasons did not expressly or impliedly involve a balancing of the value of the disputed land against the cost of moving the wall; and
(e) the question of the practicality or feasibility of moving the wall is not relevant to the decision arrived at on ASA’s appeal, which proceeds on the basis that ASA is entitled to orders that result in the boundary as shown on the title being moved to accord with the physical boundary between the two shops. Even if the evidence were accepted and the proposed notice of appeal were amended, it could not change the result of the ASA proceeding and thus the outcome of Ms Adamopoulos’ appeal would also be unaffected.
Relevant principles
The Court has a discretion to allow a party to re-open its case to admit fresh evidence, and that may occur at any stage of the trial or after the trial has concluded.[6] Where the reasons for judgment have been delivered, the appeal rules relating to fresh evidence provide a guide to the manner in which the discretion should be exercised.[7]
[6]Re Australian Meat Industry Employee’s Union (WA Branch); ex parte Ferguson (1986) 67 ALR 491.
[7]Smith v New South Wales Bar Association (No 2) (1992) 176 CLR 256, 267.
The application in this case is a little different from a conventional application to re-open a case. Here, the application is to re-open the hearing of an application for leave to appeal and to amend the proposed notice of appeal where the reasons for decision in the application have been published. It was not disputed that the principles applicable to re-opening trials should be applied to this application, even though the allegedly fresh evidence relevant to the amended proposed notice of appeal must, if successful, result in the whole matter being remitted to the Tribunal for a re-hearing.
In Madden v Madden,[8] Stevenson J of the Supreme Court of New South Wales, summarised the principles applicable in the following terms:
[8][2014] NSWSC 1098.
[19]The question whether leave should be granted to re-open is one which must be exercised with great caution and having regard to the public interest in maintaining the finality of litigation: Wentworth v Woollahra Municipal Council (No 2) [1982] HCA 41 ; 149 CLR 672 at 684 per Mason ACJ and Wilson and Brennan JJ.
[20] In Autodesk Inc v Dyason (No 2) [1993] HCA 6 ; 176 CLR 300, the High Court said that a case may only be re-opened where a party has, without fault on his or her part, not had the opportunity to be heard (per Brennan J at 309 and Dawson J at 317).
[21] In Autodesk Mason CJ said at 303:
... it must be emphasised that the jurisdiction is not to be exercised for the purpose of re-agitating arguments already considered by the court; nor is it to be exercised simply because the party seeking a rehearing has failed to present the argument in all its aspects or as well as it might have been put. What must emerge, in order to enliven the exercise of the jurisdiction, is that the court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing.
In Spotlight Pty Ltd v NCON Australia,[9] the Court of Appeal, in upholding an appeal against the re‑opening of a case by the trial judge, said:
There are good reasons why the circumstances must be exceptional before a court may allow a case, having been closed and judgment reserved, to be reopened. The need for finality in litigation is one. It is no answer to this point to say that the further evidence sought to be adduced by the respondent in this case is confined to the quantum of damages. Were applications to reopen to be allowed almost as of course, such applications would regularly be made. That would add enormously to inefficiencies in the administration of justice, even if the re-opening hearing was strictly confined. The discipline which ought to attend the conduct of litigation by highly competent litigators would also inevitably decline.
[9][2012] VSCA 232 [17] (Harper and Tate JJA and Beach AJA).
The Court noted with approval the four categories referred to by Kenny J in Inspector General in Bankruptcy v Bradshaw,[10] where a court may grant leave to re-open, where:
[10][2006] FCA 22.
(a) fresh evidence, unavailable or not reasonably discoverable before, becomes known and available;
(b) there has been inadvertent error;
(c) there has been a mistaken apprehension of the facts; and
(d) there has been a mistaken apprehension of the law.
Consideration
Referring only to paragraph [88] of the Tribunal’s reasons does not give a fair representation of the finding that is relevant to the application to re-open. The Tribunal found that:
83The power to make an order under s 34D(2) is discretionary. The Tribunal may make, but is not required to make, an order on an application under s 34(1)(a),[11] requiring an owners corporation to do a thing that under s 32 it could have done if by unanimous resolution its members had resolved to do it. It may make such an order even though there has been no such unanimous resolution. In the present case it is obvious that there could be no unanimous resolution; Ms Adamopoulos would vote against a motion to alter a boundary in the way that ASA wishes it to be altered. The discretion to make, or not to make, an order under s 34D(2) must, of course, be exercised judicially and in accordance with legal principle, and not ‘arbitrarily or capriciously or in such a way as to work oppression or abuse’.
[11]A mistaken reference to s 34D(1)(a) of the Subdivision Act 1988.
84There is a powerful reason for exercising the discretion so as to make an order that would require the owners corporation to do something to alter the title boundary between lot 3D and lot 3C. As matters presently stand, the power of both ASA and Ms Adamopoulos to grant or dispose of interests in their land is in doubt. ASA has purported to grant to its tenant, the bank, exclusive possession of land – the disputed land – to which it has no title and for which it has no right to grant possession. The position of Ms Adamopoulos is just as bad. Her ability to sell is affected because she could not give to a purchaser vacant possession of the disputed land. Each would benefit from the making of the order to which I have referred, if the order could be fashioned so as not to be oppressive to either.
85I think that there are four reasons that could weigh against the exercise of the discretion to make such an order.
86Artificiality. There is an artificial aspect to this proceeding. ASA is in dispute with Ms Adamopoulos, not with the owners corporation. The outcome will have no effect upon common property or upon any other lot owner, so far as I can see. Yet ASA has shrunk from taking legal proceedings against Ms Adamopoulos. Instead it has in this proceeding asked the Tribunal to order the owners corporation to do something. Why it should be the owners corporation that makes an application to the Registrar of Titles in respect of the disputed land, not one of the disputants themselves, is not obvious. There is a basis for saying that the Tribunal should not allow this proceeding to be used as an artificial device to enable ASA to achieve something that, on my findings, it would not have been able to achieve in a court proceeding brought against Ms Adamopoulos.
87On the other hand, I am not sure that an alteration to the boundary in question could be achieved without the owners corporation doing something. For all I know, even if ASA and Ms Adamopoulos were to agree upon a particular application to be made to the Registrar of Titles, it might be necessary to obtain the owners corporation’s consent to the application. Matters of conveyancing practicality like that were not canvassed during the hearing. Absent the owners corporation’s consent, it might be necessary, for all I know, to obtain an order under s 34D(2) before any application could be made successfully to the Registrar of Titles in which case the proceeding would not be wholly artificial.
88Alteration of the occupation boundary instead. An alternative solution to the boundary discrepancy would be to alter the occupation boundary so that it accords with the title boundary: to remove the internal wall so that Shop 4 was expanded to include the disputed land, or to do something else that would enable Ms Adamopoulos or her tenant to occupy the disputed land. If that alternative solution were feasible, there would be no need to alter the title boundary or to make the orders sought.
89The feasibility of such an alternative solution was not canvassed during the hearing. The only evidence about the use to which the disputed land is being put came from the letter from the surveyor Barker Monahan Pty Ltd, signed by David Monahan, to ASA’s solicitors dated 13 October 2014. The first four paragraphs of the letter were:
I have attached a copy of my Proposed Plan under Section 32 of the Subdivision Act which shows the proposal to resubdivide the current lots 3B and 3C to create lots 3E and 3F to accord with the location of a wall which exists between the two tenancies.
Lot 3E is occupied by the Geelong West branch of the ANZ bank and Lot 3F is occupied by a bakery.
The wall as plotted on my plan is certainly the wall which is appropriate to adopt as the boundary as it stands in a position which allows for a rear access door to the rear of lot 3E.
On 28 July 2014 I gained access to the rear of the ANZ bank to locate the position of the inter tenancy wall but was limited to only access approximately four or five metres of the wall because the strong room exists along the rest of the wall. On the day of this access to the bank it was not possible to access the bakery tenancy.
90On the evidence in that exhibited letter I find that a strongroom of ASA’s tenant, the ANZ Banking Group, takes up part of the disputed land. Unless some arrangement were to be made for the bank to remain in possession of the disputed land, the alteration of the present occupation boundary would probably involve the strongroom being relocated; the alteration might or might not involve the demolition of the internal wall. It is not hard to envisage that the implementation of this alternative solution to the boundary discrepancy might lead to ASA’s liability to compensate its tenant. Whether the amount of the compensation would be more or less than any sum which Ms Adamopoulos could claim to be the value of the disputed land, I cannot say. At all events there was no evidence that would justify a finding that the alternative solution is feasible or realistic.
91Exposure to claims by third parties. Ms Adamopoulos has alleged that the making of the orders sought would expose her to a claim by her tenant, the bakery, for compensation and could cause her mortgagee, National Australia Bank, to act to her detriment: another reason why the orders sought should not be made. Over Mr Shaw’s objections I received as exhibits a letter to Ms Adamopoulos’s solicitors from the tenant West Coast Bakeries Pty Ltd dated 4 August 2015 and a letter to her from National Australia Bank dated 30 July 2015.
92The tenant’s letter asserted that the rent ought to be reduced because the area of Shop 4 is less than 150 square metres and that the tenant ought to be given a credit for rent overpaid in previous years. It stated, amongst other things, that ‘I moved into the premises based on the understanding that I had 150 m2 of usable space’. The landlord at the time that the tenant first took possession was not Ms Adamopoulos, so it is difficult to see how the assertion, if true, could give rise to a claim against her. The tenant does not claim that by virtue of a current lease of Shop 4 it is entitled to possession of the disputed land; I doubt that such a claim would be tenable. It does not claim that it exercised an option to renew (if it did) in reliance upon a representation in the Darcy Jarman Pty Ltd information memorandum (if it knew of it) that the area of Shop 4 was approximately 150 square metres. I have not heard any evidence from the tenant, and there may be more to its potential claims than presently meets the eye, but I presently doubt that Ms Adamopoulos is exposed to any serious risk from such potential claims.
93The letter from National Australia Bank to Ms Adamopoulos stated that ‘any adverse effect [from this proceeding] on the boundaries will have an impact on the value of your property and will trigger a right of review by the NAB as the mortgagee of the property’. I was not told what detriment to her might result from a review of the mortgage facility. I take the letter at face value but it is evidence only of some unspecified potential detriment that might result from an alteration to the title boundary.
94So I am not persuaded that an exposure of Ms Adamopoulos to potential claims by third parties is a good reason for refusing to made the orders sought.
95ASA has no legal right to the alteration. I have given my reasons for concluding that ASA would not have succeeded in any court proceeding against Ms Adamopoulos seeking rectification of any instrument or a declaration that it has an entitlement to the disputed land. It has no legal right to the disputed land, therefore, and Ms Adamopoulos could not be compelled to transfer it. Even though she has only a paper title to it, the disputed land must have a value for Ms Adamopoulos. Unless she can be compensated in some fashion it would be wrong, by making the orders sought, to permit ASA to achieve indirectly what it has no legal right to achieve directly. This would be the strongest reason, in my opinion, for refusing to exercise the discretion to make the orders sought.
96By virtue of s 130(1) of the Victorian Civil and Administrative Tribunal Act 1998 I may make an order subject to any conditions that I think fit. Making the orders sought, but imposing conditions designed to ensure that Ms Adamopoulos is compensated for any loss that she suffers as a consequence of an alteration to the title boundary and her loss of paper title to the disputed land, would neutralise the strongest reason against making the orders sought. It would achieve the desirable result of better securing for ASA its right to lease the whole of Shop 3 and of better securing for Ms Adamopoulos her right to give a purchaser vacant possession of the whole of Shop 4.
97For those reasons I propose to make the orders sought but to make them subject to those conditions.
It is important to note that the Tribunal observed that the feasibility of an alternative solution was not canvassed during the hearing and that there was no evidence regarding the feasibility of the alternative solution of moving the dividing wall.[12] Ms Adamopoulos has not established, and in my view cannot establish, that the matter to which the fresh evidence relates is material to the decision, and if accepted will probably affect the result. It was not apparently a part of ASA’s case in the hearing before the Tribunal that the wall was structural and that it was impracticable or impossible to move. It is true that in a letter from ASA’s solicitors dated 9 April 2014 it was asserted that the wall was a structural element of the building and cannot be removed, and that letter was tendered as an exhibit. But neither counsel referred to it and the Tribunal did not refer to it or take it into account in the reasons for decision.
[12]Tribunal’s reasons [89] and [90].
Further, I disagree with Ms Adamopoulos’ submission that it is implicit in the Tribunal’s reasons that the cost to alter the existing occupation boundary was more than the value of the disputed land. That matter was simply not considered because there was no evidence to base a decision upon. The Tribunal’s reasons did not expressly or impliedly involve a balancing of the value of the disputed land against the cost of moving the wall.
The most important reason against re-opening the application for leave to appeal is that the question of the practicality or feasibility of moving the wall is not relevant to my decision, which proceeds on the basis that ASA is entitled to orders that result in the boundary as shown on the title being moved to accord with the physical boundary between the two shops. Even if the evidence were accepted and the proposed notice of appeal was amended, it could not change the result of the ASA proceeding and thus the outcome of Ms Adamopoulos’ proceeding would also be unaffected.
For this reason, it is not necessary to go into the question of law raised by Ms Adamopoulos, that the Tribunal was bound to inquire into the alternative solution as a part of its obligation to act in accordance with the substantial merits of the case and to inform itself as to the true nature of the dividing wall, ASA’s potential liability to compensate its tenant, whether the amount of such compensation would be more or less than any sum which Ms Adamopoulos could claim to be the value of the disputed land, the feasibility of removing the dividing wall so that the bakery premises included the disputed land and doing something else that would enable Ms Adamopoulos or her tenant to occupy the disputed land.
Argument in support of this ground was not developed to establish that it imposed an obligation on the Tribunal to exercise the power in s 98 of the VCAT Act (in particular s 98(1)(c) to inform itself on any matter as it sees fit) so as to turn itself into an inquisitorial body, and to require the parties to produce evidence they had individually not thought material to the disputes between them, particularly where the parties were represented by solicitors and counsel throughout the proceeding.
In addition, there is no evidence to suggest that Ms Adamopoulos or her agents/lawyers could not with reasonable diligence have discovered the fact that the wall was a stud wall.
For these reasons, and in the interests of finality and the just, efficient, timely and cost-effective resolution of the real issues in dispute,[13] I reject the application to re-open the hearing of the application for leave to appeal.
[13]Pursuant to ss 7, 8 and 9 of the Civil Procedure Act 2010.
Orders consequent on successful appeal by ASA
Submissions
ASA submits that to give effect to my primary judgment it is necessary to change; first the relevant boundary between Lots 3B and 3C in plan of subdivision 513436B, second, the ownership of the affected land so that it accords with the new boundary and third, the mortgages registered on the title to the affected land.
ASA further submitted, without supporting evidence as to the requirements of the Land Registry or the Registrar of Titles, that:
(a) to alter the boundary between the Lots, it is necessary that:
(i) a written application for certification of the new plan by the City of Greater Geelong is drawn up. The application would require the signed consents of ASA and Ms Adamopoulos, but not of the Owners Corporation because the new plan does not require any change to the common property;
(ii) to lodge the certified new plan with the Land Registry so that Lots 3B and 3C on the existing plan of subdivision 513436B are amended to accord with the proposed Lots 3E and 3F on the new plan;
(b) to alter the ownership of the disputed land it is necessary to lodge with the Land Registry an instrument of transfer transferring the ownership of Lot 3E on the new plan from the resultant dual proprietors, ASA and Ms Adamopoulos, to ASA, concurrently with lodgement of the new plan;
(c) to change the mortgages over the affected land it is necessary:
(i) to lodge with the Land Registry the duplicate certificates of title held by the mortgagees over Lots 3B and 3C of the existing plan of subdivision 513436B;
(ii) for the mortgagees to apply to the Land Registry to discharge the current registered mortgages; and
(iii) for the mortgagees to apply to the Land Registry to register their mortgages, respectively, over Lots 3E and 3F on the new plan.
In the event the mortgagees are not prepared to consent to the above, the Court has the power to direct the Registrar of the Land Registry to give effect to the Court's orders. Section 103(1AA) of the Transfer of Land Act 1958 (‘Transfer of Land Act’) states:
In any proceeding in VCAT relating to land or any instrument or dealing in respect of land, if VCAT directs the Registrar to make any amendment to the Register or otherwise do any act or make any recordings necessary to give effect to an order of VCAT, the Registrar must obey that direction.
Given that the mortgagees are not parties to either the ASA proceeding or the Adamopoulos proceeding, ASA submits that in order to deal with any new issues the Court should reserve liberty to apply.
The following orders are proposed by ASA in the ASA proceeding:
1. In this order:
(a)‘The new plan’ means the plan prepared by the licensed surveyor, David John Monahan of Barker Monahan Pty Ltd, a copy of which is annexed to this order;
(b)‘The disputed land’ means that part of the land described as Lot 3E in the new plan as is not presently contained in Lot 3B described in plan of subdivision 513436B.
2.Irene Adamopoulos shall execute (if tended for execution) and/or deliver to ASA any document required to register the new plan and any document required to enable ASA to become the sole registered proprietor of Lot 3E in the new plan.
3.ASA will bear the expenses of the preparation, lodgement and processing of all documents required to effect order 2.
4.Irene Adamopoulos shall, within 14 days after receipt of a copy of these orders:[14]
(a)provide to any registered mortgagee holding a mortgage over Lot 3C of the existing plan of subdivision 513436B a copy of these orders and a written request that the mortgagee consent to the registration of the new plan (‘the mortgagee correspondence’);
(b)provide to ASA a copy of the mortgagee correspondence.
5.Each party has liberty to apply for further orders.[15]
5.Ms Adamopoulos pay ASA's costs of and incidental to this proceeding and the proceeding in the Victorian Civil & Administrative Tribunal, the subject of this appeal.
[14]This proposed order was added after submissions from Ms Adamopoulos were delivered identifying an issue with her mortgagee.
[15]This proposed order was modified after submissions from Ms Adamopoulos to remove the words ‘including an order or direction empowering the Registrar of the Land Registry to do any act or make any recording necessary, to give effect to these orders,’ pursuant to the power in s103(1AA) of the Transfer of Land Act.
Ms Adamopoulos submitted that:
(a) the proposed orders do not deal with the issue of the consent of Ms Adamopoulos’ mortgagee, National Australia Bank (‘NAB’). The submissions attached a letter from NAB dated 30 July 2015 (in relation to shop 1/72 Weller Street Geelong West Vic 3218[16]) stating:[17]
[16]Which I assume to be an address of the bakery premises.
[17]The letter is also referred to in the reasons of the Tribunal [91] and[93].
It has come to our attention that there is a dispute regarding the boundaries on the above property which is currently being challenged in VCAT. Please note that any adverse effect on the boundaries will have impact on the value of your property and will trigger a right of review by NAB as the mortgagee of the property.
Please advise the NAB in writing once the proceedings have been completed at VCAT to finalise the review of your facilities by 31/08/2015.
(b) section 22(1E) of the Subdivision Act supports Ms Adamopoulos’ submission that the Tribunal has no power to make orders compelling a party to give up registered land. That section empowers this Court to make an order consenting to the registration of a plan, where the person whose consent is required refuses consent;
(c) further, the mortgagee would be a necessary party to any application and no order should be made which circumvents the rights of a mortgagee; and
(d) there is no evidence to support the conveyancing requirements expressed in the proposed orders.
Consideration
The power of this Court on an appeal under s 148 of the VCAT Act are set out in s 148(7). There are a number of matters of law relevant to the exercise of those powers:
(a) section 148(7) confers powers in aid of the exercise of the jurisdiction of the Court which is limited to appeals on a question of law;[18]
[18]Osland v Secretary to the Department of Justice [No 2] [2010] HCA 24; (2010) 241 CLR 320 (‘Osland’) [18] (French CJ, Gummow and Bell JJ).
(b) although called an appeal, it is the exercise of original not appellate jurisdiction, and is in the nature of judicial review;[19]
[19]Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) [2001] HCA 49; 207 CLR 72, 79 [15] (Gaudron, Gummow, Hayne and Callinan JJ); Osland [18].
(c) section 148(7) does not enlarge that jurisdiction, but confers powers in aid of its exercise,[20] and the powers are only to be exercised as a remedial consequence of dealing with an error of law;[21]
[20]Osland, [19] (French CJ, Gummow and Bell JJ).
[21]Osland, [78] (Hayne and Kiefel JJ).
(d) the power to make any order the Court thinks appropriate (in s 148(7)(d)) should not usurp the Tribunal’s fact finding function;[22]
[22]Osland, [19] (French CJ, Gummow and Bell JJ).
(e) section 148(7) empowers the Court to make orders that the Tribunal should have made where only one conclusion is open on the correct application of the law to the facts found by the Tribunal;[23]
[23]Osland, [20] (French CJ, Gummow and Bell JJ).
(f) the language of s 148(7) of the VCAT Act is wide enough to allow the Court to make substitutive orders in other circumstances. But its powers must be exercised having regard to the limited nature of the appeal. Absent such restraint, a question of law would open the door to an appeal by way of rehearing;[24]
(g) where there is a factual matter that has to be determined as a consequence of the appeal, it may be that it is able to be determined by the Court upon uncontested evidence or primary facts already found by the Tribunal;[25] and
(h) when the outstanding issue involves a factual, evaluative or ministerial judgment within the jurisdiction of the Tribunal, then it should ordinarily be remitted to the Tribunal.[26]
[24]Ibid.
[25]Ibid.
[26]Ibid.
The power in s 148(7)(a) of the VCAT Act enables the Court to affirm, vary or set aside the Tribunal’s order. The Tribunal in fact made more than one order - it made several orders.[27] The power of the Court must extend to varying any one or more of the orders, depending on the effect of the successful determination of the question or questions of law on the orders made. In this case, the success enjoyed by ASA is limited. The Tribunal only fell into error in deciding that ASA would not have been entitled to rectification of the contract of sale and transfer to Ms Adamopoulos so as to entitle ASA to a realignment of the boundary between the two Lots. This was expressed in the application and the appeal as amounting to varying the Tribunal’s orders by removing the condition for compensation to be paid by ASA to Ms Adamopoulos, and the orders that relate to the method of determination of that compensation.
[27]See primary judgment, [59].
In the primary reasons, I expressed my conclusion as to the effect of ASA’s success as follows:[28]
ASA has been successful in it application for leave to appeal and in its appeal. The effect of that success is that the condition imposed by the Tribunal for the payment of compensation by ASA to Ms Adamopoulos should not have been imposed, with all the consequential orders and directions. In consequence, the orders sought by ASA should be made and the orders made by the Tribunal on 8 October 2015 should be set aside and replaced with the orders set out above at paragraph 62.
[28]Primary judgment, [116].
The orders then proposed by ASA, as recorded in the primary judgment, were little more than a variation of the orders made by the Tribunal, as follows:[29]
[29]See the outline of submissions dated 4 November 2016.
1 In this order,
(a)‘the new plan’ means the plan prepared by Barker Monahan Pty Ltd, a copy of sheet 2 of which is annexed to this order;
(b)‘the disputed land’ means that part of the land described as lot 3E in the new plan as is not presently contained in lot 3B described in Plan of Subdivision 513436B.
2Subject to the conditions set out in paragraph 3 of this order having been met, Owners Corporation PS 513436B, by affixing thereto its common seal, must execute all documents necessary to be executed by it to effect an amendment to Plan of Subdivision 513436B in accordance with the new plan and shall deliver those executed documents to the applicant’s solicitors.
3This order is subject to the condition that Irene Adamopoulos shall have executed and delivered to the applicant any instrument of transfer to the applicant of the disputed land that the applicant had tendered to her for execution.
4The second respondent pay the applicant’s costs of and incidental to this proceeding.
There are now significant differences between the Tribunal’s orders, and as proposed in the course of the hearing of the appeal, on the one hand, and the orders now proposed by ASA, on the other. In particular, the orders now proposed by ASA:
(a) do not require the Owners Corporation to do anything, whereas the power of the Tribunal in s 34D(1)(a) of the Subdivision Act, the provision relied on by ASA in the proceeding in the Tribunal, confers power on the Tribunal to make an order requiring it to do any of the things set out in s 32 or 33 of the Subdivision Act;
(b) require Ms Adamopoulos to execute any document required to register the new plan and any document required to enable ASA to become the sole registered proprietor of the disputed land (Lot 3E on the new plan), and it is not clear, and it has not been argued, whether that power resides in the Tribunal; and
(c) require Ms Adamopoulos to provide to any registered mortgagee holding a mortgage over her Lot, a copy of these orders and a written request that the mortgagee consent to the registration of the new plan provide to ASA a copy of that correspondence.
ASA supported its submissions that the orders it proposed were appropriate by reference to undisclosed information ‘provided by the licensed surveyor, David John Monahan, and the Land Registry.’[30] At some stage during argument, counsel for ASA handed up a document issued by the Land Registry entitled ‘What is NICO?’ That document sets out a procedure laid down by Land Registry for the realignment of boundaries in subdivisions where the owners of the Lots are ‘not in common ownership’, known as NICO plans or applications. It seems that the surveyor adopted the approach set out in that document.
[30]Ibid.
The remedy available under s 34D(1)(a) of the Subdivision Act, however, empowers the Tribunal to ‘alter the boundaries of any land affected by the owners corporation’. Whether the power in that section means that the only way to give effect to a realignment of the boundary between the two Lots is in accordance with the NICO procedure has not been argued or decided in the Tribunal. That is a question for the Tribunal as it is its power under s 34D that is to be exercised. That question will also involve consideration of the Tribunal’s power:
(a) under the Subdivision Act and the VCAT Act to make orders, if they are required, compelling Ms Adamopoulos to execute documents to give effect to the realignment of the boundary; or
(b) under s 103(1AA) of the Transfer of Land Act to give effect to the realignment of the boundary.
The Tribunal rightly pointed out in its reasons for decision that the power under s 34D(2) is discretionary. Senior Member Vassie said:[31]
The Tribunal may make, but is not required to make, an order on an application under s 34(1)(a),[32] requiring an owners corporation to do a thing that under s 32 it could have done if by unanimous resolution its members had resolved to do it. It may make such an order even though there has been no such unanimous resolution. In the present case it is obvious that there could be no unanimous resolution; Ms Adamopoulos would vote against a motion to alter a boundary in the way that ASA wishes it to be altered. The discretion to make, or not to make, an order under s 34D(2) must, of course, be exercised judicially and in accordance with legal principle, and not ‘arbitrarily or capriciously or in such a way as to work oppression or abuse’.[33]
[31] [2015] VCAT 1475 [83].
[32]A reference to s 34D(1)(a) of the Subdivision Act.
[33]Conroy v Owners Corporation Strata Plan 30438 (Owners Corporations) [2014] VCAT 550 [13].
The Tribunal went on to consider the various factors relevant to the making of the orders in fact made. This included the imposition of a condition pursuant to the power conferred by s 130(1) of the VCAT Act to ensure that Ms Adamopoulos is compensated for the loss of her ’paper title’ to the disputed land.
The consequence of ASA’s success in its appeal is that it is no longer appropriate to include the compensation condition in the orders, at least in so far as the compensation is intended to recompense her for the loss of the title to the disputed land. The warrant for the imposition of the compensation condition for that loss would appear to be lacking. Whether there is a proper basis for other compensation as a result of the mistake apparently made by ASA’s former surveyor has not been considered, and may need to be considered.
Although the fact that ASA was successful in its appeal may indicate that it is likely that the discretion given to the Tribunal under s 34D(1)(a) of the Subdivision Act ought to be exercised by ordering the realignment of the boundary between the two Lots, whether, how and on what terms that is done are matters for the Tribunal. This is not a case where there is only one conclusion open on the correct application of the law to the facts found by the Tribunal. It is not appropriate to make orders of the kind proposed by ASA because to do so would involve the determination of both factual and legal issues within the Tribunal’s jurisdiction as to the exercise of the discretion conferred by s 34D of the Subdivision Act, and the appropriate manner of the exercise of the power conferred by that section and other relevant provisions.
There is neither a question of law nor any factual or legal material before this Court that would enable it to determine:
(a) the manner of the exercise of the power of the Tribunal under the Subdivision Act and the VCAT Act;
(b) the appropriate conveyancing procedure to be adopted, or the appropriateness of the Tribunal exercising power under s 103(1AA) of the Transfer of Land Act.
Even if the appropriate factual and legal material was before me, the exercise of the power rests with the Tribunal and it is not appropriate for this Court, having decided only a limited question of law, to attempt to substitute its decision for that of the Tribunal. That would truly turn the appeal under s 148 of the VCAT Act into an appeal by way of rehearing.
In short, the remedial power of this Court in consequence of ASA’s success on its questions of law, limited as they are to what might be called the rectification issue,[34] does not empower the Court make orders of the kind proposed by ASA, whatever the conveyancing requirements might turn out to be.
[34]See the primary judgment, [60].
Having regard to the fact that the power in s 34D(1)(a) of the Subdivision Act is discretionary and is given to the Tribunal, and because the exercise of that discretion was a composite exercise taking into account the matters identified by the Tribunal at paragraphs [83] to [97] of the reasons,[35] including that ASA has no legal right to the alteration of the boundaries because it could not succeed in an action for rectification of the contract of sale or transfer, I consider that discretion must be exercised again, taking into account:
[35]ASA Nominees Pty Ltd v Owners Corporation PS513436B (Owners Corporation) [2015] VCAT 1475.
(a) the success that ASA has had in this appeal and these reasons for decision;
(b) the extent of the Tribunal’s powers to make orders under s 34D of the Subdivision Act and the evidence, if any, that is relevant to the exercise of the powers;
(c) the Tribunal’s powers under the VCAT Act that might aid the making of effective orders under s 34D(1)(a) of the Subdivision Act, including the implied power, particularly having regard to the legislative policy revealed by the relevant provisions of the Subdivision Act;
(d) the evidence to be adduced in relation to the steps that might need to be taken to effect an alteration of the boundaries between the two Lots, particularly having regard to the existence of the leases and mortgages affecting the two Lots;
(e) whether the power in s 103(1AA) of the Transfer of Land Act is available to be exercised in this case, and whether it should be exercised;[36] and
(f) any other matters appropriate to be considered.
[36]The power in s 103(1AA) of the Transfer of Land Act shows that the powers of the Tribunal are substantially similar to the statutory powers of the Supreme Court given by s 103(1) of that Act.
For these reasons, all the Tribunal’s orders made on 8 October 2015, with the exception of the last order reserving the costs of the proceeding in the Tribunal, should be set aside and the matter should be remitted to the Tribunal to be heard and decided again according to law and taking into account these reasons.
The hearing in the Tribunal has not, however, been wasted. My expectation is that the evidence heard in the proceeding need not be dealt with again. It is only evidence with respect to the exercise of the discretion given by s 34D of the Subdivision Act, and the exercise of the power to make orders under that section, perhaps aided by other powers under the Subdivision Act, the VCAT Act and the Transfer of Land Act, that will be needed.
In accordance with s 148(8) of the VCAT Act, I will direct that the Tribunal shall be constituted for the rehearing by Senior Member Vassie, the same Senior Member who made the original order are the subject of the appeal, if that is possible. I consider his familiarity with the subject matter of the proceeding will make the hearing and decision as to the appropriate orders to be made under s 34D of the Subdivision Act quicker, more efficient and more cost-effective than the matter being remitted to another member of the Tribunal.
Costs
ASA applied for its costs of the proceeding in the Tribunal. It produced material relevant to that proposed order, but it is not necessary to canvas that evidence because of my decision that the proceeding should be remitted to the Tribunal to be heard and decided again.
As I have noted above, the question of the costs of the proceeding in the Tribunal was reserved by the Senior Member. The discretion under s 109 of the VCAT Act rests with the Tribunal. There is presently no basis for this Court to exercise the discretion. Given the remittal, there should be no order by this Court as to the costs of the proceeding in the Tribunal.
It is of no surprise that ASA also sought the costs of the appeal. It was successful on the basis of the reasoning it advanced in its submissions, both oral and written. In the Adamopoulos proceeding Ms Adamopoulos has been unsuccessful both in her application for leave to appeal and in her application to re-open her application.
Ms Adamopoulos accepted the force of these propositions but submitted that because of the submissions made regarding the necessity for the consent of her mortgagee before any amended plan of subdivision could be registered, it was not clear whether the Court could grant ASA any effective relief in the terms it sought, because not all affected parties were before the Court. In these circumstances, Ms Adamopoulos submitted that the question of the costs of the appeals should be reserved until such time as the utility of the VCAT proceeding, and the appeals, can be properly assessed by the Court.
Because of my view that the successful appeal by ASA means that the grant of discretionary relief under s 34D of the Subdivision Act must be revisited by the Tribunal, it being a discretion conferred on the Tribunal and not on this Court, the doubts and uncertainties referred to by Ms Adamopoulos are not relevant to the costs of the appeal or her application for leave to appeal. Those matters will be addressed in the Tribunal.
Neither party addressed the possibility of the remittal of the proceeding pursuant to s 148(7)(c) of the VCAT Act. ASA proceeded on the footing that it could have all necessary orders to give effect to an alteration of the boundaries between the two Lots in this Court on its appeal. Ms Adamopoulos merely sought to meet those submissions at a detailed level and according to the requirements of the Subdivision Act. As I have said, the discretion conferred on the Tribunal by s 34D(1)(a) of the Subdivision Act, being dependent in part on reasoning that I have determined involved an error of law, must be exercised anew, and all the difficulties identified by Counsel for Ms Adamopoulos may also then be addressed in the context of the powers of the Tribunal in consequence of the exercise of the discretion.
I add that the submissions made as to the appropriate orders have not been wasted, and these were all in writing. The hearing fixed for the argument about the orders to be made was in fact used for argument concerning the application to re-open, and there was no time spent on argument about appropriate orders.
For these reasons, ASA’s costs of the ASA proceeding and the Adamopoulos proceeding should be paid by Ms Adamopoulos.
Conclusion
For the reasons given above, it is not appropriate to make the extensive orders sought by ASA, giving effect to the supposed exercise of a discretion by the Tribunal to alter the boundary between the bank premises (Lot 3B on the plan of subdivision) and the bakery premises (Lot 3C on the plan of subdivision).
The orders of the Tribunal, other than the order reserving the costs of the proceeding, should be set aside and the proceeding remitted to the Tribunal to be heard and decided again, noting however that the evidence heard in the proceeding need not be dealt with again. It is only evidence with respect to the exercise of the discretion given by s 34D of the Subdivision Act, and the exercise of the power to make orders under that section, perhaps aided by other powers under the Subdivision Act, VCAT Act and the Transfer of Land Act, that should be needed.
For the reasons given above, Ms Adamopoulos should pay ASA’s costs of both proceedings in this Court.
In the ASA proceeding, the orders of the Court will therefore be as follows:
1.Set aside the orders made by the Victorian Civil and Administrative Tribunal on 8 October 2015 in proceeding OC2700/2014 (‘the VCAT Proceeding’), with the exception of order 8 in relation to the costs of the proceeding.
2.Remit to the Tribunal to be heard and decided again the application by ASA Nominees Pty Ltd (ACN 084 232 306) (Controllers appointed) (‘ASA’) in the VCAT Proceeding for orders pursuant to s 34D of the Subdivision Act 1988, such hearing and decision to be made in accordance with the reasons for decision in proceeding S CI 2015 05653 in which ASA is plaintiff and appellant and Ms Irene Adamopoulos is defendant and respondent.
3.Direct pursuant to s 148(8) of the VCAT Act, that the Tribunal is to be constituted by the same member who made the original order, if that is possible.
4.Ms Adamopoulos, the defendant and respondent, shall pay the plaintiff and appellant’s costs of this proceeding.
5.Reserve to the parties liberty to apply as to the further working out of this order.
In the Adamopoulos proceeding, the orders of the Court will be as follows:
1.The plaintiff’s application by summons filed 20 October 2016 is dismissed.
2.The application for leave to appeal filed on 4 February 2016 is dismissed.
2.The plaintiff shall pay the defendant’s costs of the proceeding.
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