Angas Securities Ltd v Shire of Wyndham East Kimberley - [2021] WADC 79

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION:   PERTH
CITATION:   ANGAS SECURITIES LTD -v- SHIRE OF WYNDHAM EAST KIMBERLEY [2021] WADC 79
CORAM:   DEPUTY REGISTRAR HEWITT
HEARD:   5 AUGUST 2021
DELIVERED          :   19 AUGUST 2021
FILE NO/S:   CIV 495 of 2020
BETWEEN:   ANGAS SECURITIES LTD
Plaintiff (by counterclaim)

AND

SHIRE OF WYNDHAM EAST KIMBERLEY
Defendant (by defence to counterclaim)

Catchwords:

Practice and procedure - Application for dismissal of action - Turns on its own facts

Legislation:

Local Government Act 1995 (WA), s 1.4, s 6.81, s 6.77, s 6.77(5)
Valuation of Land Act 1978 (WA)

Result:

Counterclaim dismissed

Representation:

Counsel:

Plaintiff (by counterclaim)	:	Mr C Rowley
Defendant (by defence to counterclaim)	:	Mr J C Yeldon

Solicitors:

Plaintiff (by counterclaim)	:	Charlton Rowley
Defendant (by defence to counterclaim)	:	CS Legal

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

Nil

DEPUTY REGISTRAR HEWITT:

This matter had its genesis with a writ of summons filed by the Shire of Wyndham East Kimberley naming Angas Securities Ltd as the defendant. The cause of action pursued by the plaintiff was for the recovery of various rates and other charges levied against land for which the shire considered the defendant responsible. Each of the parties filed a summary judgment application which led to an order granting the plaintiff a judgment of $5,000, no order for costs of the plaintiff's claim and the summary judgment application, and the dismissal of the defendant's application. By that order the defendant was given 21 days to file and serve any amended counterclaim and the matter then progressed to directions hearing. The summary judgment application brought by the defendant was dismissed with no order as to costs. The effect of those orders were that insofar as the plaintiff pursued a claim, that claim was determined by the order that I have mentioned. The defendant however retained the right to pursue its counterclaim and that ultimately was expressed in a substituted statement of claim filed on 12 March 2021.
At this stage I pause to mention that for reasons that are not apparent to me, the parties now describe the original defendant as the plaintiff and the Shire of Wyndham East Kimberley as the defendant. That creates a considerable confusion as to the meaning of the orders which have previously and subsequently been made, since in truth Angas Securities Ltd is a plaintiff by counterclaim and the Shire of Wyndham East Kimberley is a defendant by counterclaim, and it will be necessary to rectify the situation before the action proceeds much further.
The statement of claim to which I have referred identifies the parties and refers to an additional player namely VFE Investments Pty Ltd. That entity is the registered proprietor of an estate in fee simple of a large number of lots in the Kununurra area of Western Australia. Those lots are subject to a mortgage to Angas Securities Ltd. VFE Investments Pty Ltd is in liquidation and Angas Securities Ltd, following a default by VFE under the mortgage and pursuant to the powers contained in the mortgage, appointed itself to be controller pursuant to s 427(1A) of the Corporations Act 2001 (Cth).
As a consequence of that step the local government authority considered the mortgagee to be an owner within the meaning of s 1.4 of the Local Government Act 1995 (WA) which provides that the term 'owner' where used in relation to land includes a person who is in possession as a mortgagee and hence liable to pay rates levied against the properties over which the mortgage is held. The decision to issue rate notices to the mortgagee generated an objection from the mortgagee under the provisions of s 6.76 of the Local Government Act, it being alleged by that objection that the mortgagee was not in fact an owner within the meaning of the Local Government Act and therefore not liable to pay rates on the land over which it held a mortgage, and additionally challenging the valuations which had been placed on the properties alleging them to be substantially in excess of the true value of the properties rated. As to the categorisation of the mortgagee as an owner, the challenge was initiated by a letter dated 10 June 2020. Such an objection is required to be made within 42 days of the date of service of a rate notice and it is clear from the materials before me the objection was significantly out of time probably to the extent of years.
It is clear that the only part of the objection which could be validly brought against the local authority was that concerning the characterisation of the mortgagee as an owner. As to the challenge of the amount of the valuation, that may only be brought in accordance with the Valuation of Land Act 1978 (WA) and the objection ought to be directed to the Valuer General under the terms of that act. Therefore insofar as that objection was directed to the local government authority it was incompetent, however I understand the objection has been passed on to the Valuer General, but whether it has merit or not is not relevant to determination of this matter.
I also note that by s 6.81 of the Local Government Act an objection is not to affect the liability to pay rates or service charges and the existence of an objection does not affect the liability to pay.
As to the objection against characterising the mortgagee as an owner and levying rates, that objection was to my mind brought out of time and substantially so and that impacts on the position of the mortgagee. Power to extend the time for making an objection exists and by s 6.77 of the Local Government Act, a local government authority may upon application by a person proposing to make an objection extend the time for making the objection for such period as it thinks fit. That is not the position here. No application for extension of time was sought by the mortgagee.
Complaints made by the mortgagee are that the local authority is in breach of s 6.77(5) of the Local Government Act which requires it to promptly consider any objection and either disallow it or allow it wholly or in part. I take the view that an objection which is brought out of time without being preceded by an application to extend the time is a nullity and the response contemplated by s 6.77(5) of the Local Government Act is not applicable.
Having briefly outlined the framework which exists in this case I now turn to the application which is before me which was filed by the local authority on 5 May 2021 in which it is sought that the authority have leave to bring the application and that the claim be dismissed with costs. No basis for such a dismissal has been cited in the application but clearly one exists. The statement of claim seeks an order directing the local authority to comply with its obligation under s 6.76(5) of the Local Government Act to respond to the objections. Secondly, a declaration that the mortgagee is not the owner of the land within the meaning of the Local Government Act, and finally damages and compensation.
The first order is clearly an injunction. The second order is a declaration and both of these remedies are equitable remedies which are not within the jurisdiction of this court unless linked with some action which is within the jurisdiction. The claim for damages is linked to what are alleged to have been breaches by the plaintiff entitling it to the injunction and the declaration. I can see no basis for the shire being liable for commencing an action for unpaid rates which it is entitled to recover under the Local Government Act. No other basis for compensation is pleaded. Accordingly on my analysis, the relief which is sought by the mortgagee is beyond the jurisdiction of the court and ought not be permitted to proceed. Additionally to those observations, I further note that the process of challenging a rate notice is codified within the Local Government Act setting out the basis of making an objection and the process of reviewing any decision which is made either on the objection or a refusal to extend the objection by the State Administrative Tribunal. Again, these matters are not within the jurisdiction of the District Court and ought not be dealt with in this court or indeed any court other than the State Administrative Tribunal at this stage.
My findings are therefore that the relief sought by the plaintiff is equitable relief which is not within the civil jurisdiction of the District Court of Western Australia and the claim for damages is not sustainable.
Following the settlement of the local authority's claim, there is now no action which can be regarded as within the court's jurisdiction within the meaning of s 55 of the District Court of Western Australia Act 1969 (WA) and if the action by the mortgagee were to continue it would need to be in the Supreme Court. I am however of the view that the mortgagee's action is entirely without merit for the other reasons which I have identified in this decision and for that reason I take the view that it is appropriate for the claim to be dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
DH
Court Officer
19 AUGUST 2021