ANZ Banking Group Ltd v WILLIAMS; ANZ Banking Group Ltd v Willsmore

[2012] SASC 2

SUPREME COURT OF SOUTH AUSTRALIA

(Civil)

ANZ BANKING GROUP LTD  v  WILLIAMS & ANOR;  ANZ BANKING GROUP LTD  v  WILLSMORE & ANOR

[2012] SASC 2

Reasons for the Order of Judge Lunn a Master of the Supreme Court

16 January 2012

REAL PROPERTY

Application under Part 17 of Real Property Act 1886 by mortgagee against mortgagors for order for possession of premises - tenant of mortgagors in occupation of premises - whether Residential Tenancies Tribunal has exclusive jurisdiction to deal with such a claim for possession - held where claimant for possession is a mortgagee, and not a landlord, Supreme Court has jurisdiction - order for possession made.

ANZ BANKING GROUP LTD  v  WILLIAMS & ANOR;  ANZ BANKING GROUP LTD  v  WILLSMORE & ANOR
[2012] SASC 2

JUDGE LUNN:

Reasons on mortgagees’ applications for possession

1. In Action SCCIV-11-1572 in this Court the plaintiff seeks an order for the possession of premises at 19 Acacia Road, Morphett Vale, under Part 17 of the Real Property Act 1886 (“the RPA”) and 6R 204. The named defendants are the registered proprietors of that property. They have mortgaged it to the plaintiff and are in default in their obligations under the mortgage. When served with the Summons and supporting documents on 26 October 2011 the defendants informed the process server that a woman and her children were in occupation of the premises under a Residential Tenancy Agreement.

2. In Action SCCIV-11-1582 in this Court the plaintiff seeks similar orders in respect to a property at Normanville.[1]  The defendants in this action have also mortgaged that property to the plaintiff and are in default in their obligations under that mortgage.  Upon service of the Summons on 29 October 2011 the defendants informed the process server that a sister of the second defendant was in occupation of the Normanville property.

   [1]    The order is also sought in respect of another property, but there is no suggestion that that property is tenanted. 

3. In both actions there is no cogent evidence before me about whether there is currently a tenant in occupation of the subject properties pursuant to a tenancy agreement to which the Residential Tenancies Act 1995 (“the RTA”) applies. However, for the purpose of the argument, the plaintiff’s counsel conceded that I should proceed on the basis that there were tenants in occupation under Residential Tenancy Agreements to which the RTA applied.

4. In neither action has any defendant, tenant or occupant of the properties responded to the Court as required by the Summonses and notices served upon them.  Hence, there has been no contradictor to oppose the orders sought by the plaintiff.

5. By virtue of 6RR 203 and 204(1) both actions seek orders in rem for possession of the subject properties.  This means that subject to any further orders made by the Court, if a warrant of possession is executed by the Sheriff over a property pursuant to any order for possession made by the Court, the Sheriff will evict from that property any persons who are in occupation of it, regardless of whether they are named defendants or not.[2]

   [2]    If a person in occupation at the time the warrant of possession is executed claims to have a right to possession which is enforceable against the plaintiff/mortgagee, that person needs to obtain an urgent order from the Court to discharge or vary the possession order.

6. In both actions the plaintiff has made out on the affidavits filed its entitlements to possession of the subject properties and, apart from the matter to be dealt with below, is entitled to have the possession orders made in its favour.

7. At the outset of the hearings in both actions I raised with the plaintiff’s solicitor a point concerning the jurisdiction of this Court arising out of reasons of the Residential Tenancies Tribunal (“the Tribunal”) for its order made on 21 July 2011 in Lea v Perpetual Trustees Victoria Ltd. 

8. The relevant background of that case before the Tribunal was as follows. In SCCIV-10-972 in this Court Perpetual Trustees Victoria Ltd (“Perpetual”) as mortgagee sought an order under Part 17 of the RPA for possession of the subject property. The defendant was the mortgagor/registered proprietor of it. On 21 March 2011 another Master in this Court made an order in favour of Perpetual for possession of the premises. The Court had not been informed that on 26 January 2011 the defendant in that action had entered into a Residential Tenancy Agreement for the property with Alison Lea and Karla Willis for a term of 12 months. On 30 May 2011 the Registrar of this Court sealed a warrant for the possession of the property. On 21 June 2011 the tenants applied to the Tribunal and this led to the order which was made on 21 July that Perpetual be restrained from enforcing its order from this Court to obtain possession of the premises.[3]

   [3]    I am not concerned about the correctness or otherwise of the order made by the Tribunal and do not comment upon it.

9. In the reasons of 21 July 2011, published under the seal of the Tribunal, the following was stated:

   The mortgagee asserts a right to obtain vacant possession of the premises pursuant to the aforesaid order of the Supreme Court made on 28 June 2011.  It does not have that right.  The order of the Supreme Court was made without jurisdiction.  It is null and void.

   The Residential Tenancies Tribunal has exclusive jurisdiction pursuant to section 24(1) (a) of the Residential Tenancies Act 1995 (the Act) to hear and determine a matter that may be the subject of an application under the Act: McConnon v Cottrill [2005] SASC 46 at paragraph 10. Section 24(1) (a) of the Act ousts the jurisdiction of the Supreme Court to deal with this matter.

10. The decision of McConnon v Cottrill, cited by the Tribunal, which is a decision which I made, does not stand for the proposition that the Tribunal has exclusive jurisdiction over a claim by a mortgagee for possession of residential premises which have been mortgaged to it.  McConnon’s case was an action by the owner of the property against an occupant who would not voluntarily vacate.  The defendant there claimed that he was in possession of the premises under an agreement by which he was to pay rent to the owner, but this was denied by her.  I held that I could not be satisfied I had jurisdiction in the matter unless the factual issues about whether there was a Residential Tenancy Agreement in existence between the plaintiff and the defendant was determined.  On the defendant’s case it was a claim by his landlord to evict him.  There was no involvement of any mortgagee of the land.

11. Section 24 of the RTA provides:

    24—Jurisdiction of Tribunal

    (1)     The Tribunal has—

    (a)     exclusive jurisdiction to her and determine a matter that may be the subject of an application under this Act;

12. Section 93 of the RTA gives a landlord the right to apply to the Tribunal for an order for possession of premises. The RTA does not give the Tribunal the right to make an order for possession on the application of anyone who is not a landlord, but who claims to be entitled to possession. If there was a Residential Tenancy Agreement in McConnon’s case, the plaintiff there as the landlord would have been entitled to have applied under s 93 against the defendant for an order for possession of the premises. While Part 17 of the RPA would also have given the plaintiff a right to apply for an order for possession under that Part, that jurisdiction in the context of that case was clearly excluded by the operation of s 24(1) of the RTA. However, McConnon’s case cannot be a precedent for other than where the claimant to possession is a landlord.

13. Even if the Order of the Supreme Court for possession in SCCIV-10-972 was made without jurisdiction, which I do not accept, the Order was not thereby null and void.  Orders of superior courts, such as this Court, if made without jurisdiction, are only voidable, and they must be obeyed until they are set aside.[4]  Where an inferior court is faced with any challenge to the validity of an order of a superior court it should adjourn its hearing to enable an application to be made to that superior court for it to discharge its order. 

    [4]    Blades v Lawrence (1874) LR 9 QB 374; Moore v De Baisi (1975) 10 SASR 128; Jackson v Sterling Industries Ltd (1987) 162 CLR 612; Isaacs v Robertson [1985] AC 97; Cameron v Cole (1944) 68 CLR 571 at 590.

14. I accept the plaintiff’s submission that “matter” in s 24(1)(a) of the RTA means an entire matter. In Croome v State of Tasmania[5] three Justices of the High Court said:

    A “matter” must be distinguished from the action or judicial proceeding which is commenced in order to obtain a determination of a controversy between the parties.  The “matter” is not the proceeding, but the subject of the controversy which is amenable to judicial determination in the proceeding. 

    [Footnotes omitted.]

    Merely because the RTA gives the Tribunal jurisdiction to hear a possession application by a landlord, which is a “matter”, does not thereby also give it jurisdiction over any different matter, eg a claim by a mortgagee to possession of the premises both as against the mortgagor and any tenant.

    [5] (1997) 142 ALR 397 at [400].

15. The RTA as a whole is inconsistent with the Tribunal having exclusive jurisdiction over all claims by anyone who claims the right to possession of residential premises from a tenant. Sections 79, 95 and 96 of the RTA provide as follows:

    79—Termination of residential tenancy

    A residential tenancy terminates if—

    …

    (d)a person having title superior to the landlord’s title becomes entitled to possession of the premises under the order of the Tribunal or a court;

    (e)a mortgagee takes possession of the premises under the mortgage;

    ...

    95—Repossession of premises

    A person must not enter premises for the purposes of taking possession of the premises before, or after, the end of a residential tenancy unless—

    …

    (b)the person is authorised to take possession of the premises under the order of a court or the Tribunal.

    …

    96—Forfeiture of head tenancy not to result automatically in destruction of right to possession under residential tenancy agreement

    (1)     A person cannot take possession of residential premises subject to a residential tenancy agreement so as to defeat the tenant’s right to possession under the residential tenancy agreement unless an order for possession of the premises is made by a court or the Tribunal.

    (2)     If a person is entitled to possession of residential premises as against a person who granted a residential tenancy, a court before which proceedings for possession of the premises are brought, or the Tribunal, may, on application by an interested person, vest the residential tenancy agreement in the person who would, but for the agreement, be entitled to possession of the premises so that the tenant holds the premises directly from that person as landlord.

    [Underlining added.]

    Each of ss 79(d), 95(b) and 96(1) and (2) refer to orders for possession of residential premises made by either a Court or the Tribunal. If the Tribunal had exclusive jurisdiction, the references to “Court” in those sections would be superfluous and serve no purpose.

16. Although I do not base my decision upon it, s 79(d) of the RTA could well be construed to mean that a residential tenancy is terminated if a mortgagee, assuming it has a title superior to that of the landlord, obtains an order of the Supreme Court for possession of the premises.[6] If an order of the Supreme Court for possession terminates the residential tenancy, the rights thereafter of any tenant under the RTA are thereby considerably diminished.

    [6]    It is not clear whether sub-s 79(e) covers the field for mortgagees, and so excludes the operation of sub‑s (d), or whether it refers only to where the mortgagee takes possession other than by an order of the Court under sub-s (d).

17. Counsel for the plaintiff also mounted an argument that by virtue of s 6 of the RPA, Part 17 of the RPA took precedence over any inconsistent provision of the RTA, but I need not pursue that point.

18. For the above reasons I consider that the existence of any residential tenancy for the purposes of the RTA over the subject property does not affect the jurisdiction of the Supreme Court to make an order in rem for the possession of that property in favour of a mortgagee.  For these reasons I made the orders for the possession on 9 January 2012.