Badah Pty Ltd v One Investment Administration Ltd as trustee for the Alt No 1 Trust

[2017] WASC 96

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   BADAH PTY LTD -v- ONE INVESTMENT ADMINISTRATION LTD AS TRUSTEE FOR THE ALT NO 1 TRUST [2017] WASC 96

CORAM:   LE MIERE J

HEARD:   15 FEBRUARY 2017

DELIVERED          :   12 APRIL 2017

FILE NO/S:   CIV 2993 of 2016

BETWEEN:   BADAH PTY LTD

Plaintiff

AND

ONE INVESTMENT ADMINISTRATION LTD AS TRUSTEE FOR THE ALT NO 1 TRUST
First Defendant

REGISTRAR OF TITLES
Second Defendant

Catchwords:

Property law - Caveat - Application to amend and extend operation of caveat - Turns on own facts

Legislation:

Property Law Act 1969 (WA), s 72
Town Planning and Development Act 1928 (WA), s 21(1)(a)
Transfer of Land Act 1893 (WA), s 138B, s 138B(2)(a), s 138C(2)(a)(iii), s 138D(1)(c), s 138C, s 138C(2), s 137
Transfer of Land Act 1958 (Vic), s 90(3)

Result:

Caveat amended
Operation of caveat extended until further order

Category:    B

Representation:

Counsel:

Plaintiff:     Mr G R Dean

First Defendant              :     Mr P G McGowan

Second Defendant         :     No appearance

Solicitors:

Plaintiff:     Valenti Lawyers

First Defendant              :     Cornerstone Legal

Second Defendant         :     No appearance

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

Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27

Bashford v Bashford [2008] WASC 138

Custom Credit Corp Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42

Hazelwood v BP Australia Ltd [1987] Tas R (NC) N1

Kuper v Keywest Constructions Group Pty Ltd (1990) 3 WAR 419

Midwarren Estates Pty Ltd v Retek and Stivic [1975] VR 575

Multi-span Constructions (No 1) Pty Ltd v 14 Portland Street Pty Ltd [2001] NSWSC 696

Myra Pty Ltd v Thompson [2011] WASC 230

Palazzo Homes Pty Ltd v Goh [2010] WASC 407

Percy & Michele Pty Ltd v Gangemi [2010] VSC 530

Professional Services of Australia Pty Ltd v Mila Properties Pty Ltd [2004] WASC 30

Radford v Bellevue Apartments Pty Ltd [2008] WASC 291

LE MIERE J: 

Summary

1. In the late 1980s the plaintiff purchased and became the registered proprietor of approximately 22,000 acres of land in the Condingup area known as Linkletter's Place, which is comprised of 11 lots of land. There are several sheds and buildings on Linkletter's Place. On 2 September 2005 the plaintiff sold Linkletter's Place to ITC Timberlands Ltd (ITC). A condition of the sale agreement was that ITC would lease back a portion of Linkletter's Place on which portion the plaintiff intended to continue its intensive farming business, which is primarily the breeding and feed lotting of sheep. The sale was completed and ITC became the registered proprietor of Linkletter's Place. On 31 January 2006 the plaintiff as lessee and ITC as lessor executed a lease agreement (Lease Agreement) whereby ITC agreed to lease a portion of Linkletter's Place to the plaintiff. From the date of settlement of the sale until 19 June 2006 the plaintiff continued to operate its business in more or less the same manner which it had done prior to selling Linkletter's Place. On 19 June 2006 the plaintiff and ITC executed a lease (Lease) by which ITC leased for a term of 15 years an area of Linkletter's Place (the Leaseback area) together with an option to renew the lease for a further five years. The plaintiff registered a caveat against part of Linkletter's Place.

2. ITC sold Linkletter's Place to the defendant and the defendant became the registered proprietor of Linkletter's Place. On 28 June 2016 the defendant terminated, or purported to terminate, the Lease and demanded that the defendant deliver up vacant possession of the Leaseback area to the defendant. The notice of termination states that the Lease is contrary to s 21(1)(a) of the Town Planning and Development Act 1928 (WA). The notice of termination further asserts that the Lease expired on 2 February 2016, that the plaintiff remained in possession of the land as a tenant at will by virtue of the operation of s 72 of the Property Law Act 1969 (WA) and the defendant, as landlord, is entitled to terminate the Lease by serving 30 days' notice on the plaintiff, as tenant, pursuant to s 72(1) of the Property Law Act.  On 27 July 2016 the plaintiff commenced action CIV 2289 of 2016 in this court against the defendant seeking, among other things, a declaration that the Lease is valid and lawful.

3. On the application of the defendant, the Registrar of Titles gave the plaintiff notice under s 138B of the Transfer of Land Act 1893 (WA) (TLA). The notice states that the caveat will lapse on 22 November 2016 unless before that time the plaintiff obtains a Supreme Court order pursuant to TLA s 138B(2)(a). The plaintiff caused this originating summons to be issued by which the plaintiff seeks an order pursuant to TLA s 138C(2)(a)(iii) that the operation of the caveat be extended until further order and that the caveat be amended or alternatively an order that the plaintiff have leave pursuant to TLA s 138D(1)(e) to lodge a further caveat against part of some of the lots constituting Linkletter's Place. On 22 November I ordered that the operation of the caveat be extended to 29 November and on 29 November 2016 I ordered that the operation of the caveat be extended to 13 December 2016.

4. On 13 December 2016 I ordered that the operation of the caveat be extended to 15 February 2017. On 14 February 2017, by leave, the plaintiff amended its originating summons to seek an order pursuant to TLA s 138C(2)(a)(iii) that the operation of the caveat be extended until further order of the court subject to the amendments set out in the amended originating summons. Alternatively, the plaintiff seeks an order that it have leave pursuant to TLA s 138D(i)(e) to lodge a further caveat in the form attached to the amended originating summons.

5. On 15 February 2017 I heard the plaintiff's application for the orders sought in its amended originating summons.  At the conclusion of the hearing I reserved my decision and extended the operation of the caveat until further order.  For the reasons which follow the caveat should be amended and the operation of the caveat as amended should be extended until further order.

The Lease

1. The Lease recites that the Lessor (ITC) purchased the farming property known as Linkletter's Place and now known as Linkletter's Tree Farm from the Lessee (the plaintiff) by contract of sale in which the Lessor agreed that the Lessee could lease the Leaseback Area which is part of the property being purchased.  The recital states that the Leaseback Area is depicted on the Lease Plan annexed.  The leasing clause states:

   The Lessor agrees to grant and the Lessee agrees to take a lease of the houses, sheds and surrounding areas depicted on the Lease Plan annexed hereto (the 'Leaseback Area', which expression includes all improvements thereon) together with access thereto via laneways as shown on the Lease Plan annexed hereto on and subject to the following terms and conditions.

   The terms and conditions include that the Lessor agrees that the Lessee may lodge a subject to claim caveat over Linkletter Tree Farm in respect of the lease of the Leaseback Area.  There is no document entitled 'Lease Plan' attached to the Lease.  There are four attachments to the Lease.  Three are entitled map A, map B and map C respectively.  The fourth attachment is a hand drawing which shows the location of feedlots, pens, yards and buildings on parts of lots 25, 26 and 301.  I will refer to that drawing as the Main Compound Map, which is the description given to it by the plaintiff.  Each of map A, map B and map C contains one or more approximately circular shapes with the word house written next to them.  For convenience I will refer to these shapes as circles.  Map A appears to depict part of lots 301 and 22 and parts of two other lots which are not labelled but which from other evidence appear to be part of lots 26 and 25.  Map A contains two circles with the word house next to each and a large approximately square shape with the word house written on or next to it in three places.  The plaintiff says that that square shape corresponds to the area shown by the Main Compound Map.  Map B appears to depict part of lots 27, 28, 134 and 135 and contains two circles with the word house next to each.  Map C appears to depict lot 126 and contains a circle with the word house next to it.

The caveat

1. The description of land on the caveat is the whole of the land in each of lots 24, 301, 22, 26, 25, 27, 270, 126, 134, 135 and 136.  The estate or interest being claimed is stated to be:

   In leasehold as Lessees and as holder of an option to renew the Lease.

   The caveat states that the caveator claims an estate or interest as specified of the estate or interest of the registered proprietor in the land described by virtue of:

   A Lease Agreement over part of the land described with such Lease dated the 19 day of June 2006 made between the Registered Proprietor as Lessor and the Caveator as Lessee for a term of fifteen years commencing on 1 February 2006 together with an option to renew the Lease for a further term of 10 years.

   The caveat forbids the registration of any instrument affecting the estate or interest unless such instrument is expressed to be subject to the caveator's claim.

The proposed amended caveat

1. The proposed amended caveat describes the caveated land as:

Land Description	Extent	Volume	Folio
1. That part of Lot 22 on Plan 7061 which falls within the area marked 'MAIN COMPOUND' and identified as part of the 'Leased Area' on the map attached hereto and marked 'Map A'	PART	1660	221
2. That part of Lot 25 on Plan 7061 which falls within the area marked 'MAIN COMPOUND' and identified as part of the 'Leased Area' on the map attached hereto and marked 'Map A'	PART	1660	222
3. That part of Lot 26 on Plan 7061 which falls within the area marked 'MAIN COMPOUND' and identified as part of the 'Leased Area' on the map attached hereto and marked 'Map A'	PART	1660	223
4. That part of Lot 27 on Plan 7061 comprised of 'HOUSE F' and its surrounding area as identified as part of the 'Leased Area' on the map attached hereto and marked 'Map B'	PART	1819	571
5. That part of Lot 126 on Plan 7987 comprised of 'HOUSE H' and its surrounding area as identified as part of the 'Leased Area' on the map attached hereto and marked 'Map C'	PART	1284	178
6. That part of Lot 134 on Plan 7988 comprised of 'HOUSE G' and its surrounding area as identified as part of the 'Leased Area' on the map attached hereto and marked 'Map B'	PART	1274	198
7. That part of Lot 301 on Plan 30664 comprised of 'HOUSE A' and 'HOUSE B' and their surrounding areas, and the area which falls within the 'MAIN COMPOUND', as identified as part of the 'Leased Area' on the map attached hereto and marked 'Map A'	PART	2513	320

1. Attached to the proposed amended caveat are five plans or drawings.  Three of them are map A, map B and map C which are copies of those maps attached to the Lease with the houses written on those maps labelled A to H.  The fourth is the Main Compound Map attached to the Lease.  The fifth is a map or plan of the plans on which each of the lots is on and which shows the location of each maps A, B and C (Overview Plan).

Amendment of caveats - legal principles

1. The plaintiff does not seek an order extending the caveat as lodged.  The plaintiff seeks an order amending the caveat and extending the operation of the caveat as so amended.

2. There are numerous cases in which the court has considered its power to allow the terms of a caveat to be amended. Most of the cases are concerned with applications to amend the description of the nature of the interest in land claimed rather than the description of the land in which the applicant claims an interest. The power to amend a caveat on an application under s 138C of the TLA is found in s 138C(2) which provides:

   On the hearing of an application under subsection (1), the Supreme Court ‑

   (a)if satisfied that the caveator's claim has or may have substance ‑

   (i)may make an order extending the operation of the caveat for such period as is specified in the order; or

   (ii)may make an order extending the operation of the caveat until the further order of the court; or

   (iii)may make such other orders as it thinks fit concerning the caveat or the land in respect of which the caveat was lodged;

   and

   (b)if not satisfied that the caveator's claim has or may have substance, shall dismiss the application; and

   (c)may make such ancillary orders in relation to the application as it thinks fit.

3. The High Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself.  The language which has actually been employed in the text of legislation is the surest guide to legislative intention albeit that the meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy:  Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 [47] (Hayne, Heydon, Crennan and Kiefel JJ).

4. Section 138C(2)(a)(iii) empowers the court to make such orders as it thinks fit concerning the caveat. That power extends to allowing the terms of the caveat to be amended. However, that power is conditioned by the requirement that the court be satisfied that that caveator's claim has or may have substance. In Professional Services of Australia Pty Ltd v Mila Properties Pty Ltd [2004] WASC 30, at [17], and Palazzo Homes Pty Ltd v Goh [2010] WASC 407, at [17], I expressed the view that 'the caveator's claim' refers to the estate or interest claimed in the caveat. Beech J expressed the same view in Bashford v Bashford [2008] WASC 138 (Bashford) at [46]. Those were cases where the amendments to the caveat sought concerned the nature of the interest claimed in the land, not the description of the land in which an interest was claimed. In my opinion, 'the caveator's claim' refers to the estate or interest claimed in the land described in the caveat. For example, a caveator cannot establish that his claim to an interest in certain land has or may have substance by showing that his claim to an interest in an entirely different piece of land in a different location that that stated in the caveat has or may have substance. That does not mean that a caveat may not be amended to correct errors in the description of the land described in the caveat. Each case must be considered according to its circumstances.

5. In Radford v Bellevue Apartments Pty Ltd [2008] WASC 291 the caveat described the land the subject of the caveat as the whole of the land in the relevant certificate of title [6], [16]. Beech J said, at [17], that the description 'whole' was incorrect but if that were the only defect the caveat could consistent with the principles explained in Bashford at [51] be amended to say 'part' rather than 'whole'.

6. In Percy & Michele Pty Ltd v Gangemi [2010] VSC 530 the caveat described the wrong interest [26]. It described the interest claimed as 'estate in fee simple' [26]. The caveator conceded that it should claim 'an equitable interest as chargee' [26]. Section 90(3) of the Transfer of Land Act 1958 (Vic) empowered the court to 'make such order as the court thinks fit'. Macaulay J referred to the decision of Menhennitt J in Midwarren Estates Pty Ltd v Retek and Stivic [1975] VR 575 where his Honour did not consider that the provisions of s 90(3) of the Transfer of Land Act (Vic) authorised the making of an amendment to the estate claimed [94]. Macaulay J said at [96] that there is force in the argument that s 90(3) should not be construed so as to empower the court to amend a caveat by substituting an entirely different estate or interest claimed. After referring to other authorities his Honour said:

   … I do nonetheless recognise that the power expressed in s 90(3) is wide and unqualified. Ultimately, the better view may be that although the power is to be construed as being wide enough to amend the estate or interest claimed, in appropriate circumstances, nevertheless when exercising its discretion the court should generally be less inclined to amend the interest or estate claimed than to amend the grounds of the claim or the scope of the protection asserted [101].

   After saying that he found it unnecessary to resolve that issue, Macaulay J set out, at [104], the factors which should be taken into account in the exercise of discretion which include:

   •the nature of the amendment sought;

   •the circumstances in which the error was made;

   •wrongfully formulated caveats should not easily be tolerated because they can have powerful and serious consequences; and

   •the overall merits of the claim for a caveatable interest of the king which is sought by the amendment.

7. The amendment sought is to the description of the land.  The amendment reduces the land caveated.  The amended caveat deletes from the land description lots 24, 270, 135 and 136 which are within the land described in the original caveat.  Secondly, the land description in the amended caveat is part of each lot whereas the description in the original caveat is the whole of each lot.  Thirdly, the part of each lot is identified in the amended caveat by attached maps.  In this case the whole includes the part.  The amendment is to claim the same interest but in only part of the land described in the caveat.  The circumstances in which the plaintiff claimed an interest in the whole of each lot constituting Linkletter's Place includes that it is a term of the lease that the Lessor agrees that the Lessee may lodge a subject to claim caveat over Linkletter Tree Farm in respect of the lease of the Leaseback Area.  That is, at least arguably the Lease provided for the plaintiff to lodge a caveat over the whole of Linkletter Place or as it was then called Linkletter Tree Farm.

8. Caveats which claim a different interest in the land than is actually held by the caveator or which claim an interest in land in which the caveator has no interest may mislead parties dealing with the registered proprietor or relying on the caveat.  However, whilst the land's description on the caveat is not confined to the Leaseback Area, the description in the caveat of the estate or interest claimed states clearly that the interest claimed is by virtue of a Lease Agreement 'over part of the land described'.  Thus, anyone reading the lease was alerted that the interest claimed was over part of the land as described in the identified lease agreement; the interest claimed was not over the whole of the land.

9. An important consideration is the overall merits of the claim for a caveatable interest of the kind which is sought by the amendment.  I now turn to consideration of that claim.

Leasehold interest is a caveatable claim

1. The interest of a lessee under a lease or agreement for lease is an estate or interest in land sufficient to support a caveat.  In CIV 2289 of 2016 the defendant claims that the Lease is unenforceable and invalid and the plaintiff does not have a leasehold interest in the land.  However, the defendant concedes for the purpose of this application that the plaintiff has an interest as lessee in the Leaseback Area.

2. The defendant submits that the plaintiff's application does not have substance in that the Lease does not support the caveat in its proposed amended form.  The defendant puts forward a number of submissions in support of that contention.  I will consider each in turn.

Defendant's contentions that application does not have substance

1. First, the defendant says that the interest claimed in the caveat does not correspond with the Leaseback Area referred to in the Lease and the plaintiff is seeking to caveat an estate or interest significantly greater than the Leaseback Area.  That is true of the caveat but not of the proposed amended caveat.  The land described in the proposed amended caveat is confined to the Leaseback Area.

1. Secondly, the defendant says that dimensions or descriptions of the estate being claimed have not been provided within the caveat to allow the Registrar and searchers of the caveat to ascertain the interest being claimed.  The defendant says that the maps are not capable of clear expression and are not prepared within any degree of precision.  The extent of the caveatable interest, the defendant says, is unclear and ambiguous.

2. I do not agree with the defendant's submission. TLA s 137 requires a caveat to be in the approved form. The approved form for a caveat is form C1. The form contains a panel for 'description of land' and three adjacent panels to enter 'extent', 'volume' and 'folio'. A note to the form says that the lot and diagram/plan/strata/survey strata plan number or Location name and number is to be stated. In relation to 'extent', whole, part or balance of the land comprised in the Certificate of Title is to be stated. The Volume and Folio are to be stated. The note further states '[i]f this document relates to only part of the land comprised in the Certificate of Title further narrative or graphic description may be necessary'. In my opinion, if the caveat relates to only part of a lot then a further narrative or graphic description is necessary.

3. There are authorities which take a strict approach to the description of the subject land.  For example, in Hazelwood v BP Australia Ltd [1987] Tas R (NC) N1 the caveat was framed to claim an estate or interest as equitable and/or beneficial owner of all that portion of the land comprising storage tanks, pumping equipment and other fixtures and the right to enter and remove them by virtue of an agreement in all the land mentioned in the schedule.  The schedule contains no entry in column headed 'whole or part'.  Cox J held that the caveat was unclear in that it failed to identify whether the subject land was the whole or part only of the land in the certificate of title and also that if the description was sufficient to convey a limiting of the claim to a portion of the land in the certificate of title it was inadequate to identify the subject land.  His Honour noted that the effect of the caveat was to prevent all dealings with the subject land, whereas if part only is subject to a prohibition, the Recorder must be able to determine with reasonable precision whether any given dealing is affected by it.

4. A more flexible approach was taken by the Full Court of the Supreme Court of Western Australia in Kuper v Keywest Constructions Group Pty Ltd (1990) 3 WAR 419. The first defendants had contracted to purchase two lots on a strata title plan yet to be registered. Following the purported termination of the contract by the plaintiffs, the defendants lodged a caveat which purported to claim an interest 'as to portion only of' the relevant lot the subject of the certified title over which the caveat was lodged. The Full Court held that the description was sufficient. The proposed amended caveat identifies the subject land with as much precision as is possible. Having regard to the nature and purpose of a caveat, it is a sufficient identification of the subject land.

5. In Custom Credit Corp Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42 Malcolm CJ explained at (44 ‑ 45):

   … the concept of a caveat as a form of statutory injunction was clearly stated by Barwick CJ (with whom McTiernan and Owen JJ agreed) in J & H Just (Holdings Pty Ltd v Bank of New South Wales (1971) 125 CLR 546 at 552. The then Chief Justice said of a caveat:

   'Its purpose is to act as an injunction to the Registrar-General to prevent registration of dealings with the land until notice has been given to the caveator. This enables the caveator to pursue such remedies as he may have against the person lodging the dealing for registration. The purpose of the caveat is not to give notice to the world or to persons who may consider dealing with the registered proprietor of the caveator’s estate or interest though if noted on the certificate of title, it may operate to give such notice.'

   Windeyer J said (at 558):

   '… the primary purpose of a caveat against dealings is not to give notice to the world of an interest. It is to warn the Registrar-General of a claim. The word caveat has long been used in law to describe a notice given to an official not to take some step without giving the caveator an opportunity to oppose it.'

   It is in the sense stated by Barwick CJ and Windeyer J that a caveat is a form of statutory injunction of an interlocutory character.

6. In Multi-span Constructions (No 1) Pty Ltd v 14 Portland Street Pty Ltd [2001] NSWSC 696 Barrett J said, at [127], that central to s 74F of the Real Property Act 1900 (NSW), which authorises the lodgement of a caveat, is the notion that the party lodging a caveat asserts an entitlement to a particular estate or interest and that the caveat prohibits the recording of any dealing affecting the estate or interest to which the person claims to be entitled and a caveat is ineffective to do more than provide protection, by way of notice, commensurate with the extent of the notified estate or interest.

7. The nature and purpose of a caveat is such that technical deficiencies in its form and content should not be allowed to deprive a claimant from obtaining the advantage of lodging a caveat where the claimant establishes there is a serious question to be tried that he or she has a caveatable interest in the land and the subject land is identified with sufficient precision.  What is sufficient precision must be determined in a practical way.  In my opinion the identification of the land in the proposed amended caveat is sufficient.

8. Thirdly, the defendant says that the description of the land refers to an area marked 'Main Compound, whereas no such document is referred to in the Lease or any plans annexed to it.  That is true but not relevant.  The Leaseback Area described in the Lease is 'the houses, sheds and surrounding areas depicted on the Lease Plan annexed hereto (the "Leaseback Area", which expression includes all improvements thereon) …'  Map A contains three areas depicted by bold lines - two circles with the word House next to each and an approximately square shape with the word House on or next to different parts of it.  The most obvious interpretation of the description of the Leaseback Area is that it is the areas within the bold lines on each of the maps attached to the Lease.  One of them includes the area to which the plaintiffs have given the title Main Compound.  It makes no difference whether that label is attached to the area or not.

9. Fourthly, the defendant says that the plan marked Main Compound Map appears to seek to include the entire area shaded in red, including feedlots and yards, when the Leaseback Area does not refer to feedlots or yards.  Thus, the defendant says the wording used in the proposed amended caveat is inconsistent with the terminology of the Lease that amounts to a different interest.

10. I do not agree.  The description of the Leaseback Area in the Lease includes houses, sheds and surrounding areas depicted on the annexed Lease Plan including all improvements on it.  The Main Compound Map contains what the plaintiff alleges are houses C, D and E as well as sheds and other improvements.  The Main Compound Map, without that title, is one of the maps or plans annexed to the Lease and appears to be, together with the other maps the Lease Plan referred to in the description of the Leaseback Area.  It is at least arguable that the area on the Main Compound Map is part of the Leaseback Area.

11. Fifthly, the defendant says that the proposed amended caveat annexes documents which are not annexed to the Lease, specifically the Main Compound Map and the Overview Plan.  The Main Compound Plan is annexed to the Lease, although the copy of that plan annexed to the Lease does not have the title Main Compound Plan.  The Overview Plan is not annexed to the Lease.  It was, however, annexed to the Lease Agreement.  The depiction of the Leaseback Area on the Overview Plan does not extend the Leaseback Area beyond the areas shown on map A, map B, map C and the Main Compound Map annexed to the Lease Plan.  The Overview Plan serves to better identify the Leaseback Area by giving an overview of the area covered by each of Map A, Map B and Map C and the land between and surrounding them.

12. Sixthly, the defendant says that the proposed amended caveat is unintelligible and embarrassing.  The defendant says that it includes lot 22 in the description of the land but the maps annexed to the Lease do not show any houses, sheds or surrounding areas depicted on that lot.

13. It is not clear that the Leaseback Area does not extend onto lot 22.  The northern boundary of the Main Compound arguably appears to extend, albeit minimally, onto lot 22.  The plaintiff has shown that its claim that the Leaseback Area extends onto lot 22, and hence that it has a caveatable interest in lot 22, has or may have substance.

The plaintiff's claim has or may have substance

1. I find that the plaintiff's claim in the proposed amended caveat has or may have substance.

Balance of convenience

1. Where a caveator has established that there is a serious question to be tried as to the existence of the claimed interest, removal of the caveat would be unusual:  Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd; Myra Pty Ltd v Thompson [2011] WASC 230 [35]. Removal of the caveat may well have the effect of destroying the benefit of the proprietary interest claimed in the caveat. There is no evidence of any prejudice to the defendant sufficient to tip the balance of convenience in favour of refusing to extend the operation of the caveat as amended.

Leave to amend the caveat

1. The plaintiff has established that its claim in the proposed amended caveat has or may have substance.  The caveat was registered when the defendant purchased Linkletter's Tree Farm.  Notwithstanding that the description of land on the caveat extended to the whole of Linkletter's Tree Farm and thereby went beyond the land in respect of which the plaintiff claims an interest, the caveat makes it clear that the interest claimed is the interest in respect of part of the land described and that it is the land leased to the plaintiff under the Lease.  For the purposes of this application the defendant concedes that the plaintiff has an interest in the Leaseback Area.  For those reasons and the reasons stated earlier in these reasons the caveat should be amended in accordance with the proposed amended caveat.  The operation of the caveat, as so amended, should be extended until further order.