Cassegrain v Gerard Cassegrain & Co Pty Ltd
[2014] HCATrans 249
[2014] HCATrans 249
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S141 of 2014
B e t w e e n -
FELICITY CASSEGRAIN
Appellant
and
GERARD CASSEGRAIN & CO PTY LTD
Respondent
FRENCH CJ
HAYNE J
BELL J
GAGELER J
KEANE J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON THURSDAY, 13 NOVEMBER 2014, AT 10.01 AM
Copyright in the High Court of Australia
MR D.F. JACKSON, QC: If the Court pleases, I appear with my learned friends, MS P.J. GORMLY and MS L.M. JACKSON, for the appellant. (instructed by Peter Condon & Associates)
MR B.W. WALKER, SC: May it please the Court, I appear with my learned friend, MR G.B. COLYER, for the respondent. (instructed by McCabes Lawyers Pty Limited)
FRENCH CJ: Thank you.
MR JACKSON: Thank you, your Honours. Your Honours will have our outline of submissions. The appeal relates to two transfers of a number of pieces of property, collectively described as the Dairy Farm. May I take your Honours very briefly to the facts, which are really quite brief in the end? The first transfer your Honours will see at page 79 of the appeal book and the transfer - your Honours will see there is a date – 14 September 1996 – the several properties making up the Dairy Farm, and there are eight of them, no doubt of various sizes, referred to at about line 23 or 24.
The transferor is the respondent. The transferees are Claude Cassegrain – and your Honours, if I could use the name “Claude” in relation to him, it just makes it a lot easier – and the appellant, his wife, as your Honours will see as joint tenants. The transfer, your Honours will see, is executed on behalf of the respondent by Anne‑Marie Cameron and by Claude. There is no suggestion, may I note in passing, that Anne‑Marie Cameron was in any way complicit in or aware of any fraud by Claude.
Your Honours will see that the consideration for the transfer is stated to be a million dollars and that is explained by the minutes of meeting of the directors of the respondent, held on 2 September 1996, which you will see at page 73. Your Honours will see on page 73 itself that in paragraphs (a) to (g) there is a recitation of matters considered and that goes on to (j) on the next page, and then the resolutions that are set out on page 74.
Your Honours will see a reference to a valuation of the property as being a million dollars and the valuation is at pages 76 to 77. It is dated at the bottom of page 76, 20 June 1994, but at the top of the next page you will see it is considered to be the value of the interest described at 21 September 1995, and the relevance of that date is reflected at the bottom of page 74 in the last paragraph on that page.
Now, your Honours, the transfer was registered on 10 March 1997. I suspect that the parties have agreed this at the hearing because I do not think one finds in the material that your Honours have, apart from the judgment, that date, but you will see it referred to at page 139 in paragraph 107 of the primary judge’s reasons.
Your Honours will see, if I could stay at page 139 for a moment, in the concluding sentence at paragraph 106, it was not suggested the transaction was at an undervalue from the respondent’s perspective and your Honours will see that fact referred to also in paragraph 122 at page 144.
May I move then to the second transfer? It occurred three years later. The document is at page 95. Your Honours will see that the transferor is Claude. The transferee is the appellant. The consideration is nominal, a dollar, and the transfer in fact was registered on 18 April 2000. That appears from the primary judge’s reasons at page 151, paragraph 148.
May I add this also, your Honours? As Justice Basten in the Court of Appeal noted at page 255, paragraph 119, there was only one proceeding at first instance and the underlying circumstances were the same but the Court of Appeal decided to prepare separate judgments in the case of the appeal by Claude which failed, on the one hand, and the respondent’s appeal against the present appellant which succeeded.
Your Honours, the findings by Justice Barrett at first instance as to the nature of Claude’s fraud applied as between the appellant and the respondent as well as between the respondent and Claude. I will come to that a little later, your Honours, but may I take your Honours for a moment to page 253, paragraph 113 in the reasons for judgment of Justice Beazley. Your Honours will see towards the second‑half of that paragraph her Honour says:
But, in any event, fraud was clearly established on the facts. This is apparent from the review of the facts canvassed in GC & Co’s appeal against Claude . . . As the claim against Felicity was brought in the same proceedings, the evidence was adduced in respect of both claims.
FRENCH CJ: What was the fraud?
MR JACKSON: The fraud, your Honour, was in debiting to the ‑ ‑ ‑
FRENCH CJ: The post‑transfer debit.
MR JACKSON: Yes, your Honour, yes, that was the finding. I will take your Honours to the detail of that a little later but that is what it amounts to, and I was just going to put it in summary form at the moment that as against Claude it had been held that he was liable to pay equitable compensation for the sums including the purchase price of the Dairy Farm which he debited against his “account” with the respondent and it was held that the fraudulent conduct occurred when the money was debited against that account. That occurred in the case of the Dairy Farm consideration on 30 June 1997, the transfer having been registered earlier on 10 March that year.
May I come then, your Honours, to the position relating to the first transfer? The first transfer which, of course, is at page 79, was a transfer by the respondent to Claude and the appellant as joint tenants. It was not asserted in either court below that the appellant was in any way involved in the fraudulent conduct held to have occurred. May I take your Honours very briefly to the references in that regard? First of all, the primary judge at page 157, paragraph 164, the second sentence his Honour said:
There is no allegation that Felicity was a participant in or had notice of Claude’s fraud at the time the Dairy Farm passed to the two of them as joint tenants.
In the Court of Appeal, Justice Beazley in two references, first of all, page 219, paragraph 6, where her Honour said:
There was no allegation in the claim against Felicity that she knew of Claude’s fraudulent conduct in using the purported credit balance in the loan account for the purchase of the property.
Also, your Honours, at page 234, paragraph 52 of her reasons, your Honours will see the first sentence of those reasons. The issue was adverted to also by Justice Basten at page 256, paragraph 123, where your Honours will see towards the bottom of page 256 and two‑thirds of the way through the paragraph.
It may be inferred that she knew that payment was to be made, purportedly from her husband’s loan account with the company, but that did not entail an understanding or knowledge of fraud, let alone participation in it. Nor did the company suggest otherwise.
So that, your Honours, any attribution to her of fraud had to come from some responsibility, if I could use a neutral phrase for the moment, for the fraudulent conduct of Claude. The basis for so doing comes, if at all, from the use of the term “agent” in Assets Company Ltd v Mere Roihi [1905] AC 176 and the passage at page 210. Your Honours, I am going to come back to this in more detail when I get further into the argument, but may I just take your Honours to the relevant passage first. Your Honours will see at page 210 in the advice of the Privy Council per Lord Lindley, you will see that in the fourth line of the new paragraph on that page, his Lordship said:
appear to their Lordships to shew that by fraud in these Acts is meant actual fraud, i.e., dishonesty of some sort, not what is called constructive or equitable fraud . . . Further, it appears to their Lordships that the fraud which must be proved in order to invalidate the title of a registered purchaser for value . . . must be brought home to the person whose registered title is impeached or to his agents.
That is the phrase, your Honours –
Fraud by persons from whom he claims does not affect him unless knowledge of it is brought home to him or his agents.
Then if I could go to the last five lines of that paragraph:
A person who presents for registration a document which is forged or has been fraudulently or improperly obtained is not guilty of fraud if he honestly believes it to be a genuine document which can be properly acted upon.
FRENCH CJ: So there is no question of anybody being deceived in this case, it was just a question of him debiting a loan account in respect of which he had no entitlement in relation to the purported credit of $4.25 million.
MR JACKSON: Yes.
FRENCH CJ: So that, for example, had he executed the transfer and, instead of debiting his loan account, written out a cheque for a million dollars from his own personal funds there would have been no problem.
MR JACKSON: That is what the primary judge said, too, your Honour.
FRENCH CJ: The dishonesty is in the subsequent act?
MR JACKSON: Yes.
FRENCH CJ: Yes.
MR JACKSON: Your Honours, the passage to which I have referred – I should return to it shortly, but what it says is that the fraud must be brought home to the person whose title is impeached or to his agents and, your Honours, the first question which arises is whether, assuming that the appellant was innocent, Claude was her agent to effect the registration or the – her agent in effecting the fraud, whatever be quite the right question to be asked, and I will come back ‑ ‑ ‑
HAYNE J: But that is the difficulty, is it not, Mr Jackson, to know what this reference to “or his agents” carries with it.
MR JACKSON: Yes, indeed, your Honour. Yes. It is a difficult question, your Honour. Might I say that we will be submitting that it does require that the person who is the principal be, in effect, complicit in the fraud? Now, your Honour, that is a term which itself requires further definition of course, but essentially in circumstances where the person who is the principal gives the agent the authority to commit the fraud at the least it has some concept of there being the possibility of fraud. It is a case where it must be something that, in effect, is authorised in a fraudulent sense. Your Honour, I am putting that badly, but may I come back to that?
Your Honours, the evidence on the question whether Claude was her agent is, as the primary judge said at page 154, paragraph 155, sparse. Your Honours will see the judge’s observation at paragraph 155 and could we refer also to paragraph 156? I will not read them out, but may I refer your Honours to their content? Could I then endeavour to take your Honours to what the evidence was?
This was not a case where there was oral evidence, your Honours, so it consists of these things. First of all, the transfer at page 79 to which I have taken the court. The second thing is the letter at page 81 which is on the letterhead of the company, the transferor, signed by Claude as managing director and it refers to “Re: Purchase of Dairy – C & F Cassegrain”. I will come back to it, your Honours.
The next thing is the letter at page 83 from the solicitors referring to sending a letter back to “Mr C Cassegrain” care of the company. You will see the letter at page 87 similarly addressed and the letter at page 89 similarly addressed, and then, your Honours, at page 91 the “With Compliments” slip from the company which encloses the stamp duty.
Now, your Honours, if I could go for a moment to our submissions in‑chief, we have set out in paragraphs 23 and 24 of our written submissions the views on the evidence of the primary judge to which I have taken your Honours already, and then the views of Justice Basten in dissent in the Court of Appeal in paragraph 24. Justice Basten’s reasons can be seen at page 257 in the appeal book and, in particular, at paragraph 125 where you Honours will see it set out in a more easy to read fashion.
Your Honours, how then did one get agency from that evidence? We have set out the steps which were adopted by Justice Beazley in our written submissions in‑chief at paragraph 25. May I take your Honours to that for a moment? Your Honours will see that her Honour – and I am referring to page 224 of the appeal book. Your Honours will see that at paragraphs 23 through to 27, her Honour recited the submissions that were made on behalf of the other side and then at 28 and 29 those made on our behalf. Then at paragraph 30 at page 227 her Honour expressed the view that the letter of 27 February – that is the letter to which I took your Honours at page 81:
was a direction from Claude to register the transfer.
Claude had signed it so he registered the transfer. She noted at paragraph 32 at page 228, the contention that the case was one of “implied authority” rather than express authority. At paragraph 33, she took the view that he, Claude, had assumed authority to act on behalf of the appellant but as her Honour said in the middle of paragraph 33 that is not sufficient – the assumption of authority was “not sufficient to establish implied” authority.
HAYNE J: But authority in what sense - authority to achieve what result, authority to do what?
MR JACKSON: Well, the way in which her Honour is expressing it was authority to have the transfer registered, your Honour. That is what she was speaking of.
HAYNE J: That seems to be a chain of argument – or steps of argument are A directs the solicitor to register. The transfer is a transfer to A and B. Therefore – it is the “therefore” clause which I – yes, I see the word “authority” but what is it connoting? It is not connoting drawing B into some legal relationship with another, I think, is it?
MR JACKSON: Your Honour, the effect of registration is to confer on C – I forgot who you said ‑ ‑ ‑
HAYNE J: The other.
MR JACKSON: The transferee, your Honour – confer on the transferee an estate upon registration.
HAYNE J: Sure.
MR JACKSON: But, your Honour, the transferee thereafter uses the estate, has the estate. But in this case, your Honour, if one looks, for example, at the terms of section 42 of the Real Property Act what one sees is that the person who is registered holds the estate except in the case of fraud. Now, the case of fraud, your Honour, must mean in one fashion or another - fraud in effecting the registration in one way or another. But the agency that seems to be looked at in paragraph 33, for example, is simply agency to effect the registration. I think that is what her Honour is speaking of.
FRENCH CJ: Paragraph 37, I think that is made explicit, is it not?
MR JACKSON: Yes, your Honour.
FRENCH CJ:
Felicity’s agent for the purposes of directing Mr McCarron to register the transfer.
MR JACKSON: Yes. Now, your Honours, we have set out in paragraph 25(c) the fact that when one comes to paragraphs 34 and 37, her Honour said in paragraph 34 that:
If that was all there was in this case, Felicity would succeed as Barrett J found.
But there was, she thought, evidence that:
Claude was acting as Felicity’s agent.
That evidence, your Honours, seemed fundamentally to come from the letter and also what she regarded as the matter that was of particular importance. In that regard, your Honours, those are the final – what her Honour said at paragraph 31 was “the final factor”, halfway through paragraph 31, was that he was acting – the solicitor signed the document “on behalf of both Claude and Felicity”.
Could we say in relation to that, your Honours, the submissions that we make are those set out first in paragraph 34. Perhaps I should say this. So far as the letter of 27 February, which is at page 81, is concerned could we just say these things? The letter was on the company’s letterhead. It was signed by Claude Cassegrain as managing director. It clearly conveyed a direction purporting to be on behalf of the company, which was the transferor. It may be that as Justice Beazley said at paragraph 30 that the letter was written by him in pursuance of the fraud, but it does not follow, in our submission, though she said, that he must have written the letter on behalf of the transferees.
Your Honours, it also does not follow, as her Honour said at paragraph 31 of her reasons at page 228 that the letter was evidence that he, Claude, was acting on behalf of both of them. What you have is simply that he did these things, he did it.
BELL J: Even if one took from circumstances including the “With Comps” slip that an inference was open that Claude used the company stationery indiscriminately and that the letter of 27 February that he signed on the company letterhead was an instruction by Claude as transferee, your argument would remain good.
MR JACKSON: Yes, your Honour, yes. Your Honours, it also does not follow, in our submission, that the final factor – what the judge described at paragraph 31 as the final factor – if I could take your Honours to that for a moment at page 228, halfway through the paragraph:
The final factor was that Mr McCarron acting on instructions as he must have done, signed on behalf of both Claude and Felicity.
That, your Honours, as we have submitted in paragraph 30, would really lead to the opposite view. If he was acting on behalf of both Claude and the appellant it really militated against the view that Claude was the person who was the appellant’s agent in the matter.
If I could take your Honours to our learned friend’s written submissions for a moment. Your Honours will see that in paragraph 18 of those written submissions, various matters are relied on as supporting the finding as to agency. May I deal with those matters one by one, or perhaps, two by two.
As to (a) and (b), these are truisms, but one asks, how do they go to establish agency in this case? If one goes to (c) and (d), the fraud did not occur, on the judge’s findings, until after registration, but in any event, the matters in (c) and (d) do not go to agency. Does it mean that one simply says he must have been the agent because he was defrauding the company and that it what it seems to amount to, your Honours.
If one goes to paragraph (e), that is true – the solicitor could only act in instructions. But, as Justice Basten said at page 257, paragraph 125, it was entirely possible – “plausible” I think was the word he used – that she spoke to the solicitor directly to give the instructions. As to paragraphs (f) and (g), it is correct that Mr McCarron signed the transfer as solicitor for the transferees, but the correspondence rather suggests that he was acting for both parties, or for the respondent. Your Honours have seen the letters at pages 83, 87, 89 and 91.
Your Honours, as to the payment of stamp duty, the “With Compliments”, which is the last matter, I think referred to – I am sorry, it is paragraph (i) – the “With Compliments” slip at page 91 rather suggests that the payment, rightly or wrongly, was being made by the company rather than by Claude personally. Now your Honours, could we ‑ ‑ ‑
FRENCH CJ: Agency in this context is not satisfied by finding that he was acting in her interest obviously.
MR JACKSON: No, no, of course not, your Honour.
FRENCH CJ: It is a notion of “on behalf of” in some sense for some purpose, and the purpose in terms of the forensic purpose must be either to attribute to her notice of the fraud or participation in the fraud.
MR JACKSON: Indeed, your Honour, yes, and of course neither of those matters was alleged against her except at the conclusion – to the latter as a conclusion.
FRENCH CJ: What is the logical path from a finding of agency, whatever that means, to outcome?
MR JACKSON: Well, your Honour, it means, we would submit, that there was a participation in the fraud by the use of someone acting on their behalf in effecting the fraud because one is ultimately looking to see whether the fraud exception in section 42(1) is applicable.
HAYNE J: The innocent principal is affected by the fraud of the agent; is that proposition?
MR JACKSON: That is the proposition that would have to be established, in our submission, your Honour, for the protection of section 42(1) to be lost by it being a case except in case of fraud.
HAYNE J: Is it either right or relevant to observe that a fraudster will commonly seek to control all aspects of the execution of the fraud, and will not let it out of his or her grasp for fear of discovery?
MR JACKSON: Well, one is speaking, your Honour, about frauds that are successful because the issue would not otherwise arise and a successful – if I can put it this way. People who engage in activity that is fraudulent or criminal are of – using those alternatives, as it were, although I appreciate that sometimes the two are the same, but are sometimes very intelligent, sometimes they are not. The very intelligent can succeed or fail. The stupid can succeed or fail. It is a question of the number of times it happens one way or the other in a way.
But, having said that, the fraud exception recognises – and I am about to add something to this – that there will have been a fraud which has resulted in a person becoming a registered proprietor. The fraud may be one that occurs in circumstances where the person who effected the fraud was or was not the person who became registered proprietor. The person who became registered proprietor may be someone who is personally innocent in the matter, and that takes one back to the view of the relevant test which is provided for by Assets Co v Mere Roihi and there are some parts of that rather declamatory passage, if I may say so, with respect, that require some consideration.
HAYNE J: But the bare observation that here a person found to have acted fraudulently took control of the execution of the fraud of itself is an observation that does not readily lead anywhere.
MR JACKSON: Well, your Honour, the observation is made, and I am going to come to it. But it does not lead anywhere. It is not uncommon. It is what one would expect really. But the object of provisions like section 42 in the case of acquiring title by registration is that there will be people whose title, if one had a different system or did not have the Act, would be capable of being set aside under the general law.
FRENCH CJ: The implication of agency really almost collapses into an attribution of participation – attributed participation.
MR JACKSON: Yes, your Honour, it does. Could I refer also in relation to the issue I was dealing with paragraph 18 of our learned friend’s submissions into our reply submissions where we have said some additional things in paragraphs 4 to 10. Could I come then, your Honours, to the second basis of our attack on the finding of agency and may I go back to the passage from Assets Company [1905] AC at 210. Your Honours, there are several aspects to it. First, there is the requirement of:
actual fraud, i.e., dishonesty of some sort, not what is called constructive or equitable fraud –
That is the first thing. Secondly it is said the fraud that must be proved:
must be brought home to the person whose registered title is impeached or to his agents.
Agents in this sense, we would submit, presumably means persons acting within their authority as such, that is, authority to commit the fraud, not authority to do acts but authority to commit the fraud. Thirdly, one sees in the last five lines the proposition that does seem to have some application to this case that:
A person who presents for registration a document which is forged or has been fraudulently or improperly obtained is not guilty of fraud if he honestly believes it to be a genuine document which can be properly acted upon.
Your Honours, one is talking about title obtained by registration and that seems, in our submission, to be an appropriate statement ‑ ‑ ‑
KEANE J: So if the highest that the plaintiff’s case got was that there was authority to procure the registration of the transfer that would not be enough unless you proved something more beyond that.
MR JACKSON: Yes.
KEANE J: Mr Jackson, one of the things about this discussion of fraud in the context of the Real Property Acts, the Torrens Title Acts, is that the focus is almost always on fraud or the moral quality of the conduct as real fraud, actual fraud, as opposed to equitable or constructive fraud. But there is another aspect to it, is there not, that the legislation draws a distinction between a transferee who has notice of interests that will be defeated by registration, that person is not without more a fraud.
MR JACKSON: That is so, your Honour, yes.
KEANE J: The idea of fraud in this context is not just about the moral quality or lack thereof of the conduct. It is actually about conniving in the depriving of the title, is it not?
MR JACKSON: Yes, it is, your Honour. Yes, it is. I say yes, it is and what I was going to say, your Honour, in addition to that was this, that the title is acquired, as the cases say, by registration. That is why one is looking to see if there is conniving in obtaining the registration. What I was going to say was this. Your Honours will appreciate that when one is talking about obtaining title by registration and the fraud relates to obtaining that title by registration, in the decisions in the State courts, to which we have referred in our written submissions, one sees that the courts have been restricted a bit by the reference to the term “agent” in the passage to which I have referred to in Assets Co.
But, the interpretation of that has been an interpretation which suggests that there has to be a situation where there is the principal, as it were, person who achieved registration in some way complicit in the fraud of the agent. May I take your Honours for a moment, first to the interpretation – very briefly put – of that passage of Assets Co, what was said about it by Chief Justice Barwick in Breskvar v Wall (1971) 126 CLR 376. The relevant passage, your Honours, is at page 384 where your Honours will see that in the second paragraph on the page, his Honour says, halfway through:
Section 44 complements these provisions by providing that the registered proprietor holds the land absolutely free from all unregistered interests except
(a) “in the case of fraud”‑which means except in the case that the registration as proprietor was obtained by the proprietor’s own fraud‑see Assets Co. Ltd. v. Mere Roihi.
Your Honours, his Honour was not dealing, of course, substantially with the present issue but your Honours will see – and I will come back to this – that, in our submission, that is the better interpretation of the provision. Could I just note something about that case – Breskvar v Wall. Your Honours will see that Justice Macfarlan, at page 269 in paragraph 155, halfway through the paragraph, said:
Although to constitute an exception to indefeasibility, fraud must be that of the registered proprietor, the fraud of an agent acting within the ambit of his or her engagement is imputed to the registered proprietor.
Your Honours will see the reference in the last four lines to Breskvar v Wall. But what should be noted, your Honours, is that in fact, both principal and agent were involved in the fraud in that case. That that is so can be seen from Justice Menzies’ reasons at page 394. Your Honours will see at about point 4 of that page:
It was, in fraud of them, registered in the name of Wall after his name had, in September 1968, been put into the transfer by Petrie to cheat the appellants out of their land. The learned trial judge found the fraud and found that Wall was a party to it.
Then your Honours, his Honour goes on to say at page 395, about point 3 -you will see in the first new paragraph on the page, the second line:
The first is that it was obtained illegally by the use of an invalid instrument . . . the second is that it was obtained by his own fraud.
So, Breskvar v Wall, if Justice Macfarlan was treating it as a case of an innocent principal it was not such a case, really. It was a case where both the principal and the agent were involved in the fraud. The fact that it is appropriate to treat the case as one where the principal is involved can be seen in a number of decisions that we have referred to in our written submissions. Your Honours, I will not refer to them all, but may I take your Honours to a couple of them, or to three of them.
The first is Schultz v Corwill Properties Pty Ltd [1969] 2 NSWR 576. The relevant page is page 583, in the judgment of Justice Street, where his Honour said about line 26 on page 583, that here:
But, (and here I acknowledge I am putting a gloss upon the words used by the Privy Council) the mere fact that the existence of a fraud is known to an individual who is, in the transaction under consideration, the agent for some purposes of the person whose title is impeached will not of itself affect the indefeasibility of the title when registered. It is not enough simply to have a principal, a man who is acting as his agent, and knowledge in that man of the presence of a fraud. There must be the additional circumstance that the agent’s knowledge of the fraud is to be imputed to his principal. This approach is necessary in order to give full recognition to (a) the requirement that there must be a real, as distinct from a hypothetical or constructive, involvement by the person whose title is impeached, in the fraud, and (b) the extension allowed by the Privy Council that the exception of fraud under s. 42 can be made out if “knowledge of it is brought home to him or his agents”.
His Honour then went on to discuss the application of that notion to the particular case. Your Honour Justice Hayne adverted to the issue in the Supreme Court of Victoria in Vassos v State Bank of South Australia [1993] 2 VR 316. Your Honours, if I could take your Honours to two passages. The first is at page 326. Your Honour in the second paragraph was referring to fraud in section 44(1) of the Victorian Act, and then your Honour said in the second new paragraph on the page:
In my view the words of s. 44(1) suggest that there must be established fraud by or on behalf of the party who seeks and obtains registration; otherwise how it is it that the folio or the amendment is procured or made by fraud?
May I pause there to say your Honour is there using the words of section 44 of that Act which your Honours will see set out in the previous paragraph. Then if one goes to the penultimate paragraph on that page, your Honours will see that it said:
It was accepted in argument by all the parties (and the authorities make clear) that the exception “in case of fraud” that is mentioned in s. 42 is limited to fraud by or on behalf of the person obtaining registration.
Your Honours will then see the concluding three lines of that paragraph:
it is clear that s. 42 is now to be read as providing for an exception to indefeasibility only in cases where the registered proprietor has obtained registration by fraud.
At page 328 in the paragraph commencing halfway down the page, your Honour said you were not able to agree with the conclusion by Justice Gray in Chasfild’s Case and then went on to say:
Rather, I consider that on its true construction s. 44(1) is not intended to and does not extend the operation of the fraud exception to s. 42(1). It follows that I consider that in this case the title obtained by the bank on registration is not to be defeated save by fraud on the part of the bank or to which it was privy and is not to be defeated by the mere fact that some other party to the instrument (which the bank has had registered to thereby procure an amendment to the register) is fraudulent.
So your Honours will see the expression “fraud on the part of the bank or to which it was privy”. Now, your Honours, those observations were applied again in a Victorian court by Justice Coldrey in Rasmussen v Rasmussen [1995] 1 VR 613 at 631 between lines 9 and 19 where that was followed. May I refer also to Beatty v ANZ Banking Group Ltd [1995] 2 VR 301 at 314? Your Honours will see in the first new paragraph on the page Justice Mandie followed what was said by Vassos in your Honour’s reasons in Vassos. Then in the paragraph immediately following, it said:
It follows that, in order to succeed in this proceeding, proof of forgery is not enough. The plaintiff must establish that the bank was party to “fraud” within the meaning of ss. 42 and 44 –
Finally, your Honours, may I take your Honours to a decision of the Victorian Court of Appeal in Pyramid Building Society v Scorpion Hotels Pty Ltd [1998] 1 VR 188 at 191. On this occasion, your Honour Justice Hayne was in the Court of Appeal and gave the judgment that the other members of the Court agreed with. Your Honours will see at about line 25 on page 191 reference to Vassos where your Honour said:
I held that the title obtained by a mortgagee on registration . . . of a forged instrument of mortgage cannot be defeated on grounds of fraud if the mortgagee was not party or privy to the fraud.
Your Honours will see the last sentence of that paragraph, about line 37. Then in the third line in the next paragraph, line 42:
It was accepted in the argument in Vassos and in Chasfild . . . that the exception “in case of fraud” . . . is limited to fraud by or on behalf of the person obtaining registration -
and your Honour said about line 47:
That the exception “in case of fraud” in s. 42 is limited to fraud by or on behalf of the party obtaining registration is well established by authority –
Now, your Honours will see that at that page about the third‑last line, about line 49, your Honour referred to the passage in Breskvar v Wall from Chief Justice Barwick that I referred to earlier. So, your Honours, in our submission, the situation is one in which the requirement that there be a fraud by or on behalf of the appellant was not satisfied.
HAYNE J: Just going back to all this black past that you have just brought up, Mr Jackson, those bank cases were often cases in which the bank had allowed the fraudster to procure the signature – usually of a relative – and the fraudster had forged it. At least in that respect they were cases which might be thought to have yielded to this analysis by reference to agency in one sense. You might say, well, the bank was letting Peter Vassos or whoever it was act as its agent for procuring the signature. When Peter forges the signature the bank is utterly innocent.
MR JACKSON: Well, your Honour, if the term “agent” used in the Assets Co Case was one that was intended to have the loose, if I can put it that way, meaning that a person doing something that benefits or is for someone else without there being any investigation into the quality of the act, as distinct from the fact that he is doing it on behalf of someone, then one could see that that possibility would be open. But the difficulties that arise, your Honour, are these.
First of all, the term “agent” is one which is difficult. It can be productive of difficulty. It can be productive of difficulty because, amongst other things, it has with it the matters adverted to in the judgment of Justice Street to which I have not referred in any detail. What happens if one is talking about the agent’s own fraud? That brings about a separate consideration of whether there can be any attribution of knowledge to the principal. The third aspect of it is that one does have to start from really the statutory provision. The statutory provision speaks – if I can just take your Honours to the words of section 42 for a moment:
Notwithstanding the existence in any other person of any estate or interest which but for this Act might be held to be paramount or to have priority, the registered proprietor for the time being of any estate or interest in land . . . shall, except in case of fraud, hold the same, subject to such other estates and interests . . . but absolutely free –
et cetera. When it speaks of “except in the case of fraud” and when one treats fraud as being actual fraud, one would think, in our submission, one is looking the state of mind and conduct of the person who is the registered proprietor. Persons who are registered proprietors, for example, companies act through people but it has to be a fraud by the registered proprietor, in our submission, committed by the person himself or by someone acting in that regard on behalf of the registered proprietor.
FRENCH CJ: Is it the difficulty that, absent some inference of authority to cover the act of the fraudster given by the principal that in the end the conclusion as to agency is indistinguishable from a conclusion as to attribution? There is no anterior step unless you have some inference of authority.
MR JACKSON: That is so, your Honour, yes. That is so. In this case, what does one have? I have taken your Honours to the material.
HAYNE J: Just going back to Assets Co – Assets Co was, of course, a case where the title impeached was that of a company.
MR JACKSON: Yes, your Honour, yes it was.
HAYNE J: The reference to “or his agents” may, may not, have been directed to, well, what do you do in the case of a corporate party? How do you find fraud in a corporation except dealing with real live human beings?
MR JACKSON: That is so, your Honour, yes. Your Honour, that is the background to it. Of course, Assets Co was a company which had taken title over – there were a number of cases dealt with together. But it was, as your Honour said, a company that had to act through agents. Could I come then, your Honours, to the second transfer? The ultimately relevant provision is section 118(1)(d) of the Real Property Act. Could I take your Honours to that provision for a moment? You will see it speaks of, in its opening words:
Proceedings for the possession or recovery of land do not lie against the registered proprietor of the land, except as follows –
One goes then to paragraph (d) which says:
proceedings brought by a person deprived of land by fraud –
So that is the starting point:
proceedings brought by a person deprived by land by fraud –
One then sees that the person against whom the proceedings are brought must be within one of the categories referred to in (d)(i) or (d)(ii). Could I pause, your Honours, as to (d)(i)? It would only be if the agency found – the agency of Claude – continued into the second transfer that that provision could apply, otherwise what would be the fraud? So, your Honours, if we were to succeed on the agency – and I will come to the joint tenancy aspect in just a moment – but if we were to succeed on that, one has to go then to (d)(ii) for there to be a finding against us.
Now, your Honours, if I could go to (d)(ii) for a moment, we accept, as your Honours will see in our written submissions, paragraph 55, that the appellant did not give valuable consideration for the second transfer. We also accept that the second transfer was one because it was from Claude to her, that she derived from or through Claude. There is certain economy of language in that part of (d)(ii), your Honours, but that is why I use the expression that she “derived from or through Claude”.
Your Honours, that left the question, the question which is posed by the words of (d)(ii), whether Claude was registered as proprietor through fraud. Your Honours will see that the provision requires that the derivation be for a person registered as proprietor through fraud. That that was the relevant question was recognised by the primary judge. Your Honours, I will come in a moment to the relevant passages, but it is of importance to recognise the timings that are involved.
The transfer from the respondent to Claude and the appellant – and that is the one one is looking at for the purposes of the second part of (d)(ii) – was registered on 10 March 1997. The consideration was not debited until 30 June 1997, three and a half months later, and you can see that, your Honours, at page 93. At page 93, you will see in the left column, 30 June 1997, and you will see a debit of a million dollars. Then, you will see further down the page, I think the last four entries, all 30 June 1997, relating to other aspects of the consideration for the sale of the farm.
Now, your Honours, that aspect was dealt with by the primary judge at page 140 in paragraphs 110 to 112. Your Honours will see at paragraph 110 at page 140 that he refers to the various debit entries and then goes on to say, in paragraph 111, that he inferred from the books of account that the debiting was effected on 30 June:
The fact that there was no actual movement of cash indicates that it was only at 30 June 1997 that the financial impact was recorded within (and suffered by) GC & Co.
Your Honours will see the remainder of that paragraph and then paragraph 112:
The overall effect was thus that, on 30 June 1997, GC & Co acted upon and gave effect to the directors’ resolution of 2 September 1996 concerning debiting of Claude’s loan account and thereby notionally paid the relevant amount to Claude . . . It was thus on 30 June 1997 that value passed from GC & Co to Claude by way of debit to the loan account.
FRENCH CJ: That was on the assumption that the entry was made on that date. It does matter if it was made later than the date ‑ ‑ ‑
MR JACKSON: No, there is no other evidence of a date for it, your Honour. Your Honours, the Court will appreciate – and I took your Honours to the passages earlier – that there was only the one proceeding below and that the findings by Justice Barrett as to the nature of Claude’s fraud applied throughout the proceedings. I think I took your Honours to the passages at paragraphs 113 and 119 in the Court of Appeal’s reasons at pages 253 and 255 respectively.
Your Honours, may I go to the analysis and the actual findings by the primary judge in this regard and also to how the matter was dealt with then in the Court of Appeal; this aspect of the matter? In the primary judge’s reasons at paragraph 121 at the bottom of page 143, your Honours will see that he said that:
the establishment of the $4.25 million loan account . . . did not represent the recording of genuine indebtedness . . . that GC & Co was never in a position where it was bound to act upon and satisfy demands by Claude for repayments of “loan” –
Then, if your Honours go to the last four lines, he said:
to the extent that Claude received payments from GC & Co upon that supposed pretext, he took moneys of GC & Co that it was not legally obliged to pay to him and which he, in turn, had no legal right to demand or receive from it.
Then, your Honours, in the next paragraph -122 - having referred to the fact there was no suggestion that the transfer was at an undervalue, he went on to make an observation similar to that your Honour the Chief Justice made earlier:
It follows that, had that transfer taken place on the basis that saw Claude and Felicity pay GC & Co from their own pockets for the assets transferred, there might have been no attack on the transaction . . . The attack that GC & Co mounts in these proceedings is made because there was no actual payment and because Claude . . . purported to pay GC & Co by recording a reduction in the balance owing and payable by GC & Co to him in respect of the false loan account.
FRENCH CJ: Would it have made any difference in terms of the plaintiff’s case if Claude had simply transferred the land?
MR JACKSON: Probably not, your Honour, probably not. I am sorry, it would depend ‑ ‑ ‑
FRENCH CJ: Absent the debit, I am assuming.
MR JACKSON: Absent the debit, your Honour, no. The position would be that there would have been transfer of the land; there would be a debt owing for the balance for the consideration. If the situation had been one where there was simply a transfer for no consideration, questions might arise. If I could go to paragraph 124, your Honours, the fourth line of that paragraph, page 144, his Honour said that:
the establishment and recording of the loan account did not, of itself, cause harm to the company in any immediate way. Its asset base remained intact –
and your Honours will see the remainder of that paragraph. Then if one goes to paragraph 125, his Honour said:
Appropriation by Claude occurred when drawings were made, either by actual outlay . . . or, as in the case of the Dairy Farm, by recording a reduction in satisfaction of some genuine indebtedness owed to the company, again on the footing of some entitlement of Claude. Where there was an actual outlay of funds . . . appropriation occurred at the time of outlay. In cases exemplified by the case of the Dairy Farm, where no payment as such was made, appropriation occurred upon recording in the books of a reduction in the company’s indebtedness to Claude and satisfaction of the concomitant financial obligation of the company.
Your Honours will see then, if I can move over to paragraphs 128 and 129 on page 146, your Honours will see, in particular, paragraph 129:
It follows that, on each occasion on which Claude obtained money or value from GC & Co which reflected in a reduction of the loan account balance, he acted not only in breach of fiduciary duty but also dishonestly.
Your Honours will see the reference to “on each occasion”. Now, your Honours will see then that his Honour turned at page 161, paragraph 177, to dealing with the operation of section 118(1)(d). In paragraph 177 he recognised the two matters which we have accepted – the matter is not now in dispute. Then in paragraph 178, his Honour went on to refer to the operative words of section 118(1)(d)(ii), and your Honours will see that he said – he referred to the focus of them being on:
the process by which registration as proprietor was achieved –
Could I just say, your Honours, it may be correct to say that the last sentence of paragraph 178 goes too far. It may be that his Honour was a little too emphatic in saying in the sentence commencing “Their focus is exclusively on the process” et cetera. But what we would say is that it was entirely correct for his Honour to say was that the focus of 118(1)(d)(ii) in relevant respects was on the fact of registration, and secondly, whether that registration was through fraud. Your Honour, the registration of the first transfer on the findings made by the judge was regular, the fraud with the later debiting of the consideration to the so‑called loan account.
BELL J: Given the resolution – the company’s resolution – namely, that the consideration for the transfer was to be the reduction in the loan account in Claude’s name, and that took place I think about 2 September 1996, and given Justice Barrett’s finding that the loan account was a false account, does it matter that, in fact, the book entry was effected on 30 June 1997?
MR JACKSON: Well, it does, your Honour, because what one has – it is right to say it, putting it highest against Claude, if I can put it that way, was that he had entered into an arrangement whereby there was to be a transfer of the property on the one hand, and the consideration was to be consideration which was to be debited to his loan account. But, of course, there (a) was no debiting. At that time there was a separation of the transfer and that any time up to 30 June the situation was one where there had not been any loss sustained by the company – sustained by the respondent.
Your Honour, that is the way in which the case was found. Your Honour will appreciate there was an appeal by Claude against that which failed, an application for special leave which failed, and one sees that in the case – I am sorry – in the case against Claude in the Court of Appeal, in his appeal in the Court of Appeal, one of the things he was endeavouring to do was to, in effect, backdate things from 30 June 1997 because he wanted to have an earlier date for the limitation period to start running, and that failed.
BELL J: One can understand the forensic reasons for that, but looking to the inferences that were open on this case which was wholly documentary, could one inference be that in regard to the date of the resolution, the date of the transfer – that the fraud lay in the creation of the false loan account and that the fact that the book entry occurs three months after registration was neither here nor there?
MR JACKSON: Well, your Honour, one should not, in our submission, for these reasons. First of all, if one goes to the actual resolution, which is page 73 through to page 75, you will see that the – one has first of all, in paragraphs (a) to (j), the considerations that were taken into account. Then you see the resolutions. Resolution 1 is for resolution that there be a transfer, then there is resolution 2 for the consideration, and that is 2, 3, 4 and 5, really – and then when one comes to:
RESOLVED that the company debit the loan account of Claude Cassegrain in the books of the Company for the amount of the consideration . . . thereafter the Company shall relinquish all right title and interest in the property referred to in resolutions 1 and 3 hereof.
So, undoubtedly it was contemplated ‑ ‑ ‑
HAYNE J: But is a necessary step in your argument the proposition that, in the period between transfer and debiting, the company could have sued and recovered a judgment for a million?
MR JACKSON: It could have, your Honour. A million or more – yes, it could have.
HAYNE J: Consistent with this resolution could it have done that?
MR JACKSON: Well, your Honour, on the assumption that the loan account was not something that really existed, yes, it could have.
KEANE J: Mr Jackson, there is no question that this resolution by Claude and Anne‑Marie Cameron – there is no attempt to suggest that it is not a genuine resolution of the company. Is that right?
MR JACKSON: I think that is right, your Honour. I will check that, but I think it is right.
KEANE J: So the company did resolve to transfer this land for a million dollars?
MR JACKSON: Yes.
KEANE J: So the relevant fraud lies in the non‑payment of the money, does it not?
MR JACKSON: Yes, your Honour.
KEANE J: In return for the transfer?
MR JACKSON: Well, for non‑payment ‑ ‑ ‑
KEANE J: Non‑payment of money upon the transfer?
MR JACKSON: Yes.
KEANE J: So that is the fraud. That seems to be the basis on which the primary judge approached it.
MR JACKSON: Yes, it is, your Honour, yes. He said the fraud occurred at a time when the money was treated as debited to the account that did not exist – and that is 30 June.
KEANE J: The company – just to sort of get it clear ‑ ‑ ‑
MR JACKSON: Sorry.
KEANE J: ‑ ‑ ‑ the company would have been perfectly content, had it been paid – there is no suggestion that – what the company has been deprived of is a million dollars.
MR JACKSON: Yes. Plus the few other bits, yes.
KEANE J: Yes. But, that is what the company was defrauded of.
MR JACKSON: Yes. Your Honour, could I say that this was not challenged in the Court of Appeal. Could I take your Honours to page 254?
HAYNE J: Just before you do that, Mr Jackson, is this not chopping events up a little too finely in this way. This takes its place as part of steps taken driven by notions of capital gains tax, if I can put that neutrally. Is that right?
MR JACKSON: Yes, your Honour, yes.
HAYNE J: A step in the CGT considerations was to attribute an entitlement in Claude to half the money CSIRO had paid when there was none. How can we – why should we – why should the courts below focus on the resolution, shorn of the circumstances which generate it, both before and the circumstances that happen after. Is that what your argument entails or am I misstating it?
MR JACKSON: Well, your Honour, the starting point really is to look at the legislative provision that is in issue. One goes then to see that that is relevantly 118(1)(d)(ii). That assumes a person who has not given ‑ ‑ ‑
HAYNE J: Not a bona fide purchase of the value without notice.
MR JACKSON: Yes. But, your Honour, what it assumes, of course, is that the person has derived title from or through a person registered as proprietor of the land through fraud. The way in which the provision is expressed – it does not say a person who obtained the land through fraud. It speaks of:
a person who has been registered as proprietor of the land through fraud –
If one were dealing with a case at first instance then it would be a question of identifying what conduct amounted to the fraud and the relationship between that and registration. But, of course, that has been determined and determined at first instance as being one where the fraud occurred post‑registration.
Now, I appreciate, your Honour, of course the things have some connection, but the primary judge’s view was – and it was, if I could just say this, reiterated when he was dealing with the actual orders that he made – but it was that the fraud occurred on the debiting of the million dollars and the other sums. So that occurred. Now, it is a case that has its particular facts, as they often do, but one does have to look then to see how the statutory provision applies. I do not know that I can take it beyond that, your Honour. Your Honours, could I just say ‑ ‑ ‑
GAGELER J: Mr Jackson, may I just understand the factual position? Resolution 6 at page 75 ‑ ‑ ‑
MR JACKSON: Page 75, your Honour, yes.
GAGELER J: ‑ ‑ ‑ was the resolution that was being implemented, as I understand it, when the loan account was actually debited on 30 June 1997.
MR JACKSON: Yes, that is so, your Honour.
GAGELER J: Yes.
MR JACKSON: Well, your Honour, one could draw that inference, yes.
GAGELER J: Well, I think that is what the trial judge found at page 141.
MR JACKSON: Yes, your Honour.
GAGELER J: So the resolution was passed in the expectation that the loan account established dishonestly in advance would be debited as a result of the transfer.
MR JACKSON: Yes, that is so, your Honour, yes, and – well, yes, it did, your Honour. I do not know that I can advance it beyond that. But could I just say this, and, your Honours, if I may, I was going to say if one goes to what happened in the Court of Appeal your Honours will see at page 254, paragraph 113, a reference to – it is at the top of the page – the review of the facts canvassed in Claude’s appeal at paragraphs [10] to [32]. Now, the judgment there is relevantly at page 284. Your Honours, there is a discussion of the various facts through paragraph [10] in that judgment through to, if I could first stop at paragraph 29 at page 290, your Honours will see the resolution referred to and:
no evidence to suggest that the transfer was at an undervalue.
You will see then paragraph 31 at page 291 where what is said is that:
Barrett J held, at [111], that the financial impact of the transaction was suffered on that date. This date is relevant because of the limitations issue.
Then, your Honours, paragraph 33 said:
Before dealing with the issues raised by Claude on the appeal, the findings of the trial judge that formed the basis of his conclusion that Claude acted fraudulently in breach of his fiduciary duty should be noted. Whilst there is no direct challenge to these findings, they will fall away if Claude succeeds in –
showing, et cetera. Now, your Honours, will then see paragraphs 38 to 40 and you will see paragraph 39 particularly:
At [122], Barrett J characterised GC & Co’s complaint in relation to the Dairy Farm as being there was “no giving of valuable consideration” in return for the transfer because Claude purported to pay the company by recording a reduction in the loan account. His Honour noted that GC & Co had not suffered harm merely by the creation of the loan account –
Then your Honours will see paragraph 40 and then the last sentence of paragraph 40. Your Honours, the question was also adverted to in that appeal where the laches issue was dealt with. Could I refer to Justice Beazley at page 316, paragraph 120? Your Honours will see the first five lines of that paragraph; that is, the limitation period having commenced on 30 June 1997. You will see a reference also in paragraph 122 on page 316 to:
the period between the accrual of the cause of action in June 1997 and the commencement of proceedings.
Your Honours will see then at paragraph 123, page 317, in the second sentence her Honour records the contention that the judge had:
erred in finding that the relevant date for considering s 23 was immediately after the recording of the relevant book entries relating to the payment for the Dairy Farm.
He contended they should run earlier, that is, from the date he first asserted an entitlement to the 4.25 million, and that therefore the limitation period had commenced earlier. That failed, your Honours. At page 320 in paragraph 136, you will see her Honour said:
Rather, by book entry, he misappropriated monies to himself.
Then Justice Basten, your Honours, at page 337 – I am sorry, your Honours, I should have referred to Justice Beazley also at paragraphs 146 and 147, and your Honours will see particularly in 147 the reference to:
His Honour concluded that even though the loan account was false . . . there had been no change in GC & Co’s asset base . . . Damage was only sustained when Claude actually appropriated monies belonging to GC & Co, either by way of drawings or by making book entries, including the book entry in relation to the Dairy Farm.
Your Honours, Justice Basten, page 337, paragraph 187, your Honours will see to the same effect; and then at page 340, paragraph 193, and it is the last five or six lines of that paragraph. Your Honours will see Justice Macfarlan, paragraph 200, page 342.
Could I go, your Honours, to the reasons why the Court of Appeal overruled Justice Basten on this issue and it may appear first in Justice Beazley at page 246, paragraphs 90 to 99. At paragraphs 91 to 93, her Honour refers to the similarity in wording of the two parts of section 118(1)(d). Each uses the expression, “registered as proprietor of the land through fraud”. Then, at paragraph 93, her Honour says:
there is no basis for confining para (ii) to the registration process.
Your Honours, that is no doubt a reference back to, and a criticism of, the last sentence of Justice Barrett at paragraph 178, at page 161, where his Honour said:
Their focus is exclusively on the process by which registration as proprietor was achieved –
Now, your Honours, in our submission, going back to her Honour at paragraph 93, her Honour’s observations do not sufficiently recognise, in our submission, that the condition of operation of 118(1)(d)(ii) is that the proprietor was registered through fraud and, your Honours, in our submission, that was not established.
If I could go to her reasons at paragraph 94, page 247, in our submission the last sentence of paragraph 94 understates the requirement. The appellant was not vulnerable - it was established that Claude was fraudulent. It is vulnerable if he was registered through fraud. Your Honours, in relation to paragraphs 96 to 98 of her Honour’s reasons at page 248, one can accept that 118(1)(d)(ii) will apply to cases where the defendant is personally innocent of the fraud, but one still has to look at the language of the provision, and the expression in paragraph 98 of ‑
the process by which registration was achieved ‑
If I could just take your Honours to paragraph 98 – that is a reference back to what had been said by the primary judge. That might be too narrow, but again, one does have to look at the words of the provision. Could I take your Honours to what was said by Justice Basten on this issue at page 265, paragraphs 144 to 146. If one goes to the last five lines of 144, in our submission, they take too broad a view of the term “registered”. It really equates the term to obtaining, in effect, title and, your Honours, similar observations apply to paragraph 145.
HAYNE J: The dichotomy you just drew was between obtaining title and registering. You obtain title by registering.
MR JACKSON: What your Honour puts to me is correct, of course.
HAYNE J: The point is not a captious, but verbal point.
MR JACKSON: No, no, I understand, your Honour. What I was trying to say was this. Your Honours will see that in the last five lines of 144, what is said is that:
It makes good sense to say that Claude Cassegrain was registered as owner of the land “through fraud”, that is through his own act in arranging for the company . . . Just as the company was deprived of its title “by fraud”, Claude Cassegrain obtained his title “through fraud”.
What I was seeking to say, your Honours, was this. Those references in those two sentences are speaking of more than registration. The statutory requirements – the statutory provision speaks of registration. The language there used is, with respect, rather looser and it appears to be that because Claude was involved in a fraud – one aspect of which was that there would be a transfer of title to himself and his wife – that, therefore, that satisfied 118(1)(d). In our submission, that was not good enough.
Your Honours, Justice Macfarlan’s reasons are at page 209, paragraphs 155 to 158. I am sorry, your Honours, I have given the wrong reference there. It should be 269, your Honours, I am sorry – page 269. You will see essentially that his Honour relied on three matters. One was agency – that is paragraph 155. The second was joint tenancy – paragraph 156. Thirdly, at paragraph 158, he agreed with Justice Beazley as to the operation of 118(1)(d)(ii).
Could I come to the question of joint tenancy, your Honours, and reliance on the fact of joint tenancy? Could we just say this, your Honours? It is clear that the Act recognises that a joint tenant has an estate or interest in land. It does so because section 100 says so. Your Honours will see that section 100(1) says that:
Two or more persons who may be registered as joint proprietors of an estate or interest in land under the provisions of the Act, shall be deemed to be entitled to the same as joint tenants.
Section 97 uses language which speaks of the joint tenants’ interest in the land. Your Honours will see that in section 97(1). It recognises that the interest of a joint tenant may be transferred. One goes then to section 42. Your Honours will see that section 42 provides that:
the registered proprietor for the time being of any estate or interest in land –
and, your Honours, that is a term which would include the holder of an estate as joint tenant -
hold the same –
that is, the estate as joint tenant -
except in the case of fraud.
Your Honours, the term “fraud” in section 42 really on any view means fraud brought home to the holder, that is, the holder of the estate as joint tenant. That, in our submission, is the joint tenant. In our submission, Justice Basten was correct as he said at page 262 in paragraphs 137 to 139, and your Honours will see in paragraph 137, he said:
Nor does s 100(1) of the Real Property Act prescribe that all principles applying to a joint tenancy under the general law operate with respect to registered title, nor indeed that any specific incidents apply.
Your Honours will see – I will not read them out – but in our submission, what his Honour is saying in paragraphs 137 to 139 simply apply the concepts that are involved in sections 100(1), 97 and 42, and there is not a position whereby to be a joint tenant means that one as a joint tenant is liable for any conduct, relevant to the present cases, on the part of the other holder of the joint tenancy.
HAYNE J: Well, one way of putting the point may be only to observe that the statutory question presented by the indefeasibility provisions in the Real Property Act cannot be answered by looking to the general law relating to joint tenancy when the question is one which by hypothesis cannot and never will arise under general law relating to joint tenancy.
MR JACKSON: Your Honour, I would adopt, if I may say so with respect what your Honour has said. Your Honours, could I come then to the matter on which we have sought to make a further submission which your Honours will see that we sought leave. I want to say two things about it. The first is that your Honours will see, if I could go to paragraph 11 of that – and this relates to the submissions I made earlier – it is a reference to the way in which the primary judge dealt with the orders which were made
at first instance. Your Honours will see that in paragraphs 15 to 18 of his reasons, which your Honours will see at pages 189 to 190, he said that in paragraph 15:
Claude’s position is that the appropriate measure . . . is the sum of $1 million drawn from the loan account to finance the acquisition (plus the appropriate interest).
He accepted that submission in paragraph 16, and he said:
The situation was not one in which Claude, in breach of fiduciary duty, took (or procured to be taken) the land and other farm property. What he took (or procured to be taken) in breach of duty was the $1 million drawn on the false loan account. The price of $1 million was not alleged to be an undervalue . . . The wrongful taking was thus of money, not of the dairy farm property.
That is the first thing, your Honours. The second thing is that, as your Honours will have seen, this relates to what order the Court might make if the Court were against us on the second transfer but with us on the first. The short difference is, your Honours, that we have sought to submit the matter should in that regard be remitted to the Court of Appeal and your Honours will see that referred to in paragraph 16 of those submissions in order for an application, successful or otherwise, to be made to that court as to the proper order, bearing in mind the question of improvements, a matter in which I say immediately evidence was not adduced before the court at first instance.
We do not suggest we could adduce the evidence before this Court, but we simply ask that the Court take into account the possibility of there being such an application and that the matter then be remitted to the court if we had that limited success – the Court of Appeal if we had that limited success. Your Honours, those are our submissions.
FRENCH CJ: Thank you, Mr Jackson. Yes, Mr Walker.
MR WALKER: If it please the Court. Your Honours have our outline for the address. Could I seek your indulgence to make some comments first which are responsive to matters that have fallen out this morning before I embark on the order here? It will involve the reordering of some of the matters that we refer to in our outline, particularly, as your Honours may have guessed, paragraphs 5 and 7.
At the outset, in our submission, it is significant to identify as a matter of fact, including the forensic course, what is the relevant fraud and, using that expression, in particular as required by the relevant statutory provisions to which sufficient reference has already been made. But “fraud” is also a word of ordinary English and, indeed, the force of the Privy Council authority upon which both of us rely for our opposite purposes is precisely to give “fraud” what might be called an ordinary or colloquial sense shorn of the refinements supposedly attributed to equity.
The fraud is, in our submission, extremely neatly displayed in the apparently regular and formal document which is the company resolution to which your Honours have been taken. Justice Keane asked my learned friend in relation to what its status was concerning any challenge to it. Well, it is riddled with the fraud which we attacked, to which I will come in the pleadings.
These are not incidental matters. Another question from the Bench to my friend posited in order to test the matters, what would have happened if before this busy day of 30 June 1997 in the accounts office there had been an action in debt for the unpaid price. One assumes in that highly artificial situation where Claude Cassegrain as purchaser responded to the demand from the company controlled by Claude Cassegrain as vendor that he would say “hold your horses” or indeed “give me your cattle”, as it turned out, this is to be satisfied – see the company resolution – by debit of loan account, not by payment of money in cash.
HAYNE J: That necessarily assumed (a) there was a loan account, (b) there was the right state of balances ‑ ‑ ‑
MR WALKER: Quite so.
HAYNE J: Let it be assumed rather than Claude is in control of both sides of the ledger the bankers moved in on the company and a receiver is in control.
MR WALKER: Yes. Now, that then would leave open the question which would be for, say, an administrator, receiver, to determine what would be done in relation to the transaction itself because it might be unwound and the hypothesis ceases, with respect, to be useful, bearing in mind that what we are looking at is what actually happened in terms of the deprivation of title in the actual facts that are the subject of findings, which are not challenged, of course, and that is that this document starting at 73, going through to 75, is riddled with the fraud in question.
One can see in particular in the usual way whereby, apart from contractual dispensing with the need to exchange – I stress exchange – price and title, that is, there being no contract here for payment by instalments or delayed payment, one has in resolution 2, as you would expect, a resolution that the consideration be for the transfer of the above property, not by payment months and months later.
Resolution 6, to which attention has properly been drawn is, of course, a resolution which purports to authorise there and then and thereafter as necessary – see resolution 5 – but there and then purports to authorise, indeed direct, the debiting of the loan account being described as being “the amount of the consideration payable”. Now, it is only payable because there is a transfer being given over and we know from the form of the transfer that there was no attempt whatever made to defer the obligation to pay.
One of the things about the transfer which, of course, bears emphasis is what you find at page 79 just after line 30. In the usual way, the receipt clause – there is acknowledgment of the receipt of the consideration of $1 million. Now, that is not a promise contractually to be satisfied in the future, let alone by cash, actual money. We know that that on its face was false. There had not been the receipt of $1 million. So the whole of the argument which, as it were, postdates what my friend calls the “fraud” depends upon allocating that character only to, and thus it follows, for the first time when there was that purported debit of the purported entirely spurious loan account.
HAYNE J: All this is to be done by inference from documents without a real live human witness holding the bible in the right hand.
MR WALKER: Your Honour is, of course, correct but it is to be remembered that there had been previous occasions in a court of law where the opportunity for Mr Cassegrain to give evidence had arisen and he had taken them from time to time. He had suffered findings and findings had been made and they were relevantly binding. He preferred not to prove anything by his own testimony and thus to avoid being cross‑examined. The same was true for the current appellant.
HAYNE J: The company, which was the moving party, called no oral evidence.
MR WALKER: The company, of course, as the moving party with the relevant onus was in the position that, at the time of all of these events, the company was controlled by the first defendant. That is, nobody currently in control of the company was able to give any testimony as to the position that obtained in relation to Mr Claude Cassegrain’s fraud.
HAYNE J: But the analysis you have just undertaken of the events at least assumes, I think, that the events as they turned out are to be attributed as having been designed from the outset.
MR WALKER: Yes.
HAYNE J: Of events.
MR WALKER: Yes. As the findings make clear, they were. He knew the loan account was dishonest. He knew any debiting from it would accordingly be dishonest. He has suffered judgment on account of all of that on the basis of the material before the Court, including the issue estoppels which led to conclusions which are not challenged in this Court, that the loan account was a fiction to his knowledge. No recklessness, just direct dishonesty – that any debiting of it, of course, would obviously be equally spurious.
In a sense, debiting on its own – perhaps by learned friend’s postdating argument proves too much. If you focus too carefully just on the debiting of the loan account something very peculiar emerges, namely, an act which on the face of the accounts favours the company, that is, increases its net asset position, is to be treated as having been the fraud. The reason that that would be a completely peculiar way to see it – and perverse – is that that was the belated performance of the pretended – fraudulently pretended arrangement by which real property, the Dairy Farm, would be transferred by the company for consideration. If it had not been transferred for consideration, all sorts of other matters and claims would, of course, have been available and would have remained available for some time.
In our submission, these are not facts which were the subject of any uncertain inference. They were facts which had been earlier relevantly found and were again on the evidence found with respect to the dishonesty of Claude. Thus, in further answer to Justice Keane’s question about the company resolution – not only is it riddled with the fraud but it is also, of course, a result of the actions of the company controller – Claude Cassegrain – without whose participation this could not have occurred – being in egregious and fraudulent breach of his duties to the company.
It is for those reasons, in our submission, that when one considers the word “fraud” in all and any of the statutory contexts relevant to this case, there is not only no reason to cut up the narrative so as to attribute fraud only to the last, belated step, arbitrarily on the evidence before you, occurring on 30 June, the last day of the financial year, a book adjustment date, but there is every reason – purposively, of course – to ensure that the real fraud, that which involves the deprivation of property by dishonesty, is appropriately identified for the attachment to it of the statutory provisions affecting the defeasibility or otherwise of the registered title.
It is for those reasons, in our submission, that one way to test the argument against us – postdating this payment, and it is a spurious payment of course, it had no meaning whatever, in truth – is to say that if this argument is good, then one day delay would be just as good. It does not get better as the days go on. That, in our submission, would really highlight in the context of this case where Mr Claude Cassegrain obviously controlled, for purposes which appertain to his character as a fraud, the whole and both sides of this transaction.
In our submission, it would be absurd to say that the property had not been obtained by his fraud when the company transferor controlled by him recites, not only in the transfer, but also in this resolution, that the transfer is in consideration for the money that is to be debited by an adjustment in the books, whether that took place simultaneously at a very proper exchange ceremony – a settlement ceremony – or whether it took place a day later, a week later, a month later, or 30 June would not matter for that purpose, and would not alter the dishonesty by which the whole scheme saw the removal from the company of the property.
Could I remind your Honours of the – what in hindsight is real cheek of part of this document, at page 73, about line 46, recital (f). That, in our submission, displays the whole of the scheme. This is no incidental, optional way of dishonestly doing that which was set about honestly. The whole thing is an integrated scheme – cannot be pulled apart now – by the beneficiary of Claude’s fraud, his wife, in order to say, well, when we got the transfer, there had been no fraud. That did not occur till later.
There is this added as well. Even on the face of this fraud - that just goes back to my friend’s consideration of the spectrum of cleverness among frauds - even on this fraud, to have delayed so long in the payment, in our submission, bearing in mind that there are banks, we know, involved, and see that is on the first page as well, was taking an odd risk. The notion of the beneficiary of that device taking advantage of that ramshackle administration of the crime, in our submission, is really quite bizarre.
Your Honours, it is for those reasons, and with respect, that we challenge the proposition which is contained in proposition 12 of our learned friend’s outline for address, and it follows that we need to say something about the passages to which my learned friend has gone in some detail. I do not need to return to them in anything like that detail. In particular, in the trial judge’s reasons for limitation purposes, but also in the Court of Appeal reasons. It is to be recalled, of course, that the trial judge understood and explicitly noted the difference between the dishonesty which is the fraud and the harm that may flow from it. After all, frauds may turn out not to harm if the matter can be rescued in time.
One will find at – could your Honours excuse me ‑ paragraph 25 on page 107 of his Honour’s reasons, a reference back to the pleading to which I am about to go, which notes the fraudulent act and makes the statement, plainly, with respect, correct, that:
But fraud, of itself, does not constitute a cause of action. It is actionable only by reference to its effects.
Now, if I could take you back to the pleading in order to put paid finally to this notion that the fraud found and the fraud about which this case revolves is only that which was constituted by the 30 June book entry. The way in which the matter was pleaded, the way in which his Honour, as you can see, understood it to be pleaded and argued, can be found commencing on page 11 in paragraph 14, where something is called “The first fraudulent act”. You know, albeit unsuccessfully, that Claude after all himself seized on this in order to get as much advantage as possible from the common law limitations.
The first fraudulent act was this utterly unjustified claim to four and a quarter million dollars of the company’s money. Now, the company had such a relation with its bank that it was not going to get any money, let alone $9 million without the bank having something to say about it. The bank got all the money. That is why the loan account came about. Claude Cassegrain was not ever going to get four and a quarter million dollars from CSIRO, the bank was going to get the lot. But he got a loan account, and that is the first fraudulent act. The second fraudulent act evokes, of course, his abuse of his control of the company and, as it were, perfects this fraudulent scheme of deriving advantage from the existence of a loan account. You saw it in recital (f) to the later resolution.
The company was concerned, it appears, that it had this claim against it. Then on page 13, under the subheading, “Fraudulent Acquisition of the Company’s Land”, one sees in paragraph 18, a reference back to the “first and second fraudulent acts to create the false impression”, which, of course, is utterly well conveyed by recital (f) to the company resolution, and one sees that by paragraph 19, the fraud in obtaining the transfer is the matter at hand.
In our submission, no hypotheses, appropriate test, legal argument such as what if they had paid from their own funds, are of any moment in considering what was actually alleged by pleading and proved, which is not in challenge in this case, namely, that the first and second fraudulent acts not only occurred but were fraudulent and that is the means by which he obtained this transfer.
Obtaining the transfer which on its face contained the lie that $1 million had been received is not made better either for him or her by the fact that it turns out, at least according to the company records controlled by him, no doubt, it was not until 30 June that the book entry was made by which this spurious debiting of a spurious account carried out the fraudulent and spurious supply of consideration.
Now, your Honours, it is at this point that we need to confront that which flows from the matters underlying my learned friend’s further submission for which they seek leave. Could we make our position, jumping to paragraphs 10 and 11 of our outline for address, clear as follows but with some further elaboration? It flows from what I have been saying about the nature of the fraud.
First of all, as to the affidavit, we do not understand that, from what my learned friend has said this morning, we do not understand that that is any further a live issue. That is paragraph 10, do not need to say anything further. As to paragraph 11, my learned friend has already, with respect, correctly stated one of the facts about the forensic course upon which we rely when we cite Coulton v Holcombe. It is quite pointed in this case because Claude Cassegrain did plead just allowances. Now, it went nowhere, not least because he did not get in the witness box to prove anything, but he had pleaded just allowances.
His wife, party in the same case, in her defence pleads certain answers, including discretionary answers and limitations answers, but does not plead just allowances. It is for those reasons, we say, that just as a matter of pleading, and bearing in mind that it is intensely factual, it would affect the course of the trial, and it would have required almost certainly the woman who claimed to get the discretionary benefit of expenditures by her to get in the witness box to prove them, which would, of course, have had other forensic possibilities open up. It is for those reasons, in our submission, this is a particularly strong Coulton v Holcombe position. As soon as we pleaded that we were entitled in equity to the land, and as soon as our prayers for relief contained a declaration to that effect plus ‑ plus an order for transfer, both prayers were always present.
It was a possible answer, along with the other discretionary answers, it was a possible answer that, whether by way of charge or otherwise, there should be some recognition of expenditure. Now, on the merits it would have been a quite remarkable proposition for somebody to say, you, who has been excluded from this land, ex hypothesi by the fraud which entitles you to its recovery, you should subsidise or share the expenditures I have made on money‑making enterprises. The kind of improvements in question quite plainly are not decorative, they had to do with grazing as well as personal amenity.
So that on the merits it might have been difficult, and maybe that explains why there was no attempt to do it, but what matters forensically is that it was not done. The opportunity for the trial has come and gone and, in our submission, it would be quite wrong in the event that the further submission is addressed to cover; it would be quite wrong for this Court to open up by its decision, it not having had the facts, it not being able to entertain an application to amend the pleading by the current appellant and, in our submission, that is a matter that is now locked away.
Alternatively ‑ because I have labelled this a just allowances claim, and perhaps I am making a presumption wrongly there ‑ alternatively if, as we suppose from the further submission, this is not by analogy with a defaulting trustee’s just allowances claim, but rather it is a co‑owner’s claim for contribution, a highly particular kind of claim ‑ that is to be gathered, we think, from the content of the further submission – then, of course, this involves considerable factual inquiry as to what I am going to call the equities between the parties. It is to be recalled that we were an excluded – on this hypothesis – an excluded co‑owner for the whole of the period during which these expenditures were made.
Ordinarily ‑ and we should not have to argue this now, or ever ‑ ordinarily that would be enough to put paid to the notion of the excluding co‑owner getting contribution from the excluded co‑owner. Excluded by way, among other things, of a fraudulent depravation of title only makes the matter, in our submission, all the more odd to contemplate as the object of further opportunity on the part of the current appellant to put argument to her financial advantage. It is for those reasons, in our submission, that there is no call for the remitter on terms which is, in effect, the outcome sought on that contingency by the appellant.
Now, it is against that background that I come to the second matter that we put before I come to the rest of the order of our address and, with respect, it is in a number of different senses, none of them particularly easy, good for us, what might be called the difficulty of agency. As your Honours know from the course of argument, noted and determined in the Court of Appeal, while it was right at the heart of the contest at trial, unsuccessfully by us, on appeal to the Court of Appeal, successfully by us, there were other means which were argued ‑ to quote from Justice Beazley on the points, “regardless of agency”.
So it is important to note ‑ particularly from our point of view given what plainly are difficulties – it is important to note that “agency” is not essential to our success, neither as it was reasoned in the court below in our favour, nor on the argument we present in this Court. The difficulties are in at least two categories. That is all I want to talk about in address, subject, of course, to your Honours quizzing me on it.
As to the factual matters – and that is a bland expression for the process of legitimate drawing of inferences. You will have seen in our paragraphs 18 and 19 of our written submissions to which my learned friend has already, with respect, gone in a way that I am about to comment on, they are matters which we rely upon here and in the manner that Justice Beazley has argued it – has reasoned it – I apologise. We adopt, with respect, that approach as our argument in this Court. There are, in relation to it, just a few extra comments that we would urge against the way in which my learned friend put it this morning.
There were, relevantly, four players in the dealings about which agency may be critical. The first is the company – the transferor. The second, of course, is Claude. The third is the appellant. The fourth is Mr McCarron. Rightly or wrongly – we urge rightly for reasons we have put, including by adoption – Mr McCarron is treated as someone being an officer of the court about whom one would not infer, in the absence of any evidence to support such a thing, that he had connived or acted wrongly. In our submission, there are sound reasons why that should not simply be a pious fiction – that in terms of fact finding, that sufficiently accords with experience to be thrown into the collection of material, whether it attracts the epithet of sparse or not does not matter but it is what it is, but that consideration gets thrown into the collection of material.
There is, of course, nothing to suggest, and no reason from an understanding of the conveyancing in question, that Mr McCarron purported to authorise anyone to do anything. That is, an agent authorising a subagent. So he gets removed except as himself, and in obvious ways, an agent. He is also ‑ he has other guises – he is a witness, for example, a correspondent.
Now, as to the first of the four, for all purposes, it is controlled by Claude. He gives instructions on its behalf. That is most powerfully brought out in matters which are not in issue before this Court, but which were determined in the Court of Appeal on his appeal, dismissing that appeal from Justice Barrett at first instance, where Claude authorised, on the company’s behalf, time and time again, real drawings – by which I mean cash or payment of liabilities – by reason of this spurious loan account. I am not talking about the million dollars now, I am talking about things being bought for him.
FRENCH CJ: School fees, things of that kind.
MR WALKER: I am sorry, your Honour?
FRENCH CJ: School fees, I think.
MR WALKER: Yes, things that you have to pay, and that the company actually paid. So he is the controller of the company. There is no evidence of the appellant’s personal conduct – I stress personal conduct – such as the signature which is provided for of a transferee. It is accepted for the transferee, by Mr McCarron, and so the one place where one would see her acting in her own right, no one on her behalf – we do not see it. That is a form required by the office, the Land Titles Office. As to less formal matters, in what you might see, whether the country and its solicitors are more or less formal I do not know, but if there was not a telephone request to attend a registration, there might be a letter request to attend a registration, but in any event we do not have that from her either.
What we do have is the course of events. These are not natural events, they are events of a highly artificial kind in human affairs. They are really not supposed to be – they are not of a kind about which it could be supposed they could have occurred by accident. Part of that which is the collection of material for the evidentiary consideration of the aptness of the serious inference that we sought to be drawn was, of course, that what resulted from all of this was greatly to her benefit on the face of things, and there is never ever, throughout the whole course – and there are two transfers, of course, which means there is a period, an interval – nothing at all of surprise, gratitude, wonderment, examination of how this came about.
HAYNE J: So what, Mr Walker? What is the point we are getting to?
MR WALKER: Your Honour, because by elimination there are not many possibilities as to how these serious legal acts could take place unless one posits they were taking place without authority. That is my answer to your Honour’s question. We rely upon ‑ ‑ ‑
HAYNE J: But be it so, you want to attribute the term “agent”. I understand that, I understand the forensic purpose of it. Have you yet told us in what sense you are using that word “agent”?
MR WALKER: No, that is the second difficulty which will involve trying to grapple with the Privy Council’s vindication of statutes to protect native interests, to which I will come in a moment.
HAYNE J: But it is not much use telling us there are all these wonderful facts out there and therefore agent unless I know what I am looking for in agency, Mr Walker. I am sorry.
MR WALKER: Your Honour, let me make it crystal clear. This is why I have come to it early because I accept this is at the heart of the matter where our position depends on agency – our position does not depend on agency for reasons to which I will come, but in that part of our argument where it does, this is the heart of the matter. One, the authority that makes Mr Claude Cassegrain an agent is the authority to accomplish the obtaining of the transfer and its registration. That is the first part of my answer to Justice Hayne’s question. It is not enough, obviously, for the purposes of what I will call the second difficulty, what did Lord Lindley mean.
FRENCH CJ: That is the necessary authority.
MR WALKER: Yes.
FRENCH CJ: For the purpose of an agency.
MR WALKER: At the risk of there being “wind in the willows” reasoning here, doormats and doors, there was an obtaining of a transfer to her and there was a registration of the transfer to her, that logically this was a bolt from the blue, a lucky stroke of fortune where she, a stranger to everything, has something done which benefits her but has not been done for her or on her behalf. It is logically possible although, with respect, it is not socially sensible and it is not plausible, bearing in mind the fact that after all there was a second occasion as well and the same players.
GAGELER J: Mr Walker, do you accept that you have to show that the fraud fell within the scope of the authority?
MR WALKER: Yes, I do. What falling within the scope of authority means obviously goes to another difficult area because except in criminal conspiracy people are not authorised to be dishonest, so that is not what it means to be acting within scope. My submission is that the whole of the action – obtaining the transfer and procuring its registration.
FRENCH CJ: There is no suggestion that she was a party to the loan account set up.
MR WALKER: We do not allege – did not, do not allege that she, to use some of the words used, participated in, connived in, was privy to, was part of that dishonesty.
FRENCH CJ: All right. Well, let us assume that rather than the bolt from the blue they had a chat before the date of the transfer and he said “I am going to buy this dairy farm from the company for us using my loan account”.
MR WALKER: Then, in our submission, what thereafter happened was, with her authority as one of the proposed transferees; that would be a very clear actual, albeit implied, authority to have thus proceeded. Now, we could not and did not prove any such conversation.
HAYNE J: We need to distinguish sharply between using the term “agency” as a term of explanation of events which has hitherto been the whole of the content of your submission and, relevantly, the use of the term “agency” as a term intended to attribute legal responsibility.
MR WALKER: Yes, I entirely accept that, and if I do not get the first ‑ ‑ ‑
HAYNE J: Well, can we come to the legal responsibility bit? I think we do understand that you use it as a term of explanation of history.
MR WALKER: Yes. If I do not have the first, I do not get anywhere.
HAYNE J: I understand that.
MR WALKER: So I have to pause, however briefly, on it, and I really want to say that I do not have anything to add to what we have summarised, and with the references within it, in our paragraphs 18 and 19 of our written submissions. In our submission, the notion that Claude Cassegrain should now be seen as somebody for whom it might plausibly be said that he observed the niceties of using company letterhead only when he was speaking for, and only for, the company in a transaction where he was on both sides, not only in reality but in legal fact, he was on both sides of this transaction; that, in our submission, is quite unlikely and the reasoning in our favour on this point below is, in our submission, convincingly to be preferred on that aspect. As Justice Hayne points out, that takes us a distance which is not enough. I accept that.
Justice Gageler asks a matter which is related obviously to the same concern and our answer is that the whole of the obtaining of the transfer and procuring its registration was fraudulent, for the reasons I have already put, on the part of the person who can be seen to be, apart from the presumably innocent Mr McCarron, the only human actor in the dealings – Claude Cassegrain.
KEANE J: It was fraudulent because he was seeking to obtain the title to the land without paying for it?
MR WALKER: Yes is the answer to that, and by dint of having spuriously excited this corporate concern that there was a debt the company owed to him, part of which could be liquidated by transfer at valuation of the Dairy Farm. That is recital (f) to which I drew attention, yes, that is right.
KEANE J: There is no basis, is there – in fact, not even a case made – to suggest that the appellant had anything to do with obtaining the land without paying for it?
MR WALKER: Your Honour, that follows I hope from what we have written and said, and may I make it as clear as may be, there is no shadowy or veiled suggestion in our argument to her discredit in relation to the dealing.
FRENCH CJ: So does that involve anything more than a quantum leap from her knowledge to an attribution?
MR WALKER: Her knowledge or his knowledge, your Honour?
FRENCH CJ: Her knowledge of the transaction; an imputed ‑ an inferred knowledge, not being a bolt from the blue.
MR WALKER: I am tempted, your Honours, to suggest that the quantum leap is very small. It actually is. Leave aside ‑ ‑ ‑
FRENCH CJ: You have not heard that. The entanglement can occur across the universe.
MR WALKER: Yes, your Honours, that is the gap I have to fill, I have to bridge that gap. In the sense the Chief Justice as, with respect, conveniently enabled me to use, her knowledge – so it has happened ‑ ‑ ‑
BELL J: This is her knowledge that there is to be a transfer of the Dairy Farm and that she will become one of two joint proprietors.
MR WALKER: Yes. So that the logical possibility of this being a bolt from the blue – which exists, as a logical possibility – is something where, in our submission, because it is husband and wife, private dealings, private company – it is something where we were entitled to call in aid Blatch v Archer. We could not call evidence of their pillow talk.
HAYNE J: Did you get a finding that she knew before the event?
MR WALKER: No, your Honour.
HAYNE J: No. Did you seek a finding that she knew before the event?
MR WALKER: Yes, your Honour. Before the event, no.
HAYNE J: No. So all we have got is the transfer.
MR WALKER: Yes, your Honour. Well, the two transfers.
HAYNE J: I understand that. So where is the bridge across either the quantum, or the leap, or the chasm?
MR WALKER: Your Honours, where it comes is, I say, the elimination of the possibilities of the means by which these formal, serious, artificial acts in law – obtaining a transfer, getting it registered – could have happened so as to benefit her. The logical possibility of it being something that was willy‑nilly her – without any involvement on her behalf of those that we know were engaged ‑ and that is Mr Cassegrain as the director of affairs, Mr McCarron as a purely ministerial agent ‑ his knowledge is not relevant. The only way, in our submission, that that can plausibly be understood is that she was content, thus had authorised him to do what needed to be done for them to benefit in this fashion.
GAGELER J: Mr Walker, a difficulty that I have with that submission is that it factually goes beyond the inference President Beazley appears to have drawn in your favour at page 230 about line 19. The only inference that she appeared to draw was that:
Claude was Felicity’s agent for the purposes of directing Mr McCarron to register the first transfer.
MR WALKER: No, I accept that, and that suffices for all my purposes.
GAGELER J: You read a lot into it.
MR WALKER: Yes, that is, executing the design – looking at it from Claude’s point of view – required registration. From her point of view, benefiting from this transaction required registration, and registration would need to be accompanied by a stamp duty cheque from the purchasers. So these are serious steps, the idea of them happening willy‑nilly unbeknownst to her – that is the first step I take ‑ we say that is implausible, second step – but they did happen, and Claude was the one who accomplished it. It follows – and this is my attempt to jump the gap – it follows that what he did was on her behalf, for her, as well as for him.
HAYNE J: Well, in what sense then is her Honour to be understood in the passage Justice Gageler takes you to? In what sense is her Honour to be understood as using the term “agent”? Is her Honour using it as a term explaining events? Is her Honour to be understood as using it as a term attributing legal responsibility or legal consequence?
MR WALKER: In terms, and given what leads up to it, it really is the former.
HAYNE J: That is history.
MR WALKER: Yes. It does not supply the reasoning or conclusions for the latter, and I accept that one has to go further. Or to put it colloquially, there are agents and agents and it does not answer all the questions relevant.
HAYNE J: Because as a matter of history the proposition ‑ ‑ ‑
MR WALKER: Because Mr McCarron was an agent too, of course.
HAYNE J: Yes, and as a matter of history the proposition has no greater content than that Claude did it, in the sense that ‑ ‑ ‑
MR WALKER: I do not want to repeat myself, nor – I do not want to repeat myself. We obviously say in answer to that last remark by Justice Hayne that there is more to that because it is in a context of the kind of act being done, the benefit for her. As it happens, we can see the repetition of it benefiting her, again with the same players and, with respect, hence the importance of Blatch v Archer, that goes in as well. It would have been very easy for her to say, “This had nothing to do with me, they were not acting for me”, but she does not. Now, I need to complete in relation to agency ‑ ‑ ‑
FRENCH CJ: That is the kind of evidence you say that her Honour had in mind at paragraph 31 when she said:
Felicity, therefore, risked an adverse finding against her on the question of agency by not adducing evidence to the contrary.
MR WALKER: Paragraph 37, page 230, your Honour?
FRENCH CJ: No, paragraph 31 I was looking at.
MR WALKER: I am sorry, there is a similar expression in ‑ ‑ ‑
FRENCH CJ: Yes, I just picked that up in ‑ ‑ ‑
MR WALKER: Yes is the answer.
FRENCH CJ: Yes.
GAGELER J: Where is the pleading of agency, Mr Walker?
HAYNE J: Page 14, paragraph 20A, I think – page 15, sorry, paragraph 20A, I think.
MR WALKER: Yes, your Honour, thank you; and 22A for the second one, on page 15.
HAYNE J: So agent for both transfers is the plea?
MR WALKER: Quite so.
HAYNE J: Yes.
MR WALKER: Your Honours, can I move from that to the second aspect of the difficulty of agency? Even if, as Justice Hayne puts it, in the narrative explanatory way the label of “agent” becomes possible, what then in terms of the serious matter – we accept it is a serious matter – of imputing fraud using general language to describe the statutory language, the detail of which obviously matters?
The argument advanced by my learned friend this morning in answer to a number of questions from your Honours was in relation to what we accept is in danger of appearing to be construing judicial words rather than statutory words. Nonetheless, they are judicial words that have received enough attention – not all of it completely favourable as to its elusive meaning – to, nonetheless, be the appropriate point of departure.
With respect, we do not differ in any matter of principle from the way in which, in writing and in my friend’s address this morning, the subsequent Australian, particularly Victorian treatment of some of these matters has been dealt with. None of them is, of course, conclusive of present issues. They may be summarised as making clear beyond any sensible reason for us to challenge it these matters, that fraud really means fraud and second, that it is possible to be fixed with fraud by reason of your agent’s fraud.
Our short point is this, that understood for their logical conclusions, some of my learned friend’s argument this morning really renders the second of those propositions completely otiose – indeed, misleading even to be posited.
HAYNE J: Not in respect of the body corporate when spoken of in 1905, the body corporate acting through its agents, language I think of a kind common at the time, was it not?
MR WALKER: Without any doubt for some decades previously and I think subsequently the word “agent” was used where now for exactly equivalent purposes it would be resisted and simply other words such as “the person through whom the corporation acted”, or “the actor”. But yes, your Honour is, with respect – we had not taken account of that in our written submission. I do not think it emerged in argument before.
We are indebted to your Honour for the possibility, but one thing that we can say about Assets is that that matter does not seem to have, so far as one can tell from the note of argument and the facts, that matter, that is using a portmanteau expression to refer to an artificial person and human actors whose actions are those and knowledge is that of the artificial person, that does not seem to have been a distinction raised at all.
HAYNE J: But we are a full eight years after Salomon v Salomon, that is all.
MR WALKER: Quite so, your Honour. Your Honour, as I hope I have made it clear, the word “agent”, yes, it is, with respect, it is - an explanation of its employment is that his Lordship had in mind that artificial entities act through what would have been called then “agents”, but that is not the preferred reading.
First of all, that was not an issue in that case – any such distinction. Second, it is almost impossible to understand how somebody might have said that the fraud has to be brought home to the corporation where it is an artificial entity who is the person in question, but would have contested that that could have been done by looking at the mentality of the human actors for the corporation, that is, contested that it could be done through an agent.
Now, there was no such argument in the case, but it is actually impossible to understand how anyone could ever have stood at a Bar table and said, yes, the corporation can be guilty of fraud, but you cannot look to the knowledge and conduct of any of the human beings acting for it, that is, being their agents in the 19th century that Justice Hayne has suggested might be the understanding of this difficult passage.
The next thing, of course, is that his Lordship did use words which are indifferent as to whether the person in question with the putative agent is artificial or natural. That would be an odd slip if the word “agent” which, of course, very naturally applies to natural persons, particularly with land dealings where professional and business agents are commonplace, it would be extraordinary if that word “agent” were to be understood as human actors for a corporation, but not agents for natural persons.
So the better reading is to reject the possibility that this is a continuation of language from joint stock company and trust analyses in relation to corporations and to take it on its face. Now, I accept that what I have just put is in danger of construing judicial words as if they are enacted, but trying to administer the antidote, lest there be bane, we would say no, it is not a matter of construing the word “agent” so much as looking at the significance and substance of the doctrine his Lordship was pronouncing. There was a positive element. It has to be fraud, real fraud, not - to use his Lordship’s dated but pungent language:
not what is called constructive or equitable fraud – an unfortunate expression and one very apt to mislead, but often used, for want of a better term, to denote transactions having consequences in equity similar to those which flow from fraud -
to quote from [1905] AC at 210. So that was a positive thing. It must be fraud, real fraud, as people understand that word outside courts, or juries understand it in a criminal case.
HAYNE J: Over the adjournment, Mr Walker, I have in mind one of the earliest High Court cases on indefeasibility picked up the “or through agents” formula. I cannot remember whether it was just picking up Assets Co v Mere Roihi ‑ ‑ ‑
MR WALKER: We will try and find it, your Honour, yes.
HAYNE J: But I simply draw it to attention, lest there be something in there that we ought to be taking account of.
MR WALKER: Thank you, your Honour, if we can we will assist on that. Your Honours, the importance and substance of this aspect of doctrine also involved, obviously, something on the other side of the ledger. So, yes, it has to be real fraud but do people who happen to employ agents in their business dealings, do they obtain a quicker and better, safer entrance to the port of indefeasibility than people who act for themselves?
Now, bearing in mind the general common law approach that that which I do by an agent I do myself, there is obviously in policy terms great doubt to be entertained as to whether silently the enacted provisions in question - which are by the way close to verbatim similar to what is now in our provisions – whether they really did contemplate this radical difference of outcome depending upon whether you acted on your own in these technical and legal and business processes, or whether you had an agent, and that ought to be rejected.
That would be a trap between the lines of statutes enacted to give effect to a very important social policy that while there is advantage socially to be gained from the security of title by registration, there is a limit to the benefit that can be gained from that security at the point that it is seen to be a refuge for scoundrels.
At that point the question arises, so who are the scoundrels, and the answer, in our submission, would be very odd indeed if it said somebody who takes the title dishonestly but not someone who takes title having entrusted the whole of the transaction to a person who was dishonest, because in each case of course it can be seen that the title has been obtained by reason of – not incidentally but essentially – by reason of dishonesty.
It is for those reasons that the relative terseness of the various phrases “by fraud” or “through fraud” or “under or through fraud” or “through or under fraud” to be found in the relevant provisions captures all the ways in which people may be deprived of title by fraud. It must be real fraud, and then the question is, the fraud of whom?
HAYNE J: Apropos of that, the case I had in mind was Butler v Fairclough 23 CLR 78. It is after Assets Co, and if you go, for example – I think this is not the only reference – page 97 in the judgment of Justice Isaacs we find the “or agents” tailpiece added, but by reference to Assets Co. So it is a diversion, I suspect. Mr Walker, I am sorry.
MR WALKER: It can be added to the – as it were – noting up, but it does not give us – I know the passage – it does not give us anything that I can call in aid or my friend could call in aid on this particular point.
FRENCH CJ: Might be a convenient moment, Mr Walker.
MR WALKER: If it please, your Honour.
AT 12.45 PM LUNCHEON ADJOURNMENT
UPON RESUMING AT 2.14 PM:
FRENCH CJ: Yes, Mr Walker.
MR WALKER: If it please the Court. Your Honours, the passage in Butler v Fairclough 23 CLR 78 at 97 to 98 uses language based on the approach understood by Sir Isaac Isaacs to be supported by the citation of Assets Company, and your Honours will see that in applying those principles to the record before his Honour, the reference is to what the testimony reveals as to the conduct of (a) or (b), principal or agent. That, in our submission, supports the reading we have attempted of Lord Lindley’s words in the Privy Council and that it does contemplate what I am going to call a morally innocent principle, nonetheless being fixed with fraud by reason of the relevant – and that means attributable, imputable – fraud of his, her or its agent.
HAYNE J: I must say to you, Mr Walker, for my part I had read it directly antithetical to that, having regard to the facts at issue in Butler v Fairclough where it was the lodging party and his solicitor and whether the lodging party was lodging in breach of agreements which had been made. I had not read it as fraudulent agent attributed to innocent principal.
MR WALKER: The passage I have just referred to is where his Honour said he did not see in the testimony any such, but it is the reference to “or” - that is, that reference to the agent would be in complete surplusage as it would be in the Privy Council if no innocent principal could be affected by fraud attributable to the principal only through the conduct of an agent. It would be – it would add nothing to observe what the position was in relation to an agent if that would not suffice that there needed to be, to adapt language coming from an exchange between Justice Keane and my learned friend earlier today, if there had to be some moral quality redolent of dishonesty found personally in the principal.
HAYNE J: Now, if the proposition you advance is right, does it not follow that the bank which registers a mortgage which it has asked its customer to procure a signature from the registered proprietor whose property is being mortgaged has a defeasible title when the customer forges the registered proprietor’s signature - the common bank mortgage issue.
MR WALKER: Yes, quite so. There are two points. If I say yes, then for the sake, as it were, of logical purity, then that really would demonstrate that I am wrong. In other words, with respect, what your Honour raises as a test would show the error of my argument were the analogy appropriate. But the analogy is not appropriate for this reason. When a mortgagor says to somebody on behalf of a prospective mortgagee – sorry, when a mortgagee says to a someone on behalf of a prospective mortgagor, if you want the money, I want the security, and in order to give the security, you will need the mortgagor’s execution, that is not being – that procuring of execution is not on behalf of the mortgagee appointing an agent in order to obtain a mortgagee’s – mortgagor’s – execution. There is not a principal and agent relation between the bank and the person who was told that if the advance is to be made, then the security must be granted by the counterparty.
HAYNE J: It is that example precisely I wanted to put to you as the test where the bank says to its customer, “Go and get mum and dad’s signature on the mortgage instrument” and the customer forges mum and dad’s signature.
MR WALKER: But the rogue son – they always seem to be sons ‑ ‑ ‑
HAYNE J: Yes.
MR WALKER: The rogue son is not the bank’s agent for the purpose of getting the mortgagor’s signature. He has been told that if he wants the advance, there must be a security and there must be execution by the counterparty, that is, the counterparty as against the bank. That is not obtaining something for the bank as principal. That is the bank saying this transaction will not go on unless it comprises a completed mortgage, and that is my answer to what is otherwise, I accept, a test which would destroy our argument. I accept that.
The analogy, however, is quite imperfect. That is not an agency position. Telling somebody that in order to buy the motorcar they must come back with a bank cheque is not appointing the person an agent to obtain the bank cheque. It is saying, “I won’t sell you the car unless you give me the bank cheque. This is what you have to do.” There is no principal and agent relation there at all. There is no mandate, nothing fiduciary, no trust, no loyalty owed. They are counterparties, the one informing the other what is to be done if a transaction is to be furthered.
It is for those reasons we submit that, properly understood, the arguments of our learned friends this morning and in writing concerning the proper understanding of Assets Co is one which, properly understood, really renders the verbal extension in the authorities to an agent, completely supererogatory because in truth the doctrine as put forward in the argument against us still seeks personal turpitude in the principal and, in our submission, that renders bewilderingly inutile the words that have been devoted to the possibility of fraud being attributed by reason of an agent.
GAGELER J: Do you have to go so far as to assert on the facts that Felicity was indifferent to whether or not Claude was engaged in fraud in the transaction?
MR WALKER: No. Indeed, there would be artificiality in us doing that because, as I speak, I am indifferent to the possible fraud of all sorts of people involved in dealings that may affect me about which I know nothing. In no real sense am I indifferent to it. Nothing has been raised which would render thought about it germane and we are not talking – as I say, we are not suggesting any – how will I call it – Clayton’s fraud or anything like that – being put on inquiry in such a way as to introduce the notions of constructive fraud, or equitable fraud of a kind the Privy Council so robustly put to one side. No, we are not doing that.
She was indifferent on the framework, we accept, by what we allege and what we do not allege – only in the sense that we do not say she was party to any degree, or in any way. I hope that answers your Honour’s question. In neither as we argued the case at first instance or in the Court of Appeal nor here do we say, in particular, that there was an indifference to which the law would attach, appropriately attach some adverse consequence, in that sense, blameworthy indifference. We certainly do not say that.
If we have to say something to that effect, then we fail. On the authorities, as we understand it, the argument against us goes so far as to say that however fraudulent her agent, if she had an agent, if she was innocent, she enjoys indefeasibility. That is what we intend on challenging here by saying, no, the authorities understandably, bearing in mind the policy of having fraud as an exception to indefeasibility, will have the fraud operate in that fashion whether one acts for oneself or has one’s business transacted by others who are dishonest.
That completes what I wanted to say about agency. May I then move to the matter in relation to section 118, and given what I have already argued before the adjournment, may I go through the steps that, as it were, survive the disordering of our outline as follows. We submit that the facts show that the title, of which the company was deprived, either upon the execution of the transfer being delivered into Claude’s hands, or its registration – and it does not matter relevantly – but that was a deprivation of title within the meaning of the opening words of paragraph 118(1)(d), and it was by fraud, for the reasons I have put this morning concerning the scheme.
So, the opening words, which do not seem to have been the object of controversy below – I do not think I am wrong in saying that, on our examination – the opening words seem clearly made out: the company was deprived by fraud. We immediately observe how odd it would be if the operation in that socially salutary sense of permitting someone to bring proceedings if they are a person deprived by fraud were then to meet an obstacle because the word “fraud” ‑ and perhaps a preceding preposition “through” means that something much narrower, as Justice Barrett put it at first instance – is meant by “through fraud” or “fraud” when it comes to the essential elements of the exception to the indefeasibility.
In proposition 2 in our outline, we, as it were, ring the changes on the same facts, moving to the next relevant words in, in this case, subparagraph (i) of paragraph 118(1)(d), that is, Claude was registered through the same fraud. That is how he came to be registered, his fraud. As we put in the second sentence of our proposition 2 in our outline, one looks in vain, either in the nature of things or in what is known of the history - and these are old provisions; they are re‑enacted in various ways, but they are old provisions, they come from the beginning – for any reason why there would be this narrowing, quite unsignalled by any of the words, particularly, when one considers that literal paperwork – our expression for what we understand Justice Barrett’s reading of this provision involves – can, of course, be induced in apparently perfectly regular form, by tricks, stratagems and dishonesty which answer the description of fraud, that is, it is not merely forgery – the attachment by a criminal of another’s apparent signature – it is also the tricks by which a real signature can come to be attached.
In our submission, the policy of the law in relation to fraud, both the general law and in construing statutes where the avoidance of fraud and its mischief is the evident purpose, lends itself to an expansive rather than narrow understanding of the multifarious ways in which dishonesty may deprive people of property.
Then we come, still for the purposes of subparagraph (1) of 118(1)(d), then we come to the appellant’s position, and I stress that this is an argument regardless of agency. So now, rather than a gap, as it were, in factual reasoning about authority or agency, we are simply saying that the narrative, the fraud fits the provisions of the statute. The question in relation to the appellant’s title – this is upon the first transfer – is whether she became registered through fraud.
In our submission, in the absence of any gloss authoritative or in this Court persuasive, reading those words in some hitherto not discerned narrower sense, the description has to be, bearing in mind the nature of the interest she was acquiring, that yes, she came to be registered through fraud. It answers historically or in the narrative sense completely affirmatively the question, is this registration one procured by fraud, that came about through fraud.
HAYNE J: “By fraud (of anyone)” is the way you would read the two parts, the chapeau of (d) and the content of subparagraph (1).
MR WALKER: That is the nub of the issue on this first part of the case, yes.
HAYNE J: Why would you read either the chapeau or subparagraph (1) as being understood as fraud, it matters not by whom?
MR WALKER: I would not, we do not. Cannot be, it matters not, cannot be anyone, accept that entirely. This is a case of joint tenancy. It all turns on joint tenancy. There is one interest being got. There is one interest being got. There are not shares. It is at that point, it might be convenient because this serves dual purpose, if I could go to the way in which the general law of joint tenancy operating as envisaged and within the strictures of a system of title by registration bring about the consequence that the appellant is being affected not by the fraud of anyone, and it matters not anyone, but, and only because, the interest she got as joint tenant which is inseparable from her interests and his interests – that is, they were all one interest for reasons I am about to put – it was acquired by fraud of her joint tenant.
FRENCH CJ: So the fraud we are looking at in 118(d)(i) is the fraud of the ‑ ‑ ‑
MR WALKER: Is one of the joint tenants affecting the other.
FRENCH CJ: Yes, is the fraud of a person who has been registered as proprietor of the land or the fraud of a person who has been registered as a joint tenant with.
MR WALKER: In effect and application, yes, but we say just using the statutory words, she has become registered through fraud. That raises the question which in cognate provisions was answered in Assets Co and not only there – Breskvar v Wall refers to it as well, and Gibbs v Messer, I think. It is an old and established proposition. The fraud must be brought home to what I am going to call a relevant party to the title. That, in our submission, has the effect in the case of a joint tenancy that the fraud of one affects the one and only interest which exists, that is, of all.
BELL J: Can I take up this question of the one and only interest?
MR WALKER: Yes.
BELL J: Under the RPA, if you look, for example, at section 97(1) dealing with severance, one has the recognition ‑ ‑ ‑
MR WALKER: Yes, indeed.
BELL J: ‑ ‑ ‑ that each joint tenant has an interest.
MR WALKER: I want to come directly to – I can I think compress a deal of what I need to say by answering Justice Bell’s question. Perhaps the better starting point, with great respect, is section 100, because that is the way in which one gets the general law, first of all into the Torrens system but then – important question – and what happens to it upon entering in this fashion? What happens to the general law? Now, one of the things that section 97 makes clear is that Parliament has provided a means to do something which at general law could not be done at one stroke. There had to be severance before alienation of a so‑called aliquot share. But in many places ‑ ‑ ‑
HAYNE J: Is that what Wright v Gibbons holds?
MR WALKER: Yes, your Honour, and indeed, when one comes to the way in which Sir Owen applies the principles to the Torrens system at the foot of 333, top of 334, it can be seen that provisions such as 97 are a statutory means – now, the significance of enabling the severance by transfer. We have supplied – I do not want to take your Honours to it – as with respect to convenient conspectus of the common law on the point, a decision of the United States Supreme Court, United States v Craft (2002) 535 US 274 in the reasons for the majority of Justice O’Connor. I will not read it, but at particular at page 280 one sees a reference to that common law position in the main paragraph which concludes with the proposition:
Most States allowing joint tenancies facilitate alienation, however, by allowing severance to automatically accompany a conveyance of that interest or any other overt act –
et cetera. Section 97 is an example of such statutory facilitation of what otherwise at common law or in the general law would involve steps first of severance before alienation. Now, the significance of section 97 therefore is that it bespeaks the concern of the legislature to deal with attributes of the general law which, in our submission, are not swept away or rendered inapplicable by section 100. When section 100 says you are:
deemed to be entitled to the same as joint tenants –
that being a term of art – then, except to the extent that aspects of the statute prevent the operation of the incidence of joint tenancy as a matter of general law, then that is what is being invoked. That is why the expression “joint tenants” appears. It lacks meaning unless it is understood as referring to that form of tenure and co‑ownership which goes by the name of joint tenant. This is a statute of legal technique and when it uses that expression, it is talking about joint tenancy. Now, we accept – indeed, we would urge – that that has to be read subject to the paramount, essential characteristics of the system of title by registration which is the object of these statutes, including ‑ ‑ ‑
HAYNE J: Before we even get to the influence of the RPA, we have to take account, do we not, as the judgment of Justice Dixon in Wright v Gibbons reveals, the fact that jointure and joint tenancy, et cetera, is rather more complex than is ‑ ‑ ‑
MR WALKER: Unquestionably.
HAYNE J: ‑ ‑ ‑captured by ‑ ‑ ‑
MR WALKER: Unquestionably, and that is why I want to go to it now.
HAYNE J: ‑ ‑ ‑ tags, in particular, see the foot of 330.
MR WALKER: Yes.
HAYNE J: The head of 331 about forfeiture.
MR WALKER: May I go to those now? With great respect, we accept that this cannot be put into a Chinese cookie slogan but when one is asking about the nature of the interest and its susceptibility to affectation of its registered indefeasibility – its indefeasibility by registration by reason of fraud – it is significant, in our submission, to go to the nature of the title in question – section 100 saying it is as joint tenants. Staying with 100 for just one moment, could I remind your Honours that at that point we are talking about a singular estate as joint tenants. So, at that point there is not a several or, as it is called, aliquot share, or interest, being referred to. In section 100(1):
Two or more persons who may be registered as joint proprietors of an estate or interest . . . shall be deemed to be entitled to the same –
that is, that estate or interest as joint tenants. True, it is, we say, significantly, that section 97(1) has the notion of a transfer of the joint tenants’ interest, that joint tenants’ interest. That would be an interest which would be appropriately understood as being several or aliquot. One sees that that does something. It severs the joint tenancy as a piece of legislation that bespeaks the fact that it is altering doctrine. But for the Act that would not have happened because that could not be done before severance.
HAYNE J: But is it not necessary also to take account of the fact that section 42 hinges about the indefeasibility not of an interest, indefeasibility of the registered proprietor’s interest. The registered proprietor shall “hold the same”.
MR WALKER: Yes.
HAYNE J: Who is the relevant registered proprietor here – surely, Felicity?
MR WALKER: Yes.
HAYNE J: Yes.
MR WALKER: Yes, yes.
HAYNE J: What is the interest Felicity holds?
MR WALKER: She is a joint tenant in the interest which happens to be an estate in fee simple. That is the language of section 100 and it is the concept I am going and try to persuade your Honours that underlies what I am going to call the primary case expounded by Sir Owen Dixon in these famous passages. It is 78 CLR 313, starting at 328. Your Honours are familiar with the facts and the legal manoeuvring, but you will find in the language describing the nature of the case, at the foot of page 328, about an inch and a quarter up, his Honour is using the expression I draw to attention:
their respective aliquot interests in the land.
Of course, that is talking about what happens at the end of the process against which the appeal, in effect, was protesting. At page 329, in the middle of the page, notwithstanding there are a few more pages to go, his Honour says the whole of it could be stated almost in a sentence:
The foundation of the decision may, I believe, nevertheless be stated almost in a sentence. It is that in contemplation of law joint tenants are jointly seised for the whole estate they take in land and no one of them has a distinct or separate title, interest or possession. It follows an attempt on the part of two of three joint tenants mutually to assure each to the other his or her undivided share in the hope that each of their two shares will be taken by a new title and so enure as a several undivided interest, must fail because it can accomplish nothing. An alienation by a joint tenant of an undivided interest to a stranger, upon this view, imparts a several interest because such a power is incident to joint tenancy; but that is very different from identifying the respective interests of joint tenants and transposing them.
Then there commences a long passage – I will not read it all, but highlight matters we rely upon – where his Honour collects from works of authority, including by way of explaining them, familiar propositions which are important to our argument. You start with Blackstone’s –
thorough and intimate union of interest and possession.”
“They [i.e. two joint tenants] have not, one of them a seisin of one‑half or moiety, and the other of the other moiety; neither can one be exclusively seised of one acre . . . each has an undivided moiety of the whole, and not the whole of an undivided moiety”
This speaks, perhaps an affection for riddling. Then, Bracton, whether by revisionist use or not over the centuries, is cited by his Honour and a small excursus about law French at the top of page 320 which, in English, by the time – 330, yes – by the time one comes to 1849 –
There it is said of joint tenants:‑“Each of them has a right shared with his co‑tenants to the whole common property, but no individual right to any undivided share in it –
and I interpolate, of course, this stands in contrast to tenants in common –
for this reason, joint tenants should not be spoken of as holding undivided shares.”
Again, by contrast with tenants in common. Mr Williams –
went as far as saying that joint tenants in fact were considered by the law as one person for most purposes.
One of those axiomatic statements that now perhaps just does not provide as solid foundation for an argument as might have been hoped. In any event, whether by way of exaggeration or otherwise, the point behind the emphatic assertion is a significant one. Then his Honour – in a very important paragraph, rather points to the much more complicated position that might have appeared from a first reading of those statements. That foreboding opening –
Logical as it may seem –
One knows what is going to happen – the logic is not going to hold to the end. His Honour says:
there are many considerations which show that, to say the least, the consequence cannot be called an unqualified truth.
litotes, I think, in action ‑
The fact is that the principle . . . is very much qualified.
Then – I will try not to read the whole but by way of summarising it in advance – what we submit are the aspects that arise from the case of alienation and matters akin to alienation, or involving alienation, are in turn looked at. First of all, Coke is quoted so as to provide a rich variety of view in relation to a moiety:
“Albeit they are so seised” . . . (“scil. totum conjunctim, et nihil per se separatim”) –
going up to the top of that page 330, Sir Edward said –
“yet to divers purposes each of them hath but a right to a moitie.”
Question, which are those “divers purposes”? Sir Owen immediately goes to an important one where:
For purposes of alienation, each is conceived as entitled to dispose of an aliquot share. The alienation may be partial.
There are references to leases and estates for life, and then forfeiture at the foot of that page, and then alienage at the foot of that page, top of the next page, then execution on judgments and then his Honour quotes from Mr Preston:
“Joint tenants are said to be seised per my et per tout. They are in under the same feudal contract or investiture. Hence livery of seisin from one to another is not sufficient. For all purposes of alienation –
and we have now been through “divers purposes”, all of which are alienation or in the nature of it, changing the ownership of the property –
each is seised of, and has a power of alienation over that share only which is his aliquot part” –
In other words, if there was ever a choice in doctrine as to whether this supposedly or rhetorically labelled indivisible share was therefore susceptible of being disposed of by the unilateral act of one but not all of the joint tenants, the answer was no, not for the purpose of alienation. Then his Honour turned to the matter of what he calls alienation “to a companion”, meaning to a fellow joint tenant and the special rules involving the need for a release, et cetera.
Could I then take your Honours forward after that analysis – I am sorry, at the foot of 332, the paragraph commencing about an inch and a half up, you will see his Honour’s observations as to the position “independently of the Torrens system”, so:
by the use of appropriate assurances . . . severed the jointure –
I do not need to read it but your Honours see how Torrens legislation of a kind that section 97 stands as an example facilitates things to be done. Then at page 333, one finds at the end of the first full paragraph, about point 3/4 of the page, a passage which has been as to part quoted by Justice Basten in reasoning to which I will come. His Honour says:
This conclusion, to my mind, reduces the matter to a question of the operation of the Real Property Acts. It does so for two reasons. In the first place the conclusion must mean that not only for the purpose of alienations to strangers but also for the purpose of alienation of a share by one joint tenant to another –
and then follows the statement which is quoted by Justice Basten –
the aliquot share of each existed in contemplation of law as a distinct and ascertained proprietary interest.
It is for those purposes – and, of course, they are the other end of the spectrum from what is occurring in the first transfer in this case. This is the acquisition of the interest. It is not the alienation by one of the holders of anything.
HAYNE J: Well, it is the defeasibility ‑ ‑ ‑
MR WALKER: I understand, your Honour.
HAYNE J: ‑ ‑ ‑ of the interest held by one of several joint tenants.
MR WALKER: Quite so. But defeasibility equality is itself also not alienation. So one is talking here about what might be called tenure or possession.
HAYNE J: Your proposition has to be that if the interest of one of the tenants is shown to be defeasible, the whole estate in fee simple is defeasible.
MR WALKER: Yes.
HAYNE J: Why? Why would one read the Torrens Act in that way?
MR WALKER: Because it is the one interest. One contests it. What is it that is the most distinctive thing about joint tenancy – the right of survivorship. So one has here the odd notion – goodness knows what it would do for the happiness of the marriage – that the fraudulent husband need only die in time for his fraud to be now of no moment, either under section 42 or section 118 and the surviving joint tenant – ex hypothesi, innocent of the fraud – takes the whole. Now, that is because it is one interest with this attribute of survivorship. Why should it not work the other way around? That is because it is one interest.
The fraud affects – and, of course, the literal words of 118 and of 42 are not offended in their application to the one interest being affected by fraud – that you cannot affect the interest held by joint tenants, partially because there is no such thing outside the context of alienation and cognate matters, the idea of a share. You cannot have, as it were, a half permeating with fraud, an idea which is, in any event, pregnant with the oddity of what happens upon the death of the fraud before the indefeasibility is challenged.
FRENCH CJ: How does it fit into the text of (i)?
MR WALKER: Because the interest is question, which is the interest of both of them as joint tenants, was registered through fraud – to fraud of one of them.
HAYNE J: So the only interest is A and B as joint tenants?
MR WALKER: Yes. That is section 100. It is also the general law nature of a joint tenancy. It is one interest. It is not a number of interests. It is one interest. It is not cut up into shares. Of course, one has to qualify that. I hope I have by drawing to attention what Sir Owen says under, what I will call, the “it is not so simple”. But all the examples after the “it is not so simple” are about alienation or a cognate to that – execution, forfeiture, alienage, et cetera. This is the beginning, not the end. This is the opposite of alienation. This is the acquisition. The one share – the one interest, I should say – section 100 was got through fraud.
Now, one can hardly say it was not got through fraud. The only answer can be, but it was not got through her fraud. But there is no reason to favour her over him. They are, both of them, holders of that one interest, and it is that one interest which is susceptible under 118(1)(d)(i). It cannot be split up by the order in the proceedings brought under 118(1)(d)(i). It is all affected by the fraud.
GAGELER J: Mr Walker, in Wright v Gibbons at page 333, two paragraphs after the paragraph that you have taken us to ‑ ‑ ‑
MR WALKER: In approaching, your Honour?
GAGELER J: Section 39 of the Real Property Act.
MR WALKER: Sorry, yes.
GAGELER J: Section 87 I think is the equivalent of section ‑ ‑ ‑
MR WALKER: Section 100.
GAGELER J: ‑ ‑ ‑ 100. His Honour then goes in the next sentence, you will see:
These provisions result in each joint proprietor being entitled as a registered proprietor to transfer his interest by a memorandum of transfer presented for registration –
Then there is a citation of a New Zealand case. Would that proposition hold good on your construction of section 100?
MR WALKER: It certainly holds good on my construction of 97 and 100.
GAGELER J: Yes.
MR WALKER: But this is the alienation – that goes back to what his Honour is saying from 330 about two inches up, “For purposes of alienation”, and I have been sufficiently to those passages. The passage your Honour draws to my attention - Justice Gageler has drawn to my attention in 333 starting “Section 39” is summing up the outcome of that learning applied in the Torrens statutory setting. I stress we are of course not talking about the efficacy either of general law or under statute of a transfer by either of these joint tenants at all. We are talking about the affectation of their registration as joint tenants. That is why I keep calling it the other end of the spectrum. There is where they get it in, not when they are purporting to put it out.
HAYNE J: Does not that perhaps point to what may be implicit in your argument that your argument begins from the assumption that these people, A and B, are to be treated as joint tenants, then something happens called registration and there are then consequences that are to be identified, having first identified them as joint tenants? Is that the fashion of argument that you follow?
MR WALKER: It is, I think, yes.
HAYNE J: Does not that invert and deny Breskvar v Wall?
MR WALKER: I hope not.
HAYNE J: Namely, that the title they get is a title by registration, hence the language of section 100(1), “deemed to be entitled” where two or more ‑ ‑ ‑
MR WALKER: I think, your Honour, yes, yes and yes.
HAYNE J: Yes.
MR WALKER: I do depend upon 100 and there is nothing weak about deeming. There is the legal fiction in full operation. There it is, and it what it is deemed to be that is at the heart of our argument. It is deemed to be joint tenants, and that is not a category of indeterminate reference. That is a description with highly technical content, the technicality of which, not surprisingly, found in reasons of Sir Owen Dixon, include what I am going to call, perhaps tendentiously, the primary proposition: one, indivisible, do not talk of shares, it is one interest. But that must be qualified, and then we look at all these exit propositions: alienation, execution, leases, et cetera, et cetera.
There is no inversion here, and certainly no departure from the core proposition of title by registration when we say that the title is, see section 100, as joint tenant of that interest. It only becomes aliquot when you are involved in something, be it alienation or something similar to that, maybe having it done to you rather than doing it yourself.
HAYNE J: Which is the object of the defeasance you seek to have worked?
MR WALKER: This is an argument though that we are aiming squarely at her, of course.
HAYNE J: Yes.
MR WALKER: This is transfer 1, still.
HAYNE J: Yes.
MR WALKER: We are seeking to take the whole – this is the hypothetical case that existed after transfer 1 before transfer 2, and in our submission, this is not the, in effect, severance by alienation or execution of one at all that is found in what I will call the “divers purposes” for which speech of moiety is appropriate. To the contrary, we say, it is all ours. We lost all of it by fraud. Both of you give it all back.
Now, having exhausted, I think, what can be said in amplification of our written submission on the position after transfer 1, we have to move to transfer 2 because that is the real world, that is what actually we confronted. So he did not die so that the right of survivorship made her sole proprietor. Rather, he transferred ‑ as noted in the Court of Appeal - an unusual course, but that is more practice than anything else – the usual course is understood to be both transfer to one. He transferred, as it happens, to one.
Section 97 obviously provided a footing for that to be effective and it works for severance and then she became the sole proprietor, just as would happen if tenants in common had so behaved. Now, it is clear that nothing has happened – this is our proposition 6 – nothing has happened in relation to the derivation of her title by reason of fraud, by reason of that further transfer. But I want to concentrate – which is why subparagraph (1) can still apply – I want to concentrate, however, on propositions 8 and 9, on subparagraph (2). Clearly, she was not ‑
a transferee bona fide for valuable consideration –
the statutory language for the bona fide purchaser for value without notice. Clearly, she obtained her title through Claude Cassegrain - the first of the prepositional arguments. That is not ‑ ‑ ‑
HAYNE J: What title did she gain through Claude Cassegrain?
MR WALKER: She gained her title as sole proprietor by his transfer of his interest. Now, I am using “his interests” notwithstanding section 100, because of section 97. This is a case where the general law yields to the, if you like, generalising or indifferent use of language and concept called up by the Torrens Title stipulating for documents – memoranda of transfer – to be executed and registered in order to create the title.
Now, we then come to where the contest is between the parties on this point, and I stress all of this argument has nothing to do with agency of course. The contest, perhaps strangely, concerns his character. Her character that fits 118(1)(d)(ii) is conceded. She is not the transferee bona fide for valuable consideration. She did derive title from him. But it is said that he is not a person who was registered through fraud, but he was obviously, by the holdings which bind both his case and her case, registered through his fraud.
That, in our submission, is really beyond contest unless the word “fraud” presents a most unlikely statutory trap by meaning different things in nearly the same sentence, certainly in the same provision. It would show – I do not want to elaborate what we have said in writing and what we have adopted by reference to the Court of Appeal, but we emphasise it would show an odd and unlikely, a perverse relation between the expression in section 42 and the expression in section 118, and they surely match.
Section 42 is what might be called a general proposition that section 118 controls the kind of claims that may be made. You cannot make claims outside 118. That gives some understanding of what section 42 means, that section 42 is a substantive protection of the scheme against suffering the ignominy and presumably loss of all faith socially of becoming a form of protection for fraud.
It is for those reasons, in our submission, that when one sees the only point under section 118 that really is at the heart of the difference between us, it is Felicity Cassegrain shouldering the heroic burden of saying that Claude Cassegrain was not registered through fraud. That comes down to what we have called this mere paperwork proposition. I do not need to go back over that material. In our submission, there simply is no call for that as a reading at all, and my learned friend, with respect appropriately, conceded that Justice Barrett’s description of this approach as being one that produces a much narrower effect in 118 than elsewhere is perhaps unfortunate – my words not his. What it does is bespeak error.
Could I then turn in the Court of Appeal to reasons that are adopted by our learned friends as their argument in their proposition 14? That is appeal book 262, 263, paragraphs 137 to 139 in Justice Basten’s reasons. First, may I draw to attention that which I have already noted, the last sentence starting at about line 38 or 37, or so, of paragraph 137, says:
But in any event, under the general law relating to joint tenancy –
and then his Honour quotes a passage that I have already taken your Honours to which, as your Honours know, is the second half of the sentence, the first half of which talks about being for the purposes of alienation. It is not, in other words, a general proposition and it is contrary to what I have called the primary position but not for the “divers purposes” of alienation, et cetera, to which Sir Owen was referring. Then, his Honour goes in 138, third line, to this assertion:
it is preferable in principle to treat –
and then follow words which, in our submission, are fatal to the reasoning -
the shares of the joint tenants, holding title . . . as differentially affected by the fraud of one, to which the other was not party.
There can be no cavilling, with great respect, with a law reformer advancing that as a possible policy. But in terms of the incidents that the general law attributed to joint tenancy, brought in by section 100, it was, except for the purposes of alienation, et cetera, wrong – that is, wrong in principle, to talk about the shares of the joint tenants, that it was essentially wrong to conceptualise their interest as dividing aliquot into shares. We accept, and with great respect, the observation at the top of 263, first and second lines on that page:
The contrary view would impute fraud to a party who was not herself fraudulent.
We accept, again, a law reformer may find that an attractive consideration – no doubt there may be countervailing ones – as a matter of policy. But it is certainly not something that is to be found reflected in any authority that we have been able to find concerning the nature of the interest held jointly by joint tenants because, as his Honour frankly confronts in the very next sentence:
On that approach, Felicity Cassegrain should be treated as having a half interest in the dairy farm –
the moiety. But that is precisely what should not be attributed to as the informing principle of the nature of that which was acquired and, we say, affected by the fraud according to the general law of joint tenancy. Then in paragraph 139, the variation is ventured by his Honour that she may be assumed – her interests:
may be assumed to be a one‑half interest.
That is one half because there are two joint tenants. That is the reasoning which is advanced against us. For the reasons we have put, it would involve too radical a departure in this Court from established principles as to the nature of a joint tenancy to be effected by a decision in accordance with the reasoning in those paragraphs – 137 to 139. It is par excellence this sort of thing. It might be addressed by a provision ancillary to section 100, for example.
So that instead of all the baggage that comes with joint tenancy, which is what section 100(1) does, there be, for reasons of policy that may well be argued in Parliament to and fro, something to prevent what his Honour identifies at the top of page 263 as impliedly an undesirable outcome. May it please your Honours.
FRENCH CJ: Thank you, Mr Walker. Yes, Mr Jackson.
MR JACKSON: Your Honours, may I go first to the Assets Co Case in 1905 Appeal Cases. One can see, in a sense, where the reference to agents came from - from page 189, about point 7 on the page, where Lord Lindley said:
The Assets Company contends that, in the absence of fraud by the company or its agents, registration is conclusive, and confers a good title on the company –
and that appears to be the source of the expression “or its agents” and that was acceded to so that, your Honours, that is, if one is looking for where it came, that is where appears to come from. Could I come then, your Honours, to section 118(1)(d)(i) and our learned friend’s argument concerning joint tenancy. Now, if one goes to section 100 of the Real Property Act, one sees in subsection (1) that:
Two or more persons who may be registered as joint proprietors of an estate or interest in land under the provisions of this Act, shall be deemed to be entitled to the same as joint tenants.
Now, if one pauses for moment at the concept of joint tenancy that is there referred to, one sees that in Wright v Gibbons the discussion by Justice Dixon makes it very clear, in our submission, that the concept of joint tenancy is one that, and I can put it a number of ways, has a number of facets but the general propositions that our learned friends would ascribe to it are propositions that, rather like the Swiss fromage, tend to have many holes in them and that that is so can be seen by the propositions commencing at page 330, halfway down the page.
Now, your Honours, I will not go through it page by page thereafter, but what your Honours will see is that the principle, as his Honour said, must be very much qualified. If one looks, for example, at aspects of it you will see a reference to, for example, forfeiture at the bottom of page 330, and then also the ability to transfer an interest in it. Your Honours, it is a notion that as a general proposition exists in my friend’s argument but, on the other hand, it is a notion that has many qualifications, and one has to seek to apply the terms of the Real Property Act to a notion that has those various aspects. The first thing one notices, your Honours, is that if one goes to section 97 in subsection (1), it is speaking of a:
joint tenant’s interests in the land that is the subject of a joint tenancy –
It recognises that the joint tenant has an interest in the land and, your Honours, one sees then, going to section 42, that one is looking at ‑
the registered proprietor for the time being of any estate or interest in land –
and the joint tenant has an estate or interests in land. That person, except in the case of fraud, holds that interest ‑
absolutely free from all other estates or interests.
Now, your Honours, the fraud that is spoken of is fraud in the sense to which reference has already been made, and that is fraud which can be brought back, as it were, to that registered proprietor. That is the concept which section 118(1)(d)(i) is concerned. One is speaking of someone:
who has been registered as proprietor of the land through fraud –
of the nature referred to in section 42. Your Honours, could we also refer to the fact that – could I take your Honours to our written submissions in reply for a moment, and to paragraphs ‑ ‑ ‑
FRENCH CJ: Is it right that the content of the exception in 42 is only comprehensible by reference to 118, except in the case of fraud?
MR JACKSON: I perhaps put it the other way around, with respect, your Honour. The fraud that is contemplated there is fraud in terms of section 42. Your Honours, what I was going to say was, if your Honours go to our submissions in reply in paragraphs 18, 19 and 20, what we said in‑chief was it may be that the primary judge went about section 118(1) a little enthusiastically in the way he described the references to it.
The fact of the matter is that if the two provisions do operate differently, then one has to bear in mind, your Honours, that section 118 is not the only remedy provided for by the Real Property Act. In some cases, it will be one to which section 120, which we have set out in that submission, would apply. Your Honours, what we would say, as we have said in paragraph 19 of that reply submission, the fact that you have got an ability to obtain damages under section 120 emphasises that one should concentrate on the actual words that are used in section 118(1)(d).
Your Honours, could I go then to say this? Our learned friends have said that the circumstances are – I think the first version of it was riddled with the fraud – and then on the other side of the coin it was put, as it were, the circumstance that it cannot be pulled apart. Now, your Honours, a very good and contemporaneous description of what occurred in relation to it and what the judge’s findings were can be seen in the reasons of the primary judge when he was dealing with the question of what orders should be made.
Could I take your Honours to page 189? Your Honours will see that – I am sorry, I should have said paragraph 13 and following, I meant to refer to. Your Honours will see that at page 185 in paragraph 1 of his reasons of 20 December 2011, he referred to:
The question remaining in these proceedings concerns the appropriate form of the order as between –
the present respondent and Claude. Then, your Honours will see at paragraph 13, page 189, he said the next matter of controversy was whether there should be an inquiry or the court should work out the sum itself. He decided in paragraph 14 that there should be an inquiry.
You will see the reference he makes to paragraphs 182 and 183 of the earlier reasons. You will see those at page 163. He said there remains the question, in the second part of paragraph 183, as to the appropriate method of compensation. In paragraph 15 he sets out a submission that was made by the respondent as to the way in which that should be done, and he also sets out in the last three lines of paragraph 15:
Claude’s position is that the appropriate measure in relation to the dairy farm aspect is the sum of $1 million drawn from the loan account to finance the acquisition (plus appropriate interest).
I accept Claude’s submissions in that respect.
This is paragraph 16.
The situation was not one in which Claude, in breach of fiduciary duty, took (or procured to be taken) the land and other farm property. What he took (or procured to be taken) in breach of duty was the $1 million drawn on the false loan account. The price of $1 million was not alleged to be an undervalue . . . The wrongful taking was thus of money, not of the dairy farm property.
Your Honours will see then the conclusion that he reach in paragraph 17. So if one is looking for a contemporaneous analysis of what the judgment was, your Honours will there see it. Your Honours, could I go then to the question of the relief that should be granted? If it be that the result of the case is that we were to succeed, in effect, as to the first transfer but fail as to the second, the result of the case would be one to create a tenancy and then create a tenancy which presumably would be a tenancy in common. But, in
our submission, the matter is one where it should be referred to a court below to consider the appropriate result whether there should be any consequential orders in relation to it.
HAYNE J: Are those orders of a kind that at least were made available by, perhaps governed by, section 119?
MR JACKSON: Well, section 119 would not apply, your Honour, because – if I could just take your Honours to it – it does not apply to 118(1)(d).
HAYNE J: I see. Thank you.
MR JACKSON: Your Honour, I would accept that that fact that I have just stated may be one that might, in the end, militate against the making of such orders – the fact that it is not specifically mentioned there ‑but in the end it is a matter we would submit would be appropriately dealt with by argument in the Court of Appeal. Your Honours, those are our submissions.
FRENCH CJ: Thank you, Mr Jackson. The Court will reserve its decision. The Court adjourns to 9.30 tomorrow morning in Canberra, and 9.30 tomorrow morning in Sydney.
AT 3.23 PM THE MATTER WAS ADJOURNED
Key Legal Topics
Areas of Law
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Commercial Law
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Equity & Trusts
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Contract Law
Legal Concepts
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Fiduciary Duty
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Breach
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Remedies
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Constructive Trust
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Reliance
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Appeal
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