Chan v Liu - [2019] VSC 650

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION
PROPERTY LIST

S ECI 2019 04218

PAUL KWOK FAI CHAN & Anor (according to the schedule)	Plaintiffs
v
ZHENZHU LIU & Anor (according to the schedule)	Defendants

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JUDGE:	FORBES J
WHERE HELD:	Melbourne
DATE OF HEARING:	19 September 2019
DATE OF JUDGMENT:	24 September 2019
CASE MAY BE CITED AS:	Chan & Anor v Liu & Anor
MEDIUM NEUTRAL CITATION:	[2019] VSC 650

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REAL PROPERTY – Caveats – Removal - Caveatable interest based upon contract of sale – Whether removal of caveat prohibited by section 91(4) of the Transfer of Land Act 1958 - Serious question to be tried – Balance of convenience satisfies maintenance of the caveat until trial – Piroshenko v Grojsman (2010) 27 VR 489.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	L Wirth	L H Lee & Co
For the Defendants	N Jones	Katsu Lawyers

HER HONOUR:

Pursuant to s 90(3) of the Transfer of Land Act1958 (‘the Act’), the plaintiffs seek removal of a caveat lodged by the first defendant. The plaintiffs (‘vendors’) are the registered proprietors of property at 357 Burwood Highway, Burwood. They entered into a contract to sell the property to the first defendant on 21 July 2018 with a settlement date of 22 July 2019.

The first defendant says its caveatable interest in the property is based upon the contract of sale.

The applicable principles for removal of a caveat are uncontroversial. They are analogous to an application for interlocutory injunctive relief. On an application to remove a caveat the onus is on the caveator to establish first that there is a serious question to be tried as to whether they have the claimed estate or interest in land, and second that the balance of convenience favours maintenance of the caveat until trial.[1]
[1]Piroshenko v Grojsman & Ors (2010) 27 VR 489.

For the reasons that follow I have determined that the first defendant (‘purchaser’) has established that there is a serious question to be tried whether they have the caveatable interest that they assert and, notwithstanding that the vendors have entered into a later contract of sale with a third party, that the balance of convenience favours maintenance of the caveat.

The plaintiffs’ solicitor, How Yee Loh under the supervision of the principal, Mr Michael Lee, has sworn an affidavit[2] as to instructions from the plaintiffs. The first defendant relies on four affidavits, one sworn by the purchaser[3], one by his wife[4] and two sworn by the vendor’s real estate agent (Mr Cheng)[5].
[2]Affidavit of How Yee Loh (Affidavit, 16 September 2019).
[3]Affidavit of Zhenzhu Liu (Affidavit, 18 September 2019).
[4]Affidavit of Yumei Feng (Affidavit, 18 September 2019).
[5]Affidavit of Mr Xuehang (Jerry) Cheng (Affidavit 18 September 2019); Affidavit of Mr Xuehand (Jerry) Cheng (Affidavit 19 September 2019).

The first defendant asserts that shortly after the contract was signed in July 2018 he sought an extension of the settlement date. This…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Chan v Liu

Details

AGLC: Chan v Liu [2019] VSC 650
Case: [2019] VSC 650
Decision Date: 24 September 2019

CaseChat Overview and Summary

Chan, the plaintiff, initiated proceedings against Liu, the defendant, in the Supreme Court of Victoria, challenging the removal of a caveat lodged over a property. The dispute arose from a contract of sale between Chan and Liu for a property, which was subsequently assigned to Chan by the original vendor. Liu lodged a caveat over the property, claiming an interest in it, which Chan sought to have removed.

The court was tasked with determining whether the removal of the caveat was permissible under section 91(4) of the Transfer of Land Act 1958, considering Chan's caveatable interest derived from the contract of sale. Additionally, the court had to assess whether a serious question to be tried existed and whether the balance of convenience favoured maintaining the caveat until the trial. The decision hinged on whether Chan's interest in the property was sufficient to warrant the continuation of the caveat, as well as the likelihood of success in the substantive proceedings and the potential harm that could be caused by the removal of the caveat.

The court concluded that Chan had a caveatable interest in the property based on the contract of sale, and that there was a serious question to be tried regarding the validity of Liu's claim. The balance of convenience favoured maintaining the caveat until the substantive issues were resolved, as the potential harm to Chan if the caveat were removed outweighed any prejudice to Liu. The court referred to Piroshenko v Grojsman, where similar considerations were applied to determine the maintenance of a caveat. Accordingly, the court ruled in favour of Chan, ordering that the caveat remain in place until the substantive dispute was resolved.

The final orders included a direction that the caveat lodged by Liu remain in effect, and that the case proceed to a trial to determine the validity of Liu's interest in the property and the rights of the parties under the contract of sale. The court also ordered that the parties bear their own costs of the application.

Orders