Coffey v Coffey

[2015] NSWSC 137

Supreme Court

New South Wales

Medium Neutral Citation:	Coffey v Coffey [2015] NSWSC 137
Hearing dates:	26 February 2015
Date of orders:	27 February 2015
Decision date:	27 February 2015
Before:	Slattery J
Decision:	See paragraph [80] of judgment.
Catchwords:	ADMINISTRATION OF ESTATES - Settlement agreement regarding sale of estate lands - performance outside the settlement agreement by both parties – directions given to assist the making of an order for specific performance according to settlement agreement - orders for sharing of information between parties. CIVIL PROCEDURE - right to cross-examine witness - litigant in person - Civil Procedure Act 2005, ss 56 and 62(3)(a) - cross-examination of witness disallowed where issue outside defendant’s responsibility as administrator of estate - cross-examination of witness disallowed where litigant in person does not understand the proper role of the solicitor for the opposing party. CONTRACT - construction of consent orders - meaning of ‘immediately’ in context - specific performance - whether a pre-condition to specific performance is solely for benefit of promisee – whether condition may be waived.
Legislation Cited:	Civil Procedure Act 2005 (NSW), ss 56 and 62 Uniform Civil Procedure Rules 2005 (NSW)
Cases Cited:	Dorsman v Nichol (1978) 20 ALR 231 Gange v Sullivan (1966) 116 CLR 418 JC Williamson Ltd v Lukey (1931) 45 CLR 282 Measures v McFadyen (1910) 11 CLR 723 Mulcahy v Hoyne (1925) 36 CLR 41 Perri v Coolangatta Investments Pty Ltd (1982) 149 CLR 537
Category:	Consequential orders (other than Costs)
Parties:	Plaintiff: Leslie Raymond Coffey First Defendant: Ronald Bruce Coffey Second Defendant: Yvette Ray Latu Third Defendant: Andrew Bruce Coffey
Representation:	Counsel: Plaintiff: H. Durack Solicitors: Plaintiff: Lorraine White, Baker, Deane and Nutt Solicitors Second Defendant: in person
File Number(s):	2013/31875
Publication restriction:	No

Judgment

1. Alma Amy Coffey died on 22 July 2007. Almost exactly six years later, on 17 July 2013, her descendants who were in dispute about the administration of her estate managed to achieve a consensus to end several proceedings in this Court about the estate. The detail of those proceedings is not of present importance. But the July 2013 settlement has not been fully performed.

2. Now Alma’s son, Leslie Coffey, by motion filed on 19 December 2014, seeks to enforce the July 2013 settlement. A number of practical difficulties stand in the way of orders for the immediate enforcement of the July 2013 settlement. It has not been possible to make orders for its enforcement on the hearing of the motion. Instead, this judgment construes the July 2013 settlement and gives directions to the parties for information to be exchanged and for steps to be taken, which will enable the Court to finally determine the motion at its adjourned date on Wednesday, 18 March 2015, at 9.30am.

3. Mr H. Durack of counsel instructed by Messrs Baker, Deane and Nutt Solicitors appears for Leslie Coffey, the applicant on the motion. Of the two respondents to the motion Yvette Ray Latu and Andrew Bruce Coffey, the present administrators of the estate, only Ms Latu appears before the Court. Some background to the motion is required.

The Late Alma Coffey and the Coffey Farm at Michelago

4. After Alma Coffey’s death on 22 July 2007 probate of her estate was granted on 22 August 2009 to her two adult sons, Leslie Coffey and Ronald Coffey. The deceased’s estate principally comprised real property in rural New South Wales, near Michelago valued at approximately $500,000 (“the Coffey Farm”) together with a small sum in cash.

5. It is not necessary in these reasons to detail the title references to the Coffey Farm. They are clear from Leslie Coffey’s motion in the proceedings. All that is required for these reasons is a general understanding of the layout of three important parts of the property: what is known as Lot 112, the northern lots and the southern lots.

6. After Alma Coffey’s death a number of proceedings in relation to her estate were commenced in this Court: proceedings numbered 2683/2008 (“the 2008 Proceedings”), 278915/2011 (“the 2011 Proceedings”), and 31875/2013 (“the 2013 Proceedings”), all of which will be collectively referred to in these reasons as “the Proceedings”. The allegations in the Proceedings are of no present importance. As a result of the 2013 settlement all the Proceedings were dismissed and releases were given in respect of their subject matter.

7. The July 2013 settlement, made among Leslie, Ronald and Andrew Coffey and Yvette Latu, was effected in two parts: consent orders made in Court on 17 July 2013 (“the Consent Orders”) and a Deed of Settlement and Release (“the Deed”) of the same date. The Consent Orders provided an agreed plan for the distribution of Alma Coffey’s estate among the family members in dispute in the Proceedings. The Consent Orders dealt with five principal subject areas:

1. substituting new executors of the estate of Alma Coffey’s estate;

2. arrangements for interim estate administration;

3. the sale of Lot 112;

4. finalisation of the Proceedings; and

5. finalisation of estate administration.

8. (a) New Executors. The Consent Orders revoked the grant to Leslie Coffey and Ronald Coffey of probate of Alma Coffey’s will and provided for the administration (with the will annexed) of her estate to be granted to her grandchildren, Ronald Coffey’s children, Yvette Ray Latu and Andrew Bruce Coffey (collectively referred to as “the administrators” in these proceedings). Yvette Latu and Andrew Coffey have administered the deceased’s estate since July 2013. But the correspondence and the appearances before the Court yesterday make clear that Ms Latu has been the more active of the two in estate affairs.

9. (b) Interim Administration. The Consent Orders also provide for the amendment of the inventory of estate assets to include certain real estate which appeared to have been omitted from the original inventory of assets and for payment of a small bequest of $2000.

10. Neither the substitution of the executors nor the interim administration arrangements has caused any further controversy between the parties to these proceedings. The disputes which now arise concern the remaining three subjects: the sale of Lot 112, the finalisation of the Proceedings, and the finalisation of estate administration.

11. (c) Sale of Lot 112. The Coffey Farm comprises three distinct parcels of land. The first is Lot 112, a block of approximately 40 acres situated some distance from the rest of the Coffey Farm. The balance of the Coffey Farm comprised what the parties called in the Consent Orders the “northern lots” and the “southern lots”. As their names would suggest, the northern lots were on the northern side of the Incaligo Creek and the southern lots on the southern side of the creek. Each of the northern and southern lots comprised a number of titles, parcelled into two sectors divided by the creek. The division of these parcels of land into two sectors divided by the creek has created potential fencing difficulties, which will be dealt with below.

12. The Consent Orders made detailed provision for the sale of Lot 112. These sale provisions are sufficiently carefully crafted for the Court to infer that each step in the sale process of Lot 112 was important to the parties in reaching their July 2013 settlement. First, the administrators were to take a transfer to themselves of Lot 112 by Transmission Application: Consent Orders, clause 6.

13. Then, clauses 7 and 8 of the Consent Orders provided:

“7.   The Administrators sell all right, title and interest in [Lot 112] on the following terms:

(a)   on such terms as the Administrators determine, subject to such sale being at market value and finalised by 30 June 2014;

And failing the sale being finalised by 30 June 2014;

(b)   by immediately instructing licensed real estate agent Mr Graeme Spackman of Spackman Real Estate, 142 Monaro Street, Queanbeyan in New South Wales to list Lot 112 for sale:

(i)   by way of public auction;

(A) Not more than 7 weeks from 30 June 2014;

(B) With the reserve price of $140,000;

(C) On the terms contained in the contract for the sale of land annexed to the affidavit of Lorraine White sworn 1 February 2013 and marked ‘Annexure A’;

And failing sale at auction on or before the date which is 7 weeks from 30 June 2014;

By private treaty;

(A) Not more than 14 weeks from the 7 weeks from 30 June 2014;

(B) With the reserve price of $125,000; and

(C) According to terms contained in the contract for the sale of land annexed to the affidavit of Lorraine White sworn 1 February 2013 and marked ‘Annexure B’;

If Lot 112 remains unsold to a third party by the date which is 14 weeks from 30 June 2014, the Administrators shall:

(a)   obtain a market valuation of Lot 112 from a licensed valuer;

(b)   transfer their interest in the land to the Plaintiff; and

(c)   the Plaintiff shall pay to them the sum of 50% of the market valuation”

14. Annexures A and B to the Consent Orders need not be reproduced. As these reasons explain below, both the administrators and Leslie Coffey have to a degree departed from the Consent Orders, clauses 7 and 8. This creates some difficulties in dealing with Leslie Coffey’s motion.

15. (d) Finalising the Proceedings. The parties to the Consent Orders contemplated that after the sale of Lot 112, the proceeds of sale would be distributed to Leslie Coffey and to the other beneficiaries of the estate, Yvette Latu and Andrew Coffey in the proportion in which they benefited under Alma Coffey’s will. Clause 9 of the Consent Orders provided:

“9.   After deductions for the reasonable costs of the sale of Lot 112 including, without limitation, real estate commission, survey costs and legal fees associated with the sale, the net proceeds of sale of Lot 112 be distributed as follows:

(a)   Leslie Coffey      50%

(b)   Yvette         25%

(c)   Andrew      25%”

16. The parties also agreed on terms to bring the Proceedings to an end. The 2011 Proceedings and the 2013 Proceedings (including cross-claims) were dismissed with no order as to costs, to the intent that each party pay his or her own costs of those proceedings.

17. (e) Finalising Administration of the Estate. The parties then agreed upon the estate’s distribution of the northern and southern lots to the beneficiaries. Within 30 days of the grant of administration the administrators were required by the Consent Orders to execute transfers of the northern lots to Leslie Coffey (clause 13). The parties also agreed to make the transfers conditional upon Leslie Coffey (described in clause 14 as the “plaintiff”) providing an indemnity to the administrators in the following terms (clause 14):

“14.   The Administrators’ obligation to transfer the northern lots is conditional upon the Plaintiff idemnifying the Estate in respect of all council rates and water rates and other debts or expenses owed by the Estate in respect of the northern lots.”

18. In a parallel arrangement the administrators were also within 30 days of the grant of administration to them to transfer the southern lots to themselves as tenants-in-common in equal shares. Their transfer obligation for the southern lots was also conditional upon an identical indemnity to that given by Leslie Coffey in respect of the northern lots. The Consent Orders, clause 16 provided as follows:

“16.   The Administrators’ obligation to transfer the southern lots is conditional upon the Second and Third Defendants indemnifying the Estate in respect of all council rates and water rates and other debts or expenses owed by the Estate in respect of the southern lots.”

19. The parties agreed that for the purposes of the Consent Orders that the northern and southern lots were of equal value (clause 18). The parties also agreed that “each party shall do all things necessary for the implementation of these orders, promptly and efficiently” (clause 19). The parties further noted that they had executed in respect of Alma Coffey’s estate a “Deed of Settlement and Release”, which became Exhibit B in these proceedings.

20. The other component of the July 2013 settlement was the Deed of Settlement and Release (“the Deed”), which confirmed that the deceased’s last will divided her residuary estate into two parts, one half for her son Leslie Coffey and the other half to Raymond Coffey’s children, Yvette Latu and Andrew Coffey. Most of the operative clauses of the Deed are only background to the present dispute. The Deed parties, Leslie, Raymond and Andrew Coffey and Yvette Latu agreed to: file the July 2013 Consent Orders (clause 2); to release one another in respect of the subject matter of the Proceedings and in respect of other wider matters (clause 3); not to cause detriment to the condition or value of Lot 112 or to unreasonably interfere with its possible development as a quarry (clause 4); to indemnify one another in respect of suits concerning the estate, apart from suits related to the enforcement of the Deed or the Consent Orders (clause 5); and various other miscellaneous matters.

21. The administrators received their grant on 9 October 2013. But soon after the solicitors acting for the administrators, Messrs Bevan and Co, indicated to Leslie Coffey’s solicitors, Messrs Baker, Deane & Nutt, that some of the certificates of title to the Coffey Farm had been mislaid.

22. On 27 June 2014 Messrs Bevan and Co advised Messrs Baker, Deane & Nutt that Lot 112 could not be sold prior to 30 June 2014 and sought an extension of the 30 June 2014 sale date provided for in the Consent Orders. On 2 July 2014 Messrs Baker, Deane & Nutt agreed to an extension of the time for the sale of Lot 112 to 30 September 2014, but made clear that there would be no further extensions of time.

23. On 2 October 2014 Baker, Deane & Nutt wrote to Bevan and Co stating that the deadline for the sale of Lot 112 had by then passed. Baker, Deane & Nutt requested Bevan and Co to comply with the Consent Orders, clause 7(b) by instructing Graeme Spackman to list the property for public auction and also to transfer the northern lots to the plaintiff, in accordance with Consent Orders, clause 13. The obligation to transfer the northern lots arose 30 days after the grant of administration on 9 October 2013.

24. There was no sale by auction within 7 weeks of the amended date of 30 September 2014, namely by 18 November 2014. From that date and for another 7 weeks the administrators had the power to sell Lot 112 by private treaty for at least $125,000, that is until 6 January 2015, some 14 weeks after 30 September 2014. After that the administrators were obliged to obtain a market valuation and to transfer their interest in Lot 112 to the plaintiff, Leslie Coffey, who should pay them 50 per cent of that market valuation on conveyance of Lot 112.

25. But by mid October 2014 it was evident the administrators were ignoring their obligations under the Consent Orders to list Lot 112 for auction with Mr Graeme Spackman. On 7 April 2014 Messrs Bevan and Co advised Messrs Baker, Deane & Nutt that the administrators had listed Lot 112 for sale with an agent in Cooma, a Mr Shannon Fergusson of Fergusson Real Estate, not with Mr Spackman. On 14 October 2014 Messrs Bevan and Co informed Messrs Baker, Deane & Nutt that the agency agreement for the sale of Lot 112 would expire on 16 April 2015 and that it was a matter of “no concern” with which agent the property was listed.

26. Messrs Baker, Deane & Nutt protested. They said that the timeframe for Consent Orders, clause 7(a), as extended, had passed and alleged that the administrators were then in breach of clause 7 in entering into an agency with the Cooma agents. But Messrs Bevan and Co then advised Messrs Baker, Deane & Nutt that an offer of $135,000 had been made for Lot 112 and requested Leslie Coffey’s consent to a sale at that price. Baker, Deane & Nutt agreed to a sale at $135,000, subject to an exchange of contracts occurring before Wednesday, 12 November 2014 and completion being effected before 10 December 2014. Messrs Baker, Deane & Nutt again pressed for the transfer of the northern lots to Leslie Coffey.

27. On 4 November 2014 Messrs Bevan and Co advised Leslie Coffey’s solicitors that they would adhere to Leslie Coffey’s stipulations for the timetable for the sale of Lot 112 by 10 December 2014. But on 10 December Messrs Bevan and Co advised Messrs Baker, Deane & Nutt that the buyer for Lot 112 at $135,000 was not proceeding.

28. The collapse of the sale of Lot 112 at $135,000 seems to have been the last straw for Leslie Coffey. On 14 December 2014 he obtained a valuation of Lot 112 from Colin Davies and Associates (“the Davies Valuation”), which gave a market value of $125,000 for sale of Lot 112 by private treaty.

29. Leslie Coffey filed the motion now before the Court on 19 December 2014. The final form of the motion, the Amended Notice of Motion, was filed on 20 February 2015. The orders sought in that Amended Motion are detailed below.

30. After Leslie Coffey’s motion was filed, three other matters came to Messrs Baker, Deane & Nutt’s attention that later became issues in these proceedings.

31. First, on 23 December 2014 the debt recovery division of the NSW Crown Lands Department advised Messrs Baker, Deane & Nutt: that there were significant arrears in respect of the Crown leases for the Coffey Farm, including the northern lots; and the administrators had through their solicitor undertaken to pay those arrears upon the finalisation of the distribution of the estate. This was said to be the first that Leslie Coffey knew of these liabilities.

32. Secondly, on 14 January 2015, when Messrs Baker, Deane & Nutt began to prepare a contract for the sale of Lot 112 at $125,000 they discovered that Gibsons Lawyers who had previously acted for the administrators in the Proceedings had lodged a caveat over that lot for allegedly unpaid legal fees.

33. Finally, on 16 February 2015 Messrs Bevan and Co, who are on the record in these proceedings as acting for the administrators, indicated to Messrs Baker, Deane & Nutt that they were no longer acting. Messrs Bevan and Co have not yet filed a Notice of Ceasing to Act in the proceedings.

The Amended Motion and the Hearing

34. The applicant’s Amended Motion sought the following orders, and costs:

“1. Pursuant to section 94 of the Civil Procedure Act 2005:

(a)   The Second and Third Defendant transfer their interest in [Lot 112] not more than 14 days from the date of these orders.

(b)   The Plaintiff pay the Second and Third Defendant an amount equal to 50% of the market value of the land, less:

(i)   50% of the outstanding debts to the NSW Crown Lands Department in respect of [southern lots] ($8,413.41), [northern lots] ($18,041.41) and [northern lots] ($1,920.89) plus any further sums owing at the date of completion of the sale be paid. The total amount owed to the Crown Lands as 30 January 2015 is $28,375.71;

(ii)   50% of the outstanding rates in respect of over Lot 112;

(iii)   50% of all cost of conveyance and transfer of Lot 112;

And the amount of $22,751.43 which shall be paid to Gibson Lawyers.

Or in the alternative

Within 7 Days from the date of these orders, the Second and the Third Defendants, in their capacity as Administrators of the Estate of the Late Alma Amy Coffey execute:

(a)   the Sale of Contract of Land in respect of the land in [Lot 112] on the following terms:

(i)   Sale Price $125,000;

(ii)   Completion 28 days from exchange;

(iii)   Completion subject to confirmation from the Cooma Council that Lot 112 has an entitlement to build a residential home;

(b)   the Transfer Form 01T in respect to Lot 112; and

(c)   the Application for Development Advice

As exhibited to the Affidavit of Lorraine Susan White sworn 30 January 2014 at LSW2p67-108.

The sale proceeds from the sale of Lot 112 to be held in the Trust Account of the solicitor for the Plaintiff.

That from the sale proceeds:

(a)   outstanding rates for Lot 112 up to the date of completion be paid;

(b)   conveyance fees approximately $1,500 be paid;

(c)   outstanding debts to the NSW Crown Lands Department in respect of Lots 90 ($8,413.41), 117 ($18,041.41) and 218 ($1,920.89) plus any further sums owing at the date of completion of the sale be paid. The total amount owed to the Crown Lands as 30 January 2015 is $28,375.71;

(d)   The balance (approximately $93,000) (the Balance) to be paid as follows:

(i)   a cheque to the Plaintiff for 50% of the Balance; and

(ii)   a cheque of Gibson Lawyers in the sum of $22,751.43; and

(iii)   a cheque made payable to the Second and Third Defendant for 50% of the Balance less the Gibson Lawyers’ fees ($22,751.43).”

35. The relief that Leslie Coffey claims on the motion (the conveyance of Lot 112 to himself) is specific performance of an executory contract: JC Williamson Ltd v Lukey (1931) 45 CLR 282 at 313.

36. At the hearing of the Amended Motion on 26 February, Ms Latu sought to cross-examine the applicant’s witnesses Ms Lorraine White (a solicitor with carriage of this matter for the plaintiff at Messrs Baker, Deane & Nutt) and Mr John Wald (a potential purchaser of a Lot 112 that Leslie Coffey had introduced to the property) on a number of subjects: (1) whether proper consideration had been given to the implications for Leslie Coffey’s Centrelink Social Security benefits of the transfer to him of the northern lots; (2) on what authority Ms Lorraine White, the solicitor for Leslie Coffey had contacted the Department of Lands to find out about how much was owed on the Crown leases on the northern lots; and, (3) whether or not Mr Wald was in fact a fully independent arm’s length purchaser for Lot 112.

37. The Court did not permit cross-examination on subjects (1) and (2), but did permit cross-examination on subject (3). As to (1), the Court explained to Ms Latu that whether or not Leslie Coffey had received adequate advice about the effect on his Centrelink pension of receiving and holding the northern lots was not her responsibility as co-administrator of Alma Coffey’s estate. As to (2), the evidence before the Court shows that substantial sums are owed to the Crown on the Crown leases in respect of the northern lots, and indeed in respect of the southern lots and Lot 112. Ms Latu seemed to assume that Ms White was somehow usurping the role of the administrators in making such inquiries. But it is uncontroversial as a matter of legal practice that a solicitor such as Ms White could contact a government department to ascertain the exact liabilities associated with property that her client had acquired or was acquiring. It may well have been her legal duty to her client to make such inquiries. Nothing that the documentary evidence shows Ms White did in making these inquiries could be construed as acting in the name of the estate. Ms Latu did not appear to appreciate these matters. Determining the real issues in dispute in these proceedings would not be served by permitting such cross-examination to proceed. The Court has broad powers to limit cross-examination in such circumstances: Civil Procedure Act 2005 (NSW), ss 56 and 62.

38. The Court only allowed time for cross-examination on subject (3). Mr Wald’s readiness, willingness and ability to acquire Lot 112 and whether he believed he was offering a market price for the purchase were legitimate subjects for inquiry in these proceedings.

39. Ms Latu briefly cross-examined Mr Wald, who came through as a credible witness who was genuinely interested in purchasing Lot 112 at the price of $125,000 and in living on the lot once his purchase was completed. Mr Wald explained, and the Court accepts, that he had been familiar with the Coffey Farm since the mid 1990’s and he had visited the farm on numerous occasions when the late Alma Coffey was still alive.

40. He has the benefit of the Davies Valuation for Lot 112 at $125,000 if sold by private treaty and is desirous of purchasing Lot 112 at that price. Mr Wald believes but is unsure whether there is a residential building entitlement for Lot 112 available from the Cooma Council. He is seeking better information about that issue from the Council but he has run up against the obstacle that he is not the registered proprietor of Lot 112 and the Cooma Council will not give him information about the lot’s development status without the consent of the registered proprietors, the administrators.

41. Ms Latu’s cross-examination did not succeed in establishing that Mr Wald was seeking to purchase Lot 112 at less than market value. Indeed Mr Wald said and the Court accepts that Mr Wald was relying on the Davies Valuation and that he agreed with it in deciding to purchase Lot 112 for $125,000. He did not commission his own valuation in addition to the Davies Valuation. Ms Latu did not establish any special connection between Ms Leanne Thurling, Leslie Coffey’s daughter and now tutor, and Mr Wald’s introduction to the possible sale of Lot 112.

42. By the time of trial Mr Wald’s offer had been open for about 5 months. It cannot be expected to remain open indefinitely. He was asked by the Court how long his offer would remain open and stated that it would be “a bit longer”. Though his facts are unverified, Mr Wald believes that the building entitlement on Lot 112 will be open only for the period explained in the Davies Valuation (about 2 years) and I accept that he would not be interested in purchasing Lot 112 in circumstances in which he could not build on the lot.

Construction of the Consent Orders

43. The Consent Orders and the Deed, the principal components of the July 2013 settlement, created a well-crafted structure of successive steps for the sale of Lot 112, starting with a grant to the administrators of maximum control and discretion in the sale process. Upon the failure of the administrators to sell the property at each successive stage, greater accountability was placed on the administrators and greater restriction on their sale discretion. If the administrators failed to take advantage of their early opportunity to sell Lot 112 then Leslie Coffey would incrementally gain more control over the sale process until finally the administrators would be required to sell Lot 112 to him.

44. This movement can easily be seen in the Consent Orders, clauses 7 and 8. First, the administrators are given 12 months to sell Lot 112 by 30 June 2014 “on such terms as the administrators may determine” subject to the sale being “at market value”. Second, should the sale not be finalised by 30 June 2014 the administrators have 7 weeks to sell Lot 112 by public auction with an agreed reserve price of $140,000. Third, should the property not be sold by auction within the seven weeks then the administrators have liberty within a further 7 weeks to sell the property by private treaty for at least $125,000. Finally, should the property not sell by private treaty within the further 7 weeks then the administrators must sell it to the plaintiff at 50 per cent of a market valuation.

45. The Consent Orders gave the administrators ample time to sell Lot 112 on their own terms, provided they sold it at market value. The evidence does not disclose any adequate reason why the administrators did not take advantage of the almost 12 months between 12 July 2013 and 30 June 2014 to effect a sale. Whilst there was some difficulty about mislaid certificates of title, there are recognised procedures to replace certificates of title. That should not have held up the sale or transfer of any of the lots.

46. Within this 12 month period Messrs Baker, Deane & Nutt largely left the management of the sale to the administrators. But when nothing was communicated back to Messrs Baker, Deane & Nutt, they warned on 12 May 2014 that the timeframe in the Consent Orders was about to expire. Messrs Baker, Deane & Nutt’s written requirement on 26 June 2014 that Messrs Bevan and Co should list Lot 112 with Grahame Spackman on 30 June 2014 was well justified.

47. The administrators failed to finalise the sale of Lot 112 by 30 June 2014. Therefore Consent Orders, clause 7(b) required them to “immediately instruct [ ] licenced real estate agent Mr Grahame Spackman of Spackman Real Estate 142 Monaro Street, Queanbeyan to list Lot 112 for sale...by way of public auction”. That did not happen. A requirement that something should happen “immediately” or “forthwith” in a contract usually means “without delay” or “at once”, depending on the context: Measures v McFadyen (1910) 11 CLR 723 at 736 per Isaacs J; Dorsman v Nichol (1978) 20 ALR 231 at 237 per Forster CJ.

48. But here in my view “immediately” means within days, given that period was all that was required to make contact with Mr Spackman, check the terms upon which the property would be listed and sign an agency agreement.

49. But on 2 July 2014, Messrs Baker, Deane & Nutt agreed to an extension “of the timeframe for satisfaction of order 7 of the Orders made to 30 September 2014”. The effect of this letter in my view was to waive Leslie Coffey’s rights to complain about the administrators’ failure to list the property with Mr Spackman between 1 July 2014 and 30 September 2014.

50. The problem re-surfaced on 1 October 2014. By the end of the first week of October 2014 the administrators were in breach of clause 7(b). At that point Leslie Coffey had the right to return Court to seek specific performance of the Consent Orders, clause 7 to require the administrators to instruct Mr Spackman. He did not take that course. Perhaps he thought the administrators may yet be persuaded to perform the agreement. When the Court asked Ms Latu from the Bar table why the property had not been listed with Mr Graeme Spackman, she expressed dissatisfaction with Mr Spackman’s qualifications for auctioning rural property. But that is not an adequate answer. The administrators had agreed in the Consent Orders to sale by public auction through Mr Spackman.

51. Although Leslie Coffey did not seek to enforce clause 7(b) in requiring Mr Spackman to be appointed, he did nothing in the short term to waive his rights to complain of the breach of clause 7(b).

52. Seven weeks after 30 September 2014, on 18 November 2014, the precondition for the next obligation was triggered. There was a failure to sell Lot 112 at auction on or before that day, which was seven weeks after the amended clause 7(a) date of 30 September 2014. The obligation then was for the administrators to sell by private treaty within a further seven weeks.

53. Exactly what efforts the administrators made to sell by private treaty are unclear. The evidence is not sufficiently precise for the Court to make any finding as to whether the contract was breached during this period, except that for a period between 4 November and 10 December 2014 Leslie Coffey agreed to await a possible sale at $135,000. But by 6 January 2015 the further seven week period had expired. The obligations of the Consent Orders, clause 8 were then triggered. By 6 January 2015, being a date which was 14 weeks from the amended date of 30 September 2014, Lot 112 “remained unsold to a third party”.

54. From 6 January 2015 the administrators obligation has been to obtain a market valuation of Lot 112 from a licensed valuer and then transfer their interest in Lot 112 to Leslie Coffey. But before Leslie Coffey could have a decree for the specific performance of clause 8, it is necessary for the administrators to obtain a market valuation of Lot 112 from a licensed valuer. In a claim for specific performance, if a promisor against whom relief is sought fails to perform an act which is a precondition to performance, if that act is solely for the benefit of a promisee, then a promisee may in seeking relief waive the benefit of the promise: Mulcahy v Hoyne (1925) 36 CLR 41 at 55 per Isaacs J, 58 per Starke J; Gange v Sullivan (1966) 116 CLR 418 at 430 per Barwick CJ; Perri v Coolangatta Investments Pty Ltd (1982) 149 CLR 537 at 543 per Gibbs CJ.

55. But here the clause 8 obligation that “the administrators shall…(a) obtain a market valuation of Lot 112 from a licensed valuer” is not solely an obligation for the benefit of Leslie Coffey. It is inserted also for the benefit of the administrators to give them a degree of control over instructing the licensed valuer. When they are obliged by clause 8 to sell to Leslie Coffey, he as purchaser does not have control over the instructions by which the price is set. Clause 8 represents a sensible balance between a requirement to sell to Leslie Coffey and a mechanism that keeps the instructions leading to the pricing of the sale in the hands of the vendors. For that reason it is not possible in my view for Leslie Coffey to waive this condition, obtain his own valuation from a licensed valuer, and have specific performance of clause 8 of the agreement based on the Davies Valuation.

56. The Court is minded to grant specific performance of this agreement. The problem with granting specific performance on the basis of the Davies Valuation is that it places back in the hands of the purchaser, Leslie Coffey, the very thing which the contract allows the administrators to do: to give instructions to the valuers about the setting of the price.

57. The Court could require the administrators to obtain a valuation from a licensed valuer to set a price to effect a decree for specific performance. Were that to be done, given the distrust which has arisen among these parties, the Court will require all the instructions and communications with that valuer to be produced to the other parties to these proceedings. Alternatively, the Court itself could appoint a licensed valuer to value Lot 112 for the purposes of clause 8.

58. Ms Latu has indicated that the administrators are obtaining their own valuation of Lot 112 and that they need time to make it available. The Court will not stand in the way of that course. But if the administrators do obtain such a valuation, then the purchaser may wish to contend that the valuation is not in accordance with clause 8. Were it to be demonstrated that a further valuation so obtained was not in accordance with clause 8, then it may be possible for the Court to fill the gap and order a Court appointed valuer to act in the circumstances. But Ms Latu should first be permitted an opportunity to produce a valuation for the administrators.

59. The primary relief Leslie Coffey seeks on the Amended Motion is to transfer the property to the plaintiff. In the alternative he seeks transfer the property to Mr Wald, in accordance with price fixed in the Davies Valuation. But that alternative is not in accordance with the contract. There is no warrant under the contract for the plaintiff to obtain relief requiring the property to be transferred to Mr Wald at $125,000. The contract does not require the administrators to transfer the property to a third party on the basis of a valuation obtained by Leslie Coffey.

60. This part of the plaintiff’s case must fail. But Mr Wald may not be entirely out of the picture. It may be possible for the plaintiff to direct the transfer of property to Mr Wald by way of sub-sale or assignment. But that will be a matter for the parties to negotiate.

61. There may yet be a further solution that the parties may wish to negotiate among themselves. Something may emerge from the material that the Court will direct be made available between the parties. The Court will give a short further opportunity for that to occur, prior to the adjourned hearing date on 18 March. But if no consensus is reached the Court will, after hearing further submissions as to the precise form of relief, make orders for specific performance of the agreement in accordance with these reasons.

62. But other issues of detail must be addressed before the agreement can be specifically performed in relation to the sale of Lot 112. This judgment now turns to them.

Directions for the Sale of Lot 112

63. Ms Latu argues that Lot 112 should still be offered for sale by public auction, notwithstanding the expiry of the agreed extension for such a sale on 30 September 2014. It is not obvious to the Court how Ms Latu can argue for this outcome. However Ms Latu is unrepresented by counsel or solicitors. The Court will give her a further opportunity to formulate her contentions on this matter. But the Court indicated to Ms Latu in the course of argument that as Leslie Coffey and Mr Wald were in a position to purchase the property immediately, it was highly likely that if there were a grant of relief of the kind she seeks, a pre-condition for it would be that she would have to charge her own separate property. This would be necessary in order to cover any shortfall that might occur if the plaintiff’s sale fell through or Mr Wald became unavailable because of delay associated with the public auction. The directions will require Ms Latu to give the title details of any property that she proposes to offer as security for that purpose.

64. It may be possible, despite what has happened, for the parties to agree upon Lot 112 going to auction. If that is the course the parties wish to pursue by agreement they may wish to advance the names of a number of auctioneers other than Mr Graeme Spackman so the Court can select among them. Directions to achieve this can be made. But nothing in the giving of these directions should indicate that this is the course which the Court would take other than by the agreement of the parties.

65. There is another dispute as to whether a survey report of the boundaries of Lot 112 should be undertaken before the lot was sold. The administrators say that a survey report should be obtained and they have obtained one. Leslie Coffey disputes that one is needed. The administrators say there is uncertainty as to whether Lot 112 is 40 acres in size or approximately 39.5 acres and that a survey is required to ascertain its exact dimensions.

66. Given that uncertainty, a survey should be obtained before the sale of Lot 112. It may assist the accurate valuation of the property. Should either Leslie Coffey or the administrators wish to argue that the costs of that survey should not be borne equally by the parties then they should put submissions on that issue to the Court on 18 March. Prima facie it is a cost of the sale. Not all sale costs have been expressly provided for under clause 8. The survey cost and similar small sale costs may therefore become the subject of argument. However such a minor issue should not take long. The losing party, whatever happens to the rest of the proceedings, may bear a costs order in respect of this issue if it contested. It will be necessary for the survey the administrators obtain to be served on Leslie Coffey together with the invoice in relation to the surveyor’s fees.

67. Messrs Gibson Lawyers have a caveat over Lot 112 in respect of allegedly unpaid legal fees. Unless these fees are paid in the meantime, or Gibsons Lawyers’ caveat is set aside, provision will need to be made to set aside funds for the payment of Gibsons Lawyers at the time that the conveyance of Lot 112 is settled. The parties should discuss with Gibsons Lawyers and try to reach a consensus about what should be done either to pay or secure Gibsons Lawyers’ fees. Directions will be made for the administrators to provide Gibsons Lawyers’ fee notes to Leslie Coffey. If no agreement is reached with Gibsons Lawyers, then the Court will have to make orders about this issue.

68. Finally, there were a number of other matters in issue between the parties in relation to the sale of Lot 112 that must be the subject of directions:

1. Ms Latu says she already has a valuation of Lot 112; it should be served on Leslie Coffey.

2. There is no co-operation between the parties about accessing information from Cooma Council about Lot 112. To expedite either the grant of final relief or the consensual resolution of these proceedings, that information should be made available to both parties.

Division and Transfer of the Northern and Southern Lots

69. The northern lots have been transferred to Leslie Coffey. The administrators have not yet transferred the southern lots to themselves.

70. But the parties are still in dispute about the satisfaction of the Consent Orders, clause 14 in relation to the northern lots, the clause which obliges Leslie Coffey to indemnify the estate in respect of “all council rates and water rates and other debts or expenses owed by the estate in respect of the northern lots”. Clause 14 does not require the estate to be indemnified before the transfer of the northern lots. Notwithstanding the transfer of the northern lots it seems to be accepted in the way that proceedings had been conducted that the indemnity in clause 14 may be called upon after the conveyance of the northern lots to Leslie Coffey. However the words “debts or expenses owed” probably mean a liability which needs to be satisfied at some particular time: the obvious time is the date of transfer of the northern lots under clause 13.

71. Final argument on the question of the construction of clause 14 has not taken place. In order for the Court to determine the extent of any indemnity which is required under clause 14, more information must be exchanged between these parties. The administrators will be required to provide a full list of such expenses to Leslie Coffey.

72. One of the disputed expenses in relation to the northern and southern lots is the obligation to fence the boundary line dividing them (“the north-south boundary”). Although the Incaligo Creek runs along the north-south boundary, the administrators claim it is necessary for them to fence the boundary more securely, as soon as the northern lots and the southern lots pass into separate ownership operating as independent pastoral enterprises. It is claimed that this new fencing will be more robust than the fencing required when the lots were part of a single pastoral enterprise. The Court has not yet decided whether additional fencing is required. Nor has it decided whether the cost of such fencing can be indemnified under clause 14. But if it is required, it is likely that the new owners of the northern and southern lots will have to bear the costs of that fencing equally, as there is an equivalent indemnity in Consent Orders, clause 16 to the estate in respect of “other debts or expenses owed by the estate in respect of the southern lots”.

73. Alternatively, independently of clauses 14 and 16 such fencing may be required by law. If that is so, there may be an additional reason for the parties to try and resolve this issue in the context of these proceedings. Otherwise they will just have to deal with it later, anyway. Directions for the parties to have full information about the cost of the fencing to the northern and southern boundary will be made.

74. Leslie Coffey does not yet know the full extent of the liability of the northern lots for arrears on their Crown Leases as at the date of their transfer to him. Directions will be made for this information to be given to him.

Remaining Procedural Issues

75. A few issues remain. The administrators questioned the appointment of Leanne Thurling, Leslie Coffey’s daughter, as his tutor. The appointment was made less than a week before the hearing. The administrators questioned whether there was a proper basis for the appointment under Uniform Civil Procedure Rules (“UCPR”) 2005, r 7.16, a rule which permits the tutor to carry on proceedings after a tutor gives consent and a solicitor’s certificate has been filed stating that the tutor does not have an adverse interest to a party who is a person under legal incapacity. To facilitate ventilation of this issue the Court will make directions for any power of attorney or any other authorisation from Leslie Coffey to Leanne Thurling, which provides the basis for the appointment of Leanne Thurling as tutor, be provided to the administrator.

76. The administrators appear to be arguing that the Court might exercise its powers under UCPR, r 7.18 to remove Leanne Thurling as a tutor. But, there is no motion before the Court to that effect. Nor is there any material before the Court which would permit that question to be decided. This issue is in substance a challenge to the retainer of Messrs Baker, Deane & Nutt in the proceedings. Such a serious issue could only be decided on a properly formulated motion, not in the casual way that the administrators have raised it so far.

77. There is a concern that Messrs Bevan and Co, the former solicitors for the administrators, may yet have filed caveats on the title to Lot 112 in respect of unpaid fees. Directions will be made to communicate with Messrs Bevan and Co so that that issue can be brought to a head, to eliminate the possibility of unexpected impediments to the later conveyance of Lot 112.

78. Finally, although the administrators indicated their inclination towards auctioning Lot 112 through Mr Fergusson, they did not indicate that a sale is imminent. Nor did Leslie Coffey apply for an injunction to restrain the sale. Such relief is probably not necessary in the circumstances, especially as the matter will now come back to Court on 18 March 2015, the week before the possible sale date that the administrators floated of 23 March. But there will be liberty to apply granted to the parties should that situation change.

79. Leslie Coffey’s motion also seeks orders about his liability for aspects of the sale of Lot 112 and the distribution of sale proceeds. These issues have not yet been fully argued.

Conclusion and Orders

80. Accordingly, the Court will make the following orders and directions:

Directions Relating to the Sale of Lot 112

1.   Direct second defendant to provide to the plaintiff by 4pm on Wednesday, 11 March 2015 the title details of any real property of which she is the registered proprietor (whether solely or jointly with any other person) and over which she proposes at the next directions hearing in these proceedings to offer a charge to support her application for relief to allow Lot 112 to be offered by public auction in accordance with the parties’ July 2013 settlement.

2.   Should either the second defendant or the plaintiff propose, or alternatively should they agree, that the parties’ July 2013 settlement may now be performed by the holding of a public auction of Lot 112 using an agent or an auctioneer other than Mr Fergusson or Mr Spackman, then each of the plaintiff and the second defendant should co-operate so as jointly to provide to the Court by 4pm on Wednesday, 11 March 2015 three names of appropriately qualified auctioneers and agents (together with a short description of the qualifications) other than Mr Spackman or Mr Fergusson, so the Court can make a selection of a single auctioneer or agent to conduct the auction in place of Mr Fergusson or Mr Spackman.

3.   Direct the second defendant to provide to the plaintiff by 4pm on Wednesday, 4 March 2015 a copy of any survey report that has been obtained by the second defendant in respect of the boundaries of Lot 112, together with any invoice from the surveyor for the cost of that survey report.

4.   Direct the second defendant to obtain and to provide to the plaintiff by 4pm on Wednesday, 11 March 2015 any valuation with respect to Lot 112 from a registered valuer upon which the second defendant proposes to rely in these proceedings.

5.   Direct the second defendant to provide to the plaintiff by 4pm on Wednesday, 4 March 2015 any necessary authority for the plaintiff to make enquiries with the Cooma Council about the development conditions applicable to Lot 112.

6.   Direct both the plaintiff and the second defendant to exchange with one another any information they have from the Cooma Council about the development conditions presently applicable to Lot 112.

7.   Direct the second defendant to provide by 4pm on Wednesday, 4 March 2015 a copy of all memoranda of legal fees currently outstanding between the second and third defendants and Messrs Gibsons Lawyers and claimed by Gibsons Lawyers to be secured by that firm’s existing caveat over Lot 112.

The Division and Transfer of the Northern and Southern Lots

8.   Direct the second defendant to provide to the plaintiff by 4pm on Wednesday, 11 March 2015 a final list of all the expenses, together with all necessary substantiation of those expenses, relating to the transfer of all the northern lots for which expenses the second defendant, as administrator of the estate, seeks an indemnity against the plaintiff in respect of the transfer of the northern lots to the plaintiff.

9.   Direct that the plaintiff and the second defendant each obtain from experienced rural fencing contractors and serve upon one another by 4pm on Friday, 6 March 2015 quotations for the reasonable cost of fencing the boundary line dividing the northern lots from the southern lots (“the north-south boundary”), to a fencing standard that will permit the northern and the southern lots to be operated as independent pastoral enterprises by different registered proprietors in accordance with accepted pastoral practices.

10.   Direct the plaintiff and the second defendant to consult with one another before 18 March 2015 about agreeing upon a single fencing contractor to carry out on the north-south boundary work the subject of the quotations the subject of order 9.

11.   If the plaintiff wishes to maintain that the north-south boundary requires no further fencing to enable operation of the northern lots and the southern lots as independent pastoral enterprises in separate ownership in accordance with accepted pastoral practices, then the plaintiff should nevertheless comply with order 9 but must also provide to the second defendant by 4.00pm on 6 March 2015 a short statement as to why the current north-south boundary fences are claimed to be sufficient for such operations and why no further fencing of the north-south boundary is now required.

Other Procedural Issues

12.   Direct the plaintiff to provide by 4pm on Wednesday, 4 March 2015 to the second defendant a copy of any power of attorney or other authorisation by which the second defendant claims that Leanne Thurling is entitled to act as tutor for the plaintiff.

13.   Direct that the second defendant by 4pm on Tuesday, 3 March 2015 serve a copy of these orders on Messrs Bevan and Co, solicitors, and if available by that time the a copy of the reasons for these orders.

14.   Direct Messrs Bevan and Co, the solicitors on the record in these proceedings as acting for the second defendant, to appear on at the next hearing on 18 March 2015, or in the alternative, to provide the second defendant before then with an itemised account of any fees presently owed to that firm by the second and third defendants.

15.   Direct that the second defendant by 4pm on Tuesday, 3 March 2015 serve a copy of these orders on the third defendant and if available by that time a copy of the reasons for the making of these orders.

16.   List these proceedings for further hearing at 9:30am on Wednesday, 18 March 2015.

17.   Grant liberty to apply to the Court on two working days’ notice to the other party.

18.   Note that the second defendant has indicated to the Court that she does not need to proceed to auction Lot 112 on or before 23 March 2015. It is expected that the second defendant will take no steps to auction Lot 112 before the next directions date. But should there be any need for injunctive relief to be obtained to restrain the auction then the liberty to apply is available.

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Decision last updated: 03 March 2015