Commonwealth of Australia (As Represented BY the Department of Infrastructure and Regional Development) v Phuong Mai Greenfield Pty Ltd
[2016] FCCA 2228
•2 September 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) v PHUONG MAI GREENFIELD PTY LTD | [2016] FCCA 2228 |
| Catchwords: CONSTITUTIONAL LAW – Jurisdiction of the Federal Circuit Court of Australia – judicial power – acquisition of property other than on just terms – whether legislative instrument was unlawful. |
| Legislation: Constitution (Cth), ss.75, 76, 77(i) Federal Circuit Court Act 1999 (Cth), ss.5, 10AA Federal Circuit Court Rules 2001 (Cth), r.15.27 |
| Cases cited: Alqudsi v R (2016) 90 ALJR 711; [2016] HCA 24 Cameron v Cole (1944) 68 CLR 571; [1944] HCA 5 Commonwealth v Hevers (2015) 301 FLR 83; [2015] FCCA 1814 Commonwealth v Rigney (No 3) [2015] FCCA 3133 Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 90 ALJR 770; [2016] HCA 26 |
| Applicant: | COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) |
| Respondent: | PHUONG MAI GREENFIELD PTY LTD (ACN 134 167 276) |
| File Number: | SYG 2972 of 2015 |
| Judgment of: | Judge Smith |
| Hearing date: | 22 June 2016 |
| Date of Last Submission: | 8 July 2016 |
| Delivered at: | Sydney |
| Delivered on: | 2 September 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr J Doyle, Mr D W Rayment & Ms A Mitchelmore |
| Solicitors for the Applicant: | Australian Government Solicitor |
| Counsel for the Respondent: | Mr P E King |
| Solicitors for the Respondent: | The People’s Solicitors |
DECLARATIONS
The licence granted by the agreement between the applicant and the respondent dated 16 June 2015 (“Deed of Licence”) with respect to the land situated at Lot 43 (formerly 43/1841) and 240 (formerly 44/1841) Longleys Road, Badgerys Creek NSW 2555 (“Licensed Area”) has expired.
ORDERS
The respondent vacate, and remove all goods and animals from, the Licensed Area forthwith.
Vacant possession of the Licensed Area be given to the applicant on or before 16 September 2016.
In default of compliance with order 2, a Writ of Possession be issued forthwith.
The applicant have the authority to dispose of any goods or animals that are not removed from the Licensed Area within 14 days of the date for possession.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2972 of 2015
| COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) |
Applicant
And
| PHUONG MAI GREENFIELD PTY LTD (ACN 134 167 276) |
Respondent
REASONS FOR JUDGMENT
The applicant is the registered proprietor of the land situated at Lot 43 (formerly 43/1841) (also referred to as 250 Longleys Road) and 240 (formerly 44/1841 and Lot 44) Longleys Road[1], Badgerys Creek, NSW 2555 (“land”), a suburb on the western fringe of Sydney.
[1] These were the addresses as set out in the Deed of Licence commencing 23 June 2015 and terminating on 22 September 2015.
On 16 June 2015, the applicant and respondent entered into a licence agreement by which the applicant granted the respondent the right to occupy the land for the purpose of conducting a market garden there. It was an express term of the licence that the agreement commenced on 23 June 2015 and terminated on 22 September 2015. There is no holding over clause in the agreement.
The applicant seeks a declaration that the agreement has expired and an order that the respondent vacate the land.
The respondent resisted the proceedings on several bases: first, that this Court has no jurisdiction to deal with the matter; secondly, that the licence agreement was void, either because it was entered into under economic duress, or under a false understanding of the agreement; and thirdly, the right of the applicant to possession is subject to various personal equities of the family of the director of the respondent arising from representations made by, or on behalf of, the applicant.
The licence agreement terminated according to its terms and the applicant is entitled to possession. For the reasons that follow, none of the respondent’s arguments succeed.
Before turning to the factual issues in the proceedings, it is necessary to deal with the respondent’s challenge to the Court’s jurisdiction.
Constitutional Issues
Section 10AA of the Federal Circuit Court of Australia Act 1999 (Cth) (“FCCA Act”) confers original jurisdiction on this Court in respect of “Commonwealth tenancy disputes”. A Commonwealth tenancy dispute is relevantly a matter involving a licence to possess, occupy or use land and a dispute about the termination of that licence and possession of the land to which the Commonwealth is a party: s.5 FCCA Act.
In this matter there is clearly a dispute between the parties that falls within the description of “Commonwealth tenancy dispute”.
In a notice prepared and served by the respondent dated 27 May 2016, under s.78B of the Judiciary Act 1903 (Cth), the respondent contended that:
i)the Parliament has no power to make s.10AA of the FCCA Act;
ii)its enactment was an attempt to confer the general discretionary powers of the NSW Civil and Administrative Tribunal (“NCAT”) on a Federal court; and
iii)the law is a law with respect to the acquisition of property other than an unjust terms.
Similar arguments were raised in Commonwealth v Hevers (2015) 301 FLR 83; [2015] FCCA 1814 and Commonwealth v Rigney (No 3) [2015] FCCA 3133 amongst others. They are rejected for the reasons given in those judgments.
In summary, the Commonwealth Parliament has power under s.77(i) of the Constitution to make laws defining the jurisdiction of any Federal Court other than the High Court with respect to any of the matters in ss.75 and 76. The matter here is one in which the Commonwealth is a party: s.75(ii). As noted above, the definition of “Commonwealth tenancy dispute” requires the Commonwealth to be a party. For that reason, it was competent for the parliament to enact s.10AA of the FCCA Act. Secondly, s.10AA does nothing to effect the acquisition of property. Thirdly, s.10AA confers judicial power on the Court. In any event, there being no residential tenancy in these proceedings, the argument concerning the NCAT and the Residential Tenancy Act 2010 (NSW) is irrelevant.
For those reasons, the respondent’s argument that the Court has no jurisdiction to determine the dispute between the parties is rejected.
Factual Background
Hong Lac Mai (“Mrs Mai”) and Viet Phuong Mai (“Mr Mai”) are wife and husband. They came to Australia from Vietnam with their son, Viet Phuoc Mai (“Viet Phuoc”) after the fall of Saigon (now also known as Ho Chi Minh City) and settled in Sydney.
In 1984 Mrs Mai purchased the land at Lot 44 Longleys Road, Badgerys Creek (“Lot 44”) with Thi Ly Phan. This land was used as a market garden.
In 1986 Mrs Mai and Thi Ly Phan were notified by the Minister for Aviation of the Federal government’s decision to develop the land at Badgerys Creek for a second Sydney airport. Mrs Mai and Thi Ly Phan engaged solicitors to negotiate with the Commonwealth in connection with compensation for any compulsory acquisition.
In December 1989, a declaration of compulsory acquisition was made in respect of Lot 44. A licence in respect of that lot was granted to Mrs Mai expiring on 31 October 1990. Negotiations for compensation continued. On 6 September 1991, Thi Ly Phan and Mrs Mai entered into a Deed of Discharge with the Commonwealth whereby the Commonwealth agreed to pay certain compensation which was to be set off against any final amount of compensation payable.
Following the expiry of the first licence to Mrs Mai, the Commonwealth sent a draft further licence to her solicitors. That licence was executed by Mrs Mai on 29 January 1991 at her solicitor’s offices. The licence granted her the right to use the land as a market garden until 30 June 1991 in return for payment of a licence fee.
During the negotiations for compensation, Mr Mai wrote a letter dated 3 December 1992 to the Commonwealth. A number of important matters arise from this letter: first, although Mr Mai purports not to speak or read English, the letter is in English and signed by him; secondly, after referring to the income from the land in 1989, Mr Mai stated:
…
During this time, we are perplexed as to when we can move out, therefore, we are just doing temporary farming and as a result, our incomes are very low:
…
This is clearly intended to support a claim for higher compensation. However, it also indicates that there was no intention to remain permanently (or for very long) on the property. This indication is fortified by the later statements in the letter:
…
Although we have got the money from the government to buy land, and we actually bought a block of land 2 years ago, we still cannot move to the new place because we have no money for living for at least 1 year…
…
If we have to move to a new place, we need 1 year’s time and an amoun (sic) of money for living…
…
As soon as we receive this money, we will immediately move to our new place. If we delay and stay on, we will have to face heavier losses.
Attached to the letter was an annexure with a graph showing net income and the following statement:
…
NB: Only yesterday dec.2.92 after our telephone conversation with you, did we understand that we could sign a contract to stay on until March 1994.
That note in the letter is of some importance as it places a conversation about remaining on Lot 44 with direct evidence for the reason why Mr and Mrs Mai were remaining there.
It appears that, after the conversation referred to, Mr and Mrs Mai went to see their solicitor and the letter of 3 December 1992 was prepared with her assistance. Mr Mai explained that much in his letter dated 7 December 1992. In that letter, after explaining what had been done with the compensation paid to date, Mr Mai wrote:
…
Another problem none the less grave that we are facing is that how long can we stay on? when shall we be kicked out of this place? since you paid us the money to buy a new land, this land is no longer ours, you are its owners. We have many a time put this question to our solicitors, at the Real Estate Agency and Mr. Ray Turnell but no one has given us an answer except an indiferent one: ‘I don’t know’ while we expect and hope to get the money for the loss of income and goodwill to hire farm workers and buy farm tools and manure and not less unimportant to live on for at least one year while setting up the new place but in fact we have been waiting for over 2 years.
…
(Errors in original)
The letter went on to ask for compensation by means of a weekly payment of wages for 37 weeks. In the meantime, negotiations for the continuation of the licence over Lot 44 were also occurring.
On 22 December 1992 a property consultant for the Commonwealth wrote to the solicitors acting for Mrs Mai about the licence. The solicitors for Mrs Mai replied by letter of the same date indicating that they were preparing a further compensation submission and would then be in a further position to negotiate a licence agreement.
In the meantime, the Commonwealth had acquired Lot 43 on Longleys Road, Badgerys Creek which was adjacent to Lot 44. It granted a licence to Mr and Mrs Mai in respect of Lot 43 on 25 March 1998 and a further licence in respect of that lot on 1 March 2004.
On 1 March 2004, the Commonwealth granted a licence in respect of Lot 44 to Viet Phuoc. By this time, Viet Phuoc had become involved in his parents’ business and would translate documents for them from English to Vietnamese. Whenever he could not fully understand the document, they would obtain advice from an accountant or solicitor.
On 14 November 2008, the respondent was incorporated. Initially, Mrs Mai and Viet Phuoc were both directors and equal shareholders. Viet Phuoc gave evidence that the respondent was incorporated on the basis of accounting advice in order to obtain tax advantages in the operation of the business previously run by Mr and Mrs Mai.
On 1 April 2009 the respondent was granted a licence to use the land in Lot 43 and 240 (that is, Lot 44) Longleys Road for the purpose of market gardens. The term of the licence expired on 31 December 2009. The respondent remained on the land after the expiry and continued to pay a licence fee to the applicant.
On 29 October 2014, the property agents acting for the Commonwealth, Preston Rowe Paterson (“PRP”), wrote to the respondent on behalf of the Commonwealth, informing it of an announcement that the land at Badgerys Creek would be the site for western Sydney’s airport and that a notice of termination would be sent shortly. PRP wrote to the respondent again on 9 December 2014 stating, amongst other things:
…
We also refer to your request to be allowed additional time to enable you to vacate your property.
…the Government has agreed to allow you additional time to vacate your property until 22 September 2015 and to explain how those arrangements will be implemented.
…
We will send to you in January 2015 a formal document which will govern the terms on which you may occupy your property during the additional period commencing on 23 June 2015 and expiring on 22 September 2015. The Government requires that you sign that agreement without amendment as a condition of agreeing to allow you additional time to vacate your property. A formal agreement is required so that the arrangements for the additional period are clearly understood.
…
Preston Rowe Paterson sent a separate notice dated 9 December 2014 terminating the licence granted on 1 April 2009 with effect from 22 June 2015. On 1 June 2015 the Commonwealth sent the respondent a formal licence agreement and asked that it be signed and returned by 8 June 2015. Mrs Mai signed the licence as director of the respondent. As indicated in the letter of 9 December 2014, it was a term of the licence that it expired on 22 September 2015, unless it was terminated earlier. There was no term of the licence that permitted anyone else other than the respondent to occupy or use the premises and no term that permitted the respondent to remain on the property after the licence had terminated.
On 9 October 2015 PRP wrote to the respondent noting that it had not vacated the property and notifying it that, unless the property was vacated immediately, the Commonwealth would commence proceedings in the court for possession. The respondent did not vacate the property and still has not done so. The Commonwealth then commenced these proceedings on 30 October 2015.
On the basis of those facts, the respondent has no right to remain on the property. The Commonwealth is the registered proprietor of the property. The only rights that the respondent had in respect of the property were those granted under the 1 April 2009 licence and, subsequently, under the licence commenced 23 June 2015. The rights under the 2009 licence came to an end when the term of the licence ended on 31 December 2009.
The Commonwealth accepts that an implied licence arose after that time by the acceptance by it of the licence fee which the respondent continued to pay. However, notice of termination of that licence was served on 9 December 2014 and the licence ended on 22 June 2015. The respondent’s right to remain on the property was then provided for by the terms of the June 2015 licence. Those rights came to an end on 22 September 2015 and the Commonwealth expressly disavowed the respondent any further rights in respect of the land.
In those circumstances, unless the respondent has established any of its defences, the Commonwealth is entitled to the relief it seeks.
Arguments raised by the respondent
The arguments raised by the respondent were neither constant nor precise. In light of this, it is necessary to set out each argument before considering the evidence that was said to have supported it.
In its response filed 10 December 2015, the respondent alleged “that the land was held by an arrangement between Mr Phuong Viet Mai and Mrs Hong Lac Mai (‘the Mai Family’) from 1989 to date”. As any agreement between Mr and Mrs Mai would not be binding on the Commonwealth, I assume that the allegation is that there was an “arrangement” between the Commonwealth and the Mai Family (as defined).
The particulars of this arrangement were as follows (without alteration):
a)the Mai Family owned the land from 1983 to 1989 when the Commonwealth took the land by resumption action from the Mai Family;
b)in 1989 Mr Turnell of North Sydney the agent of the Commonwealth informed the Mai Family that the Government has taken the land but leases it back to the Mai Family who have ongoing possession of the land and who may continue to work and improve the land as if tenants and as they had done to date as owners;
c)since 1989 the Mai Family have continued to work and improve the land as owners and have had exclusive possession of the land since that time;
d)the Mai Family have paid rent as cash each month and sometimes by cheque through their service companies from time to time since 1989 to the agent of the Commonwealth at Badgerys Creek under the said arrangement;
e)the said arrangement comprises a convention of the parties and upon which the Mai Family have relied since 1989 with continuous improvement of the land and expense paid under the arrangement to their detriment whereby the Applicant is estopped from denying the tenure of the Mai Family, which will seek to be joined as parties to the present proceedings.
It may be noted in respect of this last particular that there was no application for any person to be joined as a party to the proceedings. Mr and Mrs Mai had every opportunity to do so, were legally represented and were both witnesses in the proceedings. There was no simulacrum[2] of a trial here. Mrs and Mr Mai, who asserted a right against the Commonwealth in respect of the land were offered the opportunity to be joined without opposition by the Commonwealth and chose not to. Given the availability of legal representation, I infer that this was a deliberate choice intended to raise a technical defence to the Commonwealth’s claims.
[2] See Cameron v Cole (1944) 68 CLR 571 at 589 per Rich J; [1944] HCA 5 cited in John Alexander’s Clubs Pty Ltd v White City Tennis Club Limited (2010) 241 CLR 1; [2010] HCA 19 at [137].
Both Mr and Mrs Mai participated in and were present in court throughout the proceedings. Mrs Mai is the only director of the respondent and directly responsible for instructing its legal representatives. Those representatives were, in effect, also representing Mr and Mrs Mai and their interests were relevantly identical to those of the respondent. There was no submission that Mr and Mrs Mai lost any opportunity to present any argument and, in the circumstances I have described, I can think of none. In spite of all that, they argued that their non-joinder meant that the Commonwealth was not entitled to relief. I reject that argument. As will be seen, the evidence reveals that there is no basis for the interest claimed by Mr and Mrs Mai and their joinder would have made no difference.
The 10 December 2015 response also alleged that the 2015 licence was ineffective as the application of the principle of non est factum. The particulars given were:
a)the Deed of Licence was signed by Mrs Hong Lac Mai without the knowledge or authority of Phuong Viet Mai in the office of the Applicant’s agent at Badgerys Creek;
b)Mrs Hong Lac Mai who is 60 years old does not read or speak English except with difficulty signed the document when she went to pay the rent at the Applicant’s agent’s office;
c)Mrs Hong Lac Mai did not know or appreciate what the nature or character of the document was that she was signing, did not read or seek advice on same, but simply signed the document when Mrs Kennison said to her at the agency office and presented it to her at the time of signing ‘Lac, you have to sign this’.
It was submitted in the alternative, that the document was signed under economic duress or in circumstances that “are unconscionable under the Australian Consumer Law”. No particulars were given of those two assertions.
In written submissions filed by counsel for the respondent on 14 June 2016, it was contended that the Mai family’s rights were protected in equity and referred to a number of reported cases, none of which involved factual circumstances similar to those in the present case. In his oral submissions, counsel for the respondent argued that, whatever happened on the surface, the Mai family were given assurances of two kinds but only mentioned one, namely, that they could remain in possession.
Counsel for the respondent said in oral submissions that the fact that a company was established in 2009 for tax purposes emphasised that point. He argued that the company was not there to be an occupier of the land, but rather, the enterprise through which the business was conducted. He emphasised the fact that the rent was paid by the Mai family. He later appeared to qualify that assertion in a submission that the Commonwealth was estopped from terminating the licence until the airport was built. On that basis of that assurance, it was argued, the Mai family had made significant improvements to the land.
In written submissions filed on 8 July 2016, after the hearing, counsel for the respondent first relied on what he called an acknowledgment by the Commonwealth before the court that there was an implied licence after the term of the 2015 licence ended on 22 September 2015. That assertion can be dealt with simply. Counsel for the Commonwealth did refer to an implied licence in his opening but only in respect of the period after the end of the 2009 licence and up to the commencement of the 2015 licence.
The second part in the written submissions was that there was no relevant circumstance under the 2015 licence to justify its termination. Again, this can be dealt with briefly: the 2015 licence ended on 22 September 2015. The termination clause relied on by the respondent (cl.6.1.1) would, if applicable, have entitled an earlier termination but did not otherwise affect the termination date of 22 September 2015. The point is irrelevant.
The third point in those written submissions was that one of the Commonwealth’s witnesses acknowledged that the licence was non-exclusive. This, it was argued, was consistent with the respondent’s case that there was an informal arrangement “giving rise to a personal equity in the nature of a contractual licence or an interest by estoppel [or an informal agreement for a restrictive covenant in equity …]”. The submission acknowledged that “the arrangement on the evidence is not specifically that pleaded” but asserted that that was a basis for the court to refuse to act on the evidence.
Next, the submission stated that the documents produced by the Commonwealth under notice to produce tend to support the position of the respondent of the underlying oral arrangement referred to by Mr and Mrs Mai in oral evidence. The documents produced by the Commonwealth on 20 May 2016 were all tendered by the applicant in a large, uncollated bundle held together with a rubber band. Given the time it would have wasted going through each document to ascertain the admissibility of each document in the bundle, I admitted the bundle into evidence on the express basis that I would not refer to any document to which my attention was not drawn. The respondent has not drawn my attention to any document in the bundle and therefore I have not had regard to those documents.
The Commonwealth, by contrast, had extracted a number of documents from the documents it had produced under notice to produce. Those documents were contained behind tab “F” in the tender bundle (exhibit A). I have had regard to those documents. As will be seen, those documents do not support the existence of any underlying oral arrangement. Indeed, they are inconsistent with it.
Finally, (with the exception of a constitutional argument) the respondent’s further written submission filed on 8 July 2016 asserted that the “elements of economic duress and/or non est factum are also both established” by the evidence of Mrs Mai that between 1990 to 1994, and at later times, she signed the licences without any belief in its nature or character. It was asserted that she said:
I would have signed any document to keep going – to protect our business.
and
I don’t know what I signed it for.
The respondent relied on the evidence of the Mai family including Mr and Mrs Mai and Viet Phuoc.
In purported compliance with orders for the filing of affidavits, the respondent filed three documents. The first was described as the “Affidavit of Hong Lac Mai”. That document was in English even though, at [14], the document stated that Mrs Mai does not read English and only speaks it with difficulty. The document was signed, and asserted that it was sworn on 21 December 2015 before Mark Wilson, a Justice of the Peace, at Sydney.
Rule 15.27(2) of the Federal Circuit Court Rules 2001 (Cth) (“FCCA Rules”) provides:
(2)If the person making an affidavit does not have an adequate command of English:
(a)a translation of the affidavit and oath or affirmation must be read or given in writing to the person in a language that the person understands; and
(b)the translator must certify in or below the jurat that he or she has done so.
There was no certificate on the document as required by r.15.27(2).
Rule 15.27(3) provides relevantly, that, if an affidavit is made by a person who is incapable of reading it and a certificate under r.15.27(2) does not appear on the affidavit, it may not be used in a proceeding unless the Court is satisfied that a translation was read or given in writing to the person and the person seemed to understand the affidavit.
The respondent also filed a document entitled “Affidavit of Viet Phuong Mai”. Paragraph [2] of that affidavit stated:
I do not read nor speak English. This affidavit was translated and read to me in Vietnamese before I signed it.
The second sentence was inadmissible and rejected. In any event, not only was there no certificate required by r.15.27(2) of the FCCA Rules, but the document was not signed.
Given that the respondent’s case turned almost entirely on assurances said to have been given to Mr and Mrs Mai, any competent lawyer exercising reasonable care would have at least attempted to ensure that evidence of those assurances was admissible. It seems obvious that the respondent’s lawyers took no such care, if any.
In those extraordinary circumstances it appeared to me that the incompetence of the respondent’s lawyers might have led to some injustice. It is, as French CJ recently reiterated, the final and paramount purpose of the federal judicial power “to do justice”: Alqudsi v R (2016) 90 ALJR 711; [2016] HCA 24 at [1]. Although a litigant is ordinarily bound by the way in which a trial is contested by its lawyers, there is a point at which that conduct might result in a miscarriage of justice: R v Birks (1990) 19 NSWLR 677 at 685 (Gleeson CJ). The point cannot, and perhaps should not, readily be defined.
I have not concluded that it was reached here; however, in an effort to avoid any resultant injustice, I took the unorthodox approach of having the court-appointed interpreter translate the document to each of Mr and Mrs Mai. Once that was done, I was satisfied that they both understood the contents of the documents and so allowed them to be used in evidence.
The respondent also relied on the affidavit of Viet Phuoc Mai.
Affidavit of Mrs Mai
In her affidavit, Mrs Mai stated that she and her husband had received a letter from the Minister for Aviation in 1986 to the effect that the Government wanted to take their land. The letter was annexed to the affidavit. After referring to the proposed acquisition of the land, the letter stated:
…
After the Commonwealth has bought the land, you may lease it back until it is needed for construction of the airport, if that is your wish. You could therefore buy another property, or invest the money you will get from the Commonwealth, while continuing to live here. Alternatively, you could simply continue your current activities. You can negotiate the sale of your property to the Commonwealth any time up until the stage where the land is actually required for development.
…
Mrs Mai did not give evidence that she relied on this letter in any way. Her evidence was that she and her husband were very upset by it. However, this letter is important in one respect. That is, it made it plain that the Commonwealth was going to be the owner of the property and any future occupation of the property by Mrs Mai was limited. At the most, any occupation would cease when the land was required for development.
Mrs Mai’s evidence was that they were told by a Mr Turnell in 1989 that the land had been resumed and that he said the following:
…
The Government is taking your ownership of this land. You must sign this. Once you do you will then have the lease of the property. We will pay you 90% of the value of what you have lost and we will then negotiate the remainder of the compensation for your loss.
…
Mrs Mai said that there was no interpreter at the time or a lawyer. She said that Mr Turnell then said:
…
The Government agrees to lease the land back to you so you will not be disadvantaged. You and your husband will have ongoing exclusive possession of the land and may may continue to work and improve the land as if owners and just as you have done to date as owners. You will not lose if you continue to work hard. Noone else will be able to use or occupy the land with you.
(Errors in original)
I find that these words were never spoken by anyone on behalf of the Commonwealth. I will explain why later in these reasons.
Mrs Mai’s affidavit then stated that she signed the document given to her by Mr Turnell on the faith of what he had said, went on to negotiate the terms of compensation and continued to work and improve the land. The document referred to was never identified by Mrs Mai. I will assume, in the respondent’s favour, that it was a licence agreement. However, I find that there was no reliance on anything said by Mr Turnell and nobody even understood, or acted on the basis that, the Mai’s had an unrestricted, perpetual right of tenure or any leasehold interest at all. Further, even if they did, any such interest came to an end in 2009 when the respondent was granted a licence over the land. Once again, I will explain my reason for these conclusions later in these reasons.
Even if those words had been spoken by Mr Turnell, I am not satisfied that they were sufficiently clear to have formed the basis of an estoppel: Legione v Hateley (1983) 152 CLR 406 at 435; [1983] HCA 11, Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 90 ALJR 770; [2016] HCA 26 at [35]. The words “as if owners” qualified the right of the Mai’s to work and improve the land and did not clearly import any notion of permanent occupation. Given the context provided by the 1986 letter, the meaning of the words reportedly used by Mr Turnell could only be understood to have referred to a temporary right to occupy and work the land. That, as will be seen, is exactly what Mr Mai, and by inference, Mrs Mai understood.
Finally, Mrs Mai’s affidavit referred to the 2015 licence. In this respect she said:
…when I signed this document I was unaware of the nature of the document or that it was a licence or that the Commonwealth could dispossess my husband and I or the company from the land at any time. I signed the document in the belief it was a further lease of the land and was a document giving effect to the continuing arrangement my husband and I had with the Commonwealth since our conversation with Mr Turnell after it took our land in 1989.
I reject this evidence and find that Mrs Mai knew exactly what the 2015 licence meant and that she signed it in order to have further time to vacate the property and to relocate the respondent’s business.
Affidavit of Mr Mai
Mr Mai’s affidavit was almost identical to that of Mrs Mai. In some cases it was clear that the latter had been simply copied and pasted into the former. For example, when referring to the 1986 letter (see [61] above) Mr Mai’s affidavit states “my husband and I were very upset …”.
The bulk of this affidavit was, in any event, inadmissible and rejected. All that remained was, relevantly, that he and his wife started paying rent in 1989, that the respondent is a service company that operates its business from the land, Viet Phuoc helps in the business and Mr Mai was unaware that Mrs Mai had signed any documents that would have the result of them having the farm “as I consider we are tenants, and that we have rights to our property on the farm as we have continued to build up the value in the farm since 1989”.
None of that evidence assists the respondent. The fact that Mr Mai referred to the payment of “rent” rather than “licence fee” says nothing about the true character of the payment or the rights that were granted in return for such payment. Similarly, adding the tag “service company” to the respondent says nothing about the identity of the parties to the 2015 licence or the existence of any right or relationship outside that agreement. Thirdly, Mr Mai’s understanding about the basis on which the land is occupied is, without more, insufficient to undermine the Commonwealth’s right to the relief it seeks. Without being able to ascribe that understanding to some conduct of the Commonwealth, the respondent cannot establish any unconscionability. Equity does not intervene to protect against a simple misunderstanding.
Further, the document that Mrs Mai signed did not have the result of anyone losing the land. Its effect was to extend the period within which the respondent had to vacate the property.
Affidavit of Viet Phuoc
Viet Phuoc’s affidavit also did nothing to assist the respondent. Again, neither his use of the word “rent” nor his lack of awareness about his mother signing a document having the result of them losing the farm says nothing to undermine the legal effect of the licences granted to the respondent and nothing to support the existence of any personal equity concerning the land.
The oral evidence for the respondent
Each of the respondent’s witnesses gave oral evidence at the hearing.
Mrs Mai was asked a number of questions in cross-examination about her affidavit. Her evidence was that when she signed it only a Mrs Fung was present and she did not remember the name Mr Wilson (the person who purports to have witnessed her signature).
When Mrs Mai was asked about the document she signed in 1989, she said, referring to Mr Turnell:
…
He asked me to declare whatever put on the document and I did it. I didn’t understand anything else because my husband, he didn’t know English. Only a little bit he know. (T48.33)[3].
…
and
…
He asked me just to sign this document and in the future … to go to court, you still have the 10 per cent. (T48.40).
Mrs Mai was then asked when she signed the document. She replied:
[3] Pinpoint reference to the transcript of the hearing before the Court on 22 June 2016.
…
I can’t remember. I will remember there was a Mr Turnell and … solicitor. (T48.46).
…
Mrs Mai was then shown a Deed of Discharge, Release and Indemnity dated 9 August 1990 (which would have corresponded to her answer above), but she neither confirmed nor denied that that was the document she was referring to. This passage of evidence undermines her affidavit in a number of ways.
First, contrary to her affidavit, Mrs Mai said that a lawyer was present when she signed the document. She had in fact engaged lawyers in connection with both the resumption and licences from 1986. It makes sense that a lawyer was present when she signed an important document relating to the land and I find that there was one and that the lawyer was representing Mrs Mai.
Secondly, Mrs Mai’s recollection of the events was poor. That is to be expected after the elapse of close to 30 years. This undermines her ability to recollect the conversation with Mr Turnell in any detail. Further, her recollection of that conversation in the witness box was limited to compensation and contained nothing about a lease or quasi-ownership.
Later, Mrs Mai was asked about the licences that she had signed. She said that her solicitor “just helped [her] to get a licence to lease the land and just keep working on the land” (T51.36) and that she signed the licences because she wanted to “stay and keep on working on the land” (T52.21). This evidence is inconsistent with any assertion that Mrs Mai either did not know what she was signing or completely misunderstood the documents she signed.
It shows that Mrs Mai received legal advice about the effect of the document and knew that, absent the rights to be granted by the licences, she and her family could no longer remain on the land (which, at that stage, comprised only of Lot 44 Longleys Road, Badgerys Creek).
Mrs Mai was also cross-examined about the incorporation of the respondent and the execution of the 2015 licence. She said that the respondent was incorporated on advice so that claims could be made (which I infer were claims for deductions against assessable income).
Her evidence about the reason for signing the 2015 licence was not consistent. She was asked that the reason she signed the licence was so she did not have to leave the property. Her reply was:
I didn’t think so. I was informed about the property a long time ago and what I thought of was how do I move. (T60.41).
She was asked a similar question shortly after and her reply was:
I can’t remember. I only ask for how could I move in three months or six months. (T61.25).
Finally, though, she appears to have accepted the proposition put to her (T61.25):
Mr Doyle:Right. Sorry, to understand that answer – all you understood was that the purpose of this document was to say whether you should move in six months or three months. Is that correct?
Interpreter: I think so but at that time my son was also at company with me. We met – a lady came from Canberra and another … I can’t remember the name. Explain.
It will be recalled that the offer of the 2015 licence was made in response to a request from the respondent for more time to vacate the property: see [29] above. This is what Mrs Mai appears to be referring to in this passage of evidence.
She agreed that she had received a copy of the licence in the mail. When she was asked about the effect of that document she said:
And after that Mrs Wendy call me and she said as she had explained that my licence for the 3 months. (T63.1).
…
I told her that I could not move in time and she said that is okay. I will give you extra time.
This evidence makes it plain that Mrs Mai understood that the 2015 licence was intended only to give further time to the respondent to vacate the property.
Mrs Mai was finally taken to [9] of her affidavit which refers to what was said by Mr Turnell in 1989 and is set out at [64] above. When it was suggested to her that she did not in fact remember what was recorded in that paragraph, she replied:
Remember that in 1989 I signed the document and I paid the rent. That is it. (T64.37).
I accept that that answer was a truthful statement about the extent of Mrs Mai’s recollection of what occurred with Mr Turnell in 1989.
Given the numerous difficulties with her affidavit, I do not accept what is recorded in it in that respect. That conversation was the only basis for the respondent’s argument that there was some personal equity or unconscionable conduct that might affect the Commonwealth’s right to the relief it seeks. I am not satisfied that the conversation took place as alleged or that any assurance was given that might have given rise to the understanding now relied on by the respondent and the Mai family. That is not only because there is simply no evidence of it, but because it is entirely inconsistent with the fact that the Mai family, while legally represented, engaged in lengthy negotiations with the Commonwealth concerning the land and not once was there any mention of any assurance of any sort given by the Commonwealth.
Further, the fact that Mrs Mai entered into a series of licence agreements, again with legal advice, a number of which were the subject of negotiations, is inconsistent with any understanding of any long-term right of occupation. In short, both parties acted on the basis that the land was owned by the Commonwealth and that the Mai family (and subsequently the respondent) could continue to operate a market garden on the land until the Commonwealth decided it needed the land for the construction of an airport in the area. Mrs Mai understood that the 2015 licence was merely to allow further time for the property to be vacated. The principle of non est factum has no operation in those circumstances.
These conclusions are fortified by the oral evidence of Mr Mai and Viet Phuoc.
Mr Mai’s evidence was that he understood that the land was resumed by the Commonwealth and that his family may have to move out. Importantly, he said in cross-examination that the reason they did not move was that they did not have enough money. Not only is that consistent with the position taken by the Mai family in negotiations for compensation, but it is entirely inconsistent with any understanding that there was any long term right of tenure or even any expectation of such a right.
Mr Mai said that he was only farming the land temporarily and agreed that there was no right to stay on the property indefinitely. When he was asked about the letter he signed in December 1992 (contained in exhibit A, outlined at [18] above), he agreed that, at the time, he did not know how long they could stay on the land and, in fact, that they might have to move out at any time, if asked by the Commonwealth (T95.38). He also agreed that, between 1986 and 1995 he had obtained extensive legal advice from firms instructed by his family in relation to both the negotiation of the land and the legal documents signed in relation to the occupation of the land (T97.35).
Viet Phuoc gave evidence that, as a general proposition, he would translate letters for his mother and, if necessary, she would get advice from a solicitor or lawyer. He also agreed that, at one point, he was the licensee of one of the lots and that the licence agreement was the source of the right to occupy the property and that that right ended with the term of the licence.
Viet Phuoc was asked about the letter from the Commonwealth in June 2015 offering a further document to extend the right to stay on the property for a further 3 months. He replied that he recalled that letter and that there was a discussion in the family to the effect of which was that, if they were to stay for another three months, they would have to sign the document.
Conclusion
The evidence, taken as a whole, simply does not support the respondent’s arguments. Mr and Mrs Mai operated a market garden on 240 Longleys Road, and later on both Lot 43 and 240 Longleys Road (Lot 44), until 2009. The Commonwealth owned both lots, having acquired Lot 44 from Mrs Mai and Thi Ly Phan and Lot 43 from its previous owners. From 2009, the market garden business was operated by the respondent which occupied the land pursuant to a licence granted to it by the Commonwealth. Finally, in order to afford the respondent further time to leave the land, the Commonwealth granted a licence for a further three months that terminated on 22 September 2015.
In those circumstances the Commonwealth is entitled to the relief it seeks and there will be orders in accordance with those sought in the application.
I certify that the preceding ninety-nine (99) paragraphs are a true copy of the reasons for judgment of Judge Smith
Date: 2 September 2016
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