Coolart Holdings Pty Ltd v Australian Securities and Investments Commission
[2018] WASC 264
•24 AUGUST 2018
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: COOLART HOLDINGS PTY LTD -v- AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION [2018] WASC 264
CORAM: ARCHER J
HEARD: 24 AUGUST 2018
DELIVERED : 24 AUGUST 2018
FILE NO/S: CIV 2272 of 2017
BETWEEN: COOLART HOLDINGS PTY LTD as trustee for THE COOLART DISCRETIONARY TRUST
Plaintiff
AND
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION
First Defendant
THE REGISTRAR OF TITLES
Second Defendant
Catchwords:
Adverse possession - Declaration sought
Legislation:
Corporations Act 2001 (Cth), s 509, s 601AD
Limitation Act 1935 (WA), s 4, s 5, s 30, s 36, s 48
Limitation Act 2005 (WA), s 4(1)
Limitation Legislation Amendment and Repeal Act 2005 (WA), s 4(2)
Transfer of Land Act 1893 (WA)
Result:
Declaration made
Category: B
Representation:
Counsel:
| Plaintiff | : | Mr J C Yeldon |
| First Defendant | : | No appearance |
| Second Defendant | : | No appearance |
Solicitors:
| Plaintiff | : | Pacer Legal |
| First Defendant | : | No appearance |
| Second Defendant | : | No appearance |
Case(s) referred to in decision(s):
Bowman v Tremaine [2016] WASC 294
Cervi v Fletcher [2011] VSC 156
Goodwin v Western Australian Sports Centre Trust [2014] WASC 138
Harris v Wongama Pty Ltd [1969] 1 NSWR 245
Mulcahy v Curramore Pty Ltd [1974] 2 NSWLR 464
Payne v Dwyer [2013] WASC 271
Re Johnson [2000] 2 Qd R 502
Whittlesea City Council v Abbatangelo [2009] VSCA 188
ARCHER J: (This judgment was delivered extemporaneously and has been edited from the transcript, with references added.)
Introduction
Coolart Farm is in Walebing in the Wheatbelt region of Western Australia.
The farm land comprises approximately 5225 acres. Within that area is Melbourne Location 229 (Lot 229), which comprises about 40.36 acres. Lot 229 was alienated by crown grant in 1874, prior to the operation of the Transfer of Land Act 1893 (WA). Lot 229 has not been made subject to the provisions of the Transfer of Land Act.
The balance of the farm land is Torrens land. Since 1972, Glasfurd Holdings Pty Ltd (Glasfurd Holdings) has been the registered owner of the Torrens land.
Coolart Farm has been farmed by the plaintiff since 1997. In 2017, the plaintiff discovered that Lot 229 was not Torrens land and had not been transferred to Glasfurd Holdings.
The plaintiff seeks a declaration that it is the owner of the land on the basis of adverse possession.
Before dealing with the issues, I will set out the relevant facts.
Facts
Coolart Farm has been in the Glasfurd family for generations. It was purchased by Duncan Glasfurd and Divie Colin Glasfurd in 1928.
Since that time to now, it has been continuously farmed by various members of the Glasfurd family, more recently through corporate entities.[1]
[1] Affidavit of Jane Elizabeth Glasfurd sworn 27 July 2018 (JGA) [20] ‑ [21].
On 10 August 1959, a Mr Duncan Glasfurd sold the Torrens land to Dambagee Pastoral Co Pty Ltd (Dambagee). I have not been told the identity of the officers of Dambagee at that time. However, from at least 1977 to 2006, the officers of Dambagee were members of the Glasfurd family.
On the same date, 10 August 1959, an indenture was made between Duncan Glasfurd and Dambagee to record their agreement that, in effect, Lot 229 was to be included in the sale of the Torrens land and a memorial was to be registered of the indenture. The memorial was lodged, and accepted, on 5 February 1960.[2] There are no other documents registered with Landgate for Lot 229. The chain of title for Lot 229 stops as at the date the Memorial was registered.
[2] JGA page 121.
In late 1971 an agreement was executed to transfer the land from Dambagee to Glasfurd Holdings. On 13 June 1972, the Torrens land was registered in the name of Glasfurd Holdings.
Glasfurd Holdings is a land holding entity and has never conducted farming operations in its own right.[3] There is no evidence as to why Lot 229 was not included in this transfer. In view of the fact that Lot 229 is contained within the Torrens land, it seems likely that this was an oversight. However, it is unnecessary to reach a conclusion about this.
[3] Affidavit of David Angus Glasfurd sworn 21 July 2018 (DGA) [9].
Kalinga Nominees (Kalinga) was registered in 1977. Since its registration, at least one of its directors has been a member of the Glasfurd family. A Mr Jamie Glasfurd has been a director of Kalinga since 1980. A Mr David Glasfurd has been a director since 1993.
From 1977 to 1997, Kalinga, as trustee for the Coolart Trust, farmed the Coolart Farm. During that period, Kalinga exercised exclusive use and control of the whole of Coolart Farm. Kalinga used Lot 229 for sheep grazing, maintained it and paid all outgoings.
Throughout the period Kalinga farmed the Coolart Farm, members of the Glasfurd family controlled the operations. From 1990, Jamie and David Glasfurd took over the control of the operations from their parents. They continued to control the operations, with their wives, until 1996.
In 1996, David Glasfurd and his wife left Coolart Farm to farm elsewhere.[4] Jamie Glasfurd and his wife Jane Glasfurd continued to farm Coolart Farm.
[4] DGA [23].
In 1997, the plaintiff was registered and named trustee of the Coolart Discretionary Trust (Trust). Since that time, Jamie Glasfurd and his wife Jane Glasfurd have farmed Coolart Farm through the plaintiff. From that time to the present, the plaintiff has exercised exclusive use and control of the whole of Coolart Farm. The plaintiff treated Coolart Farm as it if was its own, including Lot 229. The plaintiff used Lot 229 for sheep grazing, maintained it, erected further improvements and paid all outgoings.
Dambagee was deregistered under s 509 of the Corporations Act 2001 (Cth) on 18 November 2006. The appointed liquidators of Dambagee are now deceased. One of the liquidators, a Mr Trinnick, signed and lodged a typewritten Form 523 'Notification of final meeting convened by liquidator' under s 509(3) and (4) of the Corporations Act. Annexure A to that form distributed 'all of the surplus assets of the said company as set out in the schedule hereto' on 17 July 2006. Lot 229 was not in that schedule. It is likely that the liquidators did not discover Dambagee's ownership of Lot 229 during the liquidation of the company.
As a result of Dambagee's deregistration, all of its property vested in the Australian Securities and Investment Commission (ASIC).[5]
[5] Section 601AD of the Corporations Act 2001 (Cth).
In 2017, Jamie and Jane Glasfurd wanted to move the banking of the Trust from the Rural Bank to the Commonwealth Bank. The Commonwealth Bank advised them that Lot 229 was an old system title. Further inquiries revealed that Lot 229 had not been transferred to Glasfurd Holding when the Torrens land was transferred (or at any other time).
Later the same year, the plaintiff brought an action claiming it had been in adverse possession of the land for over 12 years, extinguishing the title of Dambagee and ASIC.
The plaintiff brought its action against ASIC and subsequently joined the Registrar of Titles as second defendant.
ASIC has advised the court that it does not intend to assert, exercise, enforce or waive any rights Dambagee may have. ASIC has said it does not oppose any order sought by the plaintiff and that it will abide by any orders made by the court on the usual provisos.
The Registrar of Titles has advised the court that she will abide by any orders made by the court on the usual provisos.
Was Dambagee's title extinguished?
The Limitation Act 1935 (WA)
Subject to exceptions not relevant here, the Limitation Act 1935 (WA) continues to apply to causes of action that accrued prior to the commencement day of the Limitation Act 2005 (WA),[6] and the latter Act does not apply.[7]
[6] Limitation Legislation Amendment and Repeal Act 2005 (WA), s 4(2).
[7] Section 4(1) of the Limitation Act 2005.
Under s 30 of the Limitation Act 1935, a title to land will be extinguished by adverse possession at the end of the limitation period prescribed by that Act for bringing an action to recover land.[8]
[8] Payne v Dwyer [2013] WASC 271 [35], [37]; Bowman v Tremaine [2016] WASC 294 [36].
The limitation period is 12 years after the time to bring an action first accrued.[9]
[9] Section 4 of the Limitation Act 1935.
Relevantly to this case, s 5 of the Limitation Act provides:
the right to … bring an action to recover land … shall be deemed to have first accrued …:‑
(a)When the person claiming such land … has, in respect of the estate or interest claimed, be in possession ... and while entitled thereto has been dispossessed, or has discontinued such possession … then such right shall be deemed to have first accrued at the time of such dispossession or discontinuance of possession … .
…
For the purposes of this section, the right to … bring an action to recover any land, has not and shall not be deemed to have first accrued to any person in any case, whether or not such person has been in possession … until such land is in the actual possession of some person not entitled to such possession, and any land not in the actual possession of any person shall be deemed to be in the possession of the person entitled to such possession.
In the absence of evidence to the contrary, the registered proprietors of land are deemed to be in possession of the land and, prima facie, the persons with the right to possession.[10]
[10] Bowman v Tremaine [30]; Whittlesea City Council v Abbatangelo [2009] VSCA 188 [5].
Dispossession is where a person goes on to the land of another, effectively driving others from possession. Discontinuance is where a person voluntarily goes out of possession, effectively abandoning possession, and another assumes possession in their place.[11]
[11] Harris v Wongama Pty Ltd [1969] 1 NSWR 245, 248; cited by Allanson J in Bowman [34].
In Payne v Dwyer,[12] Pritchard J explained:
In order to attribute possession of land to a person who has no paper title to it, s 5 requires that that person be in 'actual possession'. That requires that the person have both factual possession and the requisite intention to possess (the animus possidendi). Factual possession requires physical custody and control. As for the intention to possess, it is the intention of the person in possession which is in issue, not that of the actual owner of the paper title. There need not be a conscious intention to exclude the true owner. Instead, what is required is an intention to exercise exclusive control on one's own behalf and for one's own benefit. The question is whether a person has dispossessed the owner by going into ordinary possession of the land without the consent of the owner.
[12] Payne v Dwyer [64]. See also Whittlesea [5].
Whether the paper owner realises that dispossession has taken place is irrelevant.[13]
When did Dambagee's right accrue?
[13] Cervi v Fletcher [2011] VSC 156 [16]; Whittlesea [6]; Re Johnson [2000] 2 Qd R 502, 506.
The evidence establishes that the plaintiff and its predecessors have had actual possession and an intention to exercise exclusive control on their own behalf and for their own benefit of the whole of Coolart Farm since at least 1977. The plaintiff has had actual possession and that intention since 1997.
Therefore, under the Limitation Act 1935, Dambagee's right to bring an action to recover Lot 229 was deemed to have first accrued no later than 1977.
Can a series of adverse possessors be aggregated?
Periods of adverse possession by different possessors can be aggregated for the purposes of determining when the true owner's title will be extinguished, provided there is continuous adverse possession by somebody. It is not necessary that there be a formal or informal conveyance or assignment of the inchoate possessory rights from one possessor to the next.[14]
[14] Mulcahy v Curramore Pty Ltd [1974] 2 NSWLR 464, 476 ‑ 477; Goodwin v Western Australian Sports Centre Trust [2014] WASC 138 [48] ‑ [49].
The evidence establishes that there has been continuous adverse possession since at least 1977.
Accordingly, Dambagee's title to Lot 229 was extinguished in 1999.
Which possessor acquires the interest?
Karinga effectively abandoned farming at Coolart farm when David Glasfurd and his wife moved to farm elsewhere in 1996. There was no break in adverse possession. The farm continued to be run, as it had been run since 1928, by members of the Glasfurd family.
As a result, the title in fee simple is held by the plaintiff.[15]
[15] Mulcahy (476 ‑ 477).
What is the impact of the deregistration?
As at the date of Dambagee's deregistration, 18 November 2006, all of its property vested in ASIC.[16]
[16] Section 601AD(2) of the Corporations Act 2001.
If Dambagee's title to Lot 229 had not been extinguished by that time, an interesting issue would have arisen as to whether 'the Crown' had acquired an interest in Lot 229 by virtue of the vesting of Dambagee's property in ASIC. If it had, this would have meant the plaintiff could not have acquired a possessory title to Lot 229, due to s 36 of the Limitation Act 1935.[17]
[17] See also s 48 of the Limitation Act 1935.
Section 36, titled 'No title by adverse possession against Crown' provided:
Notwithstanding any law or statute law now or heretofore in force, the right, title, or interest of the Crown to or in any land shall not be, and shall be deemed not to have been, in any way affected by reason of any possession of such land adverse to the Crown.
The plaintiff and its predecessors did not acquire an interest in Lot 229 by possession adverse to the Crown (or ASIC). The plaintiff acquired a fully matured legal estate in fee by adverse possession prior to the vesting of Dambagee's property in ASIC. By the time of Dambagee's deregistration, its title to Lot 229 had been extinguished. ASIC was not vested with any right, title, or interest in Lot 229. Section 36 of the Limitation Act 1935 does not apply.[18]
[18] See also Goodwin [79] ‑ [81].
Accordingly, the deregistration of Dambagee is not relevant.
Form of declaration
I would make a declaration in the terms sought by the plaintiff.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
CG
ASSOCIATE TO THE HONOURABLE JUSTICE ARCHER28 AUGUST 2018
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