Cooper v Moloney (No 3) - [2012] SASC 153

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
COOPER v MOLONEY & ORS (No 3)
[2012] SASC 153
Reasons of Judge Lunn a Master of the Supreme Court
3 September 2012
PROCEDURE
Action pleading the facts for a worker's lien under the Worker's Liens Act 1893, but, contrary to 6R 99(1)(d), not seeking an order for the enforcement of the lien - whether under 6R 223 the Court could still order its enforcement - defendant applied under s 16 of the Act for Registrar-General to note cessation of the lien - plaintiff applied for interlocutory injunction to prevent the Registrar-General from noting the cessation and to amend his prayer for relief to claim enforcement of the lien - amendment allowed but question of its retrospective effect reserved to the trial Judge - application for injunction adjourned for further consideration of the balance of convenience and whether an adequate undertaking as to damages could be given by the plaintiff.

COOPER v MOLONEY & ORS (No 3)
[2012] SASC 153
JUDGE LUNN:
Reasons on plaintiff’s application to amend to seek enforcement of workers’ liens
Definitions

In these reasons:
“the plaintiff” is Richard Cooper;
“the first defendant” is Brendan Moloney;
“the second defendant” is Brian Moloney, now deceased. (He was the father of the first defendant);
“Hampden” is the third defendant, Hampden Park Pty Ltd. (It was controlled by the first and second defendants);
“Gortmore” is the fourth defendant, Gortmore Proprietors, and was a partnership comprised of the first, second and fifth defendants;
“the fifth defendant” is Helen Moloney, former wife of the first defendant;
“the Moloney farm” comprised of three parcels of land which were respectively owned by the first defendant, the second defendant and Hampden. Gortmore conducted a farming business on that land;
“the WLA” is the Worker’s Liens Act 1893.
Background
In the Statement of Claim the plaintiff alleges that he entered into oral contracts:
(1)On 28 December 2009 with Gortmore to perform the transportation and repair of farm machinery used by Gortmore (“the first contract”);
(2)On 1 February 2010 with Gortmore or the first defendant, the second defendant and/or Hampden to perform various tasks on the Moloney farm (“the second contract”);
(3)In or about December 2010 with Gortmore to harvest crops on the Moloney farm.
Initially he claimed a total of $659,728[1] for the work done under those three contracts.
[1] All sums of money in these Reasons are stated only in terms of dollars and ignore any additional cents.
On about 3 February 2011 the plaintiff alleges that he entered into an oral agreement with Gortmore (“the payment agreement”) for the periodic payment of monies owed to him by Gortmore and interest on them.
The defendants have not made the payments alleged to be due to the plaintiff and he now claims a total of $727,921. On 31 October 2011 he sent notices of demand under s 10(2) of the WLA to each of the first and second defendants and Hampden for the amounts allegedly due to him for work done on their respective lands under the first, second and third contracts. In the notice of demand to the first defendant he claimed $49,490.13 for lienable work done on his land. In the notice to Hampden he claimed $235,730.55 for lienable work done on its land. The defendants did not pay under those notices of demand.
On 31 October 2011 the plaintiff lodged workers liens over the titles of the lands of the first and second defendants and Hampden. On 11 November 2011 the plaintiff commenced this action pleading the matters set out above. In the prayer for relief he only sought judgment for $727,921 plus interest and costs, but he did not expressly seek an order for the enforcement of the liens.
Requests for notices of cessation
Sections 15 to 18 of the WLA provide:
15—Liens to cease in certain events
Every lien under this Act upon the estate or interest of any owner or occupier shall cease unless an action shall be brought against the owner or occupier for enforcement of the lien within fourteen days from the registration thereof.
16—Satisfaction of lien to be recorded
The Registrar-General upon payment of the prescribed fee and proof to his satisfaction that any person who has registered a lien has failed in an action to enforce the same, or that no such action has been brought by him against the owner or occupier within fourteen days from registration or having been so brought has been discontinued without an order of the court giving further time to bring a fresh action to enforce the lien, which order the court is empowered to make, or that any claim made or judgment obtained against the owner or occupier has been satisfied by payment or otherwise, or in any case where the owner or occupier shall have deposited with the Registrar-General the amount claimed in respect of the lien, either in discharge of such lien or to abide the event of an action to enforce the same, or to recover the amount so deposited, shall make on the proper folium of the Register Book if the lien is registered there or otherwise on the notice of lien a memorandum that the lien has ceased, and upon such entry the lands affected by such notice shall be discharged from the lien.
17—Proceedings to compel Registrar-General to record lien in event of refusal
If the Registrar-General shall refuse to make the memorandum that any lien has ceased, the owner or occupier may apply to a judge of the Supreme Court or District Court or a magistrate in a summary manner to direct the Registrar-General to make such memorandum, and notice of such application shall be given by posting the same in a registered letter two clear days at least before such application shall be heard to the person who has given the notice of the lien to his address mentioned in such notice, and he shall be entitled to be heard on the application.
18—Judge or magistrate may make order
Upon the hearing of such application the judge or magistrate may make such order in respect thereof as shall be just and the Registrar-General shall obey such order, and the costs of and incidental to such application shall be in the discretion of the judge or magistrate.
By notices dated 30 July 2012 the first defendant and Hampden each requested the Registrar-General under s 16 of the WLA to note the cessation of the plaintiff’s liens lodged on their respective properties on the ground that the plaintiff had not brought an action to enforce those liens as required by s 15 of the WLA.[2] On 13 August 2012 the plaintiff issued an interlocutory application (FDN24) seeking, inter alia, that the Registrar-General be injuncted from noting on the titles to the land of the first defendant and of Hampden that the plaintiff’s liens had ceased. This application has been opposed by the first defendant and Hampden. The Registrar-General has indicated to the Court that he will abide by any order of the Court on the matter. I have made interim orders restraining the Registrar-General from noting the cessation of the liens in question until further order while I determine FDN24.
[2] No similar application has been made by the second defendant, who has died since the commencement of this action.
The plaintiff’s application to amend
In the course of pursuing FDN24 the plaintiff has made an oral application to amend his Statement of Claim to include in the prayer for relief a new sub‑paragraph (1a) to the effect that the liens claimed by him under the WLA be enforced against the land of each of the first and second defendants and Hampden. He further seeks that such an amendment be retrospective in its operation to the commencement of the action. If that amendment is allowed with retrospective effect, it would apparently mean that the plaintiff had satisfied s 15 of the WLA and the first defendant and Hampden would have no grounds to seek any cessation of the liens against them being noted on the titles. The first defendant and Hampden opposed the amendment and, if it is to be allowed, opposed it having any retrospective effect.
Has an action been commenced to enforce the liens?
6R 99 provides:
(1)     A Statement of Claim –
…
(d)     must state any remedy for which a plaintiff asks …
This was not done through the inadvertence of the plaintiff’s solicitor. The plaintiff’s counsel conceded in his outline of argument that the Statement of Claim did not seek an order for the enforcement of the liens. However, as I pointed out in the course of argument, this is not necessarily the case. 6R 223 provides:
223The Court may, in an appropriate case, give judgment for a form of relief that differs from the kind of relief sought by the plaintiff.[3]
[3]    The cases on where similar Rules have been used are noted in Civil Procedure South Australia Volume 1 [6R 223.15]
If the Statement of Claim has pleaded material facts for the enforcement of a lien, it is within the discretion of the trial Judge to make an order under the WLA for the enforcement of the lien, even though the plaintiff had not complied with 6R 99(1)(d). All the pleading in the Statement of Claim about the notices of liens and their registration would be superfluous unless the plaintiff was pursuing such a remedy. However, the plaintiff’s counsel indicated that he still wished to pursue his application to amend.
The pleading of claims to enforce the liens
There are two distinct issues on this topic. The first is whether the plaintiff has satisfied the requirements of the WLA for him to have some lien over the land of a defendant. The second issue is, if the prerequisites for a lien have been established, for what amount is that lien to be enforced. Much of the defendants’ opposition to FDN24 went to this second question, but it is only of marginal relevance to what I have to decide. If the plaintiff properly pleads a case for the enforcement of a lien, even if it is only valid for one dollar, although the notice of lien may claim much more, the Registrar-General would not be entitled under s 16 of the WLA to note a cessation of that lien. The defendants’ counsel sought to show on the documents that the plaintiff could not have a lien for much, and possibly most, of the monies claimed in the notices of lien, but that does not mean that there is not some arguable case for there being some enforceable lien. The defendants’ arguments about an abuse of process do not go far enough to show that there could not be any lien at all over the land of either the first defendant or of Hampden. Hence, those issues need not be further explored by me on FDN24.
Whether the action was commenced too late in any event?
I do not accept the defendants’ contention that a letter of 5 July 2011 from the plaintiff to the fifth defendant was clearly a notice of demand under the WLA and thus under s 10(1) of the WLA the liens had to be registered by 9 August 2011, which did not occur. That letter of 5 July 2011 does not purport on its face to be a notice of demand under s 10(2) of the WLA. It is equivocal as to whether it is a demand for payment of money. It will be an issue for the trial Judge whether the operative notices of demand under s 10(2) of the WLA were the notices of 31 October, as pleaded by the plaintiff, or was the earlier letter of 5 July 2011. The issue is not so clear-cut that I can properly refuse an interlocutory injunction on the basis that there is no reasonable prospect that the plaintiff could now enforce the liens.
Whether work was done on the land?
Again, this point goes to the issue of the quantum of the liens. It may be that further particularity will be required from the plaintiff identifying what work was done on what land, but on both the pleadings and the documents put in evidence, it is reasonably arguable that he has done some work on the land of each of the first defendant and Hampden which could be the subject of a lien under the WLA.
Effect of the payment agreement
I do not accept the defendants’ contention that any entitlement of the plaintiff to payment for work under the first, second or third contracts for work done on the land of either the first defendant or Hampden ceased to have that character by virtue of the payment agreement, and thus the amounts now claimed by the plaintiff were not for work done on land, as required by the WLA, but were under a payment agreement. The plaintiff has a reasonable case that the amounts claimed are for work done on land. The issue will need to be resolved by the trial Judge.
Retrospective effect of any amendment
There is no good reason why I should refuse permission to amend to add the new paragraph (1a). Its omission resulted from an inadvertent error by the plaintiff’s solicitor, presumably partly attributable to the haste in which the pleading needed to be prepared to ensure compliance with s 15 of the WLA. The contentious issue is whether the amendment should be allowed to have retrospective effect.[4] If the trial Judge does not exercise his or her discretion under 6R 223 in favour of the plaintiff, the defendants will suffer significant prejudice if the amendment is given retrospective effect. Although the plaintiff’s counsel did not seek to make any other amendments to the Statement of Claim, it is likely that other amendments will be needed, or at least further particularity. The person who will be best able to exercise the discretion as to whether the amendments should be made retrospective will be the trial Judge and I consider the question should be left to him or her.
[4] See Brook v Flinders University of South Australia (1988) 47 SASR 119; Mullett v Gabriel (1989) 52 SASR 330.
Balance of convenience and undertaking as to damages
On the evidence before me I am prepared to find that the plaintiff has made out the necessary prima facie case for an injunction until trial restraining the Registrar-General from registering the cessations of the two liens in question. However, whether such an interlocutory injunction should now be granted depends upon whether it is consistent with the balance of convenience and whether a sufficient undertaking as to damages is to be given in support of it. The question of the balance of convenience has not been addressed. In particular, there is no evidence about what, if any, prejudice the first defendant and Hampden may suffer if they are restricted in dealings with their land until trial because of the plaintiff’s liens on their titles. The plaintiff is an undischarged bankrupt. I have already indicated that an undertaking for damages in the usual terms from him alone will not be acceptable for an extended interlocutory injunction. What further undertakings, and/or security for damages, should be required will depend in part upon what is the potential damage which may be suffered by the first defendant and Hampden from the continuation of the injunction if it is ultimately held that the plaintiff was not entitled to it. I will hear the parties on these issues on Wednesday 12 September 2012 at 9.30am.