Douglas v Nelson
[2024] VSC 116
•18 March 2024
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S ECI 2023 05559
| STEPHEN ROSS DOUGLAS and PHILLIP DOUGLAS | Applicants |
| - and - | |
| SIMON NELSON | Respondent |
| - and - | |
| KEITH CHARLES HARFFEY | Intervenor |
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JUDGE: | Quigley J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 27 February 2024 |
DATE OF JUDGMENT: | 18 March 2024 |
CASE MAY BE CITED AS: | Douglas v Nelson |
MEDIUM NEUTRAL CITATION: | [2024] VSC 116 |
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ADMINISTRATIVE LAW — Application for leave to appeal — Eviction order made by VCAT under Residential Tenancies Act1997 (Vic) to allow sale of land by Trustee in Bankruptcy — Refusal by VCAT to reopen hearing on substantive grounds — No reasonable excuse for non‑appearance — No reasonable case to argue — Trustee in Bankruptcy as legal owner — Warrant of Possession — Pre‑existing warrant issued in the Federal Court — Futility of appeal — No real prospect of success — Leave to appeal refused — Costs order against applicants and intervenor — Residential Tenancies Act 1997 (Vic) ss 322(1), 91ZZB; Victorian Civil and Administrative Tribunal Act 1998 (Vic) ss 120, 148; Bankruptcy Act 1966 (Cth) ss 58(1), 116.
PRACTICE AND PROCEDURE — Application to intervene in proceeding — Supreme Court (GeneralCivil Procedure) Rules 2015 r 9.06 — Conditional leave to intervene granted — Adverse conduct of intervening party — Cost consequences.
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APPEARANCES: | Counsel | Solicitors |
| For the Applicants | Mr Stephen Ross Douglas on his own behalf and on behalf of the second applicant | |
| For the Respondent | Mr L Freckelton of Counsel | Baker Jones, Lawyers |
| For the Intervenor | Mr Keith-charles Harffey, on his own behalf |
HER HONOUR:
By Notice of Appeal filed on 20 November 2023 the applicants, Stephen Ross Douglas and Phillip Douglas, sought leave to appeal the order made by the Victorian Civil and Administrative Tribunal (the ‘Tribunal’) on 6 November 2023 refusing their application to reopen and rehear an application in the residential tenancies jurisdiction. The application for leave is made pursuant to section 148 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) (the ‘VCAT Act’).
The substantive application before the Tribunal was one issued by the respondent, Simon Nelson, who is the registered proprietor of Lot 1, Walker Street, Koo Wee Rup (the ‘Property’). The respondent is the sole proprietor of the estate in fee simple of the Property as the Trustee in Bankruptcy of the estate of the first applicant.[1] The application was made to the Tribunal under the Residential Tenancies Act 1997 (Vic) (‘RT Act’) to obtain possession of the Property to enable its sale.
[1]Affidavit of David Alan Baker sworn 13 December 2023 (‘Baker affidavit’) [4] Exhibit DAB 1/1–2.
The applicants did not appear at the Tribunal hearing on 8 September 2023 and the Tribunal made orders granting the respondent’s application. The Tribunal directed the issue of a Warrant of Possession in the event the applicants did not vacate by 22 September 2023.
Pursuant to s 120 of the VCAT Act the applicants brought an application to reopen and rehear the Tribunal’s orders made on 8 September 2023.
On 16 November 2023 the Tribunal heard the s 120 application, dismissed it and confirmed the Tribunal’s order dated 8 September 2023.[2] It is from the 16 November 2023 orders of the Tribunal refusing the application to reopen the previous Tribunal orders that this application for leave to appeal pursuant to s 148 arises.
[2]The Tribunal also extended the time for the execution of the warrant to a date no later than 15 December 2023.
Keith‑charles Harffey (who requested that he be referred to as ‘Keith‑charles’ without title or surname) sought to be joined to the proceeding as intervenor. He asserts that he is the ‘Special’ trustee of a certain trust entity (or entities) which is the lawful owner of the Property.
The Notice of Appeal seeks to rely on two categories of questions of law. Primarily, the questions are founded in the alleged dispute as to the legal ownership of the Property and the consequent jurisdiction of the Tribunal to make any orders under the RT Act.[3] The second category relates to claims of lack of service or notice of the Tribunal proceedings.[4]
[3]Questions 2–5 in the Notice of Appeal filed 20 November 2023 (the ‘Notice of Appeal’).
[4]Questions 1 and 6 of the Notice of Appeal.
The history of the interaction between the applicants and the proposed intervenor in the respondent’s attempts to administer the first applicant’s bankrupt estate, and in particular to take possession of the Property, forms part of the background to this current proceeding.
FEDERAL CIRCUIT COURT BANKRUPTCY PROCEEDINGS
On 26 September 2019, a sequestration order was made against the first applicant in the Federal Circuit Court on the petition of the Deputy Commissioner of Taxation. The respondent was appointed Trustee in Bankruptcy of the first applicant’s estate.[5] On the making of the sequestration order, the first applicant’s interest in the subject property vested in the Trustee in Bankruptcy pursuant to ss 58(1) and 116 of the Bankruptcy Act 1966 (Cth).
[5]Douglas affidavit February 2024 [18], [20](the ‘Second Douglas affidavit’).
An application to the Federal Court by the first applicant seeking a review hearing of the matter was dismissed on or about 9 November 2020.[6]
[6]Second Douglas affidavit [35]–[39].
On 4 October 2021, the respondent was registered as the sole proprietor of the estate in fee simple of the subject property.[7]
[7]Baker affidavit [4] Exhibit DAB 1, 1–2.
On 5 July 2022, the Federal Court made an order declaring that the ‘Trustee of the Bankrupt Estate of Stephen Ross Douglas, is, as at the date of the making of this Order, entitled to take possession of all that real property situated at Lot 1, Walker Street, Koo Wee Rup, Victoria 3981’.[8]
[8]Baker affidavit [5] Exhibit DAB 1/3–4.
On 10 August 2022, the Federal Court issued a Warrant of Possession at the request of the respondent in his capacity as Trustee of the property of Stephen Ross Douglas. The sheriff was directed to recover possession of the property and cause the respondent to have possession of it.[9] The last known address of the first applicant was stated on the Warrant to be Lot 1, Walker Street, Koo Wee Rup.
[9]Baker affidavit [6] Exhibit DAB 1/5–6.
When the sheriff attempted to execute the Warrant of Possession, the first applicant produced documents said to be a lease agreement in relation to the Property. The first applicant was said to have informed the sheriff that the Property was subject to a lease and the Property was ‘Trust’ Property. The first applicant claimed to be entitled to occupy the Property as ‘Executive Manager’ of the ‘Non‑denominational Religious, Not‑For‑Profit, Charitable, Trust Organisation: Koo Wee Rup Ministry, Trust and DOUGLAS, Stephen Ross, Estate Trust’ (‘The Trust’). Keith‑charles Harffey was said to be the ‘Special Trustee of ‘The Trust’.[10]
[10]Second Douglas affidavit [44] Exhibit ‘C‑2’; Keith‑charles Harffey affidavit sworn 11 February 2024 [19] (the ‘Harffey affidavit’).
On 15 November 2022, the Victorian Sheriff’s Office informed the respondent’s solicitor the warrant could not be executed for as long as the bankrupt maintains a ‘supposed rental agreement’ in respect of the premises. Notwithstanding the Federal Court Warrant of Possession, the proposition was put that a residential tenancy agreement must be terminated pursuant to the relevant residential tenancy legislation of the state or territory.[11]
TRIBUNAL APPLICATION FOR POSSESSION
[11]Carrafa v Chaplin, in the matter of a bankrupt estate of Michael Chaplin [2019] FCA 415 [29].
On 14 February 2023, Notices to Vacate were sent by registered post to the premises addressed to each of the applicants.
On 1 May 2023, the respondent issued an application in the Tribunal seeking orders for possession under sub‑s 322(1) and 91ZZB of the RT Act. The respondent brought the application as the registered proprietor and the rental property provider by reversion pursuant to the lease produced by the first applicant on the attempted execution of the Federal Court Warrant.
Orders to vacate were made by the Tribunal in the applicants’ absence on 8 September 2023. A copy of the Tribunal’s order is annexed to the Notice of Appeal. The Tribunal’s order records that there was no appearance by either of the applicants. The Tribunal recorded that it found that:
(a) The applicant (Rental Provider)[12] made application to the Tribunal pursuant to section 91ZZB of the RT Act seeking possession of the rented premises;
(b) The Rental Provider gave the respondents[13] at least 60 days notice to vacate including a copy of a contract of sale prepared by Australian legal practitioner for the rented premises; and
(c) having regard to the matters in section 330A of the Act it is reasonable and proportionate to make a possession order.
[12]The respondent in this proceeding.
[13]The applicants in this proceeding.
The Tribunal ordered and directed that the premises be vacated by 22 September 2023. The respondent was entitled to request a Warrant of Possession to be executed days after the date of issue, after 22 September 2023 and no later than 22 March 2024.
A warrant for possession for the premises was issued by the Tribunal on 11 October 2023.
The applicants claim that they were not served with any documentation, nor received any notice of the Notice to Vacate or of the application made to the Tribunal for possession. This is also a complaint they make in respect of steps taken by the respondent in the Bankruptcy proceedings in the Federal Court.[14]
[14]The is set out in the affidavit sworn by Stephen Ross Douglas on 28 November 2023 (the ‘First Douglas affidavit’) at [9], [10], the Second Douglas affidavit [46], [59], and the Harffey affidavit [15]–[18].
The explanation given by the first applicant as to why no documentation was received by them is that there is no physical mail box at the Property and that the first applicant keeps a post office box for mail deliveries at the Koo Wee Rup Post Office.[15] A copy of an envelope of a registered letter addressed to the second applicant was exhibited to the Second Douglas affidavit sworn as Exhibit D. Curiously, this single exhibit directed to only one of the applicants (the second applicant) was the only documentary proof that was provided by the applicants on this topic.
[15]Second Douglas affidavit [45] and Exhibit D.
Given the date of the document, being the ‘return to sender’ envelope (which was sent on 14 February 2023 and returned on 27 March 2023), the Exhibit would appear to relate to the service of the Notice to Vacate and not to any other correspondence from the Tribunal or the respondent in relation to the application.
APPLICATION TO RE-OPEN THE TRIBUNAL’S ORDERS
On 26 October 2023 the applicants filed an application to reopen the order to vacate pursuant to s 120 of the VCAT Act.
Section 120 of the VCAT Act provides:
120Re-opening an order on substantive grounds
(1)A person in respect of whom an order is made may apply to the Tribunal for a review of the order if the person did not appear and was not represented at the hearing at which the order was made.
(2)An application under subsection (1) is to be made in accordance with, and within the time limits specified by, the rules.
(3)The rules may limit the number of times a person may apply under this section in respect of the same matter without obtaining the leave of the Tribunal.
(4)The Tribunal may—
(a)hear and determine the application if it is satisfied that—
(i)the applicant had a reasonable excuse for not attending or being represented at the hearing; and
(ii)it is appropriate to hear and determine the application having regard to the matters specified in subsection (4A); and
(b)if it thinks fit, order that the order be revoked or varied.
(4A)For the purposes of subsection (4)(a)(ii), the matters are—
(a)whether the applicant has a reasonable case to argue in relation to the subject-matter of the order; and
(b)any prejudice that may be caused to another party if the application is heard and determined.
(4B)The Tribunal may hear and determine an application under this section despite subsection (4A)(b) if the Tribunal is satisfied that any prejudice that may be caused to a party may be addressed by an order for costs under section 109 or an order for reimbursement of fees under section 115B or both.
(4C)In deciding to hear and determine an application under this section the Tribunal may require the applicant to give any undertaking as to costs or damages that the Tribunal considers appropriate.
(5)Nothing in Division 3 of Part 3 applies to a review under this section.
On 16 September 2023, the return date of the s 120 application, the first applicant attended at VCAT in person. However, the hearing had been scheduled as a telephone hearing which is and was the usual mode of hearing for matters in the Residential Tenancies List at the Tribunal. The first applicant attended with the person who seeks to be known by the name Keith‑charles[16] and another (undisclosed) person.
[16]Keith-Charles is otherwise known by the legal name of Keith Charles Harffey in which name he issued a summons to intervene in this proceeding.
The first applicant and Keith‑charles participated in the hearing by telephone, a circumstance both complained was unsatisfactory.
I will return to the issues and the role of Keith‑charles and his participation shortly. I observe at this point however, that the submissions made as to the Property being property of ‘The Trust’, had wrongfully been transferred to the respondent and that the applicants had ‘lease’ agreements entitling them to possession were forcefully and repeatedly put throughout the hearing by Keith‑charles.
On 16 November 2020, the Tribunal made the following findings and orders:
VCAT finds:
1.The renter seeks review of the VCAT order dated 08 September 2023. The renter did not appear at the hearing when the order was made, nor were they represented at the hearing.
2.The renter did not attend the hearing on 08 September 2023 because the renter hid themselves from the Tribunal and the rental provider and consequently the renter did not have a reasonable excuse for not attending or being represented at the hearing on 08 September 2023
3.Further, it is not appropriate to hear and determine the application because:
- the rented does not have a reasonable case to argue in relation to the subject matter of the order; and
- to rehear and determine the application would cause prejudice to the rental provider.
VCAT orders:
1.The application for review is dismissed.
2.The VCAT Order made 08 September 2023 is confirmed
3.The time for execution of the warrant of possession issued by the principal registrar on 11 October 2023 extended so that it is to be executed no later than 15 December 2023.
4.The principal registrar will serve a copy of this order of the parties and send a copy of this order to the police station specified in the warrant.
The Notice of Appeal seeks to appeal the whole of the order made by the Tribunal on 16 November 2023.
SUMMONS ISSUED BY PROPOSED INTERVENOR
By the summons dated 20 February 2024, Keith‑charles, named in the Summons as Keith‑charles Harffey, sought to be joined to the proceeding. His interest in the proceeding was stated to be as ‘Occupant of the Office of Special Trustee for the DOUGLAS, Stephen Ross Trust and the Koo Wee Rup Ministry’.
The summons was heard at the commencement of the proceeding and, whilst not identified as such, the application to intervene in the proceeding by Keith‑charles was treated as an application made pursuant to r 9.06 of the Supreme Court (GeneralCivil Procedure) Rules 2015. The application was opposed by the respondent and supported by the applicants.
BASIS OF THE INTERVENTION APPLICATION
The basis of the application for intervention relied on allegations that Keith‑charles was the proper representative of the entity which was the rightful owner of the land the subject of the tenancy and that there was a private lease agreement between the applicants and that entity. He maintained that the property in question was ‘Trust property’ of the ‘DOUGLAS, Stephen Ross Estate Trust and the Koo Wee Rup Ministry Trust’ and that he was the ’Occupant of the Office of Special Trustee’ of those trusts or ‘The Trust’. He alleged that the subject property formed part of the property of ‘The Trust’ and could not be the subject of the Tribunal’s orders and that the title to the land was wrongly transferred into the name of the respondent.
The summons also sought certain orders, in addition to an order to be joined in the proceeding as ‘trustee with a special interest in the property the subject of the trusts’ including:
(a) the validation of the trust as obligated under the Trust (Hague Convention) Act 1991;
(b) the respondent be recognised as Trustee de son tort;
(c) segregation of the property from the respondent,
(d) equitable writ of mandamus for performance to VCAT, and writ of certiorari to set aside the decision of VCAT;
(e) a freezing order to the respondent preventing and restraining any further interference with trust property or its interests to prevent additional abuse of office, harm, damage and loss;
(f) the ‘registered title owner’ be returned to its previous name; and
(g) the money wrongly taken be returned with interest.
The Harffey affidavit attached a number of documents which included:
(a) Affirmation, Certificate of Trust and Abstract of Trust;[17]
[17]Harffey affidavit Exhibit A.
(b) Memorandum of Irrevocable Trust Minute;[18]
[18]Harffey affidavit Exhibit B.
(c) Notice of Express Trust Estate;[19]
(d) Notice of Ambiguity;[20] and
(e) Notice: Formal complaint (addressed to the Inspector‑General in Bankruptcy enclosing a copy of certificate of Appointment of Trustee appointing the respondent as Trustee and the Orders of the Federal Circuit Court made 26 September 2019, and a copy of the Notice of Ambiguity and a copy of the Notice of Express Trust Estate).[21]
[19]Harffey affidavit Exhibit C.
[20]Harffey affidavit Exhibit D.
[21]Harffey affidavit Exhibit E.
The first applicant also made an affidavit dated 28 November 2023 deposing that neither he nor the second applicant has ever had a rental agreement with the respondent and that he and the second applicant have a lease agreement with the ‘Special Trustee’ who holds the land as part of the Trust estate known as the ‘DOUGLAS, Stephen Ross Estate trust and the Koo wee Rup Ministry Trust’.
The ‘Second Douglas affidavit reiterated matters set out in the Harffey affidavit and some matters dealing with his interaction with the Tribunal and his version of events of the hearing held on 16 November 2023. He also recorded that, on 23 October 2023, he was informed by the Koo Wee Rup police that a warrant to possess the property would be enforced in four days time. He deposes that this was the first he knew of the Tribunal matter and that, in response, on 26 October 2023 he filed an application to reopen the Tribunal proceeding and to stay the warrant.[22]
[22]Second Douglas affidavit [23]–[24].
He deposed at [52] of the Second Douglas affidavit that the Koo Wee Rup police attempted to execute the VCAT Warrant of Possession on 18 January 2024 but that the ‘Special Trustee’, Keith‑charles, was occupying property as was the ‘Second Special Trustee, Paul Green’ and that after discussion between Keith‑charles and the police officer in charge, the officer left without executing the warrant. He records that there was a crowd of onlookers at the front of the property and that Keith‑charles showed the police officers the relevant sections of ‘The Trust Deed’ informing them that ‘he is the rightful owner under Trust Laws asking them not to trespass on Trust property’.
The balance of the affidavit sets out his argument that the respondent has no entitlement to the subject property, that is legally owned by ‘The Trust’ ‘and that the actions of the respondent were in breach of the criminal law, that the proceedings before the Federal Court and the Tribunal were abuses of process, denials of his ‘Natural Rights to Justice’ and an abuse of office, a tortious interference with the contractual relationship and a private nuisance that he required relief from this unconscionable conduct of misfeasance in public office’. In addition, damages ‘for the immense Harm, Damage and Loss’ caused by what he believed to be an undeniable intent to defeat The Trust deprive it of Real Property were sought.[23]
[23]Second Douglas affidavit [55]–[63].
INTERVENOR ORDER
I heard submissions from the parties and determined that the proposed intervenor would be allowed the opportunity to participate in the application for leave made pursuant to s 148 of the VCAT Act. The order to that effect gives the proposed intervenor the right to participate on a limited basis to support the arguments made by the applicants and to bring any matters to bear which might assist the Court in the s 148 application.
I also determined that I would not make the other orders sought in the summons as they raised matters which were not appropriate to be litigated as part of this application for leave to appeal the Tribunal’s orders. The other orders sought in the intervenor’s summons were matters which went to the role and authority of the respondent as Trustee in Bankruptcy and if they had any substance at all, they were more properly made in a separate proceeding, or alternatively pursued in the Federal Court. They are not matters both in content or form which are properly brought in an application for leave to appeal the orders of the Tribunal in this proceeding.
PRINCIPLES RELEVANT TO LEAVE TO APPEAL
Section 148 of the VCAT Act provides that a party to a proceeding may only appeal from an order of the Tribunal on a question of law.[24] An appeal against an order of the Tribunal requires leave of the court.[25] The application for leave to appeal must be made in accordance with the rules of the Supreme Court.[26]
[24]VCAT Act s 148(1).
[25]Ibid s 148(1)(b).
[26]Ibid s 148(2)(b).
The Court may grant an application for leave to appeal if it is satisfied that the appeal has a real prospect of success.[27] This requirement imposes an additional safeguard on the requirement for leave to appeal so that the Court may dispose of a challenge to the decision at an early stage where appropriate.[28]
[27]Ibid s 148(2A).
[28]Chopra v Department of Education and Training [2019] VSC 488 [21].
An applicant for leave to appeal need not demonstrate that it is likely the appeal will succeed, only that its prospects are not fanciful.[29] Even if an applicant can show there is a real and not fanciful prospect of success, leave to appeal does not automatically follow. Satisfaction that there is a real prospect of success is a threshold that enlivens the discretion to grant leave.[30] However, meeting the threshold does not dictate that leave must be granted. In the exercise of discretion, the Court may have regard to a number of matters including:
[29]Kennedy v Shire of Campaspe [2015] VSCA 47 [11]–[14].
[30]Metricon Homes Pty Ltd v Softley [2016] VSCA 60 ( 2016) 49 VR 746 (Metricon) [29].
(a) the importance of the question of law in which leave is sought;[31]
[31]Sec to the Department of Premier and Cabinet v Hulls [1999] VSCA 117 [11].
(b) whether the proposed appeal would be futile or of limited practical impact in the circumstances of the case;[32]
[32]Metricon [18]; Djime v Kearnes [2019] 117 [14].
(c) whether the error of law made any difference to the order made by the Tribunal; and
(d) whether leave to appeal is required to bring justice to all of the parties, not just the applicant for leave.[33]
SUBMISSIONS OF THE PARTIES ON LEAVE APPLICATION
[33]Hulls [16].
The Applicants and the Intervenor
I will not repeat at any length the submissions made by the intervenor or the applicants as they rely on the matters already recited above. Essentially, the basis of the application for leave is based on a submission that the subject property is ‘Trust property’ and that the respondent has no legal entitlement to take any steps to take possession of it.
Further, they argue that not only is the property ‘trust’ property, the applicants are entitled to occupy the subject land pursuant to ‘private’ lease agreements with the Trusts.
In respect of the s 120 orders made by the Tribunal from which leave is sought, they dispute the finding of the Tribunal that they were ‘hiding’ from the Tribunal and dispute the conclusion drawn by the Tribunal that the matters set out in s 120 were not properly made out.
The questions of law which are set out in the proposed Notice of Appeal raise questions of characterisation or application of the RT Act, in particular, of the characterisation of the respondent as a ‘rental provider’ and that allege he has no ‘rental agreement’ as defined in the RT Act. The second category of questions relates to notice or service of documents under the RT Act.
The Respondent
The respondent argued that leave to appeal should not be granted as the Court ought not be satisfied that the appeal had a real prosect of success. If leave were granted, the appeal should be dismissed as it had no merit.
The orders made by the Tribunal which are subject to the application for leave are orders made pursuant to s 120 of the VCAT Act. The section requires the Tribunal to be satisfied that there was a reasonable excuse for non‑attendance. The Tribunal was not satisfied that all of the threshold criteria were satisfied and no error of law is demonstrated by the applicants’ proposed questions of law.
Additionally, it was argued that there is futility in the appeal as determination either way will not alter the legal position between the parties. The respondent is the registered proprietor of the subject land and ought have vacant possession in order to sell the premises for the benefit of the creditors of the bankrupt.
The respondent argued that he is entitled to possession of the property either by virtue of the rental agreement and a Warrant of Possession issued on the order of the Tribunal, or he is entitled to possession by virtue of a warrant issued order of the Federal Court.
ANALYSIS
The Orders of the Tribunal from which leave to appeal are sought are the Orders made on 16 November 2023 in respect of the applicants’ s 120 application. The order of the Tribunal was to refuse to reopen an order on substantive grounds.
The applicants and the intervenor did not address identification of any question of law arising from the Tribunal’s dealing with the s 120 application but rather focussed on the ownership of the Property, the occupation rights arising from the arrangements between the ‘The Trust’ and the applicants and the lack of notice or service.
Tribunals consideration of s 120 application
There are a number of matters which the Tribunal was required to consider on an application under s 120 before any rehearing on the merits is open.
Firstly, the Tribunal must be satisfied by s 120(1) that the person in respect of whom the order was made did not appear and was not represented at the hearing at which the order was made. The Tribunal was satisfied that this threshold question of standing was made out.
Secondly, by s 120(2) that the application is made within time and in accordance with the rules. There was no issue raised with this criteria.
‘Reasonable excuse for non-attendance’ consideration
Thirdly, by s 120(4)(a) the Tribunal has the discretion to hear and determine the application if it is satisfied that the applicant(s) had a reasonable excuse for not attending or being represented at the hearing.
In respect of this criteria, the Tribunal found that there was no reasonable excuse for non‑attendance. The Tribunal records that ‘the renter hid themselves from the Tribunal and the rental provider’.[34] The factual finding and thus the basis of the Tribunal’s exercise of discretion was challenged by the applicants before me, as it was before the Tribunal on 16 November 2023.
[34]Order 2 of the Tribunals Orders made 16 November 2023.
Whilst the Tribunal adopts a liberal approach to what it might find a reasonable excuse, the situation is very different to a situation where the failure to attend arose from the applicants hiding themselves from the respondent and the Tribunal. The Tribunal noted in Avon Homes Pty Ltd (in liq) v Milodanovic[35] that the party seeking to set aside an order must not have ignored the proceeding.
[35]Avon Homes Pty Ltd (in liq) v Milodanovic (2005) 23 BAA 189; [2005] VCAT 1297.
In Tomasevic v Victoria, Morris J said:
It seems clear enough that ‘a blameless non-attending defendant’ will usually be able to satisfy the [reasonable excuse element]. The Tribunal has an obligation to act fairly and, in the normal course, this would require a party to be notified of the hearing and be given an opportunity to be heard. However what may constitute a ‘reasonable excuse’ (or, for that matter, what would make an applicant ‘blameless’) ought be left to the judgement of the Tribunal in a particular case. It is likely to be a question of fact, to be determined by the member concerned. To seek to lay down legal principles that might govern this exercise seems to me to be fraught with difficulty.[36]
[36]Tomasevic v Victoria [2005] VCAT 1525 at [12] per Morris J, President.
The applicants and the intervenor appeared and made submissions to the Tribunal on the hearing of the s 120 application. The respondent was also heard. The obligation, or burden of proof (even if that threshold may not be high), before the Tribunal was to demonstrate that they had a reasonable excuse for non‑attendance.
The affidavits relied on by the applicants demonstrate they appeared at the rehearing application and, by their own admissions made in the affidavit and orally at the hearing before me, made submissions and sought to refute the allegation made by the representatives of the respondent that they did not have any reasonable excuse to non‑attendance.
I also observe that the Tribunal’s orders made 8 September 2023 record in its second finding that the applicants were given at least 60 days notice to vacate. Such a finding must be based on proof of service.[37]
[37]Given the usual practice of the Residential Tenancies List, the requirement to be satisfied of service is an automatic procedural step in this high volume list where the non-attendance of a renter is common place.
I find the allegations of lack of notice or service of documents somewhat curious given the history of the interactions between the applicants and the respondent and the involvement by the intervenor since October 2019 (at minimum) which is recorded in both the affidavits of Harffey and in the Second Douglas affidavit. I note that the only document referred to in the material which seeks to prove the lack of notice or failure of service is one ‘return to sender’ envelope addressed to the second applicant.[38]
[38]Second Douglas affidavit Exhibit D.
The Tribunal in considering the s 120 application made its finding and rejected the submissions made by the applicants and the intervenor and was satisfied no reasonable excuse for non‑attendance was made out. There is no question of law which has a reasonable prosect of success which arises in this circumstance. An appeal does not lie against the merits of the decision made. I cannot be satisfied on the material here (the assertion of lack of service and a ‘return to sender’ envelope sent only to one party) that there was any reason to form the view that the Tribunal member was in error on the 8 September 2023 or on the s 120 application.
The Tribunal was not satisfied on this first part of the third threshold question.
The legal questions based on failure to give notice or inadequacy of service[39] have no reasonable prospect of success. There is overlap here with the findings of the Tribunal that the applicants were hiding from the Tribunal and the respondent with regard to service.
[39]Questions 1 and 6.
I am not satisfied that there is a legal question with a real prosect of success identified in the material upon which the applicants or intervenor relies.
‘Reasonable case to argue’ consideration
The Tribunal went on to consider the matters set out in s 120(4A) as required by s 120(4)(a)(ii).
The matters set out in s 120(4A) are by (a) whether the applicant has a reasonable case to argue in relation to the subject matter, and by (b) any prejudice that may be caused to another party if the application is heard and determined.
The Tribunal’s orders at Order 3 recorded that ‘it is not appropriate to hear and determine the application because the renter does not have a reasonable case to argue in relation to the subject matter and to hear and determine the application would cause prejudice to the rental provider’.
In consideration of whether there was a reasonable case to argue in relation in to the to the subject matter of the order, the applicants rely on their argument that the subject property was ‘Trust’ property and not in the legal ownership of the respondent. It is in this context that they argued that the subject property did not fall within the jurisdiction of the Tribunal as the RT Act did not apply to it.
The questions of law raised in the Notice of Appeal raise the question of characterisation of the respondent as a ‘rental provider’ and that there was no ‘rental agreement’ both as defined in the RT Act. Questions of characterisation are capable of being framed as questions of law.
However, how these questions arise in the context of the appeal against the s 120 application is not assisted by the material in support of the application filed by the applicants and the intervenor. No transcript of the Tribunal hearing was provided. No Court Book was produced by the applicants.
The applicants’ case, as set out in their submissions and in the filed affidavits, relies on their argument that the respondent has no legal entitlement to possession as legal owner because the subject property was legally transferred to the Trusts and, as trust property, it is immune from being considered as part of the first applicant’s bankrupt estate.
The (Trust or) trusts are expressed to be ‘non‑statutory unincorporated pure express Trusts as known as Natural/Common Law Trusts first created by parol in March 2015 by Private Agreement then expressed in the Trust Deed and other Trust documents in 2017’ with amendments over the following years[40] and amended over the years.
[40]Affidavit Stephen Ross Douglas sworn 12 February 2024 and Exhibit ‘A’ thereto.
It is clear from the affidavits sworn by the intervenor and the first applicant that they draw a distinction between a natural person (they describe as the ‘God fearing man’) and the legal entity (or what they refer to as The Name). The also seek to rely on a collection of documents which are a melange of quasi‑legal concepts and phrases, Bible quotes and which make reference to organisations in the same name as the first applicant (although with a trade mark annotation)[41] and referring to a range of entities with unconventional titles or descriptions[42] from which they urge the Court to draw the conclusion that they create legal entitlements or protections which would defeat the respondent’s entitlement to possession of the property.
[41]Exhibit B affidavit of Harffey sworn 11 February 2024.
[42]See the exhibited documents to the Harffey and Douglas affidavits.
The First Douglas affidavit denies he or his son, Philip, have ever had a ‘rental agreement’ with the respondent, that he did not believe that the respondent fell within the definition of a ‘rental provider’ and the subject premises is subject to a lease with ‘the Special Trustee’ of the Trust Estate known as ‘Douglas Stephen Ross Estate Trust and the Koo Wee Rup Ministry Trust’. In the Second Douglas affidavit, he deposes that he is ‘the duly appointed the Office of Executive Manager for the Douglas, Stephen Ross, Estate trust, Trust Deed and the Koo Wee Rup Ministry, Trust’, which both are ‘non‑statutory, unincorporated, pure express Trust, also referred to as Natural/Common law Trusts’. He argues that ‘The Trust’ is the sole owner of all property vested to and are the Trustees of the sole absolute Legal Title Owners thereof. The Affidavit proceeds to quote various parts of the alleged trust documents and include annexures being Certificate and Abstract of Trust, Declaration of Trust Schedule ‘A’ or Addendum to Schedule ‘A’. The affidavits there refer to the Hague Convention on the Law Applicable to Trusts.
Further, the right to possession claimed by the applicants is said to be, in the case of the first applicant, a document entitled ‘Executive Manager’s Agreement Minute and Appointment to Office’. In respect of the second applicant, the right to occupy the subject land is said to be by a ‘lease agreement’ entered in to by private agreement with the Board of Trustees for the Koo Wee Rup Ministry and the Douglas Stephen Ross Estate Trust.[43]
[43]Exhibit C‑2.
I note that a ‘residential rental agreement’ under the RT Act is defined as follows: ‘residential rental agreement means an agreement, whether or not in writing and whether express or implied, under which a person lets premises as a residence (but does not include an SDA residency agreement) and includes a fixed term residential rental agreement and periodic residential rental agreement’.
As the legal owner of the subject property, the respondent has an entitlement to possession of the premises. There is no strict requirement for a written residential rental agreement. It can be implied and can be periodic according to the definition. The owner of the land has given notice to the renters of eviction pursuant to s 91ZZB of the RT Act so that the property can be sold.
Whilst the questions posed to characterisation may be of some intellectual interest, there is an absence of material to support the applicants’ argument that the Tribunal was not, or could not, be satisfied that the applicants had a reasonable case to argue on the subject matter of the order as required by s 120(4A). The respondent is the registered proprietor of the subject land. He is the Trustee in Bankruptcy with orders for possession from the Federal Court. There is no evidence of a legal transfer of the subject property to either of the Trust entities.
On the documents before me,[44] I am not satisfied that the first applicant made a valid transfer of the legal ownership of the title to the real estate to either of the ‘Trust’ entities and, on that basis, the ability to lawfully enter into a lawfully binding agreement to occupy the land such that would defeat the legal owners right to possession is difficult to accept.
[44]Harffey affidavit and the First and Second Douglas affidavits and exhibits filed on behalf of the applicants and intervenor, and the Baker affidavit filed on behalf of the respondent.
I am not persuaded that these ‘Trust’ entities or the ‘lease agreement’ documents which purports to provide an entitlement to possession and occupancy of the subject land have the legal capacity to override the entitlement of the respondent as land owner to his order for possession so that the land can be sold. The applicants and the intervenor reinforced the description of the trust(s) as ‘non‑statutory’ ‘unincorporated’ ‘pure express trusts also referred to Natural/Common Law Trusts’. Consequently, there is doubt as to whether they are entities which can hold real property. However, that aside, the significant flaw is the lack of any evidence which could convince a court that the real property was not legally transferred to the respondent. Even if there was an entity capable of entering into a lease agreement with the applicants, the lease or other tenancy agreement is subject to reversion to the legal owner.
There is no competent evidence before the court which demonstrates the legal transfer of the real property to either of the ‘Trust’ entities.
In Marchesi v Apostoulou,[45] Weinberg J considered the law in which equity will recognise the assignment of property without consideration. The question in that case was whether a ‘gift’ to a family trust was ‘perfected’ in accordance with the principles established by the High Court in Corin v Patton.[46] That is, whether the bankrupt did all that was necessary to arm the donee with the capacity to register of titles in the name of the trustee of the trust.
[45]Marchesi v Apostoulou [2006] FCA 1122 per Weinberg J.
[46]Corin v Patton (1990) 169 CLR 540, 560 per Mason CJ and McHugh, 582 per Deane J.
At [25] his Honour said that the position appears to be settled by the High Court’s judgment in Corin v Patton quoting Mason CJ and McHugh J (at 560):
Where a donor, with the intention of making a gift, delivers to the donee an instrument of transfer in registrable form with the certificate of title so as to enable him to obtain registration, an equity arises, not from the transfer itself, but from the execution and delivery of the transfer and the delivery of the certificate of title in such circumstances as will enable the donee to procure the vesting of legal title in himself.[47]
[47]Corin v Patton, 560 per Mason CJ and McHugh. See also at 582 per Deane J quoted in Marchesi at [26].
There is no evidence of any legal transfer of title to any entity other than the respondent. That transfer occurred by operation of the Bankruptcy Act and the respondent’s registration of his legal interest as Trustee in Bankruptcy is recorded on the certificate of title held by the Registrar of Titles.
It is also pertinent that despite the Bankruptcy proceedings being instigated in 2019 and the allegations made by the applicants and the intervenor being raised directly with the respondent in October 2019,[48] there has been no finding in the applicants’ favour in this Court, or in the Federal Court, to challenge the legal ownership of the Property. The respondent has been the legal owner of the property since 4 October 2021 and the Federal Court orders for possession were made 5 July 2021. The first visit from the sheriff seeking to enforce the possession of the property was on 21 October 2021. As noted above, a second attempt to enforce possession was made on 18 January 2024. I note that after this second attempt to execute the warrant a caveat was lodged over the Property.[49]
[48]Harffey affidavit [8]–[10] makes reference to correspondence with the respondent dated on 24 October 2019.
[49]See discussion of this at [98]–[101].
In the absence of any legal authority which would provide justification for a better claim to occupation of the land, I cannot be satisfied that the applicants have or had a reasonable case to argue in relation to the subject matter of the order.
Prejudice to another party
The final matter to which the Tribunal was required to have regard was under s 120(4A)(b), which was consideration of prejudice that may be caused to another party if the application is heard and determined. The Tribunal recorded a finding that there would be prejudice to the respondent.
The applicants did not address the issue of prejudice to the respondent or any other party.
I do not consider that there is any error of law in the task that the Tribunal undertook in making its assessment of the application made under s 120 of the VCAT Act.
Futility of the appeal
The futility of the outcome of an appeal is a consideration which the Court may take into account.
Even if the appeal were successful, the underlying subject matter in dispute would remain undisturbed. The respondent would be entitled to possession under the Federal Court orders. The Federal Court Warrant having no impediment standing it its way of enforcement as there would be there being no residential tenancy jurisdictional issue preventing its operations.[50]
[50]See Transfer of Land Act 1958 s 42(1).
The respondent being entitled to vacant possession under one or other of the Warrants, the position between the parties will not be fundamentally altered.
The Caveat
Of note is that despite the Trustee in Bankruptcy being appointed in over four years ago in September 2019 and the Federal Court Warrant being issued in July 2021, no proceedings have been pursued whereby the applicants or the intervenor has been successful in overturning the registration of the Property’s title in the respondent’s name. They have instead resorted to self‑help in preventing the execution of the warrant when attempts to take possession have been made. The most that has occurred is a very recent caveat being lodged alleging an interest variously by way of a resulting, implied or constructive trust.
The Second Douglas affidavit refers to the instructions to Einsiedels Legal Practitioners[51] on behalf of the Special Trustee, Paul Green, to lodge a caveat on the title of the subject property. The affidavit also exhibits a letter from the respondent of 30 January 2024 seeking details of the ‘implied, resulting or constructive trust’ which was said to be the basis of caveat number AX65458U being registered on 19 January 2024.[52]
[51]Second Douglas affidavit [53] and Exhibit E.
[52]Second Douglas affidavit [53] and E-1.
A letter from Einsiedels’ lawyers dated 19 February 2024 records that their client, Paul Spencer Green, claimed a caveatable interest in his role as Special Trustee for the DOUGLAS, Stephen Ross Estate Trust. It claims the ‘Special Trustee’ was formalised by trust deed which included the property. The Trust was described as a ‘Life Estate in Fee Simple’. It further asserted that ‘under the Trusts (Hague Convention) Act 1991 Cth, who hold title to the property hold the on behalf of the trust’. The letter claimed that the respondent could not touch any assets of a religious ministry or church and that the property is held in a trust by the bankrupt for the benefit of someone else as described in s 116 of the Bankruptcy Act, being the Koo Wee Rup Ministry.
Whilst this issue is not for me to determine in this application, it would be surprising, if the caveat is not removed as requested in the respondent’s letter, that an application to remove it on behalf of the respondent would be forthcoming. As no further documentation or justification for the entitlement contrary to the orders made by the Tribunal the subject of this leave application arise from this part of the material, I have not given it any weight in my consideration.
Conclusions on Leave application
The applicants must identify a question or questions of law. The applicants also carry the burden of proof that the Tribunal’s orders raise a relevant of question of law and that the Court is satisfied that the questions of law have a reasonable prosect of success. There is no automatic right to a rehearing. The Tribunal must be satisfied that the applicants had a reasonable excuse for non‑attendance. This is a matter for the Tribunal to be satisfied on the material before it. Before this Court the applicants asserted that the Tribunal was wrong in this finding and that the Tribunal acted on the submissions and assertions of the respondent. The Tribunal made the finding that it did and concluded there was no reasonable excuse for non‑attendance.
The orders record on their face that the Tribunal refused the application not only because there was a finding that no reasonable excuse for non‑attendance was demonstrated but also on the basis there was no reasonable case to argue in relation to the subject matter, as well as prejudice to the respondent.
Notwithstanding the applicants are litigants in person (and thus some less stringent approach to procedural matters and compliance with the rules of court may possibly be afforded them), they carry the burden of proof and they are responsible for providing the evidence and submissions upon which the Court might make a decision in their favour.
In respect of the compliance with the RT Act provisions and the legal entitlement to the property, the applicants were given an opportunity to be heard and put their case. The Tribunal was not persuaded that the applicants had a reasonable case to argue in relation to the subject matter of the order.
I am not persuaded that any Tribunal would form a different view if the matter was reheard given the legal ownership of the land by the Trustee in Bankruptcy. On the material relied upon by the applicants and the intervenor, there is no evidence that the property was legally transferred to either of the alleged Trust entities claimed.
It is not for this Court on an application for leave to appeal to rehear the application, on its merits. Rather, it is necessary for the applicants to satisfy the Court that they have a real prospect of success.
The application for leave fails at this threshold point. I cannot be satisfied that the judgment exercised by the Tribunal in forming the view that the applicants had no reasonable excuse for non‑attendance in all the circumstances was made in legal error. It was a matter for the Tribunal’s satisfaction on the material before it. Further, the finding that there was no reasonable case to answer was not in error. The orders made by the Tribunal were open to it and no error has been identified which would persuade the Court that there is a real prosect of success on appeal. In any event, the outcome of any appeal would be futile. Leave to appeal is refused.
INTERRUPTIONS TO THE HEARING
Attempt at execution of the Warrant
The hearing was conducted remotely by Zoom. The applicants were at the Property in Koo Wee Rup and the intervenor was elsewhere.
I record that during course of the morning session of the hearing, the proceeding was interrupted by the attendance at the Property of a large number of members of the police force seeking to execute the warrant of possession[53] Having ascertained that the warrant had not in fact been executed by the attendance in the hearing by the police officer in charge of the operation, Acting Senior Sgt Paul Maher, I made orders temporarily restraining the execution of the warrant to enable the hearing to be completed.
[53]I was informed by Acting Snr Sargeant Maher that 15 police officers, include detectives, members of the drone and dog squads and a locksmith were in attendance. Acting Snr Sargeant Maher appeared in the hearing at my request.
Intervenor’s Behaviour
I also note that the conduct of the intervenor was less than satisfactory in terms of the expected courtesy and behaviour in the Court room hearing environment. There were a number of times during the course of the hearing that Keith‑charles refused to co‑operate and abide the directions given to him, and continued to interrupt when others were speaking. After several warnings, this required technological intervention, and I directed that he be muted on a number of occasions. His lack of civility and co‑operation was disruptive and caused unnecessary delay and distress. His useful contribution to the hearing as intervenor was, in retrospect, not justified.
CONCLUSION
I am not satisfied that the application meet the threshold of competency such that there is any utility in the application to proceed to a hearing of the appeal.
I am not satisfied that the exercise of discretion to refuse the s 120 application and make the consequential orders made by the Tribunal raises any question of law which has a real prospect of success. This is reinforced by the futility of any orders the Court may make in view of the Federal Court orders for possession already made.
No question of law has been identified which would affect the outcome of the appeal.
I am not satisfied that there is any real prospect of success on the material provided nor the arguments raised on behalf of the applicants or the intervenor.
Leave to appeal the orders made on 16 November 2023 is refused.
COSTS
The respondent sought costs of the proceeding against the applicants and, given the role played by the intervener, costs against the intervenor.
I note that the behaviour of the intervenor during the course of the hearing was often of a demeanour and content which was less than the expected courtesy and demeanour of any litigant who comes before the Court. The number of times that he was warned about his interruption and repetition of irrelevant matters delayed and interrupted the hearing across the day.
Whilst the content of the submissions made on behalf of the applicants by the first applicant were no more persuasive than those of the intervenor, there is no criticism of the first applicant’s behaviour towards or in the Court.
Given my findings on the merits of the application, I am satisfied that an award of costs is appropriate to be made in favour of the respondent, jointly and severally, against the applicants and the intervenor.
As indicated in the order made at the conclusion of the hearing, I furnish these reasons for my decision on the application for intervention by Keith‑charles, for leave by the applicants and on the costs application made by the respondent.
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