Edward James Bride and Wendy Margaret Bride v The Australian Bank Ltd
[2001] WASCA 58
•1 MARCH 2001
EDWARD JAMES BRIDE AND WENDY MARGARET BRIDE as Trustees of the PINWERNYING FAMILY TRUST -v- THE AUSTRALIAN BANK LTD & ORS [2001] WASCA 58
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2001] WASCA 58 | |
| Case No: | FUL:3/2001 | 23 FEBRUARY 2001 | |
| Coram: | MASTER BREDMEYER | 1/03/01 | |
| 11 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| PDF Version |
| Parties: | EDWARD JAMES BRIDE AND WENDY MARGARET BRIDE as Trustees of the PINWERNYING FAMILY TRUST THE AUSTRALIAN BANK LTD THE COMMONWEALTH BANK OF AUSTRALIA PEAT MARWICK MITCHELL KPMG HUNGERFORDS DAVID JAMES YOUNG CHARLES CANDLIN FEAR |
Catchwords: | Appeal Application to produce document to place in the appeal book |
Legislation: | Nil |
Case References: | Bride & Anor v The Australian Bank Ltd & Ors [2000] WASC 310 Nil |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Appellants
AND
THE AUSTRALIAN BANK LTD
THE COMMONWEALTH BANK OF AUSTRALIA
First Respondents
PEAT MARWICK MITCHELL
KPMG HUNGERFORDS
Second Respondents
DAVID JAMES YOUNG
CHARLES CANDLIN FEAR
Third Respondents
(Page 2)
Catchwords:
Appeal - Application to produce document to place in the appeal book
Legislation:
Nil
Result:
Application dismissed
Representation:
Counsel:
Appellants : In person
First Respondents : Ms C H Thompson
Second Respondents : Ms C H Thompson
Third Respondents : Ms C H Thompson
Solicitors:
Appellants : In person
First Respondents : Freehills
Second Respondents : Freehills
Third Respondents : Freehills
Case(s) referred to in judgment(s):
Bride & Anor v The Australian Bank Ltd & Ors [2000] WASC 310
Case(s) also cited:
Nil
(Page 3)
1 MASTER BREDMEYER: This is an application by Mr Bride on behalf of the appellants (plaintiffs) for production of documents. He seeks an order that the respondents (defendants) produce within seven days a document known and referred to by Mr C A Fear in a letter to Mr B Putnin on 19 December 1988 as being:
"Notice of appointment as agents of ABL (Australia Bank Ltd) [sic], that would have been forwarded to the debtors in January/February 1987."
- He further seeks that the appellants be given leave to include the said document in the appeal book index, not yet settled, for the hearing of the appeal before the Full Court. This application thus arises in the unusual context of an appeal to the Full Court.
2 This appeal is from a decision of Acting Master Chapman given on 18 December 2000, Bride & Anor v The Australian Bank Ltd & Ors [2000] WASC 310, on a strike out application by the defendants. That application succeeded and Acting Master Chapman struck out the statement of claim as disclosing no reasonable cause of action, as being scandalous, frivolous and vexatious, and because it would prejudice, embarrass and delay the fair trial of the action and was an abuse of the process of the court.
3 In a strike out application by a defendant the court assumes that the facts as pleaded in the statement of claim can be made out, in other words, that they are true and that the plaintiff will be able to prove them at trial. That being so, there is usually no need for evidence to be adduced in such an application. However, evidence is sometimes proper and is allowed. In this case some matters were put before the court, such as pleadings in other actions brought by the Brides and detailed reference was made to a judgment of Parker J. Included in the material before Acting Master Chapman was an affidavit of Mr Bride, sworn 10 July 2000, which put before the court a number of documents, including a series of letters between Mr Charles A Fear of Peat Marwick Hungerfords and Mr B Putnin, the trustee in bankruptcy for the Brides, written in 1988. I quote from four of those letters.
Mr Fear to Mr Putnin, 3 November 1988:
" E J AND W M BRIDE/
- LOT 29 CREEK STREET, KATANNING, WA
David James Young and I have been appointed as agents of the Australian Bank Limited ('ABL') in respect of the realisation of
(Page 4)
- the abovementioned property over which ABL holds registered mortgage C337514 as security for funds previously advanced to E J and W M Bride and their associated entities.
ABL has now taken possession of the property as mortgagee in possession and is progressing to the appointment of selling agents. However, a recent search of the title indicates that you lodged Caveat D745688 against the title on or about 6 May 1988. This caveat will need to be lifted prior to settlement of the property and, accordingly, I now seek your confirmation that you will remove this claim from the title forthwith.
Alternatively, if you are unwilling to lift the caveat at this time, please provide to me, details of your claim under the caveat.
Should you have any questions please contact Mr K Serls of this office."
- Mr Putnin to Mr Fear, 10 November 1988:
"Re: E J AND W M BRIDE & LOT 29 CREEK STREET KATANNING WA
Thank you for your letter KS:PW:2202I/3 dated 8th November 1988 with the attached caveat and certificate of title.
Please correct me if I am wrong, but from what I understand, the Receiver/Managership of Messrs John Anderson and R Young, in relation to the affairs of the Brides, was terminated some time ago. I received an accounting from Messrs Anderson and Young indicating how the funds from the receivership had been received and distributed.
It was, therefore, my understanding that the administration of the affairs of the Brides by the Australian Bank Limited was finalised and the remaining property which hadn't already been transferred to me was unsaleable or represented onerous property. Hence, in order to protect the estate of EJ and WM Bride, for whom I am still acting as Trustee pursuant to the provisions of the Bankruptcy Act, it became necessary for me to lodge a caveat.
No one had advised me of your appointment as agents of the Australian Bank for any purposes.
(Page 5)
- I would, therefore, require from you your letter of appointment.
You furthermore say that the Australian Bank Limited has now taken possession of the property as mortgagee in possession.
Again, as I am the Trustee for the estate, I would like to mention that I have not been notified of such possession nor have my enquiries with Mr Bride revealed that the Bank have now taken possession of the property and are acting as mortgagees in possession.
Until these issues have been clarified I prefer not to lift the caveat and therefore would seek your co-operation in providing me with the necessary information which I would require from you and which I have outlined in this letter.
As soon as I receive this information from you I shall refer the issue to solicitors acting for me in relation to the affairs of the Brides and I shall be guided entirely by their advice."
- Mr Fear to Mr Putnin, 19 December 1988:
" AUSTRALIAN BANK LTD ('ABL')/EJ & WM BRIDE
I refer to your letter dated 10 November 1988 and apologise for the delay in replying thereto.
I have considered the matters raised in your correspondence and respond as follows.
Your understanding as to the previous termination of the receiver and managership of the affairs of the Brides by Messrs Young and Anderson of this office is correct. However, at the termination of that administration, certain property of the Brides, including the land at Lot 29 Creek Street, Katanning remained unsold and the secured debt due to ABL by the Brides had not been repaid in full.
Accordingly, your assumption that ABL's secured claim had been satisfied in full and that any remaining Bride property secured to the Bank was unsaleable or onerous, is not correct.
You will also recall that by an agreement dated 19 August 1986 made between ABL, Messrs Young and Anderson and yourself, it was agreed that, as part of the settlement of various disputes
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- as to the validity of the securities held by ABL and the appointment and actions of Messrs Young and Anderson in respect of the Bride's property, you would not impede ABL in realising various freehold property, including Lot 29 Creek Street, Katanning.
In view of the foregoing, I believe that you have no substantial grounds upon which to maintain the caveat lodged against the abovementioned property.
In relation to my appointment as agent of ABL, I confirm that notice of my appointment in respect of the debt due to ABL by the Brides would have been forwarded to the debtors in January/February 1987 and I would have considered it to be normal practice that the debtors would have passed such notices to you. I am, therefore, somewhat surprised at your comments in relation to my appointment as agent.
Furthermore, I note that my appointment and the action by ABL in taking possession of the Creek Street property under Mortgage C337514 were advised to you in writing in my letter dated 27 May 1988 but no response was forthcoming at that time.
Please confirm by return that you will now take appropriate steps to lift your caveat over Lot 29, Creek Street, Katanning."
- Mr Fear to Mr Putnin 21 April 1989:
" AUSTRALIAN BANK LIMITED/
I refer to my letter dated 13 February 1989 and advise that I still have not yet received from you advice as to whether you are prepared to lift your caveat over the property at Lot 29 Creek Street, Katanning.
I recall from your previous correspondence that the delay in this issue was being caused by the pre-occupation of your counsel with other liquidation matters but I consider it unreasonable that a further two months has elapsed and I still have not yet received your reply.
Accordingly, I appear to be left with no alternative but to place the property on the market and to take to whatever action is
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- considered necessary by my legal advisors in order to effect the sale of the property immediately."
- All three letters quoted sent by Mr Fear are signed:
"CHARLES A FEAR
Agent for
- Australian Bank Limited"
5 In Mr Bride's affidavit in support of this application he has annexed that letter of 27 May 1988 from Mr Fear to Mr Putnin, which I quote:
"I refer to your letter dated 3 May 1988 to the attention of our Mr D J Young and confirm that Messrs Young and Anderson have retired as Receivers and Managers of the property of EJ & WM Bride and associated entities.
At the date of the retirement of the Receivers and Managers the debt due to Australian Bank Limited ('ABL') had not been paid in full. Furthermore, ABL continued to hold mortgage C337514 over the property at Lot 29, Creek Street, Katanning being the land comprised in Certificate of Title Volume 1682, Folio 357.
I also advise that on 12 February 1987 Mr Young and I were appointed as the agents for ABL to administer and collect on behalf of the Bank, certain outstanding accounts including that due by EJ & WM Bride.
ABL has now taken control of the property at Lot 29, Creek Street, Katanning as mortgagee in possession and, as agent of the Bank, I am arranging for its sale. Upon sale all outstanding rates and taxes due in respect of the property are expected to be paid in full on settlement.
(Page 8)
- Please advise whether the legal action being instituted against Mr Bride relates to unpaid rates on the above property. If this is the case, I will request the Shire Council to desist from its legal action until the property is sold. However, if the council claim relates to other property, I will require better particulars of the outstanding debt before I can comment further.
Should you have any questions, please contact Mr Serls of this office." (Emphasis mine.)
6 Based on these letters, I am fairly certain that Mr Young and Mr Fear were appointed as agents for the Bank in relation to this property on 12 February 1987. But this is not a normal discovery application in the course of an action. This application is sought in the course of preparing for an appeal. I consider that the production of the document is not relevant to the arguing of the appeal.
7 In the amended statement of claim of 27 May 2000 which was before Acting Master Chapman there are two references to this document. Paragraphs 43 and 44 state:
"43. The Bank as mortgagee in possession of the winery land and buildings have dishonesty denied that they are 'mortgagees in possession' despite documents and 'deeds of appointment' of David James Young and Charles Candlin Fear having been executed between the said parties.
44. The Bank as mortgagee has failed to as per the statutory requirements and refused to make available the following documents being 44.1 ... 44.2 ... 44.3 the 'Deeds of Appointment' of Young and Fear as agents for the mortgagee in possession, stated as having been executed in about January 1987."
- The prayers for relief include:
"(4) That from about January 1987 the mortgagee by its agents David James Young and Charles Candlin Fear was in possession of the land, buildings and was in fact a 'mortgage in possession' of Lot 29 Creek Street, Katanning, Western Australia."
(Page 9)
- land has not been used for the past 15 years, except that a neighbour uses the toilet. The rates and taxes have not been paid on the land for that period. The land is registered in the names of the Brides as trustees of a trust, but the Bank holds a registered mortgage over it. I mention that because beneath this forensic battle is a property of value not producing any return to the owners or to the Bank.
9 Acting Master Chapman referred to some of these matters at pars 12, 13, 14, 15 and 79 - 82, which I quote:
"[12] The defendants argue that the mortgage does not remain in possession notwithstanding the fact that in a letter written by Mr Fear on 3 November 1988 he states:
'The Australian Bank Limited has now taken possession of the property as mortgagee in possession and is progressing to the appointment of selling agents.'
[13] The defendants contended that the assertion of that right has gone stale as nothing has been done since to establish that assertion. In this case, the Brides have remained in physical possession of the property since November 1988, they have received rate notices for the property and the bank has not pursued the appointment of selling agents in relation to the property in question.
[14] The defendants argue that the mere assertion by an agent of the bank 12 years ago in the circumstances of this case would not draw one to the conclusion that the bank remains a mortgagee in possession, if it ever fell within that category.
[15] With this, I would agree, particularly when one takes into account the stringent approach usually taken as is illustrated in an article titled 'The Conveyancer' 1994 68 ALJR 812, the author, Peter Butt, at 814 had this to say:
'Indeed, so stringent is the accountability, that courts are said to be very slow to decide that mortgagees have taken possession: Gaskell v Gosling [1896] 1 QB 669 at 691 per Rigby LJ.'
....
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- [79] The defendants deny that they are mortgagees in possession of the winery land. Nonetheless they argue that even if they were found to be mortgagees in possession there is still a mortgage over the winery land, the first defendant is the mortgagee of that mortgage and it would be premature to grant the plaintiffs the relief they seek.
[80] The defendants argue the appropriate time at which the account is to be taken between the mortgagor and the mortgagee is when the mortgagee is in possession and they seek to sell the land or exercise their rights to obtain an order for foreclosure.
[81] A mortgagee who goes into possession of a mortgaged property is bound to account to the mortgagor in redemption of foreclosure proceedings. The account directed against the mortgagee in possession is of what has been received or without lawful default, might have been received. The rule applies whether the possession be of land or of business. See Williams v Price [1824] 1 SAM NST 581, Chaplin v Young [1864] 33 BEAB 330 and Bompas v King [1886] 33 Ch D 279. There is no allegation in the pleadings, nor is it a fact, that the mortgagee is attempting to sell the land at this stage. Nor has there been an offer to redeem or are orders for redemption sought.
[82] In the circumstances of this case, I consider that the claim against the defendants as mortgagee in possession is premature and the plaintiffs should therefore not be permitted to replead their case."
10 I consider it is not necessary or appropriate that the defendants should produce the notice of appointment of Messrs Young and Fear as agents of the Bank on 12 February 1987. The plaintiffs on the appeal are entitled to rely on their pleading, as if it were true. In addition, they have got before Master Chapman three of the four letters which I have quoted above and those three letters are good secondary evidence that Messrs Young and Fear were appointed as agents of the Bank in respect of this property about January or February 1997. That is sufficient. If they are able to overturn Master Chapman's decision on appeal and the
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- action continues, that is the appropriate time to seek discovery and inspection of this missing document.
11 This application will be dismissed, with costs awarded to the respondents in any event.
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