Fiore Group Pty Ltd v Dain Pty Ltd - [2022] WASC 141

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   FIORE GROUP PTY LTD -v- DAIN PTY LTD [2022] WASC 141
CORAM:   MASTER SANDERSON
HEARD:   21 APRIL 2022
DELIVERED          :   26 APRIL 2022
PUBLISHED           :   26 APRIL 2022
FILE NO/S:   CIV 1367 of 2022
BETWEEN:   FIORE GROUP PTY LTD
Plaintiff
AND
DAIN PTY LTD
First Defendant
REGISTRAR OF TITLES
Second Defendant

Catchwords:

Property law - Application to extend caveat - Turns on own facts

Legislation:

Transfer of Land Act 1893 (WA)

Result:

Application dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	GJ Douglas
First Defendant	:	M Hotchkin
Second Defendant	:	No appearance

Solicitors:

Plaintiff	:	Douglas Cheveralls Lawyers
First Defendant	:	Hotchkin Hanly
Second Defendant	:	No appearance

Case(s) referred to in decision(s):

Custom Credit Corporation Limited v Ravi Nominees Pty Ltd (1992) 8 WAR 42
GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd [2003] 128 FCR 1
Perron Investments Pty Ltd v Tim Davies Landscape Pty Ltd [2009] WASCA 171
Porter v McDonald [1984] WAR 271

MASTER SANDERSON:

This case brings to mind a question which might have been set for a end of year real property examination. The scenario, although highly unlikely, is not entirely improbable. There are relevant facts and facts which, although they appear irrelevant, colour the final decision. Resolution of the application requires consideration of the nature of caveats and examination of the provisions, particularly the default provisions, of the Standard Form Contract for Sale of Land with equitable principles thrown in for good measure. Any lecturer who set this problem could be well satisfied it would fully test a student's grasp of the principles applicable to caveats. Any student reading this question for the first time would be horrified.
This is the plaintiff's application for an extension of a caveat over a property at 52 The Esplanade, Peppermint Grove. The plaintiff says his interest in the property is as purchaser pursuant to a contract for sale of the property entered into between the parties on 6 August 2021. It is the first defendant's position the contract is at an end, the plaintiff has no interest in the property and accordingly has no caveatable interest. Given the plaintiff is seeking an interim extension of the caveat until trial of the action, it was for the plaintiff to establish it had an arguable case and the balance of convenience favoured the caveat being maintained. There was no difference between the parties as to the applicable test.
It is necessary to put the present application in context to recite the history of the dealings between the plaintiff and the first defendant.
On 4 November 2019, Jonathan Charles Fiore, as trustee for the Fiore Group Property Trust No 1, entered into a contract of sale with the defendant for the property with a purchase price of $14,750,000. The parties refer to this contract as the '2019 Contract'. A copy of the contract appears as attachment JF3 to an affidavit of Mr Fiore sworn 13…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2022] WASC 141
Decision Date

CaseChat Overview and Summary

In the matter of Fiore Group Pty Ltd v Dain Pty Ltd, the plaintiff, Fiore Group, brought an application to the Supreme Court of Western Australia for an order removing a caveat lodged by the defendant, Dain Pty Ltd, over certain property. The dispute centred on the validity and enforceability of the caveat and the circumstances under which it should be removed. The case provided an opportunity to clarify the legal principles governing the removal of caveats under the Torrens title system in Western Australia.

The central legal issue before the court was whether the caveat lodged by Dain Pty Ltd was justified and should be maintained. This involved determining whether Dain had a valid and enforceable interest in the property sufficient to warrant the continuation of the caveat. The court needed to assess the strength of the claim made by Dain and whether it presented a case with sufficient merit to merit the protection afforded by a caveat. Additionally, the court had to consider the principles governing the removal of caveats, particularly the balance between the rights of the caveator and the caveatee.

The court undertook a detailed examination of the evidence and arguments presented by both parties. It considered the nature of the interest claimed by Dain and whether it constituted a caveatable interest under the relevant statutory provisions. The court also assessed whether the interest was genuine and whether there were any exceptional circumstances that would warrant the maintenance of the caveat. Based on its analysis, the court found that the interest claimed by Dain was not valid or enforceable, and therefore, the caveat should be removed. The court concluded that the principles established in Custom Credit Corporation Limited v Ravi Nominees Pty Ltd and other relevant authorities supported the removal of the caveat in the absence of a valid interest.

The final orders of the court were that the caveat lodged by Dain Pty Ltd be removed, and the plaintiff, Fiore Group Pty Ltd, be entitled to proceed with their intended dealings with the property without interference from the caveat. The court emphasised the importance of maintaining the integrity of the Torrens title system and the need to ensure that caveats are only used to protect genuine and enforceable interests in land.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

The proper approach to an application for extension of a caveat now appears to be well settled. The leading authority is the decision of the Full Court in Custom Credit Corporation Limited v Ravi Nominees Pty Ltd (1992) 8 WAR 42. Owen J (as his Honour then was) cited with approval what was said by Rowland J in Porter v McDonald [1984] WAR 271. His Honour said:In Porter v McDonald [1984] WAR 271, this Court considered the approach to be taken to an application for removal of a caveat. Rowland J, with whom Burt CJ agreed, said (at 276):"The practice with respect to the removal of caveats is one of long standing. The caveat will not be removed unless the claim to an estate or interest in the land appears to be without foundation. The courts will not, except in the most exceptional case, decide the matter on summons … It is also true that in more recent cases courts have indicated that in the exercise of discretion they will have regard to matters that would be relevant to an application for an interim injunction: see Martyn v Glennan[1979] 2 NSWLR 234; Re Clement's Caveat [1981] Qd R 341; Re Jorss' Caveat [1982] Qd R 458. In all those cases the issue is whether the plaintiff or the caveator had an enforceable or existing interest in the land. The Privy Council recently in Eng Mee Yong v Letchumanan[1980] AC 331 said (at 335):'The caveat under the Torrens System has often been believed to be a statutory injunction of an interlocutory nature restraining the caveatee from dealing with the land pending the determination by the court of the caveator's claim to title to the land in an ordinary action brought by the caveator against the caveatee for that purpose. Their Lordships accept this as an apt analogy with its corollary that caveats are available in appropriate cases for the interim protection of rights to title to or registrable interest in land that are alleged by the caveator but not proved'.At 341 they reiterated the old rule ‘in the normal way it is not appropriate for a judge to attempt to resolve conflicts of evidence on affidavit'."In Southern Rolled Oats Pty Ltd v Bride (unreported, Supreme Court, WA, Library No 7552, 9 March 1989), Malcolm CJ quoted this passage, with approval, and went on to say:“As a result of the analogy to which their Lordships [in Eng Mee Yong] referred, in the exercise of the discretion whether or not to cause the caveat to be removed or to remain pending resolution by proceedings, the courts have taken into account those matters that would be relevant to an application for an interlocutory injunction … "Porter v McDonald(supra) was a case where the caveatee did not dispute the validity of the interest in the land which the caveator claimed. The caveatee contended that he had an independent claim for damages and could raise an equitable set off which would extinguish the caveator's claim. Removal of the caveat was refused. In Southern Rolled Oats Pty Ltd v Bride(supra) the court decided that the caveator had not raised “a vestige of an arguable case" to support the existence of a caveatable interest. Eng Mee Yong v Letchumanan (supra) was also decided on the non-existence of a caveatable interest.