Foudoulis v O'Donnell (No 2) - [2020] VSC 343

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST

S CI 2017 00193

IN THE MATTER of an application pursuant to s 84 of the Property Law Act 1958 for the modification of a restrictive covenant

– and –

IN THE MATTER of an application for the modification of the restriction arising under a covenant in a transfer of land registered No. 1073692 affecting the land at 6 Wilson Boulevard, Reservoir being the land in folio of the Register volume 4651 folio 188

BETWEEN:

PETER FOUDOULIS	Plaintiff
– and –
KEVIN HUGH O’DONNELL and DIMMITY JANE PUSPA O’DONNELL	Defendants

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JUDGE:	Mukhtar AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	Application determined on written submissions
DATE OF JUDGMENT:	12 June 2020
CASE MAY BE CITED AS:	Foudoulis v O’Donnell (No 2)
MEDIUM NEUTRAL CITATION:	[2020] VSC 343	First revision: 17 June 2020

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REAL PROPERTY ― Application for modification of restrictive covenant on land ― Property Law Act 1958 (Vic) s 84(1) ― Objection by beneficiaries of covenant ― Trial by adversarial proceeding ― Application refused by Court ― Approach to judicial exercise of discretion for costs in restrictive covenant cases

COSTS ― Alleged breach by successful party of paramount statutory duty to the Court to further the administration of justice ― No such breach or basis for depriving successful objectors of costs ― Powers of trial Court to fix costs of proceeding ― Civil Procedure Act 2010 (Vic) ss 16, 28(2), 65(2)(c) ― Supreme Court (General Civil Procedure Rules) 2015 r 63.07(2)(c)

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APPEARANCES:
Not required. The Court made this costs determination according to the parties’ written submissions.

HIS HONOUR:

After the trial of this proceeding, on 8 May 2020 the Court published its judgment.[1] The result was a refusal of the plaintiff’s application made under s 84(1)(c) of the Property Law Act 1958 (Vic) to modify a single dwelling covenant that burdened his residential land at 6 Wilson Boulevard in Reservoir. The covenant was created in 1922. The plaintiff had sought the modification to enable him to construct two semi-detached double story dwellings and garages in what is presently the backyard of a single dwelling on the land.
[1]Foudoulis v O’Donnell [2020] VSC 248.

The defendants, Kevin and Dimmity O’Donnell, own and live in a home in Broadhurst Avenue which is not far away from the plaintiff’s place. They were one of numerous owners of land in the neighbourhood having the benefit of the covenant, and therefore had legal standing to object to the plaintiff’s application. They and four other beneficiaries objected to the application. The O’Donnells took the responsibility of being the defendants to the application.

Under s 84(1)(c) of the Property Law Act, the legal onus was squarely on the plaintiff to establish that the modification to the restrictive covenant as sought would not cause ‘substantial injury’ to beneficiaries of the covenant. The plaintiff’s case was predicated on a contention that the benefits of a single dwelling covenant…

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: [2020] VSC 343
Decision Date: 12 June 2020

CaseChat Overview and Summary

In the matter of Foudoulis v O'Donnell (No 2), the applicants sought a modification of a restrictive covenant on certain land, pursuant to section 84(1) of the Property Law Act 1958 (Vic). The application was contested by the beneficiaries of the restrictive covenant, who objected to the modification. The case was heard in the Supreme Court of Victoria, where the Court was required to exercise its discretion regarding the costs of the proceeding.

The court was tasked with determining whether the applicants had breached their paramount statutory duty to the Court to further the administration of justice, which could have resulted in the successful objectors being deprived of their costs. The court also needed to consider the powers of the trial court to fix the costs of the proceeding, as provided under sections 16, 28(2), and 65(2)(c) of the Civil Procedure Act 2010 (Vic), and rule 63.07(2)(c) of the Supreme Court (General Civil Procedure Rules) 2015.

After considering the arguments and evidence presented, the court found that there was no breach of the paramount statutory duty by the applicants and no basis for depriving the successful objectors of their costs. The court exercised its discretion in fixing the costs of the proceeding, taking into account the nature and complexity of the case, the conduct of the parties, and the outcome. The court concluded that the applicants' application for modification of the restrictive covenant should be refused and that the objectors were entitled to their costs.

The final orders of the court were that the applicants' application for modification of the restrictive covenant was dismissed, and the objectors were to recover their costs from the applicants, in accordance with the provisions of the Civil Procedure Act 2010 (Vic) and the Supreme Court (General Civil Procedure Rules) 2015.

Orders