Haintz v Whaley

[2013] VCC 78

IN THE COUNTY COURT OF VICTORIA Revised
(Not) Restricted

AT MELBOURNE

COMMERCIAL LIST
GENERAL DIVISION

Case No. CI-12-02378

GEORGE HAINTZ	Plaintiff
v.
PENNY WHALEY AND CAGMAP PTY LTD	Defendants

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JUDGE:	His Honour Judge Anderson
WHERE HELD:	Melbourne
DATE OF HEARING:	18 February 2013
DATE OF JUDGMENT:	18 February 2013 (revised 19 February 2013)
CASE MAY BE CITED AS:	Haintz v. Whaley & Anor
MEDIUM NEUTRAL CITATION:	[2013] VCC 78

REASONS FOR JUDGMENT

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Catchwords:             Practice and procedure – Proceeding issued to “substantiate the claim of the caveator” pursuant to s.89A(3)(b) of the Transfer of Land Act 1958 – Caveat claimed interest in two parcels of land “as beneficiary under a Deed of Trust”- Statement of claim claimed an interest in one of the parcels as the “common intention” of the parties expressed in a verbal agreement confirmed by a later email – Claim of the caveator not established to the satisfaction of the Court – Order that the caveat be removed and the proceeding otherwise be dismissed with costs   

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr G. Dalton	Vadarlis & Associates
For the Defendant	Mr C. Rechnitzer	RB Legal

HIS HONOUR:

1The proceeding was brought by the plaintiff pursuant to Section 89A (3)(b) of the Transfer of Land Act 1958, to substantiate the claim of the plaintiff as caveator in relation to land at 116 and 118 Errol Street North Melbourne. The defendants by amended summons filed 15 November 2012, seek summary judgment in the proceeding pursuant to Rule 23.03 or alternatively pursuant to section 62 and 63 of the Civil Procedure Act 2010.

2The relevant caveat is dated 21 February 2012 and was lodged by the plaintiff’s solicitors on his behalf with Land Victoria. The plaintiff claimed in respect of Certificates of Title 11166 Folios 057 and 058 to be “entitled in equity as beneficiary under a Deed of Trust dated 30 September 2009 pursuant to which the trustee is the registered proprietor”.  The two Certificates of Title refer to the land respectively at 116 and 118 Errol Street, North Melbourne. The registered proprietor of the properties is the second defendant. The second defendant is the trustee of the Cagmap Family Trust, which was established by deed dated 30 September 2009.

3The statement of claim indorsed on the writ in the proceeding, pleads in paragraph 22 that, “On 21 February 2012, the plaintiff lodged a caveat on both 116 Errol Street and 118 Errol Street, registered caveat number AJ 505946W (the caveat) on 22 February 2012. In paragraph 23, it is pleaded that, “On 16 April 2012, the Registrar of Titles gave notice to the plaintiff pursuant to Section 89A (3) that the second defendant had applied for the caveat to be removed in respect of 118”.

4By the operation of section 89A(3), unless the plaintiff had given notice to the Registrar that “proceedings in a court of competent jurisdiction to substantiate the claim of the caveator in relation to the land and the estate or interest therein, in respect of which the application was made” had been initiated, the caveat would have lapsed.

5The statement of claim in the proceeding sets out matters of history in the relationship between the plaintiff and the first defendant who was his domestic partner between about 2008 and 2011. The statement of claim, pleads that the second defendant was established to act as trustee for the Cagmap Family Trust and that on 30 September 2009, the Cagmap Family Trust was established with the second defendant as trustee and the first defendant as the sole director, secretary and sole shareholder of the second defendant.

6The statement of claim does not however attempt to substantiate the claim made on the plaintiff’s behalf to an estate or interest in the two parcels of land on the grounds set out in the caveat. Rather, in paragraph 18 of the statement of claim, it is pleaded that “notwithstanding the establishment of the family trust and the second defendant’s role as trustee of the family trust” that the parties “common intention” was that “the plaintiff would be responsible for and the beneficial owner of 118 Errol Street and the first defendant would be responsible for and the beneficial owner of 116 Errol Street”.

7The common intention was expressed to be represented by an agreement between the plaintiff and the first defendant, which was effected by the transfer of both properties from the previous registered proprietor, Reinsford Pty Ltd, a company though which the plaintiff had previously conducted his business interests. The agreement was said to be “partly oral, partly in writing and is partly to be implied. In so far as it was oral it was constituted by on-going verbal agreements between the plaintiff and the first defendant in 2010 and 2011. In so far as it is in writing it is constituted by the content of an email sent by the plaintiff to the first defendant on 23 May 2011, which email sets out the terms of their common intention and requests the first defendant to respond by email if she disagreed with any of its content; no such response was made. In so far as it is to be implied, the agreement is implied by the subsequent conduct of the parties: since the 6 May 2011 transfers of land, the plaintiff has been responsible for 118 Errol Street and the first defendant for 116 Errol Street”.

8In the circumstances, where the plaintiff has not sought to substantiate the claim made in the caveat, it is appropriate to conclude pursuant to section 89A(7)(a) that “the claim of the caveator is not substantiated to the satisfaction of the Court”. In that event, “the Court may make such order in relation to the caveat as the Court thinks fit and the Registrar shall give effect thereto”. I consider therefore, it is appropriate to order that “caveat number AJ505946W lodged on behalf of the plaintiff in respect of Certificates of Title Volume 11166 Folios 057 and 058 shall be removed and the Registrar of Titles shall give effect to this order”.

9The question then becomes what to do with what remains of the proceeding? By its amended summons, the defendants seek “a declaration that the plaintiff holds no legal or equitable interest in 116 and 118 Errol Street Port Melbourne (Certificates of Title Volume 11166 Folios 057 and 058)”. Plaintiff’s counsel Mr Dalton has submitted that the plaintiff’s claim, in so far as it seeks a declaration that the second defendant holds its interest in number 118 Errol Street North Melbourne on trust for the plaintiff beneficially, this is as a consequence of the alleged agreement representing the common intention of the plaintiff and first defendant.

10Mr Rechnitzer, who appears for the defendants, has submitted that it would be appropriate to dismiss that claim on the basis that it has no real prospect of success having been made without any foundation. I consider that the appropriate further order for me to make is to otherwise dismiss the proceeding, and not to grant the declaration sought by the defendants in the amended summons.

11In my view this is the appropriate course for the following reasons:

a.It is plain on the face of the statement of claim indorsed on the writ that the proceeding was brought “to substantiate the claim of the caveator in relation to the land”. That claim has not been substantiated;

b.The claim has not been substantiated because, although the original caveatable interest was based upon the basis of the plaintiff’s entitlement as a beneficiary under the Deed of Trust dated 30 September 2009, the actual claim made in the proceeding is expressed to be “notwithstanding the establishment of the family trust and the second defendant’s role as trustee of the family trust”;

c.The caveat was lodged in respect of both properties although the claim made in the proceeding only sought to establish an interest in respect of No. 118 Errol Street.

12I do not consider therefore that the present action is an appropriate vehicle for the plaintiff to pursue what is effectively a separate claim. As to whether it can do so in a separate proceeding is not a matter upon which I need to make a final determination, although it is a matter in respect of which I have some doubt because of the caveat lodged by the plaintiff relying upon the Deed of Trust. There are also a number of matters raised by the affidavit material which may affect the bona fides of the claim which the plaintiff has now sought to make for an interest in one of the properties.

13These matters include:

a.the production of a copy of the trust deed which contains an execution clause where the signature of the settler has apparently been forged. The settler, Mr Anthony Schlicht, a barrister, has sworn an affidavit filed in the proceeding on behalf of the defendants that a copy of the trust deed produced by the plaintiff and exhibited to an affidavit sworn by him, does not contain his signature and that the execution page of the trust deed exhibited to the first defendant’s affidavit does contain his signature. The allegedly forged signature is noted as having been witnessed by Mr Fred Crea, the plaintiff’s former business partner. The plaintiff says that Mr Crea was involved in discussions between himself and the first defendant prior to an agreement being reached between them. Although the plaintiff swore a recent affidavit, neither he nor Mr Crea have addressed the issue of Mr Schlicht’s signature on the trust deeds exhibited to affidavits in the application;

b.the agreement relied upon as representing the common intention of the parties, is based on “verbal agreements between the plaintiff and the first defendant in 2010 and 2011”. The relevant conversations are not set out in any detail in the affidavits filed by the plaintiff;

c.the plaintiff also relies upon an email dated 23 May 2011, which he says was sent to the first defendant, although she denies having received it, The email purports to set out the “in principle agreement” which the plaintiff alleges was reached between them. The first defendant is asked that, “if you disagree with any of it, please email me back”. The email does not contain an email address for the first defendant. This by itself may not be unusual but the first defendant in affidavit material referred to the fact that she had searched files in respect of each of the computer addresses she used at that time and had not found the email. The plaintiff in later affidavits has not nominated the address to which he says the email was sent;

14In my view however, it is not appropriate for the Court to further consider these matters, although they were raised in argument. To do so would, in my view, be to go beyond what is required pursuant to the statutory provisions. In the circumstances, I propose to make the following orders:

1.    Caveat Number AJ505946W lodged on behalf of the plaintiff in respect of Certificates of Title Volume 11166 Folios 057 and 058, shall be removed and the Registrar of Titles shall give effect to this order.

2.    The proceeding otherwise be dismissed.

3.    The plaintiff must pay the defendants’ costs of the proceeding including any reserved costs and the costs of the defendant’s amended summons filed 15 November 2012 and of the hearing today, to be taxed on a solicitor client basis in default of agreement.

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Certificate

I certify that the preceding 4 pages are a true copy of the reasons for decision of His Honour Judge Anderson delivered on 18 February 2013 and revised on 19 February 2013.

Dated:            19 February 2013

Philippa Gilkes 

Associate to His Honour Judge Anderson