Harden Shire Council v Richardson - [2012] NSWSC 622

Supreme Court

New South Wales

Case Title: Harden Shire Council v Richardson

Medium Neutral Citation: [2012] NSWSC 622

Hearing Date(s): 1 July 2011, 25 August 2011

Decision Date: 07 June 2012

Jurisdiction: Common Law

Before:
Johnson J

Decision:
Judgment is given to the Plaintiff for possession of the Jugiong property.

Grant leave to the Plaintiff to issue a writ of possession in respect of the Jugiong property forthwith.

The Defendant is to withdraw caveat xxx within two business days.

Catchwords:
REAL PROPERTY - sale of land by council for unpaid rates - defendant purchased land in 1998 in false name - defendant misleads council that he is tenant and not owner of land - land sold at public auction - condition of contract for sale that council gives vacant possession to purchaser - claim by council for possession of land before completion of sale to give vacant possession to purchaser on completion - defendant refuses to surrender possession of land - efficacy of sale process - compliance with ss.713 and 715 Local Government Act 1993 - whether summary rejection by council of partial offer by defendant on eve of auction constituted non-compliance with s.715(2)(b) - whether council entitled to possession of land - whether defendant required to surrender possession of land before registration of transfer - implied entitlement of council to obtain possession under Local Government Act 1993 - application of s.60 Real Property Act 1990 and s.109 Conveyancing Act 1919 - council entitled to possession - judgment for possession with leave to issue writ of possession forthwith

Legislation Cited:
Local Government Act 1993
Residential Tenancies Act 1987
Residential Tenancies Act 2010
Real Property Act 1900
Conveyancing Act 1919
Local Government Act 1919
Bankruptcy Act 1966 (Cth)
Civil Procedure Act 2005

Cases Cited:
Anderson v Lismore City Council [2011] NSWSC 1058; 185 LGERA 239
Logue v Shoalhaven Shire Council [1978] 1 NSWLR 710
Logue v Shoalhaven Shire Council [1979] 1 NSWLR 537
Blacktown Municipal Council v Custom Credit Corporation (1968) 71 SR (NSW) 365
Quzag v Gunning Shire Council [2005] NSWSC 970; 142 LGERA 77
R v Secretary of State for the Home Department; ex parte Venables [1998] AC 407
Green v Daniels [1977] HCA 18; 51 ALJR 463
Minister for Aboriginal Affairs v Peko-Wallsend Limited [1986] HCA 40; 162 CLR 24
Sorbello v Whan [2007] NSWSC 951
Plenty v Dillon [1991] HCA 5; 171 CLR 635
Kuru v State of New South Wales [2008] HCA 26; 236 CLR 1
Hillebrand v Penrith City Council [2001] NSWSC 200; 51 NSWLR 424
Sood v Christianos [2008] NSWSC 1087
Bropho v Western Australia [1990] HCA 24; 171 CLR 1

King Investment Solutions Pty Limited v Hussain [2005] NSWSC 1076 (reported in part at 64 NSWLR 441)
King Investment Solutions Pty Limited v Hussain [2010] NSWSC 821
Saraswati v The Queen [1991] HCA 21; 172 CLR 1
Isaacs v McGuire (1888) 14 VLR 815
Reynolds v Doyle (1919) 19 SR (NSW) 108
Troncone v Aliperti (Court of Appeal, 20 April 1994, BC9402483)
Pelechowski v Registrar, Court of Appeal (NSW) [1999] HCA 19; 198 CLR 435
NSW Trustee and Guardian v Schneider [2011] NSWSC 424
Residential Housing Corporation Pty Limited v Esber [2011] NSWCA 25; 15 BPR 29, 213
Starceavich v Swart & Associates Pty Limited [2006] NSWSC 960
Perpetual Trustee Company Limited v Agusta Pty Limited [2008] NSWSC 646; 72 NSWLR 148
Re Sterling; ex parte Esanda Limited (1980) 44 FLR 125
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355
Network Ten Pty Limited v TCN Channel Nine Pty Limited [2004] HCA 14; 218 CLR 273
CIC Insurance Limited v Bankstown Football Club Limited [1997] HCA 2; 187 CLR 384
Segal v Waverley Council [2005] NSWCA 310; 64 NSWLR 177

Texts Cited:
Pearce and Geddes, "Statutory Interpretation in Australia", 7th edn, 2011

Woodman and Nettle, "The Torrens System in NSW", 2003

Butt and Others, "The Torrens System in NSW", 2nd edn

Lang, "Conveyancing and Property Law (NSW)", CCH

Butt, "Land Law", Lawbook Co, 6th edn, 2010

Category: Principal judgment

Parties:
Harden Shire Council (Plaintiff)
Anthony Charles Richardson (aka Ron Evans) (Defendant)

Representation

- Counsel:
Ms TA Iskra (Plaintiff - 1 July 2011)
Mr AG Rogers (Plaintiff - 25 August 2011)
Ms PM Lane and Dr SJ Chapple (Defendant)

- Solicitors:
KP Carmody & Co (Plaintiff)
Legal Aid NSW (Defendant)

File number(s):
2011/81441

Publication Restriction:
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JUDGMENT

JOHNSON J: The present proceedings involve a claim by a council for possession of land arising from the council's exercise of power of sale under the Local Government Act 1993 ("LG Act") for unpaid rates. The council seeks possession of the land so that the purchaser may be given possession of the property on completion of the sale in accordance with the contract for sale between the council and the purchaser.
As will be seen, the facts of the case bear some unusual features. A variety of legal issues have been raised to resist the claim for possession of land.

The Plaintiff's Claim

By Statement of Claim filed 11 March 2011, the Plaintiff, Harden Shire Council, seeks judgment for possession of land at Jugiong ("the Jugiong property"). The Plaintiff seeks leave to issue a writ of possession in respect of the Jugiong property forthwith.
The Defendant, Anthony Charles Richardson (also known as Ron Evans), resists the claim for relief. A Defence was filed on 19 April 2011 which put in issue the Plaintiff's claim for possession of the Jugiong property.
The purchaser from the Plaintiff of the Jugiong property, David Smith, is not a party to the proceedings.

The Hearing in this Court

After the filing of a Defence, the proceedings were referred to me for a judicial directions hearing in accordance with the Possession List Practice Note. When the matter came before me on 8 June 2011, Ms Iskra, counsel for the Plaintiff, foreshadowed an application by the Plaintiff to strike out the Defence. Having examined the pleadings, which indicated that the Jugiong property had been sold by the Plaintiff for unpaid rates for a sale price of about $33,000.00 and given what were indicated to be largely legal questions which fell to be determined in the proceedings, I took the view that the better course was to list the matter for final hearing at an early time. Ms Lane, counsel for the Defendant, agreed with this approach. I fixed the matter for hearing on 1 July 2011, with a half-day estimate, and gave directions for the filing and service of documents and submissions in aid of that hearing.
The hearing proceeded on 1 July 2011. A number of affidavits were read and several deponents were cross-examined. In particular, the Defendant was cross-examined at some length by counsel for the Plaintiff.
It seemed to me that the relatively narrow issues envisaged for the final hearing had expanded, as had the estimate for the hearing. Given the issues in the proceedings and the limited quantum involved, I raised with the parties the utility of mediation and determined ultimately, under s.26 Civil Procedure Act 2005, that mediation should be attempted during the period of the inevitable adjournment of the hearing.
At the conclusion of the hearing on 1 July 2011, I adjourned the proceedings to 3 August 2011. The Court was informed that mediation was unsuccessful and that the hearing would resume. The hearing resumed on 25 August 2011 and, at the conclusion of submissions, the Court reserved judgment.
At the resumed hearing on 25 August 2011, Mr Rogers of counsel appeared for the Plaintiff and Ms Lane and Dr Chapple appeared for the Defendant.

Findings of Fact

It is appropriate to record findings of fact which are pertinent to the proceedings. Most facts are not in dispute. However, several areas of factual dispute emerged from the evidence of the Defendant, in particular under cross-examination.
At the outset, I record my view that the Defendant was a highly unsatisfactory witness. I do not accept his account of events in any area of controversy unless it is corroborated by independent evidence. This assessment is not based upon demeanour alone, although the Defendant's demeanour certainly did not assist him. The assessment is based upon the totality of the evidence, including contemporaneous documentation and the evidence of other witnesses whose affidavits were read in the proceedings, some of whom were not cross-examined by counsel for the Defendant.
The Defendant was born in July 1945.
On or about 5 August 1998, a person identifying himself as Ron Evans of "Goodhope", Yass, purchased the Jugiong property for $20,000.00 from the Commissioner for Main Roads. The Defendant has testified that he purchased the Jugiong property in the name of Ron Evans. He could not explain in evidence why he had purchased the property in a different name. He said it "was just a spur of the moment thing" (T15, 1 July 2011). The Plaintiff does not dispute (and I accept) that the Defendant and Ron Evans are one and the same person although, as will be seen, the Defendant did not inform the Plaintiff of this fact until September 2010.
It appears that the Defendant commenced to occupy the Jugiong property in 1998 although he failed to register a Memorandum of Transfer at the Land and Property Management Authority so that the property remains, to this day, registered in the name of the Commissioner for Main Roads. It was not submitted that anything turned on this omission by the Defendant in this case.
However, in accordance with information contained on a Notice of Sale provided to it, the Plaintiff commenced to rate the Jugiong property for rates and charges under the LG Act from about 5 August 1998 and to issue rate notices under the LG Act addressed to Ron Evans.
I am satisfied that the Plaintiff issued rate notices addressed to Ron Evans at the Jugiong property from 1998. There is some question as to whether rate notices posted to that address were physically received by the Defendant. The Defendant readily acknowledged in evidence his knowledge and awareness that the Plaintiff would require the payment of rates and charges for the Jugiong property. His evidence suggested that there was some unreliability surrounding the receipt of mail by him associated with the presence or absence of a letterbox. I am satisfied that most, if not all, rate notices sent to the Jugiong property were received by the Defendant.
On or about 7 September 2007, the Defendant came to the front counter of the offices of the Plaintiff at Harden and spoke to Ms Kim Hill, a revenue officer employed by the Plaintiff. Ms Hill's account of what transpired that day is contained in an affidavit affirmed 18 May 2011 read in the Plaintiff's case.
Initially, counsel for the Defendant did not require Ms Hill for cross-examination. However, after the Defendant had been cross-examined on 1 July 2011 and had contradicted (apparently for the first time) aspects of Ms Hill's evidence, I acceded to a belated application by counsel for the Defendant to cross-examine Ms Hill. The parties had agreed (and I had directed) that another witness for the Plaintiff, Maxwell Kershaw, the General Manager of the Plaintiff, could be cross-examined by means of audio link (telephone). Ms Hill was not physically at Court on 1 July 2011 and the application (to which I acceded) was that she be made available for cross-examination by audio link as well. Ms Hill was cross-examined and adhered to her account as to what had transpired between her and the Defendant on this and other occasions.
I record my acceptance of the evidence of Ms Hill over that of the Defendant at any point where there is conflict between their accounts. Other aspects of the evidence fortify my conclusion that Ms Hill's account should be accepted. The Defendant's evidence in cross-examination revealed a somewhat confusing account which, in a number of respects, appears to have taken his own legal representatives by surprise. Despite the careful preparation which had obviously gone into the matter by those legal representatives, including the preparation of lengthy written submissions and the preparation of an affidavit sworn by the Defendant, an account emerged from him in cross-examination which sought to put in issue factual matters not previously indicated as being in contest.
The following factual findings are based upon the evidence of Ms Hill, which I accept.
I return to events at the Plaintiff's Chambers on 7 September 2007. The Defendant spoke to Ms Hill saying words to the effect of "I am the tenant of Lot 33 Jugiong Road, Jugiong" and "I have to pay some of the rates because I am the tenant". The Defendant paid the sum of $2,800.00 on the rate assessment and $200.00 on the water account. Once payment had been made, Ms Hill enquired "Who should I make the receipt out to?" and the Defendant replied "Anthony Richardson". Ms Hill said "Do you know where the owner of the property is?" and the Defendant replied "Ron Evans lives in the Northern Territory somewhere and is hard to contact". Ms Hill issued a receipt in favour of "A Richardson" in the sum of $3,000.00.
It is not at all clear why the Defendant engaged in a pretence at this point that he was not the owner of the Jugiong property. This was a continuation of a type of charade which, as will be seen, continued right up to the auction at which the Jugiong property was sold in 2010.
In cross-examination, it was put to the Defendant that he had purchased the Jugiong property in a false name to assist him to disguise from the Department of Social Security the fact that he owned this property and, apparently, other rural tracts of land. For the purpose of determining these proceedings, it is not necessary for me to make a finding concerning the Defendant's motivation in using a false name in 1998 and in maintaining a pretence right through to September 2010 that he and Ron Evans were two different people. It is sufficient to record my conclusion that the Defendant's deception not only misled officers of the Plaintiff, but placed himself in a somewhat complicated web from which he now seeks to be extricated.
The evidence establishes that a substantial sum by way of unpaid rates and charges was outstanding by December 2009. Due to the quantum of rates and charges owing and in arrears and the length of time for which they had been outstanding, the Plaintiff took a decision, on the recommendation of Mr Kershaw, to include the Jugiong property for sale under s.713 LG Act.
On 2 December 2009, a letter was sent by ordinary post by the Plaintiff, addressed to "Mr R Evans" at the Jugiong property, giving notice of the Plaintiff's intention to include the property in a report to Council on 16 December 2009 with a recommendation that the property be offered for sale at auction for unpaid rates and charges. The letter invited the recipient to contact the Plaintiff's revenue officer, Ms Hill, "Should you wish to discuss the implications of this action, or discuss payment arrangements to enable the property to be removed from the proposed sale of land for unpaid rates and charges".
I am satisfied that this letter came to the attention of the Defendant so that he was put on notice of the Plaintiff's intention with respect to unpaid rates on the Jugiong property.
I am satisfied that the Defendant took no steps in response to receipt of the letter of 2 December 2009 from the Plaintiff.
On 10 March 2010, the Plaintiff sent, by ordinary post, a notice addressed to "Mr R Evans" at the Jugiong property in the following terms:
"Notice is hereby given that Harden Shire Council has resolved, in pursuance of Section 713 of the Local Government Act, 1993 to sell the land described hereunder of which you are the registered owner or in which you appear to have an interest:
Owners name: Mr R Evans
Property Description: Lot [XXX]
Jugiong Road, Jugiong NSW
Property Number: [XXX]
Amount Outstanding
As at 16 December 2009: $7,837.69
In default of payment to the Council of the amount stated above and any other rates and charges becoming due and payable after the above date, before the time fixed for the sale, the said land will be offered for sale by public auction by Harden Shire Council on a date to be set by Council at the March 2010 meeting."
On or about 24 March 2010, a notice under s.713 LG Act was affixed to the boundary fence of the Jugiong property by officers of the Plaintiff. By that notice, Mr Kershaw certified that a total amount of $7,837.69 was outstanding by way of rates or charges with respect to the Jugiong property, comprising a sum of $5,550.46 of rates overdue for more than five years and $2,287.23 constituting all other rates and charges due and in arrears. The notice informed any reader of the Plaintiff's intention to sell the property at public auction at the Plaintiff's Chambers on 31 July 2010 in default of payment to the Plaintiff of the sum $7,837.69 "or any arrangement satisfactory to the Council for all such rates being entered into by the rateable person before the time fixed for the sale".
In this way, the notice drew attention to the provisions in s.715(2) LG Act, to which I will return later in the judgment.
That the notice was affixed to a fence on the Jugiong property is demonstrated by photographs attached to Mr Kershaw's affidavit affirmed 8 May 2011. The Defendant acknowledged that the sign was affixed to the boundary fence of the property, and he said that he had read it and removed it (T25, T39-40, 1 July 2011).
On 25 March 2010, the sale of the Jugiong property was advertised in the "Harden Express" for the purposes of s.715 LG Act.
On 26 March 2010, the sale of the Jugiong property was advertised in the NSW Government Gazette in accordance with s.715 LG Act.
In the course of cross-examination, the Defendant appeared to assert for the first time that he had attended the Plaintiff's Chambers in about March 2010 to enquire as to what steps he could take to pay out the unpaid rates (T19-20, 1 July 2011). There had been no assertion of such an event by the Defendant in his affidavit, nor in earlier correspondence. When Ms Hill was cross-examined after the Defendant had given his oral evidence, it was not put to her by counsel for the Defendant, that he had attended in March 2010 to make such an offer (T55-60, 1 July 2011).
I do not accept the Defendant's evidence that such an event occurred. There was a visit by the Defendant to Ms Hill on the eve of the auction in July 2010, to which I will come shortly. It may be that there is some confusion in the Defendant's mind and that this is the event which he sought to place in March 2010. I am not satisfied that the Defendant's evidence on this aspect is truthful and reliable and I do not accept it.
What is clear, however, is that the Defendant was on notice of the quantum of unpaid rates and the steps to be taken by the Plaintiff in that respect under the LG Act, together with the provisions of s.715(2) LG Act concerning action which could be taken to avoid the sale for unpaid rates. This is not a case where the owner of property has, in some way, been kept in the dark by a council and then confronted with the exercise of the statutory power of sale for unpaid rates with the owner being placed under temporal pressure or being subjected to some form of unfairness. The Defendant was aware of the true position. Unusually, it was the Plaintiff and its officers who were misled by the deceptive statements of the Defendant.
The Plaintiff's records show that on 25 May 2010, a payment of $113.93 was made towards the water account applicable to the Jugiong property. The evidence does not provide further assistance as to how this modest sum came to be paid in the context of the very substantial sum then outstanding and the statutory consequences which were already in train.

In May 2010, Mr Scott Collins, a real estate agent retained by the Plaintiff, tied an auction sign on to the boundary fence surrounding the Jugiong property. A few days later, Mr Collins drove past the property and saw that the auction sign had been removed. The Defendant admitted that he had seen the auction sign affixed to the property and that he had removed it (T25, 1 July 2011).
In early July 2010, the Defendant came to the front counter at the Plaintiff's Chambers and enquired of Ms Hill concerning the sale process. I accept the account of Ms Hill contained in her affidavit affirmed 18 May 2011 in this respect. The Defendant said words to the effect "When will the property be sold?" and "Is there anything that I can do to stop the property being sold?". Ms Hill replied to the effect "The auction is to be held on 31 July 2010. Payment in full of all costs, rates and charges would be required before that date to avoid the property being sold at auction". The Defendant said words to the effect "I am trying to contact Ron Evans but it is hard to track him down".
Even at this point, the Defendant maintained the deception that he was not the owner and that he was trying to locate the owner. The appropriate conclusion is that the Defendant considered that such a pretence might operate in his favour at that time although, as it happens, it did not. The consequence of his deception was that officers of the Plaintiff had no knowledge that the Defendant was indeed the owner. In the eyes of the Plaintiff's officers, the Defendant was the tenant of the property who had made a payment in 2007, but was stating, less than one month before the scheduled auction, that he was still attempting to find the owner.
Contained within Ms Hill's affidavit, read without objection, is a hearsay account of a further visit by the Defendant to the Plaintiff's Chambers in early July 2010 when he spoke to Ms Jenny Douglas, a customer service staff officer no longer employed by the Plaintiff. It is said, and not disputed by the Defendant, that the Defendant questioned the mailing address for "Mr Evans" and advised that he wished to change it. After the Defendant left the Plaintiff's Chambers, Ms Douglas informed Ms Hill of his visit and she reported to Ms Hill "I told Mr Richardson that as he was the tenant he could not change the mailing address as only the owner could request a change of address".
On 23 July 2010, Mr Kershaw issued a General Manager's Certificate for the purposes of s.713(3) LG Act with respect to the proposed sale of the Jugiong property for overdue rates. The Certificate provided the following breakdown of unpaid rates and charges:

Year	Rate or Charge	Levied	Amount of Rate $	Extra Charges $	Total payments received	Due Date	Cumulative Total
1998/99	Rate	By post	$500.94	31/8/98	$500.94
1999/00 .	Rate	By post	$571.23	$63.19	31/8/99	$1,135.36
2000/01	Rate	By post	$589.57	$133.53	31/8/00	$1,858.46
2001/02	Rate	By post	$608.72	$212.49	31/8/01	$2,679.67
2002/03	Rate	By post	$643.28	$230.15	31/8/02	$3,553.10
2003/04	Rate	By post	$664.07	$290.59	31/8/03	$4,507.76
2004/05	Rate	By post	$692.11	$350.59	31/8/04	$5,550.46
2005/06	Rate	By post	$718.60	$414.07	31/8/05	$6,683.13
2006/07	Rate	By post	$256.62	$471.05	$7,410.80
2006/07	Service	By post	$280.00	31/8/06	$7,690.80
2007/08	Rate	By post	$265.35	$934.67	$2,800.00	$6,090.82
2007/08	Service	By post	$280.00	31/8/07	$6,370 82
2008/09	Rate	By post	$170.99	$413.47	$6,955.28
2008/09	Service	By post	$318.00	31/8/08	$7,273.28
2009/10	Rate	By post	$171.67	$162.74	$7,607.69
2009/10	Service	By post	$230.00	31/8/09	$7,837.69

No challenge was made by the Defendant to the accuracy or sufficiency of the s.713(3) LG Act Certificate issued by Mr Kershaw.
On Friday, 30 July 2010, the day before the auction, the Defendant came to the front counter at the Plaintiff's Chambers and spoke to Ms Hill. He said "I can pay $3,000.00 off the rates today and the rest later". Ms Hill said "You can pay the $3,000.00 if you like but that will not stop the sale tomorrow. Only payment in full of the rates, charges and costs owing can stop the sale".
The Defendant did not pay the $3,000.00 at that time and he departed the Plaintiff's premises.
Having regard to an issue raised by the Defendant in the proceedings concerning the proper construction and application of s.715(2) LG Act, it is appropriate to set out evidence given by Mr Kershaw, under cross-examination, concerning the Defendant's offer made on the eve of the auction. Ms Lane asked Mr Kershaw (T9.26-T10.11, 1 July 2011):
"Q. Was any instruction given by you to Ms Hill about the exercise by Council of its discretion to make a satisfactory arrangement before this particular sale took place?
A. Are you talking about Mr Richardson's sale?
Q. Yes?
A. Okay. Specifically in relation to that sale the offer that was tendered by Mr Richardson verbally on the day was made Mr Richardson, for the time that the Council has been rating the property has not informed the Council that he is the property owner. He has deliberately evaded advising Council that he is a property owner because we would have endeavoured to engage with him to get the matter of the rate collections resolved. When the offer was made the day before the auction by Mr Richardson, he made an offer to pay $3,000, which we would have accepted, but it was incumbent upon the rates clerk to advise that would not stop the sale because we had to enter into negotiation with the property owner for successful conclusion to pay the balance out. So my instructions to the rates clerk would have been along the lines to ensure the best interests of the Council and the property owner in any negotiations for removal of these properties for sale be entered into in good faith. Mr Richardson's offer, again I repeat, was one day prior to the auction which makes it very difficult for any offer to be put forward to the Council and if I can also advise the Court, considerable action was taken by Council in the lead up to the sale, to actually get the sale to the date where we could auction it in accordance with the Local Government Act. If you are asking for my personal opinion, and again I have to be careful because I was not present when this matter was discussed, I believe it was reasonable for the rates clerk to advise as she did accordingly on the day on the basis there was no offer from the owner as recorded by the Council. We had no specific knowledge of Mr Richardson's interest in the property, there was no copies of leases or formal advices from Mr Evans; the time limit or the lack thereof of the offer one day before the auction and lack of any real substance put forward by Mr Richardson that, one, that he was the property owner and, two, about future payments.
Q. You didn't instruct specifically Ms Hill on what to say to Mr Richardson?
A. No, I did not, she informed me after the conversation what transpired."
Ms Iskra re-examined Mr Kershaw on this topic (T12.23-T13.6, 1 July 2011):
"Q. At paragraph 22 of that affidavit there was an express comment made by Ms Hill to the effect that, "You can pay the $3,000 if you like?"
A. Yes.
Q. It was your understanding after speaking to Ms Hill that the Council would have gratefully accepted that $3,000?
A. That's correct, we would have accepted payment if it had been made on the day.
Q. Was payment tendered to your knowledge?
A. No it was not.
Q. Was there any indication by anyone at any time associated with that property of a time at which payment of what remained owing beyond the $3,000 might be made?
OBJECTION: LEADING.
Q. Are you aware of any application that specified any time by which the balance of the rates and levies and interest owing would be paid?
A. No I am not aware of any other information in respect of that.
Q. So in your view, when Ms Hill approached you and indicated that that conversation had taken place the day prior to the auction, are you able to tell the court what you thought of that offer?
A. I thought the offer had no standing in several factors. One, it was made by someone who we knew not to be the owner. It was made one day before the auction and Council had incurred considerable expense in getting these properties to sale prior to that event. There was no request from Mr Richardson to see me or any other Council official to discuss more details. I believe that the rates clerk acted in the best interests of Council on the day because there was no formal advice on how the balance would be discharged. And I believe that the wording that is in her statement is actually correct and valid from what she told me after the event."
I will return to this topic when considering submissions made concerning the operation of s.715(2) LG Act in the circumstances of this case. It is sufficient, at this point, to record my view that Mr Kershaw's position was entirely understandable, as was that of Ms Hill.
Mr David Smith came to purchase the Jugiong property at auction on 31 July 2010. An affidavit of Mr Smith affirmed 19 May 2011 was read in the Plaintiff's case. He was not required for cross-examination. I accept Mr Smith's account of what occurred on 30 and 31 July 2010 as revealed in the following part of the judgment.
Mr Smith arrived in Jugiong on 30 July 2010. On the evening of 30 July 2010, he went to the property to have a closer look at it. Whilst he was looking at the property from the street, a man who identified himself as "Anthony Richardson" came out of the house and walked over to introduce himself. In the course of the ensuing conversation, the Defendant said to Mr Smith "I am renting the property from Ron Evans" and that "he [Ron Evans] disappeared years ago".
It is noteworthy that both Ms Hill and Mr Smith have testified that the Defendant made statements to each of them that he was not Ron Evans and that Mr Evans was, effectively, nowhere to be found. It is clear that, even at this late stage on the eve of the auction, the Defendant considered it to be in his own interests to maintain this charade.
At about 7.30 am on 31 July 2010, the Defendant came to Mr Smith's hotel room prior to the auction. The Defendant carried with him a stamped Contract for Sale of Land between the Commissioner for Main Roads and Ron Evans and the Certificate of Title to the property. He did not have a stamped Transfer. The Defendant said to Mr Smith "I am here to talk business. I am Ron Evans. I will sell the house to you for $35,000.00 before the auction if you pay the rates to stop the sale". The Defendant also said to Mr Smith "If you do not do business with me I will go to the auction and run the price up to $35,000.00".
Mr Smith did not agree to this arrangement.
The auction proceeded later on 31 July 2010. Ms Hill, Mr Smith and Mr Collins each observed the Defendant at the auction. Mr Smith purchased the Jugiong property at auction that day for $33,000.00. The Contract for Sale of Land required that vacant possession be given to the purchaser at the time of completion, with completion of the Contract to take place within 21 days of the date of notice by the vendor (the Plaintiff) to the purchaser that it had obtained vacant possession of the property (Special Condition 38).
On about 17 September 2010, a Notice of Determination under s.75 Residential Tenancies Act 1987 was sent by registered mail and by normal post by the Plaintiff's solicitors addressed to "Mr Tony Richardson" at the Jugiong property. The Notice indicated an intention by the Plaintiff (still believing the Defendant to be a tenant only), after the expiration of 30 days from the service of the Notice, to bring proceedings in the Residential Tenancies Tribunal for an order for possession of the Jugiong property.
By letter dated 28 September 2010, Ms Sharlene Naismith, of Legal Aid New South Wales at Nowra, informed the Plaintiff that she acted for the Defendant. The letter stated "Mr Richardson has instructed us that he is the same person as the person Ron Evans who the Council has a record of as registered proprietor of the Property". This was the first time that the Defendant (or anyone on his behalf) had informed the Plaintiff that he and Ron Evans were one and the same person. The Defendant's solicitor sought copies of documents surrounding the assessment of rates on the Jugiong property and the sale of that property at auction.
By letter dated 22 October 2010, the Plaintiff's solicitor provided copies of relevant documents to the Defendant' solicitor, together with other information concerning events preceding the auction sale on 31 July 2010. The Plaintiff's solicitors noted that they had "received telephone advice from Mr David Smith, the purchaser of the property, that he requires vacant possession of the property on completion of the sale".
The Plaintiff's solicitors wrote again to the Defendant's solicitor on 12 November 2010 indicating that, should the Defendant not have vacated the premises by 19 November 2010, they were instructed to issue proceedings in the Supreme Court for possession and subsequent costs.
On 19 November 2010, the Defendant's solicitor wrote to the Plaintiff's solicitors complaining about the certification for the purpose of s.713(3) LG Act and indicating that, as the Defendant had been a pensioner since 2002, applications for pensioner concession rates would be furnished to the Plaintiff. Complaint was also made concerning the Plaintiff's compliance with s.715(2) LG Act and the Plaintiff was requested to set out the statutory basis upon which the Plaintiff was entitled to demand possession of the property. It was indicated that the Defendant would defend any claim by the Plaintiff for possession of the property.
Further correspondence passed between the solicitors between November 2010 and March 2011.
On 22 November 2010, the Defendant's solicitor lodged an application for the Defendant's rates on the Jugiong property to be assessed retrospectively at the pensioner concession rate from 1 July 2002 to the present time. The Defendant abandoned at the hearing any submission resisting the Plaintiff's claim for relief upon the basis that the Defendant was entitled to have rates assessed on the pensioner basis in circumstances where he had never made such an application prior to 22 November 2010.
On 6 December 2010, the Defendant's solicitor lodged a caveat upon the title to the Jugiong property showing the caveator as "Anthony Charles Richardson" and with the caveatable interest described in the following way:
"Equitable Fee Simple - The caveator is entitled to be registered as proprietor of the fee simple under Contract of Sale dated 5 August 1998 and completed on 5 August 1998, and is entitled to prevent the completion of the purposed [sic] sale by Council on 31 July 2010 on the grounds of failure to comply Section Section 173 [sic] of the Local Government Act 1993."
On 11 March 2011, the present proceedings were commenced by the filing of a Statement of Claim which recited the circumstances leading to the sale by the Plaintiff of the Jugiong property at auction on 31 July 2010 under s.713 LG Act. The Statement of Claim asserted that the Contract for Sale of Land required vacant possession to be given to the purchaser at completion, and that the Defendant had been so informed by various letters between October and December 2010 but that the Defendant had failed or neglected to give vacant possession of the property, or to indicate a willingness to give vacant possession of the property on a given date to allow the completion of the Contract for Sale of Land.
Accordingly, the Plaintiff sought judgment for possession of the Jugiong property and leave to issue a writ of possession in respect of that property forthwith.
By Defence filed on 19 April 2011, the Defendant contended that he had been an eligible pensioner within the meaning of s.3 LG Act since December 2002, and that the rates that were levied upon the Jugiong property did not apply a pensioner concession pursuant to s.575 LG Act. The Defence made certain admissions and non-admissions, and admitted that vacant possession had been sought from the Defendant and that the Defendant had refused to give vacant possession to the Plaintiff.
At the hearing on 1 July 2011, Ms Lane did not press those parts of the Defence, and the submissions made in support of the Defence, which contended that the Defendant was entitled to have rates calculated at the pensioner concession rate so as to render invalid the sale process (T70-73, 1 July 2011).

The Issues in the Proceedings

The issues in the proceedings may be divided broadly into two areas:
(a) the efficacy of the sale of the Jugiong property by the Plaintiff under the LG Act;
(b) the Plaintiff's claim to a present entitlement to possession of the Jugiong property.

Relevant Provisions in the LG Act

A number of provisions of the LG Act are relevant to the determination of these proceedings.
Section 550 LG Act provides as follows:
"550 Charge of rates and charges on land
(1) A rate or charge levied under this Act on land (including any interest accrued on the rate or charge as referred to in section 566) and any costs awarded to the council by a court in proceedings to recover the rate or charge are a charge on the land.
(2) The charge ranks on an equal footing with a charge on the land under any other Act but takes priority over any other charge or encumbrance.
(3) The charge does not affect:
(a) the estate of the Crown in land owned by the Crown, or
(b) the estate of a Crown lessee if the lease is granted after the rate or charge was levied (whether or not the land was previously held under a lease from the Crown).
(4) The charge does not affect a bona fide purchaser for value who made due inquiry at the time of purchase but had no notice of the liability. A purchaser who has obtained a certificate under section 603 is taken to have made due inquiry.
(5) The provisions of this section have effect despite anything contained in section 42 of the Real Property Act 1900."
Division 5 of Part 2 of the LG Act (ss.713-726) provides for sale of land by a council for unpaid rates and charges.
It is appropriate to set out ss.713-726 in their entirety:
"Division 5 Sale of land for unpaid rates and charges
713 Sale of land for unpaid rates and charges
(1) For the purposes of this Division, a rate or charge is overdue if:
(a) in the case of vacant land, it has remained unpaid for more than one year, or
(b) in the case of any other land, it has remained unpaid for more than 5 years,
from the date on which it became payable.
(2) A council may, in accordance with this Division:
(a) sell any land (including vacant land) on which any rate or charge has remained unpaid for more than 5 years from the date on which it became payable, and
(b) sell any vacant land on which any rate or charge has remained unpaid for more than one year but not more than 5 years from the date on which it became payable, but only if:
(i) the council obtains a valuation of the land from the Valuer-General, and
(ii) the total amount of unpaid rates or charges on the land exceeds the valuation, and
(iii) the council sells the land within 6 months after the date when the council received the valuation.
(3) The council must not sell any such land unless the general manager or the public officer certifies in writing:
(a) what rates and charges (including overdue rates and charges) are payable on the land, and
(b) when each of those rates and charges was made and how it was levied, and
(c) when each of those rates and charges became payable, and
(d) what amounts are payable by way of overdue rates and charges on the land, and
(e) what amounts are payable by way of rates and charges (other than overdue rates and charges) on the land.
(4) The council may, in the case of adjoining parcels of land (whether in the same or different ownerships) each of which may be sold under this Division:
(a) sell them separately or as a single parcel and under whatever conditions of sale it considers proper, and
(b) do such things as it considers appropriate for the purpose of selling the land at its full value.
714 Estates and interests of the Crown in land
This Division does not enable the sale of:
(a) any estate or interest of the Crown in land, or
(b) any interest in land owned by the Crown that may not be transferred at law.
715 Notice of proposal to sell land
(1) Before selling land under this Division, the council must:
(a) fix a convenient time (being not more than 6 months and not less than 3 months from the publication in a newspaper of the advertisement referred to in paragraph (b)) and a convenient place for the sale, and
(b) give notice of the proposed sale by means of an advertisement published in the Gazette and in at least one newspaper, and
(c) take reasonable steps to ascertain the identity of any person who has an interest in the land, and
(d) take reasonable steps to notify each such person (and the Crown, if the land concerned is owned by the Crown) of the council's intention to sell the land under this Division.
(2) If, before the time fixed for the sale:
(a) all rates and charges payable (including overdue rates and charges) are paid to the council, or
(b) an arrangement satisfactory to the council for payment of all such rates and charges is entered into by the rateable person,
the council must not proceed with the sale.
716 Sale of land by public auction
(1) Any sale of land under this Division must be by way of public auction, except as provided by this section.
(2) Land that fails to sell at public auction may be sold by private treaty.
(3) Land may be sold under this Division to the council, a councillor, a relative of a councillor, a member of staff of the council or any relative of a member of staff of the council in the case of sale by public auction, but may not be so sold in the case of sale by private treaty.
717 Payment of purchase money
(1) The purchase money for land sold under this Division must be paid to the council, and the council's receipt is a discharge to the purchaser in respect of all expenses, rates, charges and debts referred to in section 718.
(2) The purchase money for land purchased by the council must be paid by way of a transfer between the appropriate funds kept by the council.
(3) Any such transfer is taken to be:
(a) payment to the council of the purchase price of the land, for the purposes of section 722, and
(b) purchase money received by the council on the sale of land for unpaid rates and charges, for the purposes of section 718.
718 Application of purchase money
The council must apply any purchase money received by it on the sale of land for unpaid rates and charges in or towards payment of the following purposes and in the following order:
(a) firstly, the expenses of the council incurred in connection with the sale,
(b) secondly, any rate or charge in respect of the land due to the council, or any other rating authority, and any debt in respect of the land (being a debt of which the council has notice) due to the Crown as a consequence of the sale on an equal footing.
719 What if the purchase money is less than the amounts owing?
If the purchase money is insufficient to satisfy all rates, charges and debts referred to in section 718 (b):
(a) the amount available is to be divided between the rates, charges and debts in proportion to the amounts owing on each, and
(b) the rates, charges and debts are taken to have been fully satisfied.
720 What if the purchase money is more than the amounts owing?
(1) Any balance of the purchase money must be paid into the council's trust fund and held by the council in trust for the persons having estates or interests in the land immediately before the sale according to their respective estates and interests.
(2) The council may pay the balance of the purchase money or any part of the balance to or among the persons who are, in its opinion, clearly entitled to it, and the receipt of the person to whom any payment is so made is an effectual discharge to the council for it.
(3) (Repealed)
721 Apportionment of rates on subdivided land
(1) This section applies to any land on which a rate or charge is levied and which is subsequently subdivided.
(2) If part only of any such land is sold under this Division, any unpaid rates and charges in respect of the land may be apportioned by the council on the recommendation of the Valuer-General.
722 Conveyance or transfer of the land
The council, on payment to it of the purchase money, may convey or transfer the land to the purchaser without any other authority than that conferred by this section.
723 Land is conveyed free of certain interests
(1) A conveyance or transfer under this Division vests the land in the purchaser for an estate in fee simple freed and discharged from all trusts, obligations, estates, interests, contracts and charges, and rates and charges under this Act or any other Act, but subject to:
(a) any reservations or conditions for the benefit of the Crown affecting the land, and
(b) any easements, restrictive covenants, positive public covenants created in accordance with section 88D or 88E of the Conveyancing Act 1919 and public rights of way affecting the land.
(2) This section does not apply to a leasehold estate under a lease that may be transferred at law in land owned by the Crown.
724 Special provisions concerning leases of land owned by the Crown
(1) This section applies to a leasehold estate under a lease that may be transferred at law in land owned by the Crown.
(2) A conveyance or transfer under this Division of a leasehold estate to which this section applies vests the leasehold estate in the purchaser freed and discharged from all trusts, obligations, estates, interests, contracts and charges, and rates and charges under this or any other Act, but subject to:
(a) any debt payable to the Crown, and
(b) any liability for any breach before the conveyance or transfer of the lease, and
(c) the provisions of the Crown Lands Act 1989, the Crown Lands (Continued Tenures) Act 1989 and the Western Lands Act 1901 applicable to the leasehold estate.
725 Transfers not invalid because of procedural irregularities
A transfer or conveyance issued by a council under this Division is not invalid merely because the council has failed to comply with a requirement of this Division with respect to the sale of the land to which the transfer or conveyance relates.
726 Registration of transfer of land under the Real Property Act 1900
(1) On lodgment of a transfer of land under the Real Property Act 1900, the Registrar-General is to make such recordings in the Register kept under that Act as are necessary to give effect to this Division.
(2) The transfer does not operate at law until it is registered under the Real Property Act 1900."

Other Relevant Statutory Provisions

It is appropriate to set out other statutory provisions to which reference will be made on the question of the Plaintiff's entitlement to possession of the Jugiong property.
Section 60 Real Property Act 1900 is in the following terms:
"60 In case of default, entry and possession, ejectment
The mortgagee, chargee or covenant chargee upon default in payment of the principal sum or any part thereof, or of any interest, annuity, or rent-charge secured by any mortgage, charge or covenant charge may:
(a) enter into possession of the mortgaged or charged land by receiving the rents and profits therefor, or
(b) (Repealed)
(c) bring proceedings in the Supreme Court or the District Court for possession of the said land, either before or after entering into the receipt of the rents and profits thereof, and either before or after any sale of such land effected under the power of sale given or implied in the mortgage, charge or covenant charge,
in the same manner in which the mortgagee, chargee or covenant chargee might have made such entry or brought such proceedings if the principal sum, interest, annuity, or rent-charge were secured to the mortgagee, chargee or covenant chargee by a conveyance of the legal estate in the land so mortgaged or charged."
It is appropriate to set out several definitions in s.3 Real Property Act 1900:
"3 Definitions
(1) In the construction and for the purposes of this Act, and in all instruments purporting to be made or executed thereunder (if not inconsistent with the context and subject matter):
(a) the following terms shall bear the respective meanings set against them:
...
Charge - Any charge on land created for the purpose of securing the payment of an annuity, rent-charge or sum of money other than a debt.
...
Mortgage - Any charge on land (other than a covenant charge) created merely for securing the payment of a debt.
..."
Section 109 Conveyancing Act 1919 provides as follows:
"109 Powers of mortgagees and certain chargees
(1) A mortgagee and a chargee shall by virtue of this Act have the following powers to the like extent as if they had been in terms conferred by the instrument creating the mortgage or the covenant under which the charge arose but not further, namely:
(a) A power to sell or to concur with any other person in selling the mortgaged or charged property, or any part thereof, either subject to prior charges or not, and either together or in lots, in subdivision or otherwise, by public auction or by private contract, subject to such conditions respecting title or evidence of title or other matter as the mortgagee or chargee thinks fit, with power to vary any contract for sale, and to buy in at an auction or to rescind any contract for sale, and to resell without being answerable for any loss occasioned thereby.
(b) A power at any time after the date of the instrument to insure and keep insured against loss or damage by fire any building or any effects or property of an insurable nature whether affixed to the freehold or not being or forming part of the mortgaged or charged property, and the premiums paid for any such insurance shall be a charge on the mortgaged or charged property in addition to the money secured by the mortgage or charge, and with the same priority and with interest at the same rate as that money.
(c) A power to appoint a receiver of the income of the mortgaged or charged property or of any part thereof.
(d) A power, while the mortgagee or chargee is in possession, to cut and sell timber except trees planted or left standing for shelter or ornament, or to contract for any such cutting and sale, to be completed within any time not exceeding twelve months from the making of the contract.
(e) A power to sever and sell fixtures apart from the balance of the mortgaged or charged property.
(f) A power to sell any easement, profit à prendre, right, or privilege of any kind over or in relation to the mortgaged or charged property.
(2) The provisions of this Act (except section 111 (5) and the provisions of section 111 relating to notice or lapse of time where default is made in the payment, in accordance with the terms of the instrument creating the mortgage or the covenant under which the charge arose, of any principal, interest or other money) relating to the foregoing powers comprised either in this section or in any subsequent section regulating the exercise of those powers may be varied or extended by the instrument, and as so varied or extended shall, as far as may be, operate in the like manner and with all the like incidents, effects, and consequences as if such variations or extensions were contained in this Act.
(3) Subsection (1) applies only if and as far as a contrary intention is not expressed in the instrument, and shall have effect subject to the terms of the instrument and to the provisions therein contained.
(4) This section applies to mortgages executed before, and to mortgages executed after, the commencement of Schedule 3 to the Conveyancing (Amendment) Act 1976.
(5) This section applies to mortgages and charges under the Real Property Act 1900."

The Efficacy of the Plaintiff's Sale of the Jugiong Property Under the LG Act

Mr Rogers, counsel for the Plaintiff, noted that there was no application by the Defendant to set aside the Contract for Sale of Land between the Plaintiff and Mr Smith, nor was there any claim by the Defendant for declaratory relief that the contract is void. He observed that Mr Smith would be a necessary party to any such proceedings. He submitted that it would be a denial of natural justice if the Court determined, in the absence of Mr Smith, that the contract is not efficacious.

There is considerable force in these submissions. The Defendant has not brought proceedings, by way of Cross-Claim or otherwise, seeking to challenge the Contract for Sale of Land entered into between the Plaintiff and Mr Smith. The position may be contrasted with that taken in Anderson v Lismore City Council [2011] NSWSC 1058; 185 LGERA 239 where a declaration was sought (and made) that the Contract for Sale of Land was void.
Here, the Defendant has resisted the Plaintiff's claim for possession of land on a number of bases, some involving the proper construction and application of provisions in the LG Act.
It is, of course, for the Plaintiff to establish, on the balance of probabilities, an entitlement to the relief sought in the Statement of Claim.
I propose to consider the submissions advanced by the parties in support of, and in opposition to, the relief sought by the Plaintiff. As will be seen, I have determined that the Plaintiff is entitled to the relief sought, so that no question arises concerning the joinder of Mr Smith as a party to the principal proceedings.

Has There Been Compliance with s.713 LG Act?

Although the terms of s.713 LG Act, were touched upon during the hearing, counsel for the Defendant did not contend in closing submissions that any alleged non-compliance with s.713 should stand in the way of the Plaintiff's claim for relief.
The power conferred upon a council to sell land for overdue rates was described by Powell J in Logue v Shoalhaven Shire Council [1978] 1 NSWLR 710 at 714F as an "unusual one". Although Powell J's decision was reversed by the Court of Appeal in Logue v Shoalhaven Shire Council [1979] 1 NSWLR 537, this characterisation of the relevant power remains apt.
As Walsh JA (Wallace ACJ and McLelland JA agreeing) observed in Blacktown Municipal Council v Custom Credit Corporation (1968) 71 SR (NSW) 365 at 371E, a council selling land for unpaid rates does not have vested in it, at the time of entering into a contract for sale (as vendor), the estate which it is agreeing to sell - it has a charge and a statutory power to sell that estate. I will return to these features later in the judgment when considering the Plaintiff's claim for possession.
The power conferred by s.713(2) is a discretionary one: Quzag v Gunning Shire Council [2005] NSWSC 970; 142 LGERA 77 at 89 [38]. Brereton J has observed that a council's power to sell under s.713 LG Act is akin to a mortgagee's power of sale - it is a power given to a council as a creditor to enforce a debt, due to the council, that is charged by statute on the land: Anderson v Lismore City Council at 251 [28]. I will return to this topic later in the judgment.
To the extent that it may be considered necessary, I record my satisfaction, for the purposes of s.713(2)(a), that rates owed by the Defendant had been unpaid for the requisite period.
I am satisfied, as well, that the General Manager of the Plaintiff has certified the matters set out in s.713(3). The certificate, admitted without objection, is evidence of the facts contained within it. No challenge, other than the abandoned challenge as to pensioner concession, has been made to the facts.
The Plaintiff has complied with the provisions of s.713 LG Act with respect to the sale of the Jugiong property.

Have the Provisions in s.715 LG Act Been Complied With?

The Defendant's Submissions

In written submissions, Ms Lane contended that the Plaintiff did not take "reasonable steps" for the purposes of s.715(1)(c) LG Act, to "ascertain the identity of any person who has an interest in the land". Despite the fact that, in truth, the Defendant was the owner of the Jugiong property (although he asserted falsely that he was a mere tenant), Ms Lane sought to draw comfort from what were said to be deficiencies in the Plaintiff's efforts to locate Mr Evans.
In addition, Ms Lane submitted that the Defendant's offer made to Ms Hill on 30 July 2010 of payment of $3,000.00 that day and the rest at a later time, was an offer which triggered s.715(2)(b) LG Act. It was submitted that the evidence of Ms Hill involved a categorical statement that, even if the Defendant paid $3,000.00 that day, it would not stop the sale proceeding on the following day.
Counsel submitted that this statement was highly misleading in that the Plaintiff retained a discretion to enter into a satisfactory arrangement at any time before the sale. She submitted that Ms Hill's response to the Defendant indicated effectively that the Plaintiff would not exercise that discretion no matter how compelling the circumstances may have been.
It was submitted that it was of no assistance to the Plaintiff that, as at 30 July 2010, the Defendant had represented himself to officers of the Plaintiff as the tenant of the property, and not the owner. Ms Lane pointed to the definition of "rateable person" in the Dictionary to the LG Act:
"rateable person includes the Crown in respect of rateable land owned by the Crown and means:
(a) an owner in any case where this Act provides that a rate is to be paid to the council by the owner, and
(b) a holder of a lease in any case where this Act provides that a rate is to be paid to the council by the holder of the lease."
Counsel submitted that the Defendant was capable of falling within paragraph (b) of the definition.
Ms Lane submitted that there is no evidence that the Plaintiff even considered the application of s.715(2)(b) LG Act in the circumstances of this case.
Counsel submitted that it is notable that s.715(2) LG Act is mandatory in its terms in that, before the time fixed for the sale, the Council must not proceed with the sale if one or other of the circumstances contained in the provision exists. It was not to the point that the offer was being made at the last minute, or that the person making the offer was believed by the Plaintiff to be a tenant and not the owner of the Jugiong property.
Ms Lane submitted that the question whether an arrangement for payment of rates enlivens s.715(2) LG Act depends upon whether or not the arrangement proposed is satisfactory to the Council, with this involving a decision-making process of the Council. Ms Lane submitted that the Council could not apply a policy inflexibly, without regard to the circumstances of a particular case, or ignore the discretion under the section.
In relation to the application of policy, she submitted that a discretionary power such as that contained in s.715(2) must be exercised on each occasion in the light of the circumstances at that time: R v Secretary of State for the Home Department; ex parte Venables [1998] AC 407 at 496-497. If a council policy is applied inflexibly, Ms Lane submitted that it will result in a failure to consider the circumstances of an individual case and this may constitute an error of law: Green v Daniels [1977] HCA 18; 51 ALJR 463.
If the Plaintiff is found to have not considered its discretion at all, Ms Lane submitted that its decision is invalid on the basis that it failed to take account of a relevant consideration. She accepted that this ground can only be made out if a decision maker fails to take into account a consideration that he or she is bound to take into account in making that decision: Minister for Aboriginal Affairs v Peko-Wallsend Limited [1986] HCA 40; 162 CLR 24 at 39.
As s.715(2) LG Act is expressed in mandatory terms, Ms Lane submitted that if the Plaintiff did not consider the question of its discretion under s.715(2)(b), then it necessarily follows that it failed to consider whether there was an application satisfactory to it.
Ms Lane submitted that the Plaintiff only had power to sell if it had complied with the requirements of s.715 LG Act. She submitted that the power had not been validly exercised in this case, so that s.725 LG Act could not assist the Plaintiff in the circumstances of this case.
The Plaintiff's Submissions
To the extent that the Defendant had raised an issue concerning compliance with s.715(1)(c) LG Act, Mr Rogers submitted that the Plaintiff had taken reasonable steps to ascertain the identity of any person who had an interest in the land. He submitted that "reasonable" means reasonable in all the circumstances. The Plaintiff had the correct identity, but the wrong name. He submitted that further enquiries would have revealed nothing more in any event.
Moreover, Mr Rogers submitted that the Defendant was the author of any confusion which occurred in this case, and that he cannot now rely upon his deception. To the extent that the Defendant seeks to advance submissions concerning the proper construction of the LG Act, Mr Rogers submits that a statute should not be construed so as to allow a person to take advantage of his own wrong: Sorbello v Whan [2007] NSWSC 951 at [28]; Pearce and Geddes, "Statutory Interpretation in Australia", 7th edn, 2011, paragraph [2.41].
With respect to s.715(2)(b), Mr Rogers submitted that it was unclear from the terms of the provision that a council is obliged to even consider a proposal to enter into an arrangement. The requirement that an arrangement be "satisfactory to the council" suggests that a council is at large as to how it treats such matters.
He submitted that there are necessarily implied requirements for engagement of s.715(2)(b) so that:
(a) a concrete proposal is put to a council for consideration; and
(b) the proposal is put in a form and manner suitable for consideration.
He submitted that a "chat at the council's front counter outlining a vague offer to pay most of the sum at an indeterminate time in the future" did not qualify in this regard.
Mr Rogers submitted that the Defendant fell within paragraph (a) of the definition of "rateable person" (set out at [92] above). However, the Defendant's difficulty here was that the Plaintiff did not know that he was the rateable person. Further, this state of affairs had come about as a result of the Defendant's persistent deception. Once again, Mr Rogers referred to authorities concerning construction of a statute so as not to allow a person to take advantage of his own wrongdoing (see [102] above).
Mr Rogers submitted that it is, at least, doubtful that a council could enter into a satisfactory arrangement for the purpose of s.715(2)(b) LG Act with a person other than the owner. It may be that the owner is content for the sale to proceed. He submitted that for the section to be activated by an offer such as this, from a person representing himself as the tenant, would be to place an impractical construction upon the provision which is no doubt intended to operate in a proper case.
In any event, Mr Rogers submitted that it is a necessary consequence of s.725 LG Act that, unless and until the Contract for Sale of Land between the Plaintiff and Mr Smith is set aside, any procedural defect under s.715 (if any existed) could not be relied upon to impair the Plaintiff's right to proceed with the sale. Mr Rogers submitted that any other construction would have the strange consequence that the Court may hold that the sale cannot proceed to completion, following which a Court in proceedings brought by Mr Smith would require the Plaintiff to specifically perform its obligations to him.
Determination
At the outset, I record my conclusion that the Plaintiff did take reasonable steps to ascertain the identity of any person who had an interest in the land, for the purpose of compliance with s.715(1)(c) LG Act.
If the statutory purpose of s.715(1)(c) LG Act is to ensure that a council considering sale of land for unpaid rates must take reasonable steps to ascertain the identity of any person who has an interest in the land, so that such a person may be placed on notice of the foreshadowed action, then the statutory purpose was discharged completely in the circumstances of this case.
For reasons which remain unexplained, the Defendant misled officers of the Plaintiff on several occasions by failing to reveal that he and Ron Evans were one and the same person and that he was, in fact, the owner of the Jugiong property. The Defendant was informing officers of the Plaintiff that he did not know where "Ron Evans" was, although he was attempting to locate him. No aspect of these farcical events assists counsel for the Defendant in any resistance to the claim for relief based upon suggested non-compliance with s.715(1)(c) LG Act.
The Defendant was fully aware of the steps which the Plaintiff was taking and, at different points, he sought to protect his interests in different ways.
I turn to the submissions made concerning s.715(2) LG Act.
A provision such as s.715(2) LG Act has existed in earlier forms of this legislation (see s.602(3) Local Government Act 1919).
The construction and operation of s.715(2) LG Act has been considered in decisions of this Court. In Quzag v Gunning Shire Council, Studdert J said at 91-92 [61]:
"Where rates remain unpaid for more than five years, the power of sale under s 713 is enlivened. However, if before the time fixed for the sale all rates and charges payable, including overdue rates, are paid to the council or, alternatively, an arrangement satisfactory to the council for payment of all rates and charges is made, then the council must not proceed with the sale. Section 715(2) so provides. However, if between the time that the decision to sell is made and the actual sale, some payment of rates is made but not sufficient to discharge the total indebtedness, then s 715 does not prevent the council from proceeding with the sale. Moreover, whether an arrangement for payment of the rates enlivens s 715(2) depends upon whether or not the arrangement proposed is satisfactory to the council. This involves a decision-making process of the council which, as I understand the legislative scheme and the language of the section, is not open to challenge in the proceedings presently before the Court."
Studdert J returned to s.715(2)(b) LG Act at 94-95 [84]-[87]:
"[84] It is next submitted that the defendant failed to comply with s 715(2)(b) in that there was an arrangement proposed by the plaintiff through his solicitor in the letter dated 21 April 1999 (p 79 of Ex 2) which was an arrangement that ought to have been regarded by the council as a satisfactory arrangement for the purposes of the sub section.
[85] Section 715(2)(b) expressly contemplates 'an arrangement satisfactory to the council'. Whether a proposal advanced is such an arrangement is a matter for the council to determine. It seems to me that the language chosen in the sub section indicates clearly that the legislature did not intend the issue to be revisited by reference to some objective standard, and certainly not in proceedings in this jurisdiction.
[86] In any event, the proposal that was being advanced did not offer the prospect of immediate discharge of the plaintiff's total indebtedness and there were already encumbrances affecting the plaintiff's title to the land, as the letter from Mr Pappas revealed. Having regard to the evidence, the council's reaction to the proposal was understandable.
[87] For the reasons stated above, I do not consider that the plaintiff has established a cause of action arising by reference to s 713(2)(a), s 713(3), reg 13 of the regulations made pursuant to the Act, or s 715(2)(b)."

In Anderson v Lismore City Council, Brereton J said at 250 [23]-[25]:
"[23] Ms Anderson abandoned an allegation originally advanced in her pleadings that an arrangement satisfactory to the Council for the purposes of s 715(2)(b) had been made, but she argued that she had been denied 'due process' (which I take to mean procedural fairness), in that she was not afforded a reasonable opportunity to reach a satisfactory arrangement, short of payment in full to the Council, within s 715(2)(b).
[24] In Annetts v McCann (1990) 170 CLR 596, Mason CJ, Deane J and McHugh J, said (at 598):
It can now be taken as settled that, when a statute confers power upon a public official to destroy, defeat, or prejudice a person's rights, interests, or legitimate expectations, the rules of natural justice regulate the exercise of that power unless they are excluded by plain words of necessary intendment.
[25] Notwithstanding this wide description of the application of the rules of natural justice, I am unable to accept Ms Anderson's argument that the Council, having decided to exercise the power of sale and having notified her of that decision, was then under some subsequent obligation to afford the ratepayer a reasonable opportunity to make a 'satisfactory arrangement', within the meaning of s 715(2)(b). Local Government Act, s 715, prescribes in detail the procedure to be followed in connection with the submission of a property for sale and the relevant timeframe, including what notice needs to be given to persons beneficially interested. After the sale process has been initiated, the ratepayer has an opportunity to avert sale by paying the debt in full, under s 715(2)(a). In addition to that, the statute provides for Council to grant the ratepayer an indulgence by accepting a 'satisfactory arrangement' short of payment in full, in which case the Council must not proceed with the sale. But what is a 'satisfactory arrangement' in that context is a question of which the Council is the sole judge, and its decision is not subject to review [Quzag v Gunning Shire Council [2005] NSWSC 970, [85]]. The provision for a 'satisfactory arrangement' is an indulgence granted to a debtor in default, and imports no obligation on the Council to afford the ratepayer a reasonable opportunity to make an acceptable arrangement, beyond that provided for in s 715. It suffices that the Council complies with the requirements of s 715(1). In any event, the rules of procedural fairness do not attend decisions of parties to arm's length negotiations as to whether or not to accept an offer made by the other. There is no denial of procedural fairness in the Council failing to allow opportunities, beyond those required by s 715(1), to make a 'satisfactory arrangement'. Moreover, the history of the correspondence set out above, from December 2010 onwards, demonstrates that she was afforded ample opportunity to make such an arrangement. It would be inconsistent with the scheme of s 715 to conclude that Council was bound, absent compliance with s 715(2), to defer a sale."
The notice affixed to the Jugiong property on or about 24 March 2010, which the Defendant had read and removed, informed him of the terms of s.715(2) LG Act (see [30] above).
In the present case, the Defendant did make an offer to Ms Hill on the eve of the auction. It is the case that Ms Hill informed the Defendant that only payment in full of the rates, charges and costs owing could stop the sale.
It is important to keep in mind, as Mr Kershaw explained in evidence, that the Plaintiff considered that it was dealing with a tenant at that time, and not the owner. It was also relevant that the offer was being made on the eve of the auction. If the Defendant had been truthful with Ms Hill and indicated that he was in fact the owner, then a different position may have been taken with respect to his belated offer. Even then, it would have been entirely open to the Plaintiff to consider that such an offer being made at that point did not constitute an "arrangement satisfactory to the council for payment of all such rates and charges".
To seek to defeat the statutory sale on this basis, Ms Lane sought to erect what has happened here to be a failure by a decision maker to have regard to a mandatory statutory factor so as to vitiate the relevant decision.
I do not accept the submission characterising what happened here in this way. In my view, such an approach is not supported by the statements of Studdert J and Brereton J (at [115]-[117] above) concerning s.715(2), with which I respectfully agree.
The construction advanced for the Plaintiff with respect to s.715(2) LG Act is sound. It is clear that, if the full sum outstanding is paid to a council before the time fixed for the sale, then the council must not proceed with the sale: s.715(2)(a) LG Act.
The alternative provision in s.715(2)(b) can only be construed in a practical and realistic way if a concrete proposal is put in a form and manner suitable for consideration. As Brereton J observed in Anderson v Lismore City Council at 250 [25] (see [117] above), the provision for a "satisfactory arrangement" is "an indulgence granted to a debtor in default, and imports no obligation on the Council to afford the ratepayer a reasonable opportunity to make an acceptable arrangement".
Where (as here) the proposal is (apparently) not put by the owner, then it must realistically be viewed as a proposal advanced without the council being aware of the owner's view concerning the proposal. If a tenant of the relevant property offered to enter into an arrangement with the knowledge and consent of the owner, and if the offer was made in sufficient time prior to the time fixed for the sale to allow the council to consider whether it was satisfactory, then a practical framework for the operation of this subsection may be identified. However, those circumstances are a long way from what happened here.
It may well be that the Plaintiff could have approached the informal (and incomplete) oral offer made on 30 July 2010 in a different way (the offer was incomplete as there was no indication as to when the substantial balance would be paid). For example, Ms Hill could have invited Mr Kershaw to come and speak to the Defendant. Assuming Mr Kershaw was in a position to make a decision at that late point (in place of the Plaintiff itself), then there may have been scope for the exercise of a discretion. However, as Mr Kershaw explained in his evidence (which I accept), he understood that the Defendant was the tenant and not the owner, and thus what was being proposed in this respect was simply not acceptable. That view is completely understandable.
I am entirely unpersuaded that the Plaintiff failed to comply with s.715(2) LG Act in the circumstances of this case. I am not satisfied that the events here were sufficient to trigger the need for the Plaintiff to consider whether the Defendant's offer was capable of being a satisfactory arrangement, let alone that the failure to take that course brings down, in some way, the sale process.
These conclusions concerning s.715(1)(c) and s.715(2), have not involved application of the principle of statutory construction that courts should resist an interpretation permitting a person to take advantage of his own wrong (see [102] above). It must be said that the Defendant's pattern of deceptive and manipulative conduct, together with his obstruction of proper statutory processes undertaken by the Plaintiff (his removal from the fence of the notice and auction sign), would have made him a candidate for the application of this principle if the occasion arose. However, as it happens, it does not.
I am not persuaded that there was any defect in compliance with ss.713 or 715 LG Act in this case. Accordingly, it is not necessary to decide whether s.725 LG Act would operate to overcome any procedural irregularity prior to registration of any transfer. It is sufficient to observe that the existence of that provision would constitute a further hurdle in the path of the Defendant, as would the failure of the Defendant to seek relief concerning the Contract for Sale of Land between the Plaintiff and Mr Smith (see [77]-[79] above) if some procedural irregularity had been demonstrated.

The Plaintiff's Claim to a Present Entitlement to Possession of the Jugiong Property

The Defendant's Submissions

Even if the Plaintiff had complied with the provisions of the LG Act surrounding the sale of the Jugiong property for unpaid rates and charges, Ms Lane submitted that the Plaintiff did not have an existing right to possession of the property so as to attract the relief sought in its Statement of Claim. Ms Lane submitted that the right of possession is an incident of ownership, and that the Plaintiff was not the owner of the Jugiong property and was therefore not entitled to possession as owner.
Counsel for the Defendant submitted that Mr Smith is not the owner. Although the Contract of Sale of Land under which he is a purchaser is a contract to sell with vacant possession, the sale has not been completed and Mr Smith has not been registered as proprietor of the Jugiong property. Accordingly, it was submitted that the Defendant is the person with the best right to lawful possession of the property, as well has having actual possession.
Ms Lane submitted that s.713 LG Act permits a council to transfer the title of property to another party, subject to compliance with the procedural and substantive requirements of the LG Act. However, she submitted that Division 5 of Part 2 of the LG Act does not expressly confer any right on a council to demand possession of a property, nor does it make a council the owner, nor does it authorise the recording of the council as owner where the land is under Torrens title. Counsel pointed to provisions in other parts of the LG Act which permitted council officers to enter upon land to carry out their duties, but submitted that there was no such provision in this part of the legislation which entitled the Plaintiff to take possession of the Defendant's land before registration of a transfer.
Counsel contrasted provisions such as the compulsory devolution regime in the Bankruptcy Act 1966 (Cth), in which a trustee in bankruptcy is vested with title to land and may be registered as proprietor of the land and may deal with it as owner (s.58).
Ms Lane relied upon common law principles protecting an owner's right to possession of property, which extends to prevention of entry of persons unless specifically authorised by statute: Plenty v Dillon [1991] HCA 5; 171 CLR 635 at 639-640; Kuru v State of New South Wales [2008] HCA 26; 236 CLR 1 at 14-15 [43].
Counsel submitted that the Plaintiff's claim amounted to an assertion that, even though the Plaintiff had no title to the land, it is able to disturb the possession of the Defendant merely because his possession of the property prevents it completing the contract it has entered into with Mr Smith. It was submitted that this is a purely private purpose.
Ms Lane submitted that, where there was no one in actual possession of relevant land, the Plaintiff may well be justified in entering into a contract to sell with vacant possession. However, the terms of sale are not prescribed by statute, and the Plaintiff cannot elevate its power of sale into a right to take possession, merely because it has chosen to enter into a contract under which it promises to give vacant possession to the purchaser.
Counsel submitted that there is no express statutory right to take possession, nor can any such right be implied. She submitted that the power of sale conferred by s.713 LG Act is a power compulsorily to deprive a person of proprietary rights to land, and must therefore be strictly construed and that a separate and more intrusive power to disturb possession will not be readily implied: Hillebrand v Penrith City Council [2001] NSWSC 200; 51 NSWLR 424 at 430 [22], 432 [30].
Ms Lane submitted that the legal right of the Plaintiff under the LG Act is as a statutory chargee. The statutory charge on the land is imposed by s.550 LG Act and that section does not authorise a council to take possession of the land, the subject of the charge.
Counsel referred to s.60 Real Property Act 1900 as making provision for chargees to have certain rights in relation to the property, the subject of the charge. She noted that "charge" and "chargee" are defined in s.3 Real Property Act 1900 in ways which make clear that the Plaintiff is not a chargee for the purpose of s.60 Real Property Act 1900, nor is the Plaintiff a mortgagee of land. Ms Lane submitted that the Plaintiff is not registered as proprietor for any estate or interest in land, and so may not exercise the powers conferred on a registered proprietor by the Real Property Act 1900.
Ms Lane submitted that the existence of the statutory charge does not assist the Plaintiff in relation to any rights under the general law. She submitted that the primary remedy to enforce a charge under the general law is an order for judicial sale: Sood v Christianos [2008] NSWSC 1087 at [16]-[17].
Counsel submitted that the power to sell in s.713 reflects, in a statutory form, the right of a chargee under the general law on default by the chargor to take steps to sell the property. It is the means by which the statutory charge may be enforced. She submitted that the absence of any express ancillary statutory right to take possession to facilitate the sale leads to the conclusion that there is no such right, given that the interference with the right of possession involves serious consequences for the owner of the land, and the presumption in statutory interpretation that the intention of Parliament must be clear before a statute is construed in such a way as to authorise the expropriation of proprietary rights or, as in this case, the abrogation of incidents of the proprietary right of the owner: Bropho v Western Australia [1990] HCA 24; 171 CLR 1 at 17-18.
Counsel submitted that there is no indication of any legislative intention to authorise the Plaintiff to take possession of property sold for the purpose of realising the charge on the land, arising from the levying of the rates. Nor, it was submitted, was there any basis in the text of the legislation, or in the context or purpose of the statute, for reading the statute as though such a power is implied.
Ms Lane submitted that s.722 LG Act makes plain that the transfer is the means by which the former owner is divested of the property and the purchaser becomes entitled. At the point of registration, s.725 protects the proprietor, who then acquires a right to possession of the property based on the proprietorship of the fee simple, subject to the express exceptions to indefeasibility contained in the Real Property Act 1900 and the implied exceptions based on the enforcement of rights in personam against the registered proprietor.
It was submitted that the Plaintiff in this case had sought to terminate the Defendant's occupation as though he were a tenant but that, even if the Defendant was a tenant, the Plaintiff had no right to possession to underpin the issue of a notice under the Residential Tenancies Act 1987, or subsequent residential tenancies legislation (Residential Tenancies Act 2010).
Ms Lane submitted that the Defendant's construction of s.60 Real Property Act 1900 is consistent with recent authority: King Investment Solutions Pty Limited v Hussain [2005] NSWSC 1076 (reported in part at 64 NSWLR 441) at [125]-[127] (Campbell J) and King Investment Solutions Pty Limited v Hussain [2010] NSWSC 821 at [31]-[34] (Hidden J).
Further, Ms Lane submitted that, even if s.60 Real Property Act 1900 allows an unregistered chargee to bring proceedings for possession, the Plaintiff may not, in the present circumstances, exercise the power conferred under s.60 because the statutory charge created by s.550 LG Act is not a "charge" for the purpose of s.60.
Counsel submitted that the statutory charge created by s.550 LG Act is a charge created for the purpose of securing payment of a debt, being the rate or charge levied under the LG Act, and that the fact that a debt is secured takes the statutory charge outside the definition of "charge" in s.3 Real Property Act 1900.
The Plaintiff's Submissions
Mr Rogers submits that vacant possession is a normal incident of sale, the availability of which is generally necessary for completion of the sale: King Investment Solutions Pty Limited v Hussain [2005] NSWSC 1076 at [133].
He submitted that the effect of the Defendant's submission as to possession would be to render all sales entered into pursuant to s.713 LG Act as being sales subject to the possession of the owner, rather than sales with vacant possession. He submitted that such a construction would be surprising, and would give rise to certain eccentric effects, including rendering many properties incapable of sale and reducing the purchase price for the remainder.
Mr Rogers submitted that the legislature should not be considered lightly to have legislated for an effect which prejudices both councils and landholders and appears to defeat the intention of the LG Act.
Counsel relied upon principles of statutory construction to the effect that the literal or grammatical meaning of a provision is not its "ordinary meaning", if it does not give effect to the underlying purpose of the enactment, particularly if the result would be otherwise absurd or unreasonable: Saraswati v The Queen [1991] HCA 21; 172 CLR 1 at 21-22. While Parliament is empowered to legislate for eccentric, even perverse, results he submitted that, where there are competing constructions available, a common sense result will be favoured over an eccentric consequence: Saraswati v The Queen at 408.
Mr Rogers submitted that, if a power is conferred upon a body by a statute, there is an implied power to do such things as are necessary to give effect to the power: Re Sterling; ex parte Esanda Limited (1980) 44 FLR 125 at 130.
Mr Rogers submitted that the Plaintiff is entitled to possession of the Jugiong property by any one of several routes.
Firstly, he submitted that the right to possession of the Plaintiff is necessarily implied into the power of sale given by s.713 LG Act, or alternatively, the Court has inherent jurisdiction to grant to the Plaintiff such relief as is necessary to give proper effect to the power of sale conferred by s.713.
Secondly, Mr Rogers submitted that, having regard to the definitions of "charge" and "mortgage" in s.3 Real Property Act 1900, s.60 of that Act authorises the Court to order possession of land in respect of any charge, whether registered or unregistered, or alternatively, having regard to the provisions of s.550(2) LG Act, s.60 Real Property Act 1900 authorises the Court to order possession of land in respect of a charge granted under s.550(1) LG Act.
Thirdly, he submitted that the Plaintiff is a mortgagee within the meaning of s.109(1)(a) Conveyancing Act 1919, and is entitled to exercise its power of sale under the LG Act, subject to such matters as the Plaintiff considers fit, with such power including the power to sell with vacant possession.
Mr Rogers submitted that rates due to the Plaintiff are a debt (s.695 LG Act) and represent a "charge" on the land (s.550(1) LG Act).
As the term "charge" under the Real Property Act 1900 is defined in a way so as to exclude a "debt", Mr Rogers accepted that a charge under the LG Act was not a charge under the Real Property Act 1900. However, he pointed to the definition of the word "mortgage" in the Real Property Act 1900 (see [75] above), so that a charge under s.550 LG Act is a mortgage under the Real Property Act 1900.
Mr Rogers submitted that a charge under s.550 had priority over all other non-statutory charges, including non-statutory registered charges. It follows, he submitted, that s.550(2) LG Act authorises resort to s.60 Real Property Act 1900 and that this is reinforced by s.550(5) LG Act.

Independently of s.550(2) LG Act, Mr Rogers submitted that learned writings on s.60 favour the view that an unregistered chargee or mortgagee can invoke s.60 Real Property Act 1900: Woodman and Nettle, "The Torrens System in NSW", 2nd edn, 2003, paragraph [64.140]. Mr Rogers submitted that contrary observations by Hidden J in King Investment Solutions Pty Limited v Hussain [2010] NSWSC 821 are obiter and incorrect. It is noteworthy, he submitted, that the Real Property Act 1900 distinguishes between registered mortgages (s.57(2) Real Property Act 1900) and mortgages in general (such as in s.60) and that it was not clear that this distinction was drawn to the attention of Hidden J.
With respect to s.109 Conveyancing Act 1919, Mr Rogers submitted that a "mortgage" under that Act includes "a charge on any property for securing money or money's worth" (s.7 Conveyancing Act 1919). He submitted that a s.550 charge is a mortgage under the Conveyancing Act 1919, and that s.109 of that Act may operate to assist the Plaintiff in the circumstances of this case. Vacant possession is a normal incident of sale. A condition of sale that a property be conveyed subject to vacant possession falls fairly within the words of s.109(1)(a) and is therefore authorised by the Conveyancing Act 1919.
Counsel submitted that the Court is entitled to make orders granting possession so as to give effect to the contract. The Plaintiff entered into the Contract for Sale of Land bona fide, and can take possession.
Mr Rogers submitted that the effect of the Defendant's technical points in this area would be that one second before registration, the Defendant has possession of the property, but that a second after registration, he must cede possession. This construction of the relevant statutory provisions, it was submitted for the Plaintiff, would be extraordinary. It was said that this position reinforced the correctness of the Plaintiff's approach on these issues.
Determination
The range of technical arguments advanced to the Court on this issue arise in a context where, in my view, clarity and certainty are both desirable and achievable.
The requirements of ss.713 and 715 LG Act have been met. The Jugiong property was sold by the Plaintiff to Mr Smith at public auction. The Contract for Sale of Land provides (unsurprisingly) for sale with vacant possession. The Plaintiff, on payment of the purchase money by Mr Smith, may convey or transfer the land to him: s.722 LG Act. On lodgment of a transfer of land under the Real Property Act 1900, the Registrar-General is to make any necessary recording in the Register to give effect to the sale under the LG Act: s.726 LG Act.
I have mentioned earlier (at [83]-[84]) the unusual nature of the provisions of the LG Act involving sale of land by a council for unpaid rates. In circumstances where it is the Plaintiff (as statutory vendor) which enters into a Contract for Sale of Land with Mr Smith (as purchaser), it is entirely consistent with the statutory scheme under the LG Act that the Plaintiff be entitled to obtain possession of the property from the Defendant, for the purpose of giving possession to Mr Smith on completion of the sale.
I accept that vacant possession is a normal incident of sale, the availability of which is generally necessary for completion of the sale: King Investment Solutions Pty Limited v Hussain [2005] NSWSC 1076 at [133]. The vendor's obligation to give vacant possession to the purchaser should occur concurrently with the payment of the purchase price and the transfer of title: Isaacs v McGuire (1888) 14 VLR 815 at 818. A mortgagee exercising power of sale is obliged to recover physical possession of the property from the mortgagor: Reynolds v Doyle (1919) 19 SR (NSW) 108 at 110; Lang, "NSW Conveyancing Law and Practice", CCH, paragraph [10-130]. Mortgagees normally take possession as a preliminary to sale, so that the property can be sold with vacant possession: Butt, "Land Law", Lawbook Co, 6th edn, 2010, paragraph [18 106].
It is true that the detailed statutory scheme for sale of land for unpaid rates and charges in the LG Act does not contain an express power for a council to take possession of property as part of the process of sale. However, I accept the submissions of Mr Rogers that a purposive process of construction of various provisions to which reference has been made will bring about a logical and common sense outcome in this case. The construction to be adopted does not, in my view, contradict or offend any relevant statutory provision. Nor does it contradict any applicable principles of statutory construction.
I do not consider that this conclusion infringes the principles in Plenty v Dillon, Kuru v State of New South Wales and Bropho v Western Australia.
The provisions to be construed are those contained in Division 5 of Part 2 of the LG Act (ss.713-726). What powers of entry may exist in other parts of the LG Act, conferred for different purposes, does not assist the process of construction of the provisions concerning sale of land for unpaid rates.
In Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355, McHugh, Gummow, Kirby and Hayne JJ said at 381 [69] (footnotes omitted):
"The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined 'by reference to the language of the instrument viewed as a whole'. In Commissioner for Railways (NSW) v Agalianos [(1955) 92 CLR 390 at 397], Dixon CJ pointed out that 'the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed'. Thus, the process of construction must always begin by examining the context of the provision that is being construed."
Soon after, their Honours said at 384 [78] (footnotes omitted):
"However, the duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have. Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning of the provision. But not always. The context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning."
Context, the general purpose and policy of a provision and the mischief to which it is directed are significant to the process of statutory construction, as are the inconvenience or improbability of a particular construction: CIC Insurance Limited v Bankstown Football Club Limited [1997] HCA 2; 187 CLR 384 at 408; Network Ten Pty Limited v TCN Channel Nine Pty Limited [2004] HCA 14; 218 CLR 273 at 280-281 [10]-[12].
The context in which the power of sale provisions in ss.713-726 LG Act were introduced include the well-established principles of property law where land is ordinarily sold with vacant possession, and the inconvenience and improbability of the result urged by the Defendant in this case if the owner of land could not be required to surrender possession of the land until registration of the transfer under s.726 LG Act: cf Network Ten Pty Limited v TCN Channel Nine Pty Limited at 281 [12].
The entitlement of the Plaintiff to obtain possession of the Jugiong property from the Defendant may be implied in the scheme in the LG Act because it is necessary (that is, reasonably required or legally ancillary) to the Plaintiff's statutory power to sell the property to Mr Smith, and to give vacant possession to him on completion as an incident of the sale: cf Pelechowski v Registrar, Court of Appeal (NSW) [1999] HCA 19; 198 CLR 435 at 451-452 [50]-[51].
It is a principle of construction that "Whoever grants a thing is deemed also to grant that without which the grant itself would be of no effect": Troncone v Aliperti (Court of Appeal, 20 April 1994, BC9402483, page 2). Although this principle relates to construction of contracts, it sheds light here upon the appropriateness of an implied entitlement to be found in the relevant statutory scheme, which will necessarily involve a contract for sale to give effect to the statutory power of sale.
The statutory power of sale in the LG Act carries with it the entitlement of the Plaintiff to take possession of the land so that it may give vacant possession to Mr Smith on payment of the balance of the purchase price.
It is entirely clear that the process of sale of land by a council for unpaid rates and charges is intended to give rise to a change in title to the land. Section 716 LG Act requires sale to be attempted, in the first instance, by way of public auction.
As Brereton J observed in Anderson v Lismore City Council, at 251 [28], a council's power to sell under s.713 LG Act is akin to a mortgagee's power of sale, given to a council as a creditor to enforce a debt due to the council, that is charged by statute on the land.
It is necessary to keep in mind the statutory scheme. The Defendant's property has been lawfully sold by the Plaintiff at auction to Mr Smith. The Defendant's statutory entitlements are contained in ss.718-720 LG Act. The Defendant is not the vendor. He has no control or say concerning the selection of the date when he is required to surrender possession of the property. His position is quite different to that of an ordinary vendor who enters into a Contract for Sale of Land and then executes a transfer. The existence of a transitional process which sees a council take possession of the land for the purpose of giving vacant possession to the purchaser on completion is entirely consistent with the statutory scheme contained in ss.713-726 LG Act and ordinary conveyancing practice. The Plaintiff has an implied statutory entitlement to obtain possession of the property from the Defendant for the purpose of giving vacant possession to Mr Smith on completion. All of this arises from the unusual statutory scheme where the Plaintiff can sell the Defendant's land without the Defendant being a party to the contract or the transferor.
The position is broadly analogous to that of a trustee, not in possession of a property, who desires to obtain possession of a property so that it may be sold under a power given in a will, where the Court will give judgment for possession and give leave for the issue of a writ of possession: NSW Trustee and Guardian v Schneider [2011] NSWSC 424 at [21]ff.
I am satisfied that the first route relied upon by the Plaintiff (see [154] above) permits the Court to give judgment for possession against the Defendant. In these circumstances, it is not strictly necessary to determine the availability of the second and third routes. However, as the matters have been fully argued, I will proceed to determine these claims as well.
The Plaintiff's second submission requires consideration of s.60 Real Property Act 1900. I accept the Plaintiff's submission that a charge under s.550 LG Act is a "mortgage" for the purposes of the Real Property Act 1900. It is a charge on land created to secure the payment of a debt. The ordinary meaning of a "charge" is an act in the law by which an item of property is made available as a source from which some legal obligation can be met: Residential Housing Corporation Pty Limited v Esber [2011] NSWCA 25; 15 BPR 29, 213 at 29, 223 [51].
In my opinion, s.550(2) LG Act authorises resort to s.60 Real Property Act 1900, a view which is reinforced by s.550(5) LG Act.
Section 60(a) Real Property Act 1900 does not assist the Plaintiff. The right to enter into possession by s.60(a) Real Property Act 1900 is expressly confined to a right to enter possession by receiving the rents and profits from the land: Starceavich v Swart & Associates Pty Limited [2006] NSWSC 960 at [35]-[37]; Perpetual Trustee Company Limited v Agusta Pty Limited [2008] NSWSC 646; 72 NSWLR 148 at 156 [47]. It has been described as a right of constructive possession: Butt, "Land Law", Lawbook Co, 6th edn, 2010, paragraph [18 95].
Here, the Plaintiff seeks to obtain actual possession of the property. It does so by bringing proceedings in this Court for possession of the land, an avenue available under s.60(c) Real Property Act 1900.
I do not consider that Sood v Christianos assists the resolution of the present case, which involves the exercise of the statutory power of sale under the LG Act without the need to apply for judicial sale.
I am satisfied that the pathways to achieve this result may be found in s.60 Real Property Act 1900, with the acceptance that a charge under s.550 LG Act is a mortgage.
I accept the submission of Mr Rogers that Campbell J and Hidden J in their separate decisions in King Investment Solutions Pty Limited v Hussain, were not called upon to consider the issues which are presently before me. Those cases did not involve the exercise of a statutory power of sale, nor were the provisions of the LG Act pertinent to them.
In the 2010 decision in King Investment Solutions Pty Limited v Hussain, Hidden J concluded (at [31]-[34]) that s.60 did not apply to a mortgage unless it was registered. I agree with Mr Rogers' submission that this observation of his Honour was obiter. Nevertheless, I have regard to the principle of judicial comity in determining whether I should follow his Honour's decision: Segal v Waverley Council [2005] NSWCA 310; 64 NSWLR 177 at 193 [57].
I have given careful consideration to his Honour's decision, but have reached a different view. Firstly, the definition of "mortgage" in s.3 Real Property Act 1900 can include unregistered mortgages: Residential Housing Corporation Pty Limited v Esber at 29, 223 [52]. Secondly, I note that the Real Property Act 1900 refers at different points to a "registered mortgagee" (s.57(2)) and a "mortgagee" (s.60). It has been noted that s.60 makes no distinction between registered and unregistered mortgagees: Butt, "Land Law", Lawbook Co, 6th edn, 2010, paragraph [18 95]. Thirdly, the present question is to be determined by reference to a "mortgage" derived from s.550 LG Act, a provision which refers to priority (s.550(2)) and the inter-relationship with the Real Property Act 1900 (s.550(5)). The present case is distinguishable from that considered by Hidden J, and his Honour did not have the assistance of the submissions made to me in this case.
I am persuaded that s.60 Real Property Act 1900 may be relied upon by the Plaintiff to seek an order for possession, even though there is no registered instrument in this case. I have reached this conclusion having considered the statutory scheme under the LG Act (including s.550(2) and (5)) and noting that s.60 has not been said to be confined solely to registered mortgages: Butt and Others, "The Torrens System in NSW", 2nd edn, paragraph [64,160].
I uphold the Plaintiff's second submission (at [155] above) that its entitlement to possession arises under s.60 Real Property Act 1900.
The Plaintiff's third submission in support of the claim for possession was based upon s.109 Conveyancing Act 1919 (see [156] above).
I am satisfied that the Plaintiff is a mortgagee within s.109(1)(a) by reference to a charge (under s.550 LG Act) and the definition of "mortgage" in s.7 Conveyancing Act 1919. As vacant possession is a normal incident of sale (see [167] above), I accept that a condition of sale that a property be conveyed subject to vacant possession falls within the words in s.109(1)(a) Conveyancing Act 1919.
I would uphold the Plaintiff's entitlement to possession of the Jugiong property on this basis as well.
In my view, the outcome in this case will see a coherent pathway where the exercise of the statutory power of sale by public auction by the Plaintiff to Mr Smith, followed by the entry into a Contract for Sale of Land between the Plaintiff and Mr Smith, may be given effect to by the Plaintiff taking possession of the land for the sole purpose of giving vacant possession to Mr Smith upon completion of the sale.

Conclusion and Orders

I am satisfied that the Plaintiff has demonstrated an entitlement to the relief sought in the Statement of Claim, being judgment for possession of the Jugiong property, and leave to issue a writ of possession forthwith.
In these circumstances, an appropriate consequential order will require removal of the caveat lodged on 6 December 2010 (see [63] above).
The ordinary rule is that costs follow the event, and that the Defendant should be ordered to pay the Plaintiff's costs of the proceedings. I note, however, that Ms Lane submitted that, if the Plaintiff obtained an order for possession, no order should be made for payment of the Plaintiff's costs. It was submitted that this course should flow as the Defendant's legal representatives were attempting to negotiate an orderly vacation of the Jugiong property, and had made a proposition to Council that had not been responded to at the time of the filing of the Statement of Claim.
It is difficult to see that this consideration would lead to a variation of the usual rule as to costs, especially given the vigorous defence to the Plaintiff's claim advanced unsuccessfully on a number of bases in this Court. However, I will provide the parties with an opportunity to make submissions in this respect, if they see fit, when judgment is handed down.
I make the following orders:
(a) I give judgment to the Plaintiff for possession of the land known as Lot xx Jugiong Road, Jugiong NSW 2726, being the whole of the land in Folio Identifier xxx situate in the town of Jugiong, the local government area of Harden, the Parish of Jugiong and the County of Harden ("the Jugiong property").
(b) I grant leave to the Plaintiff to issue a writ of possession in respect of the Jugiong property forthwith.
(c) The Defendant is to withdraw caveat xxx within two business days.
(d) I will hear the parties on the question of costs.
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Case Title:	Harden Shire Council v Richardson
Medium Neutral Citation:	[2012] NSWSC 622
Hearing Date(s):	1 July 2011, 25 August 2011
Decision Date:	07 June 2012
Jurisdiction:	Common Law
Before:	Johnson J
Decision:	Judgment is given to the Plaintiff for possession of the Jugiong property. Grant leave to the Plaintiff to issue a writ of possession in respect of the Jugiong property forthwith. The Defendant is to withdraw caveat xxx within two business days.
Catchwords:	REAL PROPERTY - sale of land by council for unpaid rates - defendant purchased land in 1998 in false name - defendant misleads council that he is tenant and not owner of land - land sold at public auction - condition of contract for sale that council gives vacant possession to purchaser - claim by council for possession of land before completion of sale to give vacant possession to purchaser on completion - defendant refuses to surrender possession of land - efficacy of sale process - compliance with ss.713 and 715 Local Government Act 1993 - whether summary rejection by council of partial offer by defendant on eve of auction constituted non-compliance with s.715(2)(b) - whether council entitled to possession of land - whether defendant required to surrender possession of land before registration of transfer - implied entitlement of council to obtain possession under Local Government Act 1993 - application of s.60 Real Property Act 1990 and s.109 Conveyancing Act 1919 - council entitled to possession - judgment for possession with leave to issue writ of possession forthwith
Legislation Cited:	Local Government Act 1993 Residential Tenancies Act 1987 Residential Tenancies Act 2010 Real Property Act 1900 Conveyancing Act 1919 Local Government Act 1919 Bankruptcy Act 1966 (Cth) Civil Procedure Act 2005
Cases Cited:	Anderson v Lismore City Council [2011] NSWSC 1058; 185 LGERA 239 Logue v Shoalhaven Shire Council [1978] 1 NSWLR 710 Logue v Shoalhaven Shire Council [1979] 1 NSWLR 537 Blacktown Municipal Council v Custom Credit Corporation (1968) 71 SR (NSW) 365 Quzag v Gunning Shire Council [2005] NSWSC 970; 142 LGERA 77 R v Secretary of State for the Home Department; ex parte Venables [1998] AC 407 Green v Daniels [1977] HCA 18; 51 ALJR 463 Minister for Aboriginal Affairs v Peko-Wallsend Limited [1986] HCA 40; 162 CLR 24 Sorbello v Whan [2007] NSWSC 951 Plenty v Dillon [1991] HCA 5; 171 CLR 635 Kuru v State of New South Wales [2008] HCA 26; 236 CLR 1 Hillebrand v Penrith City Council [2001] NSWSC 200; 51 NSWLR 424 Sood v Christianos [2008] NSWSC 1087 Bropho v Western Australia [1990] HCA 24; 171 CLR 1 King Investment Solutions Pty Limited v Hussain [2005] NSWSC 1076 (reported in part at 64 NSWLR 441) King Investment Solutions Pty Limited v Hussain [2010] NSWSC 821 Saraswati v The Queen [1991] HCA 21; 172 CLR 1 Isaacs v McGuire (1888) 14 VLR 815 Reynolds v Doyle (1919) 19 SR (NSW) 108 Troncone v Aliperti (Court of Appeal, 20 April 1994, BC9402483) Pelechowski v Registrar, Court of Appeal (NSW) [1999] HCA 19; 198 CLR 435 NSW Trustee and Guardian v Schneider [2011] NSWSC 424 Residential Housing Corporation Pty Limited v Esber [2011] NSWCA 25; 15 BPR 29, 213 Starceavich v Swart & Associates Pty Limited [2006] NSWSC 960 Perpetual Trustee Company Limited v Agusta Pty Limited [2008] NSWSC 646; 72 NSWLR 148 Re Sterling; ex parte Esanda Limited (1980) 44 FLR 125 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 Network Ten Pty Limited v TCN Channel Nine Pty Limited [2004] HCA 14; 218 CLR 273 CIC Insurance Limited v Bankstown Football Club Limited [1997] HCA 2; 187 CLR 384 Segal v Waverley Council [2005] NSWCA 310; 64 NSWLR 177
Texts Cited:	Pearce and Geddes, "Statutory Interpretation in Australia", 7th edn, 2011 Woodman and Nettle, "The Torrens System in NSW", 2003 Butt and Others, "The Torrens System in NSW", 2nd edn Lang, "Conveyancing and Property Law (NSW)", CCH Butt, "Land Law", Lawbook Co, 6th edn, 2010
Category:	Principal judgment
Parties:	Harden Shire Council (Plaintiff) Anthony Charles Richardson (aka Ron Evans) (Defendant)
Representation
- Counsel:	Ms TA Iskra (Plaintiff - 1 July 2011) Mr AG Rogers (Plaintiff - 25 August 2011) Ms PM Lane and Dr SJ Chapple (Defendant)
- Solicitors:	KP Carmody & Co (Plaintiff) Legal Aid NSW (Defendant)
File number(s):	2011/81441
Publication Restriction:	---