Hau Lam v Phung Thuong Lam and Pacific Far East Pty Ltd (ACN 071 762 420)
[2017] VSCA 247
•11 September 2017
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2016 0125
| HAU LAM | Applicant |
| v | |
| PHUNG THUONG LAM | First Respondent |
| and | |
| PACIFIC FAR EAST PTY LTD (ACN 071 762 420) | Second Respondent |
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| JUDGES: | SANTAMARIA and KAYE JJA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | 11 September 2017 |
| DATE OF JUDGMENT: | 11 September 2017 |
| MEDIUM NEUTRAL CITATION: | [2017] VSCA 247 |
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PRACTICE AND PROCEDURE – Application for stay of order pending special leave application – Whether substantial prospect that special leave to appeal will be granted – Balance of convenience – Where applicant seeks stay of order requiring applicant to execute withdrawal of caveat over title to land – Where land is subject to development proposal – Where first respondent’s ability to service or refinance loan facilities is prejudicially affected by caveat – No material to satisfy court that applicant will provide undertaking as to damages – Application dismissed with costs.
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr E N Magee QC and Ms C M Jones | Titanium Lawyers |
| For the First Respondent and the Second Respondent | Ms G A Costello and Ms R V Howe | Kabo Lawyers |
SANTAMARIA JA
KAYE JA:
Introduction
The applicant, Hau Lam (‘Hau’), is the former registered proprietor of the land described in the folio of the register volume 10854 folio 734, situated at 46–102 Deanside Drive, Rockbank, Victoria (‘the Rockbank land’).[1]
[1]We use the given names of the members of the Lam family as that is the way that they referred to each other at trial and during the hearing of the application for leave to appeal. The trial judge adopted the same practice in his judgment.
On 25 May 2007, a contract for the sale of the Rockbank land from Hau to the first respondent, Phung Thuong Lam (‘Cynthia’), was purportedly signed by Hau. Hau denies having signed this contract. Subsequently, the property was registered in the name of the second respondent, Pacific Far East Pty Ltd (‘Pacific Far East’).
In 2013, Hau claimed that the Rockbank land had been transferred to Pacific Far East without his knowledge or consent. He alleged that the transfer documents in relation to the Rockbank land were forgeries and that the transfer was fraudulent.
On 16 September 2013, Hau lodged a caveat (number AK594422W) over the Rockbank land. The caveat lapsed on 26 November 2013 as Hau did not have on foot any legal proceedings in respect of it.
On 28 November 2013, Hau lodged another caveat (number AK743845T) over the Rockbank land.
On 12 February 2014, Hau commenced a proceeding by writ against Cynthia, Pacific Far East, a conveyancer named Loan Tran and the Registrar of Titles in relation to the Rockbank land (‘the Rockbank proceeding’).[2]
[2]Loan Tran and the Registrar of Titles are not parties to the present application.
On 1 April 2014, Hau commenced a similar proceeding in relation to a property situated in Altona (‘the Altona proceeding’).
On 6 June 2016, a judge in the Trial Division (Almond J) delivered his reasons for judgment in the Rockbank proceeding and in the Altona proceeding.
On 25 August 2016, the Court made final orders in both proceedings. The orders made in the Rockbank proceeding included the following:
3.By 4.00pm on 9 September 2016 [Hau] execute in registrable form a withdrawal of caveat number AK743485T with respect to the land described in the folio of the Register volume 10854 folio 734 and submit and lodge all documents and do all such acts and things as are necessary to procure the withdrawal from the Register of the said caveat.
On 7 September 2016, Hau filed an application for leave to appeal the decision of Almond J.
On 30 June 2017, this Court granted leave to appeal but dismissed the appeal. This Court made further orders, including the following:
4.Order 3 of the Orders of Justice Almond dated 26 August 2016 is varied so as to substitute 7 July 2017 for 9 September 2016.
On 28 July 2017, Hau applied to this Court for an order pursuant to
rr 64.9 and 66.16 of the Supreme Court (General Civil Procedure) Rules 2015 in the following terms:
Order 4 made by the Court of Appeal on 30 June 2018 be stayed pending the determination of the applicant’s special leave application to the High Court of Australia.
On 31 July 2017, Hau applied to the High Court of Australia for special leave to appeal from the whole of the judgment of this Court given on 30 June 2017.
In support of his application for a stay, Hau has filed a number of documents, which relevantly include (a) an affidavit sworn by his solicitor on 31 July 2017, (b) documents filed in the High Court in the special leave application, (c) a Transfer of Land Act 1958 register search statement in respect of the Rockbank land; (d) a copy of a development option deed dated 17 October 2013 between Deanside Constructions Pty Ltd and Deanside Facilities Pty Ltd in respect of the Rockbank land (‘the development option deed’); (e) four emails sent between 17 October 2013 and
6 November 2013 concerning the development option deed, and (f) a copy of a caveat lodged by Deanside Constructions Pty Ltd on 24 December 2013.
In opposition to the application for a stay, Cynthia and Pacific Far East have filed (a) an affidavit affirmed by Cynthia on 14 August 2017, (b) statements by the National Australia Bank (‘NAB’) dated 10 January 2017 and 16 December 2016, (c) a letter from Mr Sang Duong of NAB dated 2 February 2017; (d) various statements from the Australian Taxation Office, (e) a letter from Dun & Bradstreet dated 27 June 2017, (f) a bundle of letters addressed to Pacific Far East and (g) a response to the special leave application.
Governing principles
The nature of the jurisdiction to grant a stay pending determination of a special leave application has been described as ‘extraordinary’. The principles which govern its exercise were articulated by Brennan J in Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd (No 1).[3]
[3](1986) 161 CLR 681.
In that case, Brennan J identified four relevant considerations:
(a) whether there is a substantial prospect that special leave to appeal will be granted;[4]
[4]See also Mercanti v Mercanti (2017) 340 ALR 225, 227–8 [11]–[12] (Kiefel J). In that case, Kiefel J said of the criterion that there be a substantial prospect that special leave to appeal will be granted; ‘this should not be understood as requiring that the prospects of success on the application for special leave be apply. In applying that test, [Brennan J] held that, in that case, he did not think “that the prospect of a grant of special leave is insubstantial”’.
(b) whether the applicant has failed to take whatever steps are necessary to seek a stay from the court in which the matter is pending;
(c) whether the grant of the stay will cause loss to the respondent; and
(d) where the balance of convenience lies.[5]
[5]Ibid 685.
Those governing principles have been considered by various intermediate appellate courts on a number of occasions,[6] including by this Court in Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd.[7]
[6]See, eg, Palmer v Permanent Custodians Ltd [2009] VSCA 164; Maher v Commonwealth Bank of Australia [2008] VSCA 12; Miller v Nationwide News Pty Ltd [2008] NSWCA 261; Rinehart v Welker (2012) 83 NSWLR 347, 356–8 [32]–[49]; Apple and Pear Australia Limited v Pink Lady America LLC (No 2) [2017] VSCA 10; Beton Pumping Group Pty Ltd v Zoomlion Capital (Australia) Pty Ltd (No 2) [2017] VSCA 185.
[7][2013] VSCA 266. At [11]–[36] of her reasons, the Chief Justice outlined the application of the principles to the circumstances before her.
In Beton Pumping Group Pty Ltd v Zoomlion Capital (Australia) Pty Ltd (No 2),[8] this Court said:
It is true that an intermediate appellate court should not be diffident about exercising this ‘extraordinary’ jurisdiction. In Minister for Local Government v South Sydney Council (No 3),[9] Spigelman CJ said that ‘an intermediate court of appeal should not be diffident in granting a stay or an injunction, in an appropriate case, notwithstanding the difficulty that may sometimes be occasioned for a member of an intermediate court of appeal in making an assessment of the prospects of a grant of special leave in a particular case’. Spigelman CJ observed that it appeared on the authorities that a number of elements often arose in such matters and that it was always material to look at the prospects of success in the circumstances of a grant of special leave.[10]
[8][2017] VSCA 185.
[9][2002] NSWCA 327.
[10][2017] VSCA 185 [20] (citations omitted) (Whelan and Santamaria JJA).
Is there a substantial prospect of a grant of special leave?
In its application for special leave, Hau has identified two ‘special leave questions’:
(a) whether the Court of Appeal fulfilled its obligation to conduct a rehearing; and
(b) whether Hau was denied natural justice by the manner in which the appeal was conducted and determined.
It is to be observed that, despite the description of the above questions as ‘special leave questions’, the application for special leave merely identifies two proposed grounds of appeal. In his written material filed in support of the application for a stay, Hau has referred to several ‘matters of public importance and general application’. In particular, he says that the application for special leave to appeal is limited to the issue of the Court of Appeal’s failure to conduct a proper rehearing because:
(a)It failed to consider the body of evidence relied upon by Hau to establish that a company controlled by Cynthia, Pacific Far East, was registered on title by fraud. It did not deal with that evidence and gave no reasons for not dealing with that evidence.
(b)In reaching its findings, it misstated the evidence and speculated as to evidence that was not before the court.
In determining whether or not there is a substantial prospect that special leave to appeal will be granted, consideration may be given to both the proposed grounds of appeal and the issues that have been identified as matters of public importance. Given that we formed part of the Court that determined the application for leave to appeal to this Court, we should leave it to others to determine whether there is any merit in the proposed grounds of appeal. However, we do not think that the issues that have been identified in the previous paragraph remain matters of public importance and of general application. The High Court has recently identified the principles that govern the disposition of appeals by intermediate appellate courts.[11]
[11]See Robinson Helicopter Co Inc v McDermott (2016) 331 ALR 558–9 [43] (French CJ, Bell, Keane, Nettle and Gordon JJ).
Balance of convenience
Further, we are not persuaded that the balance of convenience favours the present application.
The Rockbank land is the subject of a mortgage to NAB in support of facilities granted in favour of Cynthia and Pacific Far East. Those facilities are attracting a high rate of interest. Cynthia’s ability to service or refinance those facilities is prejudicially affected by Hau’s caveat. In paragraph 16 of her affidavit in opposition to the present application, Cynthia has deposed:
As far as I know, Hau is unemployed and owns no assets. He has not paid any amounts towards my legal costs of the trial. I have filed a proceeding in the Costs Court division of the Supreme Court of Victoria which was set down for taxation on 14 August 2017, however that proceeding remains unresolved and is still ongoing. [Hau] has also not offered me security for costs in relation to his High Court special leave application.
The Court asked senior counsel for Hau whether there was any material to contradict what Cynthia had deposed about the circumstances of Hau or whether any submissions might be made in response. Counsel frankly said that there was no such material, and no submissions were offered to contradict what had been said about Hau’s circumstances. Accordingly, Hau has not provided any material to the Court to indicate how he might satisfy any necessary undertaking as to damages.
The Rockbank land has become the subject of a development proposal in which it has been included with several other adjacent and nearby properties.[12] The Court was told that, pursuant to that proposal, those development plans contemplate ‘the subdivision of the Rockbank land’ into approximately 380 separate allotments. It was not in dispute that the value of the land has increased greatly
(a) since it was first purchased in Hau’s name and, again, (b) since it was transferred into the name of Pacific Far East. Before the development proposal becomes unconditional, a plan of subdivision must be registered which, thus far, has not happened. It appears that, if the development proposal becomes unconditional and some of the allotments are sold, a fund will be created. In the event that Hau is successful in his application for special leave to the High Court and subsequent appeal, there is no reason to doubt that he will have access to that fund. In his material, Hau has not suggested that he has any interest in the Rockbank land other than a financial interest. We discount the suggestion made in oral submissions that, at some point, Hau wanted to use the Rockbank land as a chicken farm.
[12]This is reflected in the development option deed.
Conclusion
In the circumstances, the application for a stay pending the determination of the special leave application is dismissed.
Orders
The Court will make the following orders:
1. The date in order 4 of the orders of the Court of Appeal dated 30 June 2017 be extended until 4.00 pm on 12 September 2017.
2. The application be dismissed.
3. The applicant pay the first and second respondents’ costs of the application.
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