Haughton v Australia and New Zealand Banking Group Ltd
[2019] SASC 198
•22 November 2019
SUPREME COURT OF SOUTH AUSTRALIA
(Appeal from a Master: Civil)
HAUGHTON v AUSTRALIA AND NEW ZEALAND BANKING GROUP LTD
[2019] SASC 198
Judgment of The Honourable Justice Kelly
22 November 2019
REAL PROPERTY - TORRENS TITLE - MORTGAGES, CHARGES AND ENCUMBRANCES
MORTGAGES - MORTGAGE CONTRACT
COURTS AND JUDGES - COURTS - JURISDICTION AND POWERS
CONSTITUTIONAL LAW - IMPERIAL, COLONIAL, STATE AND COMMONWEALTH CONSTITUTIONAL RELATIONSHIPS - GENERALLY - SOVEREIGNTY
Appeal against order for possession.
Where the appellant granted the respondent a first registered mortgage over a property for which he was the registered proprietor – where the appellant failed to comply with a notice of default – where the Master made an order for possession – where an extension of time is required to appeal.
Whether the respondent committed fraud with respect to the loan application – whether the respondent breached the Code of Banking Practice – whether the Court has jurisdiction to hear the matter.
Held: The appeal is dismissed. An extension of time in which to appeal is refused.
Law of Property Act 1936 (SA) s 55A; Royal Style and Titles Act 1973 (Cth), referred to.
Jossse v Australian Securities & Investment Commission (1998) 159 ALR 260; Petrie, Trustee of the Property of Aitken (Bankrupt) v Aitken & Ors [2019] FCCA 16; Sill v City of Wodonga [2018] VSCA 195; Southern Centre of Theosophy Inc v South Australia (1979) 145 CLR 246, applied.
HAUGHTON v AUSTRALIA AND NEW ZEALAND BANKING GROUP LTD
[2019] SASC 198Civil: Appeal from a Master
KELLY J.
The appellant, Peter Scott Haughton, appeals against an order made by an Auxiliary Master of this Court on 15 August 2019. On that date, the Master made an order granting possession to the respondent, Australia and New Zealand Banking Group Ltd, as mortgagee of a property situated in Lonsdale (‘the property’) in respect of which the appellant was the registered proprietor.
Background
Before dealing with the grounds of appeal it is necessary to set out the history.
By a loan contract dated 8 April 2014, the respondent granted the appellant a business credit facility with a limit of $1,000,000 (‘the loan application’). As security for the loan, the appellant granted the respondent a first registered mortgage over the property.
On 6 November 2018, the respondent served the appellant with a notice of default pursuant to s 55A of the Law of Property Act 1936 (SA). The appellant failed to comply with the notice of default.
On 29 January 2019, the respondent filed a summons seeking an order for possession of the property. In July 2019, the matter was set down before Auxiliary Master Roder for argument to determine whether an order for possession should be made or if the matter should be directed into the general civil list for trial.
After delivering judgment for the respondent and handing down his reasons on 30 July 2019, the Master made the order for possession on 15 August 2019.
On 25 September 2019, the appellant filed a notice of appeal complaining of the whole of the order.
There are numerous grounds of appeal, some of which appear to have no relevance to any issue either before the Master or on this appeal.
Grounds 1 to 3 can be distilled to complaints of fraud on the part of the respondent and a breach of cl 27 of the Code of Banking Practice by the respondent in respect of the loan application.
Grounds 4 to 8 are various complaints made relating to the alleged lack of jurisdiction of the Court to hear the claims (‘constitutional claims’).
The appellant does not expressly complain about any legal or factual errors made by the Master but appears to have reproduced the same evidence which was adduced in the possession proceedings, at least in relation to the complaints of fraud and breach of the Code of Banking Practice.
With respect to the constitutional claims, the appellant has exhibited a large amount of further material which, insofar as I understand it, appears to be almost wholly irrelevant and/or inadmissible.
The appellant also requires an extension of time in which to appeal.
Grounds 1 to 3: Fraud and breach of the Code of Banking Practice
The appellant’s main argument with respect to the first ground is that he did not complete the entirety of the loan agreement himself and that the loan agreement has therefore been completed by someone other than the appellant, amounting to fraud.
In the court below, the appellant produced a report of a handwriting expert who had been instructed to compare handwriting in certain diary notes allegedly made by the appellant with the handwriting of details inserted into the loan application. The author of that report, a Mr McGinn, stated that he was unable to opine as to whether the writings were completed by the same person.
The Master referred to that report in his reasons for judgment delivered on 30 July 2019 and concluded that the appellant had not pointed to any evidence that the loan application was in fact completed by the respondent or any agent of the respondent.
Irrespective of whether or not the appellant or someone else had completed the details in the body of the loan application, it was not in dispute at the hearing in the court below, nor on the hearing of this appeal, that the appellant had signed the loan application and had received the benefit of the funds.
The Master correctly held that, in any event, there was no suggestion that the loan application was not the appellant’s document or that it was not a properly registered mortgage.
At no stage did the appellant ever suggest that the signature on the loan application was not his.
In the light of these findings, the Master was correct to conclude that the claim of fraud put forward by the appellant was without merit.
With regard to the breach of the Code of Banking Practice claim, the appellant contented that, by including the inflated figure of $5,000,000 against the appellant’s home in the details on the loan application, the respondent breached the Code of Banking Practice, thereby vitiating the contract.
In his reasons, the Master considered the documentary material supporting that claim and ultimately found that the appellant’s evidence fell short of establishing that the propositions advanced by him were arguable. Further, even if the claim in respect of the breach of the Code of Banking Practice was taken at its highest, it could not impugn the validity of the mortgage. At best, it would have given rise to a counter claim for damages.
The Master referred to National Australia Bank Ltd v Rice & Rose[1] and Inglis v Commonwealth Trading Bank of Australia[2] in concluding that a claim for damages will not be sufficient to restrain the mortgagee from exercising the powers conferred by the mortgage and, in particular, the power of sale.
[1] National Australia Bank Ltd v Rice & Rose [2015] VSC 10; National Australia Bank Ltd v Rose [2016] VSCA 169.
[2] (1972) 126 CLR 161, 164-165.
The Master was correct to so conclude and, for these reasons, grounds 1 to 3 of the appellant’s notice of appeal must fail. I would dismiss these grounds of appeal.
Grounds 4 to 8: Constitutional claims
The remaining grounds of appeal, insofar as they can be understood, do not identify any relevant error made by the Master. Most of the documents exhibited by the appellant to support his various constitutional claims are entirely irrelevant and inadmissible to any matter in issue in the possession proceedings.
Nevertheless, the Master correctly identified and dealt with each of the appellant’s arguments in the following paragraphs of his reasons:
[11]In the first place, the defendant denied the Court had jurisdiction and asked me to proceed under s 78B of the Judiciary Act 1903 (Cth). The matter said to arise under the Constitution was not clearly defined, nor was there any suggestion that the defendant would give any notices to the Attorneys-General.
[12]It was not easy to follow the arguments raised under this topic. Nor was it easy to understand how they were said to be relevant to the matter before me. I do not intend to criticise the defendant. He is not a lawyer. It was, as he told me, his first trial.
[13]The defendant relied on an argument that I can trace back to Joosse v Australian Securities and Investments Commission. That was that the Commonwealth Royal Style and Titles Act 1973 was invalid because it purported to create a “Queen of Australia”. As I understood the argument, most – if not all – legislation passed since then was invalid because it was assented to in the name of an office that does not exist. Further, it was said that most, if not all, appointments since then – gubernatorial, parliamentary and judicial (including mine) – were invalid because an oath had been taken to an office that did not exist.
[14]For the reasons given by Hayne J in Joosse, Philippides J in Cameron v Peter D Beattie in his capacity as Premier & Ors, Corboy J in Hopes v Australian Securities and Investments Commission and Judge Lucev in Petrie, Trustee of the Property of Aitken (Bankrupt) v Aitken & Ors, the argument has no merit.
[15]Another argument was that, if a writ of habeas corpus were to be issued to bring the body of the Queen of Australia to the Court, there would be no return, because there is no such person. The reasons in Joosse, Cameron, Hopes and Petrie are sufficient to dispose of that argument without descending into an examination of the immunity of the sovereign.
[Citations omitted]
The Master referred to, and correctly relied on, the decisions of Joosse v Australian Securities & Investment Commission[3] and Petrie v Aitken[4] to conclude that the appellant’s argument was seriously misconceived.
[3] (1998) 159 ALR 260.
[4] Petrie, Trustee of the Property of Aitken (Bankrupt) v Aitken & Ors [2019] FCCA 16.
In Joosse,[5] Hayne J was emphatic that the Royal Style and Titles Act 1973 (Cth) did not work any fundamental constitutional change:
[20]… So far as Commonwealth legislation is concerned, it is ss 58, 59 and 60 of the Constitution that deal with the ways in which the Royal Assent may be given to bills passed by the other elements of the Federal Parliament. So far as now relevant, s 58 governs. It provides that the Governor-General “shall declare, according to his discretion, but subject to this Constitution, that he assents in the Queen’s name”. And there is no material that would suggest that has not been done in the case of each Commonwealth Act that now is challenged.
[5] (1998) 159 ALR 260, 265 [20].
In the recent Federal Court decision of Petrie,[6] Judge Lucev referred to a useful summary of the relevant authorities, which Auxiliary Master Roder relied on in concluding that the appellant’s contention has no basis in law.
[6] [2019] FCCA 16, [14]-[37].
A similar argument was rejected by Beach JA in Sill v City of Wodonga:[7]
[22]… [O]ne might also observe that the applicant’s arguments premised upon the non-existence of the Queen of Australia are totally without merit, flying as they do in the face of the High Court’s decisions in Pochi v Macphee and Nolan v Minister for Immigration and Ethnic Affairs. As was observed by Gibbs CJ in Pochi, ‘the allegiance which Australians owe to Her Majesty is owed not as British subjects but as subjects of the Queen of Australia’. As was observed by the plurality in Nolan, the words ‘subject of the Queen’ in the Constitution, should be treated as referring, ‘in a modern context, to a subject of the Queen in right of Australia: cf Royal Style and Titles Act 1973 (Cth)’. Put bluntly, Australian citizens owe allegiance to the Queen of Australia, not the Queen of the United Kingdom.
[Citations omitted]
[7] [2018] VSCA 195, [22].
The true effect of the Royal Style and Titles Act 1973 (Cth) was adverted to by Gibbs J in Southern Centre of Theosophy Inc v South Australia:[8]
… It is right to say that this alteration in Her Majesty’s style and titles was a formal recognition of the changes that had occurred in the constitutional relations between the United Kingdom and Australia. For reasons already given those changes had no effect whatever on that part of the law of South Australia which confers a right of appeal to the Privy Council. The changes occurred as the result of an orderly development – not as the result of a revolution.
[8] (1979) 145 CLR 246, 261.
The Master was, therefore, correct to conclude that the appellant’s arguments against the validity of the Royal Style and Titles Act 1973 (Cth) and the alleged consequences said to arise from that cannot stand in the face of the authorities referred to by the Master.
The Master was correct to conclude that the constitutional claims were without merit. I would dismiss these grounds of appeal.
Extension of time
I turn now to deal with the only remaining issue which is the appellant’s application for an extension of time.
The appellant’s notice of appeal contains the following notation beneath the heading of “Extension of time to Appeal”:
“As noted in transmission of emails from Supreme Court Admin and Judge Dart between
Exhibit book 4.
Letter dated 16th September to the Governor-General David Hurley and Affidavit of witness of the criminal concealment at the Christies beach Magistrates Criminal Court on 12th September 2019 pages.”
I infer from this notation that the appellant appears to have appreciated the necessity to obtain an extension of time for commencing his appeal.
There has been no explanation advanced by the appellant for the delay, even though the delay is relatively minor. However, given the fact that not one of the appellant’s grounds of appeal has any merit, and in the context of the history where the appellant has not made any repayments in respect of the mortgage since March 2018, I consider it would be unjust and inappropriate to grant an extension of time to bring the appeal. Therefore, an extension of time is refused.
Conclusion
The appeal is dismissed. I will hear the parties as to costs.
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