Hera Project Pty Ltd v Bisognin [No 6]
[2017] VSC 438
•29 JUNE 2017 (ex tempore)
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST
S CI 2016 03457
| HERA PROJECT PTY LTD (ACN 163 685 041) | Plaintiff |
| v | |
| GINO ANDREW BISOGNIN | First Defendant |
| - and - | |
| LEAH JOAN BISOGNIN | Second Defendant |
---
JUDGE: | RIORDAN J |
WHERE HELD: | MELBOURNE |
DATE OF HEARING: | 29 JUNE 2017 |
DATE OF JUDGMENT: | 29 JUNE 2017 (ex tempore) |
CASE MAY BE CITED AS: | HERA PROJECT PTY LTD V BISOGNIN & ANOR [No 6] |
MEDIUM NEUTRAL CITATION: | [2017] VSC 438 |
---
REMEDIES – Orders made in furtherance of specific performance – Issue estoppel – Time for compliance extended to allow unsuccessful party to make an application for a stay.
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr L Warren | Russell Kennedy |
| For the Defendants | Mr L P Wirth | T F Grundy Lawyer |
HIS HONOUR:
The plaintiff in this proceeding seeks further orders by way of specific performance following judgment for the plaintiff on 22 May 2017, which ordered that the defendants specifically perform what was referred to in reasons published on that day as the 2015 Contract.[1] The orders sought today were as follows:
(1)By 4:00 pm on 29 June 2017, the vendors pay the growth areas infrastructure contribution (‘GAIC’) in respect of 1 Adrian Street, Cranbourne East and obtain the G2 and G3 notices from the State Revenue Office so as to remove the GAIC notice in dealing AH336996N in relation to the property and when obtained to forward them to the purchaser.
(2)The vendors procure the Australian and New Zealand Banking Group Limited (‘the ANZ Bank’) to make the certificate of title available for the purposes of registration of the plan of subdivision or nominate Hera Project Pty Ltd to the lodgement and registration of the plan of division PS735801Q, and if required by the Land Use Australia, to give its consent to the registration of plan of subdivision PS735801Q. They are at liberty to apply for further order in aid of specific performance.
[1]Hera Project Pty Ltd v Bisognin [No 3] [2017] VSC 268.
Since the application was made for these orders, the defendants have lodged an application for leave to appeal from the decision of 22 May 2017 together with an application for the stay of the orders, as they had previously foreshadowed. The application for the stay of the orders has been listed before the Court of Appeal on Monday 17 July 2017. I indicated to Mr Warren, who appeared on behalf of the plaintiff, that I was proposing not to require the defendants to take any further action as requested prior to 20 July 2017 to enable the defendants to bring the application for a stay to the Court of Appeal and the Court of Appeal to give consideration to that application.
Submissions were made that I should not do so, on the basis of the prejudice which was set out in written submissions, para 20(a) to (i). Without referring to each of them in detail, the plaintiff points to the substantial prejudice that has been consequent upon the delays in the settlement of the 2015 Contract over what is now more than two years.
However, in particular, Mr Warren relies upon the fact that a survey expires tomorrow and it may be that a further survey will be required by the Titles Office and the fact that the critical value in Lot 1, being the land the subject of the 2015 Contract, arises from the agreement for lease entered into with Woolworths. Accordingly, he says that any delay is prejudicial.
In my opinion, there is merit in the argument that any further delay of this matter will cause prejudice to the parties; and the Court has been conscious that the commercial purpose of this contract could be destroyed if in fact, the resolution of the disputes between the parties cannot be dealt with expeditiously.
For that reason, as part of the Property List, I have accepted responsibility of finalising the settlement of this contract as soon as possible. Consequently, after the decision of the Court of Appeal,[2] the trial of this proceeding was heard on an expedited basis and I have considered further applications for specific orders in furtherance of the order for specific performance.
[2] Bisognin v Hera Project Pty Ltd [No 2] [2017] VSCA 7 (Santamaria and Ferguson JJA and Riordan AJA).
However, I am not satisfied that it is unreasonable to permit the defendant a period of three weeks to raise the money to enable the payment of the GAIC, and to prepare for the registration of the plan of subdivision. I was told from the bar table that the sum to be paid for the GAIC was in the order of $200,000.
Further, it is my opinion that, as a matter of natural justice, the defendants should not be deprived of the opportunity of making an application to the Court of Appeal prior to the registration of the plan of subdivision.
It may well be that, if the Court of Appeal were to overturn my decision, the registration of the plan of subdivision could be undone by a consolidation of the titles and the GAIC may or may not be able to be refunded.
However, in my opinion, balancing a delay of a few days against the defendants’ right to apply for a stay to the Court of Appeal, moves me to decide that I should not order the defendants to effectively take the additional steps to permit the registration of the plan of subdivision prior to the Court of Appeal having an opportunity to hear the application for a stay.
It was argued by Mr Wirth, who appeared as counsel for the defendants, that the orders should not be made as sought by the plaintiff for three reasons.
First, a procedural ground, to enable the defendants to have the opportunity to make application for a stay with the Court of Appeal.
Secondly, it was argued that equity should not impose an obligation on the defendants which would be impossible to perform.
Thirdly, there was an unresolved question which was seriously arguable, that the defendants did not have an obligation to pay the GAIC at this stage, or until any time until required by the authorities on a proper construction of special condition 10.
With respect to the procedural argument, Mr Wirth submitted that the Court of Appeal may not be able to deliver their decision by the 20 July 2017, having heard the application on the 17 July 2017.
I not only think that this is improbable; but if so minded, the Court of Appeal has the power to grant an interim stay, if further time is required to consider the application for the stay.
With respect to the impossibility, Mr Wirth referred to evidence led at the trial about the fact that his clients were unemployed and had difficulty obtaining funds in the past and to the fact that Mr Warren had said that the defendants appeared to be in breach of their obligations under a mortgage to the ANZ Bank.
The fact is that the defendants have not put on any material which satisfies me that they are unable to pay the GAIC, which is in the order of $200,000. If the registration was to proceed within 14 days, there would be a settlement of the sale of the property due in respect of which the defendants would be entitled to the payment of $3,600,000.
It would be surprising to say the least in those circumstances, if the registration of the plan of subdivision was to go ahead, that the defendants would be unable to raise the necessary funds. However, I make no finding about that because no evidence has been put on by the defendants.
I will give the defendants liberty to apply, but give a fair warning that the evidence of the inability would need to be compelling; and that their failure to put on any evidence up until this point in time, given the order of 22 May 2017 and the subsequent orders, would need to be explained.
The third submission made by Mr Wirth was that cl 10 of the 2015 Contract did not require the defendants to pay the GAIC to enable the registration of the plan of subdivision.
He argued that, on a proper construction, the best endeavours obligation to cooperate with the purchaser was limited to:
(a) the signing of documents;
(b) doing things necessary to give effect to the approval of the plan of subdivision;
(c) give effect to the UDF; and
(d) to make the duplicate title available to Land Titles Office.
However, the obligation about the GAIC was a separate obligation.
Mr Wirth further argued that this construction was supported by the fact that the obligation to pay the GAIC was only to pay it promptly if required by the relevant authorities; and that there was currently no obligation or requirement by the relevant authorities.
He said that an obligation under the Subdivision Act1988, that the amount be paid prior to registration, should not constitute a requirement by the relevant authority within the meaning of special condition 10.
In my opinion, the position of the defendants was arguable; but I am satisfied that it is an argument that has already been dealt with by Sloss J in Bisognin v Hera Project Pty Ltd.[3] In that proceeding, the plaintiffs were the vendors, and the defendant was the purchaser.
[3][2016] VSC 75.
At that trial, her Honour made orders including the following:
4.During the period of extension of time, the plaintiffs are to use their ‘best endeavours’ to co-operate with the defendant and do all acts and things necessary to give effect to the approval of the subdivision and give effect to the Urban Design Framework (as approved by the City of Casey) as required by special condition 10, including:
(a)satisfying the conditions of the planning permit issued on 11 June 2015 by entering into the agreements with the relevant referral authorities, the Responsible Authority and the relevant telecommunications service provider in a timely way in respect of both lots on the plan of subdivision;
(b)making arrangements with their mortgagee to produce the duplicate Certificate of Title from the Land Titles Office (at the cost of the defendant);
(c)promptly paying any Growth Areas Infrastructure Contribution payment
with a view to assisting the defendant to obtain the statement of compliance and thereby procure the registration of the plan.
Reference to the reasons given by her Honour make it abundantly clear that the orders in para 4 were in response to arguments as to when special condition 10 required the vendors to make payment of the GAIC. In my opinion her Honour’s order makes it plain that the obligation to use the best endeavours to cooperate with the purchaser extends to promptly paying the GAIC, and that that obligation envisages that it would be paid with a view to obtaining a statement of compliance and thereby procuring the registration of the plan.
In those circumstances, I consider it appropriate to make an order in aid of the enforcement of order 4 made by Sloss J on 22 June 2016.
I therefore propose to order that:
(a)By 1:00 pm on 20 July 2017 the defendants/vendors provide to the plaintiff/purchaser a notice relating to Lot 1 issued by the Commissioner of State Revenue under s 201SZG of the Planning and Environment Act 1987 as required by s 22(1)(g) of the Subdivision Act 1988.
(b)The defendants/vendors procure the ANZ Bank to make the Certificate of Title available for the purposes of registration of the plan of subdivision and give its consent to the registration of the plan of subdivision PS735801Q at a time as soon as practicable after 1:00 pm on 20 July 2017.
---
0