Hoon v Westpoint Management Ltd

Case [2011] WASC 239

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   HOON -v- WESTPOINT MANAGEMENT LTD [2011] WASC 239

CORAM:   CORBOY J

HEARD:   8 FEBRUARY, 15 & 21 MARCH 2011

DELIVERED          :   7 SEPTEMBER 2011

FILE NO/S:   CIV 1117 of 2004

BETWEEN:   LEE GEOK HOON

Plaintiff

AND

WESTPOINT MANAGEMENT LTD
First Defendant

PARAGON APARTMENTS LTD
Second Defendant

REGISTRAR OF TITLES
Third Defendant

Catchwords:

Caveats - Whether caveat should be removed following dismissal of action for specific performance of contract of sale for want of prosecution - Purpose of a caveat and the exercise of the court's discretion to remove - Whether purchaser retains a caveatable interest - Action for specific performance and time limitations - Laches - Turns on its own facts

Legislation:

Limitation Act 1935 (WA)

Result:

Order made for removal of caveat

Category:    B

Representation:

Counsel:

Plaintiff:     Mr S S Ludher

First Defendant             :     No appearance

Second Defendant         :     Mr J A Thompson

Third Defendant           :     No appearance

Solicitors:

Plaintiff:     Rikhraj

First Defendant             :     No appearance

Second Defendant         :     Corrs Chambers Westgarth

Third Defendant           :     No appearance

Case(s) referred to in judgment(s):

Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57

Bahr v Nicolay [No 2] (1988) 164 CLR 604

Boomalli Ltd v Hake [1985] WAR 7

Brocx v Hughes [2010] WASCA 57

Central Trust and Safe Deposit Company v Snider [1916] AC 266

Chief Commissioner of Stamp Duties v ISPT Pty Ltd (1998) 45 NSWLR 639

Composite Buyers Ltd v Soong [1995] 38 NSWLR 286

Custom Credit Corporation Ltd v Chellaston Pty Ltd (Unreported, WASC, Library No 930340, 10 June 1993)

Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42

Duke v Royalstar Pty Ltd [2001] WASCA 273

Eng Mee Yong v Letchumanan [1980] AC 331

Fairweather v Fairweather (1944) 69 CLR 121

Fitzgerald v Masters (1956) 95 CLR 420

Genrich v Maitland Holdings Pty Ltd [1982] Qd R 58

Guardian Loans Pty Ltd v FTFS Holdings Pty Ltd [2009] NSWSC 1163

J & H Just (Holdings) Pty Ltd v Bank of New South Wales (1971) 125 CLR 546

Lamshed v Lamshed (1963) 109 CLR 440

Leros Pty Ltd v Terara Pty Ltd (1992) 174 CLR 407

Lysaght v Edwards (1876) 2 Ch D 499

McCourt v National Australia Bank Ltd [2010] WASC 121

McDowall v Reynolds [2006] QSC 414

National Australia Bank v McCourt [2010] WASC 237

Navarac Pty Ltd v Moondancer Holdings Pty Ltd [2009] WASCA 95

P & O Nedlloyd BV v Arab Metals Co (No 2) [2007] 1 WLR 2288

R v McNeil (1922) 31 CLR 76

Tadrous v Tadrous [2009] NSWSC 407

Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315

The Bell Group Ltd (in liq) v Westpac Banking Corporation [No 9] [2008] WASC 239; (2008) 39 WAR 1

Thomson v Richardson (1928) 29 SR (NSW) 221

Varney v Anderson [1988] 1 NZLR 478

Verebes v Verebes (1995) 6 BPR 14,408

CORBOY J: 

The application and the result

  1. By an…

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Hoon v Westpoint Management Ltd [2011] WASC 239
Case
[2011] WASC 239
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CaseChat Overview and Summary

In the case of Hoon v Westpoint Management Ltd, the parties involved were Hoon, the appellant, and Westpoint Management Ltd, the respondent. The dispute revolved around the removal of a caveat and the purchaser's retention of a caveatable interest. The case was heard in the Supreme Court of Western Australia. The primary legal issues that the court had to decide included whether the caveat should be removed following the dismissal of the action for specific performance of the contract of sale due to want of prosecution, the purpose of a caveat and the exercise of the court's discretion to remove, and whether the purchaser retains a caveatable interest.

The court examined the purpose of a caveat and its role in preserving the status quo while questions of title to land or an interest in land are investigated. It was established that the purpose of a caveat is to act as an injunction to the Registrar-General to prevent registration of dealings with the land until notice has been given to the caveator. This allows the caveator to pursue remedies against the person lodging the dealing for registration. The court also considered the purchaser's right to retain a caveatable interest, which is an interest that is capable of being protected by a caveat.

The court ultimately decided that the caveat should not be removed following the dismissal of the action for specific performance of the contract of sale due to want of prosecution. The court found that the purchaser retained a caveatable interest, and the purpose of a caveat is to protect such interests. In exercising its discretion to remove the caveat, the court took into account the balance of convenience, as well as the purpose of a caveat and the circumstances of the application.

The final orders of the court were that the caveat should not be removed, and the purchaser retains a caveatable interest. The court's decision in this case highlights the importance of understanding the purpose of a caveat and the purchaser's right to retain a caveatable interest, as well as the exercise of the court's discretion in determining whether to remove a caveat.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Two matters should also be mentioned about the balance of convenience. First, as Owen J observed in Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42, 50, in many cases the removal of a caveat will have the practical effect of destroying the benefit of the proprietary interest that is claimed. However, the court retains a discretion as to whether it will require the withdrawal of a caveat on the grounds of convenience even where there is as an 'undisputable caveatable interest': Tadrous v Tadrous [2009] NSWSC 407 [6]; Guardian Loans Pty Ltd v FTFS Holdings Pty Ltd [2009] NSWSC 1163 [36] and see Navarac Pty Ltd v Moondancer Holdings Pty Ltd [2009] WASCA 95. Second, it is necessary to say something about the purpose of a caveat having regard to the circumstances of this application. The purpose of a caveat is generally identified by reference to what was said in J & H Just (Holdings) Pty Ltd v Bank of New South Wales (1971) 125 CLR 546. At 552, Barwick CJ said:[A caveat's] purpose is to act as an injunction to the Registrar‑General to prevent registration of dealings with the land until notice has been given to the caveator. This enables the caveator to pursue such remedies as he may have against the person lodging the dealing for registration. The purpose of the caveat is not to give notice to the world or to persons who may consider dealing with the registered proprietor of the caveator's estate or interest though if noted on the certificate of title, it may operate to give such notice. If the caveator does not take proceedings in due time against the person who has lodged a dealing for registration, and the dealing is registered, awareness of the existence of the caveat, and through it, that an estate or interest is claimed by the caveator, will be irrelevant except possibly as an element in establishing fraud in the procurement of the registration. Windeyer J quoted from the judgment of Harvey CJ in Thomson v Richardson (1928) 29 SR (NSW) 221, 223: '[t]he caveat is no blot on the title. It is simply a claim by somebody that he shall receive notice before any dealing with the land is carried through'. His Honour characterised the primary purpose of a caveat as warning the Registrar‑General of a claim: '[t]he word "caveat" has long been used in law to describe a notice given to an official not to take some step without giving the caveator an opportunity to oppose it' (558). J & H Just (Holdings) was cited with approval by Mason CJ, Dawson and McHugh JJ in Leros Pty Ltd v Terara Pty Ltd (1992) 174 CLR 407, 419 (a case concerning the TLA). Their Honours said:[T]he purpose of a caveat against dealings is to operate as an injunction to the Registrar‑General to prevent registration of dealings forbidden by the caveat until notice is given to the caveator so that he or she has an opportunity to oppose such registration. In Genrich v Maitland Holdings Pty Ltd [1982] Qd R 58, 67 Andrews J observed that the purpose of a caveat was to 'preserve the status quo while questions as to title to land or an interest in land are investigated'. In Eng Mee Yong v Letchumanan [1980] AC 331, 335 Lord Diplock, delivering the judgment of the Privy Council said:A caveat under the Torrens system has often been likened to a statutory injunction of an interlocutory nature restraining the caveatee from dealing with the land pending the determination by the court of the caveator's claim to the title to the land, in an ordinary action brought by the caveator against the caveatee for that purpose. Their Lordships accept this as an apt analogy with its corollary that caveats are available, in appropriate cases, for the interim protection of rights to title to land or registrable interest in land that are alleged by the caveator but not yet approved.