Jensen v Bank of Queensland

[2011] NSWCA 71

Court of Appeal

New South Wales

Case Title:	Jensen v Bank of Queensland
Medium Neutral Citation:	[2011] NSWCA 71
Hearing Date(s):	25 March 2011
Decision Date:	25 March 2011
Jurisdiction:
Before:	Beazley JA at [1], [31]; Hodgson JA at [2]; Macfarlan JA at [33]
Decision:	1. Order 5(d) of the orders of Gzell J made on 21 February 2011 be set aside and in place thereof: (a) Order that, until registration of an instrument of transfer in respect of folio identifier 1608/733594, known as 11 Melaleuca Close, Castle Hill NSW between the plaintiff and Jennifer Adele Hancock and Nigel Leigh Hancock, or until the Court otherwise orders, the second defendant not accept for lodgement, and not record in the Register, any caveat presented for lodgement which prohibits or purports to prohibit the second defendant from recording in the Register a dealing effected by the plaintiff as mortgagee in the exercise of a power of sale or other power or right conferred by mortgage or under law, otherwise than with leave of the Court; (b) Order pursuant to s 74MA(2)(a) of the Real Property Act that the third defendant withdraw caveat AG70440X by 5 pm on 1 April 2011. 2. Appeal otherwise dismissed. 3. No order as to costs of the Appeal or the Application for Leave to Appeal (with the intent that each party bear their own costs). Undertaking given to the Court by respondent not to lodge with the Registrar-General for registration any instrument of transfer relating to the property folio identifier 1608/733594 prior to 5 pm Monday 11 April 2011; [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	REAL PROPERTY - Land under the Real Property Act 1900 - Caveats - Caveats preventing exercise of power of sale by mortgagee - Requirements for caveats - Whether injunction can be granted requiring Registrar General not to accept certain caveats.
Legislation Cited:	Real Property Act s.36, s.74F, s.74G, s.74H, s.74L, s.74MA, s.74O and s.74Q Real Property Regulation 2008, Schedule 3
Cases Cited:	John Alexander's Clubs Pty Limited v White City Tennis Club Ltd (2010) 241 CLR 1 Williams v Mark Australia Limited (1985) 5 NSWLR 529
Texts Cited:
Category:	Principal judgment
Parties:	Paula JENSEN  (appellant) Bank of Queensland Limited ACN 009 656 740 (respondent)
Representation
- Counsel:	Counsel: L GOODCHILD (appellant) R McHUGH SC/ D BARNETT (respondent) H ALTAN (Registrar-General)
- Solicitors:	Solicitors: In Person (appellant) Dibbs Barker  (respondent)
File number(s):	2011/44879
Decision Under Appeal
- Court / Tribunal:
- Before:	Gzell J
- Date of Decision:	22 February 2011
- Citation:	Bank of Queensland v Hoerman [2011] NSWSC 73
- Court File Number(s)	2011/44879
Publication Restriction:

Judgment

1. BEAZLEY JA: Justice Hodgson will give the first judgment.

1. HODGSON JA: On 22 February 2011, in proceedings brought in the Equity Division by the Bank of Queensland Limited (the Bank) against Karl Hoermann, the Registrar General of New South Wales and Paula Jensen, Gzell J made the following orders:

5(c). An order, pursuant to s74MA(2)(a) of the Real Property Act, that the first defendant withdraw the Caveat before 5pm on 22 February 2011.

5(d). An order or direction, pursuant to s 74MA(2)(b) of the Real Property Act, that, until registration of an instrument of transfer in respect of the Property between the plaintiff and Jennifer Adele Hancock and Nigel Leigh Hancock or until the Court otherwise orders, the second defendant not accept lodgement, and remove or not record in the Register, any caveat lodged in respect of the Property on or after 14 February 2011 otherwise that with leave of the Court.

7. Costs.

1. Ms Jensen sought leave to appeal from that decision.

1. On 24 February 2011, Beazley and Macfarlan JJA granted leave to appeal, limited to the order made by Gzell J under s.74MA(2)(b) of the Real Property Act , and their Honours expedited the hearing of the appeal. It was noted that the representatives of the Bank were to convey to the Registrar General the Court's wish to have assistance from the Registrar General as to the validity of this order.

1. The primary judge gave the following outline of facts, giving rise to the Bank's proceedings before him:

3 The amended summons was taken out with respect to caveats lodged on land in New South Wales and is within the jurisdiction of this court. The plaintiff is the mortgagee in possession of residential premises at 11 Melaleuca Close, Castle Hill.

4 The first defendant, Karl Hoermann, lodged a caveat with respect to the property on or before 8 February 2011. The second defendant is the Registrar-General of New South Wales who has entered a submitting appearance. The third defendant, as I have mentioned, is Ms Paula Jensen, otherwise known as Princess Paula of the Principality of Snake Hill.

5 The registered proprietors of the property and mortgagors under the mortgage are the third defendant, Ms Helena Jensen and Mr Paul Jensen. Each has been served in accordance with orders made by Bergin CJ in Eq on 10 February 2011. The matter is related to other proceedings for possession and yet other proceedings for an extension of caveat.

6 On or about10 June 2005 the bank as mortgagee and the Jensens' as mortgagors entered into a mortgage over the property.

7 On or about 22 January 2009 the bank commenced the possession proceedings because of default under the mortgage and sought judgment in the amount of $869,902.58 plus interest and costs. The Jensens' were the defendants in those proceedings.

8 On 21 July 2009 Hoeben J ordered that a defence filed in the possession proceedings be struck out. The defence relied primarily on the allegation that the property was part of the independent territory of the principality of Snake Hill and was not subject to the jurisdiction of this court. A motion for default judgment was filed that day.

9 On 29 September 2009 default judgment was entered ordering the Jensens' to give possession of the property and pay $919,774.68 together with costs.

10 On or about 3 December 2009 the bank obtained possession of the premises.

11 On or about 15 January 2010, Ms Paula Jensen filed a notice of motion seeking orders that, relevantly, the default judgment be set aside or enforcement of it be stayed. The primary ground for that relief was the status of the principality of Snake Hill.

12 On 13 May 2010, Davies J heard and dismissed the notice of motion.

13 On 18 June 2010, Ms Paula Jensen sought an injunction and/or stay of the orders of Hoeben and Davies JJ pending an appeal. On that day Bergin CJ in Eq heard the application and refused to make the orders sought.

14 On 19 June 2010, in exercise of its power of sale, the bank entered into a contract for sale of the property to Jennifer and Nigel Hancock.

15 Settlement of that sale contract was initially scheduled to take place on 19 July 2010 but was prevented by a caveat lodged by the principality of Snake Hill on or about 24 December 2009.

16 On 7 July 2010 the bank served a lapsing notice in respect of that first caveat. That caveat was allowed to lapse.

17 In the period from June 2010 to February 2011 further caveats have been lodged by different persons one after the other and in circumstances where each caveat was lodged in very close proximity to the expiry of the period for lapse of the preceding caveat. Two subsequent attempts at settlement of the contract for sale on 30 September 2010 and 13 December 2010 did not proceed due to the presence of one of the caveats.

18 The details of the dates on which those caveats were lodged and the interest in the land claimed by the caveator are as follows:

24 December 2009, first caveat lodged noting the interest as the principality of Snake Hill.
17 June 2010 second caveat lodged by Lydia Williams, caveatable interest a secession contract and a private lease dated 27 December 2006 with the principality of Snake Hill.
24 September 2010 third caveat lodged, caveator Faye Combe stating she was the Ambassador to Australia for the principality of Snake Hill, the premises formed the embassy and she held commercial leases of a part of the premises.
9 November 2010, fourth caveat lodged, by Carmelo Vescio, caveatable interest a commercial lease of part of the property of 14 January 2007.
9 December 2010, fifth caveat lodged by Allan Schambri, caveatable interest as per commercial lease with annexure of 26 February 2009 with the Jensens'.
8 February 2011 sixth caveat lodged by the first defendant, caveatable interest commercial lease between the first defendant and the third defendant. No date for that lease was given.

19 Two further caveats were lodged by the third defendant on 16 February 2011, the contents of which were not before the court.

20 On 10 November 2010, Ms Combe applied to this court ex parte for orders extending the third caveat. That application was heard by White J. His Honour refused to make the orders and instead listed the matter before the Registrar for directions.

21 Since about 2 November 2010, the purchasers have been in occupation of the property pursuant to a licence.

22 The purchasers have informed the bank that their finance approval expires in early March 2011.

1. The primary judge gave the following reasons for making the order now under challenge:

32 In case the balance of convenience is relevant, each of the second to sixth caveats claims an unregistered lease interest derived from the Jensens and is purportedly consented to by the Jensens. In each case other than the sixth caveat the alleged lease post-dates the date of the mortgage. In the case of the sixth caveat, no date is recorded.

33 The bank submits that the timing of the lodgement of the second to sixth caveats and the nature of the interest claimed demonstrates that the caveats are being lodged for the purpose of frustrating the completion of the sale contract and not in aid of any interest that could possibly prevail against the registered interest of the bank. I agree with that submission.

34 There are no orders of the court preventing the exercise by the bank of its power of sale. Indeed the court has refused to make such orders on two occasions on the application of Ms Paula Jensen.

35 Ms Jensen has lodged an application for leave to appeal to the Court of Appeal from the decision of Davies J. However, the application for leave to appeal does not operate as a stay or an injunction.

36 The bank has exercised its power of sale by entering into the sale of contract with the purchasers on 19 June 2010. The interests of both the bank and the purchasers are being frustrated by the pattern of lodging of caveats against the property as set out earlier in this judgment. Those interests will be further prejudiced if completion does not occur prior to early March 2011, owing to the expiry of the purchasers' financial approval.

37 If a lapsing notice were to be served in respect of the sixth caveat the bank has submitted that it has no confidence that a seventh caveat would not be lodged by another person on expiry of the period for lapse of the sixth caveat in accordance with the previous pattern of conduct. As I have already mentioned a seventh and eighth caveat have been lodged by Ms Paula Jensen.

38 An injunction may be granted to restrain a person from lodging further caveats ( Urban Traders Pty Ltd v Proceris Pty Ltd [2005] NSWSC 1192). Given the established pattern of the caveats being lodged by different persons, it is not appropriate to restrain a named person from lodging any further caveat. Rather it is appropriate to order that the second defendant, the Registrar-General, not accept for lodgement any further caveat and not record the details of such caveat on the register and to remove any such caveat from the register.

1. The notice of appeal filed by the appellant, who was then unrepresented, contained 11 grounds of appeal, of which grounds 8 to 11 were outside the leave granted. Grounds 1 to 7 were as follows:

1. That J Gzell:

- proceeded to hear a matte~ in the absence of caveators,

- altered the summons by back-dating the date requested by the Bank of Queensland's legal representative to block other caveats, without any due process

- struck out the caveat of another interested party without any summons or due process and without giving that person any opportunity to defend his claim to a caveatable interest which is clearly an abuse of process through "the failure to join interested parties... without these owners being joined, the court could not make a binding declaration adverse to their interests" Coe v Commonwealth of Australia (The Wiradjuri Claim) 1993

- proceeded to hear a matter which should have been immediately dismissed for being an abuse of the process of court as it has no legal basis, is a tort of malicious prosecution and is a "misuse of a court's procedure which would be 'manifestly unfair to a party to litigation before it, or would otherwise bring the administration of justice into disrepute among right-thinking people'" from Civil Procedure, Commentary and Materials by Stephen Colbran, Greg Reinhardt, Peta Spender, Sheryl Jackson, Roger Douglas and Molly Townes O'Brien

- proceeded to hear and ruled in a matter which Involved a "legal Interest subsequent to equitable interest... for the subsequent legal interest holder to qualify for priority he or she must be what is popularly called a 'bona fide' holder of the legal estate for value without notice of the prior equitable interest" from Bank Lending and Securities in Australia by W S Weerasooria

2. Any order prohibiting the NSW Registrar-General from accepting further caveats is malicious, a denial of natural justice, gross violatlon of the rights of people as yet unknown to the court and constitutes an abuse of process as it brings the court into disrepute among right-thinking people, and even constitutes contempt of court as it pre-empts the prospective court decisions regarding the caveatable interests of people who believe they have legal or equitable interests but have not yet had those interests discussed in court

3. There are many people with legal and equitable interests in the subject property, including leases and mortgages, which pre-date the bank's claimed interest, and those interests should not be ignored or denied

4. Those people are contradictors, and the order was made in the absence of the contradictors

5. The order cannot be valid as it contradicts section 74F of the Real Property Act of NSW which states: "Any person who, by virtue of any unregistered dealing or by devolution of law or otherwise, claims to be entitled to a legal or equitable estate or interest in land,.. may lodge with the Registrar-General a caveat prohibiting the recording of any dealing affecting the estate or interest to which the person claims to be entitled",

6. The citizens of The Principality of Snake Hill all have legal and equitable interests In the subject property, as that property was declared to be part of the territory of the secessionist State in 2003, pre-dating the bank's claimed interest, and secession forcibly removes territory and people to form a new country which is immediately outside the jurisdiction of the country from which independence was unilaterally declared. Each country is immune from any other country's jurisdiction, from the date of the declared independence.

7. Allowing such an order to stop the NSW Registrar-General from accepting caveats from people claiming caveatable interests would create a terrible precedent which would then affect a large portion of the population of NSW, denying them natural justice and denying them their caveatable interests in their subject properties. This case is of huge importance as a public interest case affecting everyone in NSW.

1. On the hearing of the appeal, some additional evidence was tendered by the Bank and not objected to by other parties. That evidence consisted of a search of the title to the property carried out on 24 March 2011, and it contained also copies of the two caveats referred to in par [9] of the primary judge's judgment.

1. One of those is a caveat dated 16 February 2011, lodged by the appellant and stating the appellant to be the caveator. It claimed an interest as "registered proprietor" and "owner and founding member of the Principality of Snake Hill". Schedule 2, referring to action prohibited by the caveat, had a handwritten addition "specifically prohibiting transfer under power of sale".

1. The other is a caveat also dated 16 February 2011, lodged by the appellant but stating the caveator to be Mark Alexander Pavic. This caveat claims an interest as "caveatable interest in land arising from private agreement with owner". Schedule 2, in that caveat, had no alteration of the printed form, and thus did not specifically purport to prohibit the exercise of power of sale by a mortgagee.

1. I note that the third, fifth and sixth caveats referred to in the judgment of the primary judge, had an addition to Schedule 2 in terms of specifically prohibiting transfer of power of sale; but those caveats did not give any statement as to the manner in which the interest claimed was derived from the Bank, the Bank being the registered proprietor of the estate against which these caveats were to operate.

1. The appeal requires consideration of the effect of various provisions of the Real Property Act 1900, in particular, s.36(1A), (1B) and (1C), s.74F(1), (5) and (6), s.74G, s.74H(1) and (5)(g), s.74L, s.74MA, s.74O and s.74Q.

36 Lodgment and registration of documents

...

(1A) When the Registrar-General accepts a dealing, memorandum or caveat presented for lodgment, the Registrar-General shall allot thereto a distinctive reference.

(1B) A dealing, memorandum or caveat is lodged, within the meaning of this Act, only when the Registrar-General has, under subsection (1A), allotted thereto a distinctive reference.

(1C) The Registrar-General may refuse to accept a dealing, memorandum or caveat presented for lodgment if it does not comply with any requirement made, with respect to the dealing, memorandum or caveat, by or under this or any other Act.

74F Lodgment of caveats against dealings, possessory applications, plans and applications for cancellation of easements or extinguishment of restrictive covenants

(1) Any person who, by virtue of any unregistered dealing or by devolution of law or otherwise, claims to be entitled to a legal or equitable estate or interest in land under the provisions of this Act may lodge with the Registrar-General a caveat prohibiting the recording of any dealing affecting the estate or interest to which the person claims to be entitled.

...

(5) A caveat lodged under this section must:

(a) be in the approved form,

(b) specify:

(i) the name of the caveator,

(ii) where the caveator is not a body corporate-the residential address of the caveator,

(iii) where the caveator is a body corporate-the address of the registered office of the body corporate,

(iv) unless the Registrar-General dispenses with those particulars-the name and address of the registered proprietor concerned,

(v) the prescribed particulars of the legal or equitable estate or interest, or the right arising out of a restrictive covenant, to which the caveator claims to be entitled,

(vi) the current reference allocated by the Registrar-General to the folio of the Register, or, as the case may be, the lease, mortgage or charge, to which the caveat relates,

(vii) where the caveat relates only to part of the land described in a folio of the Register or a current lease-a description of that part in the form or manner prescribed, and

(viii) an address in New South Wales at which notices may be served on the caveator (and, if that address is a box at a document exchange, an alternative address in New South Wales that is not such a box),

(c) be verified by statutory declaration, and

(d) be signed by the caveator or by a solicitor or other agent of the caveator.

(6) On the lodgment of a caveat under subsection (1), the Registrar-General must give notice in writing of the lodgment of the caveat to the registered proprietor of the estate or interest affected by the caveat by:

(a) sending the notice by post to the address of the registered proprietor specified in the caveat, or

(b) giving the notice in such other manner, whether by advertisement or otherwise, as the Registrar-General considers appropriate,

unless the consent of the registered proprietor is endorsed on the caveat.

74G Registrar-General to enter particulars of caveat lodged under section 74F in Register

For the purpose only of acknowledging the receipt of a caveat lodged under section 74F, the Registrar-General shall, if satisfied that the caveat complies with the requirements made in respect of it by and under this Act, record in the Register such particulars of the caveat as the Registrar-General considers appropriate.

74H Effect of caveat lodged under section 74F

(1) Subject to this section, while a caveat lodged under section 74F remains in force:

(a) the Registrar-General must not, except with the written consent of the caveator:

(i) record in the Register any dealing, or

(ii) grant any possessory application, or

(iii) register any delimitation plan, or

(iv) cancel the recording of any easement, or

(v) extinguish any restrictive covenant,

if it appears to the Registrar-General that the recording of the dealing, the granting of the possessory application, the registration of the delimitation plan, the cancellation of the recording of the easement or the extinguishment of the restrictive covenant is prohibited by the caveat, and

(b) the caveat does not have the effect of prohibiting:

(i) the recording in the Register of a dealing, or

(ii) the granting of a possessory application, or

(iii) the registration of a delimitation plan, or

(iv) the cancellation of the recording of an easement, or

(v) the extinguishment of a restrictive covenant,

except to the extent that the recording of such a dealing, the granting of such an application, the registration of such a plan, the cancellation of the recording of such an easement or the extinguishment of such a restrictive covenant would affect the estate, interest or right claimed in the caveat.

...

(5) Except in so far as it otherwise specifies, a caveat lodged under section 74F to protect a particular legal or equitable estate or interest in land, or a particular right arising out of a restrictive covenant, does not prohibit the Registrar-General from recording in the Register with respect to the same land:

...

(g) in relation to a mortgage, charge or covenant charge recorded or lodged in registrable form before the lodgment of the caveat-a dealing effected by the mortgagee, chargee or covenant chargee in the exercise of a power of sale or other power or a right conferred by the mortgage, charge or covenant charge or by or under law,

74L Strict compliance with formalities with respect to caveats not necessary

If in any legal proceedings a question arises as to the validity of a caveat lodged under a provision of this Part, the court shall disregard any failure of the caveator to comply strictly with the requirements of this Part, and of any regulations made for the purposes of this Part, with respect to the form of the caveat.

74MA Application to Court for withdrawal of caveat

(1) Any person who is or claims to be entitled to an estate or interest in the land described in a caveat lodged under section 74B or 74F may apply to the Supreme Court for an order that the caveat be withdrawn by the caveator or another person who by virtue of section 74M is authorised to withdraw the caveat.

(2) After being satisfied that a copy of the application has been served on the person who would be required to withdraw the caveat if the order sought were made or after having made an order dispensing with service, the Supreme Court may:

(a) order the caveator or another person, who by virtue of section 74M is authorised to withdraw the caveat to which the proceedings relate, to withdraw the caveat within a specified time, and

(b) make such other or further orders as it thinks fit.

(3) If an order for the withdrawal of a caveat is made under subsection (2) and a withdrawal of the caveat is not, within the time limited by the order, lodged with the Registrar-General, the caveat lapses when an office copy of the order is lodged with the Registrar-General after that time expires

74O Restrictions on lodgment of further caveats if earlier caveat lapses or is withdrawn

(1) This section applies if a caveat lodged under a provision of this Part in respect of any particular estate or interest in land or any particular right arising out of a restrictive covenant:

(a) subsequently lapses, or

(b) is, after an application is lodged with the Registrar-General for the preparation of a notice under section 74C (3), 74I (1) or (2), 74J (1) or 74JA (3), withdrawn under another provision of this Part, or

(c) is withdrawn or lapses under section 74MA,

and the same caveator lodges a further caveat with the Registrar-General in respect of the same estate, interest or right and purporting to be based on the same facts as the first caveat.

(2) A further caveat to which this section refers has no effect unless:

(a) the Supreme Court has made an order giving leave for the lodgment of the further caveat and the order or an office copy of the order accompanies the further caveat when it is lodged with the Registrar-General, or

(b) the further caveat is endorsed with the consent of the primary applicant or possessory applicant for, or the registered proprietor of, the estate or interest affected by the further caveat.

74Q Registrar-General not obliged to ensure that caveator is entitled to the subsisting estate or interest claimed in a caveat

Except to the extent of ensuring that a caveat lodged under a provision of this Part apparently complies on its face with the requirements of this Part and with the requirements of any regulations made for the purposes of this Part, the Registrar-General is not required to be satisfied that the caveator is in fact entitled to the estate or interest claimed in the caveat or otherwise as to the validity of the caveat.

1. Also of some relevance are the lapsing provisions in s.74J and s.74K, and the provision for compensation in s.74P. Also material are the provisions of the Real Property Regulation 2008 and, in particular, Schedule 3 clauses 1, 2, 3, 5 and 10.

Real Property Regulation 2008

Schedule 3 Particulars of estate or interest to be specified in caveats

1 Particulars of the nature of the estate or interest in land claimed by the caveator.

2 The facts on which the claim is founded, including (if appropriate) a statement as to the manner in which the estate or interest claimed is derived from the registered proprietor of the estate or interest or the primary or possessory applicant against which the caveat is to operate.

3 If the caveator's claim is based (wholly or in part) on the terms of a written agreement or other instrument, particulars of the nature and date of that agreement or instrument and the parties to it.

...

5 If the caveator claims as lessee for a term or for a renewal or extension of a term, particulars of the duration of the term or renewed or extended term and its commencing date (and, if the agreement for the term, renewal or extension includes an option for the renewal or extension of the term or to purchase the reversion, a statement to the appropriate effect).

...

10 It is not necessary to specify:

(a) whether the estate or interest claimed is legal or equitable, or

(b) the quantum of the estate or interest claimed (except as provided in items 4 and 5), or

(c) how the estate or interest claimed ranks in priority with other estates and interests in the land.

1. Ms Goodchild of counsel, who appeared for the appellant on the appeal, submitted that the protection to registered proprietors and mortgagees from affectation by caveats is that set out in the Act, namely, the lapsing procedure under s.74J and s.74K, the prohibition against successive caveats in s.74O and the compensation provisions in s.74P.

1. Ms Goodchild submitted that s.74Q means that the Registrar General does not have power to reject the caveat, except to the extent of ensuring that the caveat on its face complies with the requirements of the legislation.

1. Ms Goodchild submitted that s.74MA (2)(b) ought not be regarded as giving the court a power at large to require the Registrar not to accept the lodgement of caveats, in the face of the statutory entitlement given by the Act to people to lodge caveats. To make an order of the kind made by the primary judge would affect the rights of people who are not party to proceedings and who have not been notified that their rights could be affected.

1. Ms Goodchild also submitted that the primary judge did not find that there was a danger of further caveats being lodged, and particularly did not find that the lodging of caveats was orchestrated by the appellant; and she submitted that this Court could not make that finding.

1. Mr McHugh SC, for the Bank, referred to the second reading speech concerning the introduction of the present regime of caveats, in support of a submission that one purpose was to deal with vexatious caveats. He submitted that the court did have power to make the order made by the primary judge under s.74MA, particularly having regard to the provision of s.36 (1A), (1B) and (1C); and that the particular circumstances of this case did justify the order made by the primary judge.

1. Mr McHugh drew the Court's attention to the caveat claiming an interest by Mr Pavic, and pointed out that Mr Pavic was not a party to the proceedings. He submitted that, particularly having regard to the power of the court to dispense with service under s.74MA, an order affecting Mr Pavic's caveat could properly be made. This caveat had been lodged by the appellant, and Mr McHugh submitted there could be no doubt that Mr Pavic was aware of these proceedings but had chosen not to become involved.

1. Mr McHugh accepted that, by reason of s.74H(5)(g), Mr Pavic's caveat, like the first, second and fourth caveats referred to in the judgment of the primary judge, could not prevent registration of the Bank's transfer to the purchasers; but he submitted that it should be removed because the presence of the caveat would still deter the purchasers from settling the purchase.

1. Mr Altan of counsel, who appeared for the Registrar General, advised the court that the Registrar General submitted to such order as the court should make, and that the practice of the Registrar General could accommodate the primary judge's order, as well as an alternative order that was suggested in the course of argument by the Court. I note that in the case of Williams v Mark Australia Limited (1985) 5 NSWLR 529 evidence was led concerning possible difficulties for the Registrar General in complying with an order sought in that case, but there was no evidence of that kind read in this case.

1. In my opinion, the court does have the power to make the order that was made by the primary judge. Although s.74F of the Real Property Act says that any person claiming to be entitled to a legal or equitable interest in land may lodge a caveat, and s.74H specifies the effect of a caveat when lodged, s.36(1B) makes it clear a caveat is not lodged until the Registrar General allots to it a distinctive reference, and s.36(1A) makes it clear that this only happens when the Registrar General accepts the caveat. Under s.36(1C), the Registrar General may refuse to accept the caveat if it does not comply with any requirements made, with respect to the caveat, by or under the Real Property Act or any other Act.

1. In my opinion, an order made under s.74MA(2)(b) having the effect that the caveat is not to be accepted would have the effect that the caveat does not comply with a requirement made under the Real Property Act. That is, in my view, such an order would not prohibit the Registrar General from doing something that the Registrar General was under a statutory duty to do.

1. I note that there is a real question whether those caveats, which were effective under s.74H(5)(g) to prevent registration of the Bank's transfer, that is, which purported specifically to prohibit such transfer, did not comply with s.74F(5)(b)(v), in that it would seem they did not comply with clause 2 of Schedule 3 of the Regulation. In those cases where a caveat is expressed specifically to prohibit dealings by a mortgagee, I think it generally must be appropriate to state the manner in which the estate or interest is derived from the mortgagee. I have noted s.36(1C), which says that the Registrar General may refuse to accept caveats that do not comply with requirements of the Act; and I would refer also to s.74Q, which suggests that if a caveat does not apparently comply, on its face, with the requirements of the regulations, it should be rejected.

1. That consideration suggests one possible order that the Court might make, namely, to require the Registrar General to reject caveats likely to affect the Bank's exercise of its power of sale, unless they state the manner in which the estate or interest has been derived from the Bank. However, in the particular circumstances of this case, in my opinion, a wider order would be justified.

1. Although I have accepted that the court has power to make an order in terms made by the primary judge, the power should be exercised sparingly. Such an order does not, in my opinion, raise the considerations dealt with by the High Court in John Alexander's Clubs Pty Limited v White City Tennis Club Ltd (2010) 241 CLR 1. However, the order does limit or could limit ways in which a non-party's rights could be exercised, and for that reason should certainly be exercised sparingly.

1. I do not think the order should extend to caveats that do not purport to affect the Bank's power of sale. If a caveat does not specify that it does prohibit the Registrar General from recording a dealing effected by a mortgagee, then s.74H(5) provides that it will not do so; and that would mean, in turn, that a purchaser from a mortgagee would be in breach of contract by refusing to settle because of such a caveat.

1. However, the particular circumstances of this case, as stated by the primary judge, do, in my opinion, justify an order that the Registrar General not accept any caveat, in relation to the subject land, that does specify that it prohibits the Registrar General from recording in the register, with respect to the subject land, a dealing effected by the Bank as mortgagee exercising its power of sale.

1. In my opinion, the primary judge did implicitly find that there was a danger of further caveats being lodged and, in my opinion, the danger in this case is sufficient in the particular circumstances of the case to justify that order.

1. I would propose that short minutes setting out the appropriate order be provided by the Bank shortly. On the question of the costs of the appeal, the appeal has had the success of narrowing the order but only very partial success. My tentative view is that each party should bear its own costs of the application for leave and the appeal.

1. BEAZLEY JA: I agree with the reasons of Justice Hodgson, except in respect of the question whether the original order made by Gzell J was within the power. I think that remains a debatable question but, for the reasons that Hodgson JA has given, I am of the opinion that there is power to make a more limited order of the type to which his Honour has adverted. I would agree with his Honour's reasons to that extent.

1. I also agree with his Honour's proposal in respect of the costs, noting that the parties are still to address on that issue.

1. MACFARLAN JA: I agree with Justice Hodgson.

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