Juratowitch v Quitlong
[2012] NSWSC 1374
•06 November 2012
Supreme Court
New South Wales
Medium Neutral Citation: Juratowitch v Quitlong [2012] NSWSC 1374 Hearing dates: 6 November 2012 Decision date: 06 November 2012 Jurisdiction: Equity Division - Duty List Before: White J Decision: Refer to paras [11] and [13] of judgment.
Catchwords: REAL PROPERTY - trustee in bankruptcy seeking sale of property pursuant to s 66G of Conveyancing Act 1919 (NSW) Legislation Cited: Conveyancing Act 1919 (NSW)
Bankruptcy Act 1966 (Cth)Cases Cited: Hogan v Baseden (1997) 8 BPR 15,723
Pascoe v Dyason [2011] NSWSC 1217Category: Interlocutory applications Parties: Daniel Peter Juratowitch (as trustee for the bankrupt estate of Paquito Quitlong) (Plaintiff)
Regina Quitlong (Defendant)Representation: Counsel:
D C Eardley (Plaintiff)
In person (Defendant)
Solicitors:
Dean Bosman, Solicitor (Plaintiff)
File Number(s): 2012/284751
Judgment
HIS HONOUR: This is an application for orders under s 66G of the Conveyancing Act 1919 (NSW) for the appointment of trustees for sale of a property in Bowden Road, Harris Park. The property was jointly owned by the defendant, Regina Quitlong, and her husband, Paquito Quitlong.
On 16 March 2011 a sequestration order was made in respect of the estate of Paquito Quitlong. The plaintiff, Mr Daniel Juratowitch, was appointed as trustee of his bankrupt estate. Pursuant to s 58 of the Bankruptcy Act 1966 (Cth) his interest in the Bowden Road property has become vested in the trustee in bankruptcy. The effect of s 66G of the Conveyancing Act is that where land is held in co-ownership the court may, on the application of any one or more of the co-owners, appoint trustees of the property and vest the same in such trustees to be held by them on a statutory trust for sale.
Co-ownership for the purpose of s 66G means ownership whether at law or in equity. The trustee of Mr Paquito Quitlong's bankrupt estate is a co-owner of the property with the defendant. The trustee in bankruptcy is entitled to the order that trustees be appointed to the property and for the property to be sold.
The circumstances in which the court can decline to make an order under s 66G are limited. It is not a ground for refusal of such an order that the order will occasion hardship. An application can be refused if to make an order would be inconsistent with a proprietary right, or a contractual or fiduciary obligation. There may be other grounds for refusing an order such as principles relating to conventional or other estoppel, but none of those grounds arises in the present case.
In Hogan v Baseden (1997) 8 BPR 15,723 at 15,723, Mason P observed that it would not be a proper exercise of discretion of the power to decline relief under s 66G to refuse an application on the ground of hardship or general unfairness (see Pascoe v Dyason [2011] NSWSC 1217 at [5]-[8] and cases there cited).
Mrs Quitlong opposes the orders. She says, as I understand her submissions, that as she is the owner of the property, no-one has the right to sell the property which would deal with her interest. However, s 66G of the Conveyancing Act is a law that overrides what would otherwise be her right to possession and to maintain ownership of the property as a co-owner. It is that law that is invoked. Nothing that she has put before me provides any basis for withholding from the trustee in bankruptcy his entitlement to the order.
Mrs Quitlong's submissions were also addressed, as I understood them, to whether a sequestration order should have been made. That is not a matter into which I can go. This court has no power, even if an application had been made to it, to review the making of the sequestration order. In fact, it seems from the materials that have been read, that an application for review of the sequestration order was made in 2011, but was refused.
It is to say the least unfortunate that, according to the trustee in bankruptcy's report, the known creditors of Paquito Quitlong were only some $28,252, not including the legal costs of the petitioning creditor and the trustee in bankruptcy's own remuneration, yet the estimated funds that would be required to discharge Mr Paquito Quitlong from bankruptcy come to some $103,186. The bulk of this estimate is the trustee's remuneration. But the fact that there was only some $28,000 of creditors prior to the bankruptcy is not a reason for withholding the order for appointment of trustees for sale. All of the obligations of the bankrupt have to be discharged if there is a property available to do so, and there is such property, being his interest in the land of which the defendant is the co-owner.
The summons also seeks an order for vacant possession. I would not make an order for possession unless it was clear that Mrs Quitlong would not give up possession to the trustees for sale. But she made it clear that she was not going to move: because she was a private owner, she said. However, from the making or registration of the order appointing the trustees for sale, the ownership of the property will vest in the trustees for sale. Mrs Quitlong is required to deliver up possession to the trustees for sale. I think it appropriate to make an order for possession today to avoid the cost of a further application. It is quite clear that such an order will be required. I was not able to obtain a sensible response to my enquiry as to what period of time she would need in order to vacate the property and I will fix a period of 42 days for that purpose.
There are affidavits as to fitness of the proposed trustees. One is a solicitor and one is a real estate agent. Their only charges will be the charges that they would make for professional fees, or as a real estate agent for commission on the usual basis on the sale of the property.
I make the following orders:
1. Order that Dev Menon and Jayne Edwards be appointed as trustees for the sale of the land situated at [xxx] Bowden Road, Harris Park contained in certificate of title folio identifier B/354671 ("the Property").
2. Order that the Property be vested in such trustees subject to any encumbrances affecting any undivided share or shares therein to be held by the said trustees upon statutory trust for sale under Division 6 of Part 4 of the Conveyancing Act 1919.
3. Order that the trustees be vested with authority to retain a real estate agent to market and sell the Property.
4. Order that Jayne Edwards may act as real estate agent on the sale.
5. Order that Mr Menon may act as solicitor on the sale.
6. Order that Jayne Edwards is entitled to charge what would be the usual rate for commission as a real estate agent on selling the property and I approve a charge of 2.5 per cent plus GST for that purpose.
7. Order that Mr Menon is entitled to charge his usual professional fees for acting as a solicitor on the sale and I approve fees of up to $2,500 inclusive of GST for that purpose.
8. Make orders in accordance with paragraph 6 of the summons.
9. Order that within 42 days, that is to say by 19 December 2012, the defendant deliver up vacant possession of the property to the trustees for sale.
10. Give the trustees for sale liberty to apply in the event that any further orders are necessary in order to allow the property to be sold.
[Parties addressed on costs.]
Pursuant to r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) prima-facie costs follow the event. The plaintiff has been successful in the application. He has been put to costs that should not have been incurred had the defendant been able to bring a proper appreciation of the law to the facts. The fact that she has been unable to do so is not a reason as to why costs should not follow the event. The defendant has not made any intelligible submission as to why costs should not follow the event.
I order that the defendant pay the plaintiff's costs of the proceedings.
Decision last updated: 14 November 2012