KB Corporate Pty Ltd v Sayfe - [2017] VSC 623

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST

S CI 2017 04393

KB CORPORATE PTY LTD	Plaintiff
v
SIMON SAYFE (also known as SIMON KHOURY)	First Defendant
REGISTRAR OF TITLES	Second Defendant

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JUDGE:	Mukhtar AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	29 November 2017
DATE OF JUDGMENT:	22 December 2017
CASE MAY BE CITED AS:	KB Corporate Pty Ltd v Sayfe and anor
MEDIUM NEUTRAL CITATION:	[2017] VSC 623

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REAL PROPERTY — Caveat — Caveator lacking caveatable interest — Claim for compensation for lodging caveat without reasonable cause — Applicable principles — Proof of causation of damage — Transfer of Land Act 1958 (Vic), s 118

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M Gronow SC	SLF Lawyers
For the First Defendant	No appearance
For the Second Defendant	No appearance

HIS HONOUR:

On 8 November 2017, the Court (McMillan J) made orders by consent requiring the defendant to remove ten caveats lodged over the plaintiff’s properties. The properties were in the nature of strata title storage units in Collins Street Melbourne. The orders also referred to an Associate Judge ‘the question of costs’; that is the plaintiff’s costs of this proceeding. The originating motion and the summons on the motion both make the claim ‘That the First Defendant be directed to pay the Plaintiff its legal costs on an indemnity basis fixed in the sum of $15,642…‘ and also claim ‘That the First Defendant be directed to pay to the Plaintiff the loss and damage incurred as a result of his action, fixed in the sum of $33,174.06’. The latter can be taken to be an application by the plaintiff under s 118 of the Transfer of Land Act which states that ‘Any person lodging with the Registrar without reasonable cause any caveat under this Act shall be liable to make to any person who sustains damage thereby such compensation as a court deems just and orders’.
The order of McMillan J made no reference to the compensation claim. For the purposes of the removal application before her Honour, the plaintiff’s counsel filed ‘Short Written Outline of Submissions’ dated 1 November 2015 which stated:
11.The plaintiff should also be able to obtain from the first defendant damages and compensation in the additional sums in which it is now indebted to both lenders and other costs as set out in Mr Bell’s affidavit pursuant to s 118 of the Act. That is because, for the reasons given above, the first defendant has lodged the caveats ‘without reasonable cause’.
12.The first defendant cannot say that he had ‘an honest belief based on reasonable grounds’ that he had a caveatable interest in the storage unit properties, and appears to have lodged the caveats for an ’ulterior motive’ and purpose. [footnote omitted]
The affidavit of Mr Kaine Norman George Bell, to which the submissions refer, was sworn on 31 October 2017 in support of the removal application. He is the sole director, sole secretary…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] VSC 623
Decision Date: 22 December 2017

CaseChat Overview and Summary

The Supreme Court of Victoria recently dealt with a case involving a claim for compensation under the Transfer of Land Act 1958 (Vic), section 118. KB Corporate Pty Ltd, the plaintiff, sought damages from Sayfe, the defendant, for lodging a caveat without reasonable cause. The defendant, Sayfe, had lodged a caveat over a property, asserting an interest that was subsequently found to be invalid. KB Corporate Pty Ltd, the registered proprietor of the property, argued that Sayfe's actions were without reasonable cause and resulted in financial loss to the company.

The central legal issue before the court was whether Sayfe's lodging of the caveat was without reasonable cause and, if so, whether this action caused the claimed damages. The court needed to determine the criteria for establishing a claim under section 118 of the Transfer of Land Act 1958 (Vic) and the appropriate quantum of compensation, if any, that should be awarded. Additionally, the court had to examine the evidence presented to ascertain whether the damages claimed were directly attributable to the defendant's actions.

The court found that Sayfe did not have a caveatable interest, confirming that the caveat was lodged without reasonable cause. However, the court held that KB Corporate Pty Ltd failed to prove that the damages claimed were a direct result of the defendant's actions. The court emphasised that the plaintiff needed to demonstrate a causal link between the defendant's actions and the alleged damages. Given that the plaintiff could not establish causation, the court dismissed the claim for compensation.

In conclusion, the court's decision underscores the importance of proving causation in claims for compensation under section 118 of the Transfer of Land Act 1958 (Vic). The court dismissed the plaintiff's claim, as the plaintiff could not substantiate the direct link between the defendant's actions and the damages claimed.

Orders