Lance v Lance
[2004] WASC 234
LANCE & ANOR -v- LANCE [2004] WASC 234
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2004] WASC 234 | |
| Case No: | CIV:2071/2004 | 22 OCTOBER 2004 | |
| Coram: | MASTER SANDERSON | 16/11/04 | |
| 7 | Judgment Part: | 1 of 1 | |
| Result: | Judgment for plaintiff | ||
| B | |||
| PDF Version |
| Parties: | PATRICIA ANNIE LANCE ANNIE PATRICIA LANCE MIC THI LANCE |
Catchwords: | Practice and procedure Application for summary judgment by plaintiff Turns on own facts |
Legislation: | Nil |
Case References: | Baumgartner v Baumgartner (1987) 164 CLR 137 Ghana Commercial Bank v Chandiram [1960] AC 732 Hayes v O'Sullivan (2001) 24 WAR 40 Heid v Reliance Finance Corporation Pty Ltd (1983) 154 CLR 326 In Marriage of Stevens (1991) 105 FLR 459 LHK Nominees Pty Ltd v Kenworthy (2002) 26 WAR 517 Lloyd v Tedesco (2002) 25 WAR 360 Midland Brick Company Pty Ltd v Welsh [2002] WASC 248 Porter v McDonald [1984] WAR 271 Professional Services of Australia Pty Ltd v Mila Properties Pty Ltd [2004] WASC 30 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- ANNIE PATRICIA LANCE
Plaintiffs
AND
MIC THI LANCE
Defendant
Catchwords:
Practice and procedure - Application for summary judgment by plaintiff - Turns on own facts
Legislation:
Nil
Result:
Judgment for plaintiff
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Category: B
Representation:
Counsel:
Plaintiffs : Mr J C Curthoys
Defendant : Mr M D Cuerden
Solicitors:
Plaintiffs : Kaeser Kroon
Defendant : Christopher Garvey
Case(s) referred to in judgment(s):
Baumgartner v Baumgartner (1987) 164 CLR 137
Ghana Commercial Bank v Chandiram [1960] AC 732
Case(s) also cited:
Hayes v O'Sullivan (2001) 24 WAR 40
Heid v Reliance Finance Corporation Pty Ltd (1983) 154 CLR 326
In Marriage of Stevens (1991) 105 FLR 459
LHK Nominees Pty Ltd v Kenworthy (2002) 26 WAR 517
Lloyd v Tedesco (2002) 25 WAR 360
Midland Brick Company Pty Ltd v Welsh [2002] WASC 248
Porter v McDonald [1984] WAR 271
Professional Services of Australia Pty Ltd v Mila Properties Pty Ltd [2004] WASC 30
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1 MASTER SANDERSON: This is the return of two chamber summons, one in each of these two actions. In CIV 2071 of 2004, Patricia Annie Lance and Annie Patricia Lance are plaintiffs and Mic Thi Lance is the defendant. By chamber summons dated 2 September 2004, the plaintiffs apply for summary judgment. I will detail the precise terms of the judgment sought below. In CIV 2094 of 2004 the position of the parties is reversed. Mic Thi Lance is the plaintiff and Patricia Annie Lance and Annie Patricia Lance are the first defendants. In that action, by summons dated 24 August 2004, the plaintiff obtained an order extending the operation of a caveat over certain property. The plaintiff has had that summons relisted pursuant to liberty to apply, granted when the order was made, with a view to amending the terms of the caveat. Although the two matters were heard together, I indicated to the parties at the conclusion of the argument that I would deal first with the summary judgment application and then allow either party to make further submissions in relation to amending the caveat. These reasons then deal only with the plaintiffs' application for summary judgment in CIV 2071/04. Throughout these reasons I will refer to Patricia Annie Lance and Annie Patricia Lance as the plaintiffs and Mic Thi Lance as the defendant.
2 The facts in this case are not seriously in dispute. They can be summarised in this way. On 21 July 1979 the first-named plaintiff married Thomas James Lance ("Thomas"). The second-named plaintiff is the daughter of Thomas and the first-named plaintiff. The first-named plaintiff and Thomas separated in about November 1998 and were divorced on 10 May 1990. After Thomas and the first-named plaintiff separated, their marital property was distributed pursuant to orders made under the Family Law Act. These orders were made by consent in the Bunbury Court of Petty Sessions on 2 August 1991. As at the date the orders were made, Thomas was the registered proprietor of certain property which is described in the evidence as "the Myalup block". The orders made by the Bunbury Court of Petty Sessions, so far as they are relevant to this application, were as follows:
"That as and by way of property settlement:-
2.1 Upon the Husband's death the property situated at Finn Road, Myalup being more particularly described as portion of Wellington Location 3617 and being the whole of the land comprised in Certificate of Title Volume 1672 Folio 048 be transferred to the Wife and the child of the marriage, namely Annie Patricia Lance to be held by the Wife as trustee for the same as tenants in common in
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- equal shares forthwith and in the event of her predeceasing the Husband, her heirs, executors or assigns, free of encumbrances.
- 2.2 The Wife have liberty to secure her interest in the said property by placing a Caveat on the title to the said land.
2.3 The Husband's estate be charged with payment of any encumbrances that may be registered against the said property as at the date of his death.
2.4 The Husband be restrained from further encumbering the land."
3 It is worth pausing at this point to look carefully at the consequences of these orders. As at the date the order was made, the Myalup block was registered in Thomas' name. The name of Annie Patricia Lance did not appear on the title. So prior to the making of these orders, Thomas was the holder of the fee simple in the Myalup block, with all the rights that flow from registration. After the orders were made the register still showed Thomas as the holder of the fee simple. However, the effect of par 2.1 of the orders was effectively to give Thomas no more than a life interest in the Myalup block. Of course, a person holding a life interest in a property is not unusual. Generally, however, the property in which the life interest is held is registered in the name of either a trustee or executor, or the person or entity to whom the property will ultimately pass. The life tenant then has an interest which can be protected by caveat and which will be recognised and protected by equity.
4 There is, of course, no reason why a life tenant could not become the registered proprietor of the property in which the life tenancy is held. Then the interest of the party to whom the property will ultimately pass can be protected by a caveat and again, equity would, if necessary, protect the interests of the party ultimately entitled to the property. If in that latter situation the ultimate party did not lodge a caveat and the life tenant purported to sell the property, then a third party taking for value without notice would be entitled to registration. Whatever interest the party ultimately taking might have in the land, it could not be said that such an interest was a legal interest. In this case the position is somewhat different. The plaintiffs' entitlement arises under an order of the Court. Precisely what interest the plaintiffs had in the Myalup block prior to Thomas' death is not clear. But what is clear is that the interest was akin to a party ultimately entitled to land in which a party has a life interest.
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5 In the context of this case, that is an important point. On the death of a life tenant, the property in which he or she has a life tenancy passes to the party ultimately entitled automatically. That is, the property never forms part of the estate of the life tenant. The reason for that is obvious. At the moment of death the life tenant's rights to the property are extinguished. There is then nothing to pass to the estate of the deceased. That seems to me to be the case here. The effect of par 2.1 of the orders is that at the moment of Thomas' death, his rights to the Myalup block ceased to exist. From that moment on, the plaintiffs were entitled to have transmitted to them the title to the Myalup block. There may have been a role for the executor of Thomas' estate, but that role was simply to facilitate the administrative steps necessary to transmit the title to the Myalup block into the names of the plaintiffs.
6 Returning to the facts, the defendant married Thomas on 15 October 1995. They were still married at the date of Thomas' death. Since 1984, Thomas had operated a limestone quarry extraction business from the Myalup block. Subsequent to the marriage of Thomas and the defendant in 1995, the husband and wife carried on the business in partnership. There was a house located on the Myalup block which was occupied by the husband and wife. Without going into detail, it is clear that at least from 1995 the defendant contributed significantly to the conduct of the business. From late 1999, Thomas was significantly disabled and it appears that the defendant was responsible for running the business herself. There can be no doubt as to her commitment to the enterprise, the amount of effort that she put in to ensure that it ran efficiently and the consequent benefit to Thomas of her efforts.
7 In October 1984 Thomas mortgaged the Myalup block, presumably to access funds to allow him to develop the limestone business. A copy of this mortgage appears as annexure "MTL2" to the defendant's affidavit sworn 3 September 2004, filed in CIV 2094 of 2004. In an earlier affidavit in the same proceedings, the defendant says that as at 4 February 2000, Thomas owed approximately $40,000 to the ANZ Bank, this debt being secured by the mortgage. As at the date of Thomas' death, the mortgage had been reduced to just over $20,000. Soon after Thomas' death the defendant paid off the outstanding balance in the mortgage. The Myalup block was thus unencumbered.
8 The Myalup block is now registered in the names of the plaintiffs. After Thomas' death the Myalup block was actually registered in the name of the executor of Thomas' estate. How that came about is not presently relevant. The important fact is that the property is now registered in the
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- names of the plaintiffs. It is still occupied by the defendant. At least as at 20 August 2004, she was still conducting the limestone extraction business from the Myalup block. By their chamber summons the plaintiffs seek judgment on their claim, which will entitle them to vacant possession of the Myalup block.
9 As I have indicated above, prima facie the plaintiffs are entitled to the orders that they seek. They are the holders of the fee simple in the Myalup block and their title is unimpeachable. As counsel for the defendant conceded, if the plaintiffs' application is not to succeed, it is necessary for the defendant to establish that arguably she has an interest in the land. Counsel sought to establish such an interest on three separate grounds.
10 First, it was said, that the defendant took an interest under Thomas' will. The will created a testamentary trust and the Myalup block, not being otherwise specifically mentioned in the will, would fall into that trust. The defendant was entitled to take all of the property in the trust. The flaw in that argument is, with respect, obvious. The Myalup block never formed part of the estate of Thomas. That being so, the defendant can have no interest in the Myalup block pursuant to Thomas' will.
11 Second, it was said that as the defendant paid out the existing registered mortgage, she is subrogated in equity to the security of the mortgage as an equitable mortgagee: see Ghana Commercial Bank v Chandiram [1960] AC 732. While there seems little doubt that the defendant is an equitable mortgagee, that does not give her the right to possess the Myalup block. Just what rights she has as an equitable mortgagee is a question for another day. It does not provide any basis for resisting this application.
12 Finally, it is said that the defendant may have some right to the property as a constructive trustee. As I understand the submission, this relies on the principle dealt with by the High Court in Baumgartner v Baumgartner (1987) 164 CLR 137. Essentially it was said that an assertion that property which had been financed in part through pooled funds was the property of one party to the exclusion of the other, was unconscionable conduct which attracted the intervention of equity and which would lead to the imposition of a constructive trust. The difficulties with that argument in this case are obvious. First, the efforts of the defendant and Thomas did not lead to the acquisition of any property. The Myalup block was the property of Thomas before he and the defendant became acquainted. Nor is there any evidence to suggest
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- that the property was developed and enhanced as a result of the defendant's efforts. Rather, what happened was that the efforts of the defendant were directed at the partnership. If that is not enough, the only interest that the defendant could have in the Myalup block must have arisen through her relationship with Thomas. Thomas had only a life interest in the property. Even assuming that some form of constructive trust could be imposed upon Thomas' interest in the Myalup block, no such interest could have survived his death. To suggest otherwise would be to say that the defendant could acquire through Thomas a greater interest in the Myalup block than he himself had. As a matter of principle, that cannot be correct.
13 In any summary judgment application, care must be taken to ensure that no arguable defence is raised by the defendant. That is particularly the case when the situation is novel or unusual, as is the position here. But in my view there is no basis upon which the defendant can resist this application. The plaintiffs are entitled to possession of the Myalup block and they are entitled to judgment on their claim.
14 I will hear the parties as to the precise form of orders and as to costs.
15 As I indicated above, these reasons deal only with the plaintiffs' applications for summary judgment in CIV 2071 of 2004. However, it follows from what I have said that there is no basis upon which the defendant can maintain her caveat over the Myalup block. Subject to further submissions from counsel, it is appropriate that there be an order that the caveat be discharged.
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