Maek Pty Ltd v Beaver - [2021] WASC 253

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   MAEK PTY LTD -v- BEAVER [2021] WASC 253
CORAM:   TOTTLE J
HEARD:   22 JULY 2021
DELIVERED          :   22 JULY 2021
PUBLISHED           :   26 JULY 2021
FILE NO/S:   CIV 1422 of 2021
BETWEEN:   MAEK PTY LTD
Plaintiff
AND
JOHANNA FLEUR BEAVER
First Defendant
REGISTRAR OF TITLES
Second Defendant

Catchwords:

Application for extension of caveat – Where parties propose alternative security in lieu of removal of caveat – Appropriate quantum of alternative security – Whether plaintiff has serious question to be tried as to quantum of alternative security – Turns on own facts

Legislation:

Nil

Result:

Caveat removed upon giving of alternate security

Category: B

Representation:

Counsel:

Plaintiff	:	D R Chandler
First Defendant	:	S P Tomasich
Second Defendant	:	No appearance

Solicitors:

Plaintiff	:	Lemonis & Tantiprasut Lawyers
First Defendant	:	Lavan
Second Defendant	:	No appearance

Cases referred to in decision:

Bashford v Bashford [2008] WASC 138
Brogue Tableau Pty Ltd v Binningup Nominees Pty Ltd [2007] WASCA 179; (2007) 35 WAR 27
Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54, (1991) 174 CLR 64
Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42
Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8; (2009) 236 CLR 272
TC Industrial Plant Pty Ltd v Robert's Queensland Pty Ltd [1963] HCA 57; (1963) 180 CLR 130, 142

TOTTLE J:

Introduction

By an originating summons filed on 21 May 2021 the plaintiff sought orders extending the operation of a caveat registered over a residential property in Shoalwater (the Property). The first defendant is the registered proprietor of the Property.
The Property is subject to a contract of sale – settlement is due to occur on 30 July 2021. The parties have now agreed that the caveat can be removed upon the payment of an amount from the net proceeds of sale into the first defendant's solicitors' trust account to be held as security.
The dispute between the parties is as to the quantum of the security. By a minute of orders dated 1 June 2021, the plaintiff contends the security should be $294,242.46. In her written submissions the first defendant contends the security should be $147,000.17.

Background

The plaintiff relies on two affidavits affirmed by its sole director and secretary Mr Jonathan Paul McComish on 18 and 25 May 2021. For the purposes of this application there is no dispute about the factual background. It may be summarised as follows.
The plaintiff is a registered building contractor. On 2 August 2019 the plaintiff and the first defendant entered into a contract to build a home at the Property. The contract price was $1,210,602.73 exclusive of GST.[1] On 16 August 2019 the first defendant paid a deposit of $86,558.10.
[1] Unless otherwise stated all figures are exclusive of GST.
The plaintiff alleges the first defendant repudiated the contract. It accepted the alleged repudiation, terminated the contract and commenced an action…

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.

Continue reading Maek Pty Ltd v Beaver

Details

AGLC: Maek Pty Ltd v Beaver [2021] WASC 253
Case: [2021] WASC 253
Decision Date: 26 JULY 2021

CaseChat Overview and Summary

The matter before the court was an application by Maek Pty Ltd to extend a caveat over certain land held by Beaver. The applicants sought to extend the caveat on the basis of an alternative security arrangement. The dispute centred on the quantum of the alternative security that should be provided. The court was required to determine whether the plaintiff had established a serious question to be tried regarding the appropriate amount of alternative security.

The court began by setting out the relevant principles for extending a caveat, which involve a two-pronged inquiry. The plaintiff must demonstrate that their claim has or may have substance and that the balance of convenience favours the extension of the caveat. The court considered the first defendant's arguments that the plaintiff could not recover both an expenses incurred claim and a loss of profit claim, and that the loss of profit claim was overstated. The court examined the relevant High Court authority and found that the first defendant's interpretation of the judgments was not supported by the authorities cited. The court concluded that the plaintiff had established a serious question to be tried as to the appropriate amount of alternative security.

In light of the above, the court dismissed the application for an extension of the caveat. The court ordered that the caveat be removed and that the parties bear their own costs of the application.

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

In the absence of any dispute about the relevant principles it is sufficient to state that a caveat is a form of statutory injunction preventing registration of a dealing against land until the caveator has been given a reasonable opportunity to justify the caveat by pursuing such remedies as he or she may have.[3] The applicable principles may be distilled to two questions:[4] (a)Has the plaintiff demonstrated that its claim has or may have substance, or as it is sometimes put, has he established that there is a serious question to be tried in respect of the estate or interest in the land claimed by it? (b)Does the balance of convenience favour the extension of the operation of the caveat?[3] Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42; Brogue Tableau Pty Ltd v Binningup Nominees Pty Ltd [2007] WASCA 179; (2007) 35 WAR 27 [68].[4] Bashford v Bashford [2008] WASC 138 [42] ‑ [57]. The two questions are interrelated. The interrelationship is usually expressed as requiring the court to balance the injustice that might be suffered by the land owner if the application to extend the caveat is granted and the caveator later fails at trial, against the injustice that might be suffered by the caveator if the application is not granted and it later succeeds in establishing its interest in the property. Where, as in this case, the parties are agreed that the caveat should be removed and the controversy concerns the value of the security to be provided, the court must balance the risk of injustice to the caveator if the security is fixed at too low a value against the risk of injustice to the land owner if the security is fixed at too high a value. In support of her contention that the security should be limited to $147,000.17 the first defendant's primary argument is that the plaintiff cannot recover both an expenses incurred claim and a loss of profit claim as this would put the plaintiff in a superior position than if the contract had been performed. In addition the first defendant contends the loss of profit claim has been overstated by $19,361.16 and therefore the plaintiff's arguable loss is limited to the sum of $233,558.27, and further the sum should be reduced by $86,558.10 to take into account the deposit paid by the first defendant. The first defendant contends her primary argument is supported by various statements made in the judgments of the High Court in the Commonwealth v Amann Aviation Pty Ltd.[5] The first defendant refers to the statements in the joint judgment of Mason CJ and Dawson J in which their Honours state that an innocent party may recover expenses justifiably incurred by a plaintiff in the discharge of contractual obligations and any amount by which gross receipts would have exceeded those expenses,[6] and seeks to confine that statement by reference to their Honours' later statement that:[7]Naturally, the categories of case in which a plaintiff is likely to make a claim for the recovery of expenditure incurred are those in which the plaintiff has not suffered a loss of profits and those in which it is impossible to assess what would have been the outcome had the contract been performed or those in which that outcome had the contract been performed or those in which that outcome is otherwise uncertain… The manner in which a plaintiff frames his or her claim for damages will be dictated not so much by a choice of alternatives giving rise to an election but simply according to whether the contract, if fully performed would have been and could be shown to be profitable (even if the actual amount of the profit is not readily ascertainable). If this can be demonstrated, the plaintiff's expectation of a profit, objectively made out, will be protected by the award of damages. Otherwise, subject to it being demonstrated that a plaintiff would not have recovered any or all of his or her reasonable expenses, a plaintiff's objectively determined expectation of recoupment of expenses incurred will be the protected by the award of damages.[5] Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54, (1991) 174 CLR 64.[6] Commonwealth v Amann Aviation Pty Ltd, 81.[7] Commonwealth v Amann Aviation Pty Ltd, 85.