Matken Constructions Pty Ltd v James

[2009] ACTSC 100

MATKEN CONSTRUCTIONS PTY LTD v TREVOR JAMES & ANOR
[2009] ACTSC 100 (27August 2009)

CAVEATS – Land Titles Act 1925 – circumstances in which Court will order removal of caveat conditionally upon payment into Court – building dispute – action by builder – standard building contract – charge under contract giving rise to caveatable interest – extent of charge – whether payment into Court should include interest – whether should include estimated costs of action

Court Procedures Rules 2006 (ACT)
Land Titles Act 1925, s 105

Gibson v Co-ordinated Building Services Pty Ltd (unreported, Supreme Court of New South Wales, Young J, 20 July 1989)
Griffith v Hodge (1979) 2 BPR 9474
Commercial Bank of Australia Ltd v Schierholter [1981] VR 292
Renascent Interiors & Refurbishers Pty Limited v ASEL Property Group Pty Limited [2002] NSWSC 345

No. SC 5 of 2009

Judge:             Master Harper
Supreme Court of the ACT

Date:              27 August 2009

IN THE SUPREME COURT OF THE       )
  )          No.  SC 5 of 2009
AUSTRALIAN CAPITAL TERRITORY    )

BETWEEN:MATKEN CONSTRUCTIONS PTY LTD

Plaintiff

AND:TREVOR JAMES

First Defendant

DIANNE JAMES

Second Defendant

ORDER

Judge:  Master Harper
Date:  27 August 2009
Place:  Canberra

THE COURT ORDERS THAT:

The application be stood over to 3 September 2009 for submissions as to the orders which should be made in the light of these reasons.

1. This is an application by the defendants in a building case for an order that, upon their paying into Court an appropriate amount, a caveat lodged by the plaintiff over their residential property be removed.

1. The defendants engaged the plaintiff company to build a house on their land at Gungahlin.  The parties signed a standard Master Builders Association home building contract on 27 June 2005.

1. The property is a standard residential suburban block.  A ninety-nine-year Crown lease was granted to the defendants in June 2002.  In May 2003 a mortgage was registered.  The mortgagee is Perpetual Limited.  The plaintiff lodged a caveat in August 2007.  It is common ground that the plaintiff was entitled to lodge a caveat pursuant to clause 31 of the contract, which provides:

31 CHARGE ON LAND

The owner charges the Site with the payment to the Builder of all monies payable to the Builder under this Contract or otherwise from the carrying out of the Works.

1. The house has been built.  The plaintiff’s case is that it has carried out the work it contracted to perform.  The defendants have made some progress payments but there remains an amount due under the contract of $47,722.58.  The plaintiff also claims interest and costs.  Item A15 in appendix A to the contract reads as follows:

   
   
   

A15 INTEREST RATE APPLICABLE TO LATE PAYMENTS

Annual Interest Rate applicable to Late Payments (Adjusted Weekly Compounding) 20 percent (if nothing stated, 20 percent).

In other words, the Master Builders form provides for twenty percent to be the default rate, but in this case the parties agreed on twenty percent anyway.

1. On 19 December 2008, the Registrar General…