JUDGE:	Derham AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	2 May 2019
DATE OF JUDGMENT:	7 May 2019
CASE MAY BE CITED AS:	McRae v Mackrae-Bathory
MEDIUM NEUTRAL CITATION:	[2019] VSC 298

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CAVEAT – Removal of caveats – Application under s 90(3) of the Transfer of Land Act 1958 (Vic) for removal of caveats over two properties registered in the name of the plaintiff – Caveats lodged by person claiming interest by virtue of an implied, resulting or constructive trust – Caveat inhibiting settlement of sale of one of two properties the subject of the claimed interest – Defendant’s claim for a constructive trust in respect of both properties persuasive but uncorroborated – Balance of convenience favours the removal of the caveat at settlement on undertaking of the plaintiff to use the net proceeds of the sale of the property to reduce mortgage secured over both properties – Goldstraw v Goldstraw [2002] VSC 491; Piroshenko v Gosjman (2010) 27 VR 489; Percy & Michele Pty Ltd v Gangemi [2010] VSC 530; Sylina v Solanki [2014] VSC 2; Carbon Black Lab Pty Ltd v Launer [2015] VSCA 126 referred to.

TRUSTS – Implied, resulting or constructive trust – Whether a basis in fact and law for finding a resulting or constructive trust in favour of the caveator – Sufficient basis for such a finding on an application for removal of the caveats – Muschinski v Dodds (1985) 160 CLR 583; Baumgartner v Baumgartner (1987) 164 CLR 137; Cressy vJohnson (2009) VSC 52 referred to.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr R A Yeboah	Mulbridge Lawyers
For the Defendant	Mr W Stark	Mirabella Solicitors

HIS HONOUR:

Introduction

The plaintiff is the registered proprietor of two properties and has applied pursuant to s 90(3) of the Transfer of Land Act 1958 (Vic) (TLA) for the removal of two caveats, one registered on the title of each property at:

(a) Unit 5/3 Ridley Street, Albion, Victoria, being the land more particularly described in certificate of title volume 10518 folio 743 (the Ridley Street Property);

(b) 58 Eastlakes Boulevard, Lara, Victoria, being the land more particularly described in certificate of title volume 11387 folio 194 (Eastlakes Boulevard Property).

There is a mortgage over each property in favour of the Australia and New Zealand Banking Group Ltd (Bank).[1] The Ridley Street Property is the subject of a contract of sale which is due to settle on or about 14 May 2019. There is, accordingly, some urgency in the determination of the plaintiff’s applications, at least so far as the Ridley Street Property is concerned. The Mortgage secures an amount greater than the sale price of the Ridley Street Property.
[1]Being registered mortgagor AL367207L (Mortgage).

The defendant’s caveats each…

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 McRae v Mackrae-Bathory

Details

AGLC: McRae v Mackrae-Bathory [2019] VSC 298
Case: [2019] VSC 298
Decision Date: 7 May 2019

CaseChat Overview and Summary

The case of McRae v Mackrae-Bathory involved an application by the plaintiff to remove two caveats lodged by the defendant over properties registered in the plaintiff's name. The defendant had claimed an interest in the properties by virtue of an implied, resulting, or constructive trust, inhibiting the settlement of the sale of one of the properties. The matter was heard and determined by Justice Byrne in the Supreme Court of Victoria. The legal issues before the court centred on whether the defendant's claim for a constructive trust was persuasive enough to warrant the continuation of the caveats and whether there was a sufficient basis for a resulting or constructive trust on the application for removal of the caveats.

The court considered the evidence and submissions from both parties, including the persuasiveness of the defendant's claim for a constructive trust in respect of both properties, which, however, was uncorroborated. The court also evaluated the balance of convenience, weighing the interests of both parties in light of the impending sale of one of the properties. The court found that the balance of convenience favoured the removal of the caveats at settlement, subject to the plaintiff using the net proceeds of the sale of the property to reduce the mortgage secured over both properties. The decision was influenced by previous cases such as Goldstraw v Goldstraw, Piroshenko v Gosjman, Percy & Michele Pty Ltd v Gangemi, Sylina v Solanki, and Carbon Black Lab Pty Ltd v Launer, which provided guidance on similar issues.

Justice Byrne concluded that while the defendant's claim for a constructive trust was persuasive, it did not provide a sufficient basis for the continuation of the caveats. The court held that the balance of convenience weighed in favour of the plaintiff, and the caveats would be removed on the condition that the plaintiff used the net proceeds of the sale of one property to reduce the mortgage secured over both properties. This decision allowed the sale to proceed while addressing the defendant's interest to some extent.

Orders