NAB v Spagnolo and Anor (Ruling)

[2010] VSC 160

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

S CI 2001 02102

NATIONAL AUSTRALIA BANK LIMITED (ACN 12 004 044 937)	Plaintiff
v
JULIE ANNMAREE SPAGNOLO	Firstnamed Defendant
and
REGISTRAR OF TITLES	Secondnamed Defendant

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JUDGE:	WILLIAMS J
WHERE HELD:	Melbourne
DATE OF HEARING:	23 April 2010
DATE OF RULING:	23 April 2010
CASE MAY BE CITED AS:	NAB v Spagnolo & Anor (Ruling)
MEDIUM NEUTRAL CITATION:	[2010] VSC 160

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CAVEAT – Application to remove caveat – Service of application – s 90(3) Transfer of Land Act 1958 (Vic).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Ms K Hamill	Thompson Playford Cutlers
For the Defendants	No appearance

HER HONOUR:

1. This is an application under s 90(3) of the Transfer of Land Act 1958 (Vic) (‘TLA’) for the removal of Caveat No. AD910790U (‘the caveat’) lodged in relation to a property, 5 Richmond Close, Caroline Springs, being the land described in Certificate of Title Volume 10740 Folio 177 (‘the property’).

1. I have granted the application and made orders for the removal of the caveat.  These are my reasons for doing so.

1. The first defendant, Ms Spagnolo, and Mr Robert Kermici ‘of 15 Blackley Court Deer Park Vic 3023’ became joint registered proprietors of the property on 19 August 2003.

1. The plaintiff, the National Australia Bank Limited, became registered as mortgagee in relation to the property on 10 June 2004.

1. On 30 September 2005, Ms Spagnolo lodged the caveat.  She gave ‘19 Welwyn Pde Deer Park’ as her address.  Ms Spagnolo stated her ‘address for service of notice’ as ‘Frank J Sagaria, Solicitors, 141 Union Road, Ascot Vale VIC 3032’.

1. Ms Spagnolo claimed ‘an estate in fee simple’ in the caveat.  She set out the grounds of her claim as follows:

As registered proprietor of the within described land the duplicate Certificate of Title is not under my control and to protect against fraudulent or improper dealing.

1. On 12 March 2009, the Bank issued proceedings in the Court for possession of the property under the mortgage.  On 23 June 2009, it entered default judgment and obtained a Warrant for Possession of the property.

1. On 25 August 2009, the Bank took possession of the property.

1. On 7 September 2009, the Bank’s solicitors wrote to Frank J Sagaria, the solicitors whose name appeared in the ‘address for service’ section of the caveat.  The letter stated that the solicitors had lodged the caveat on behalf of Ms Spagnolo.  It requested confirmation that they would provide a withdrawal of caveat at or prior to settlement, if the property were to be sold.

1. The solicitors responded that they had no instructions to withdraw the caveat, as the firm no longer acted for Ms Spagnolo.  They suggested that she should be contacted directly.

1. The property was sold on 27 March 2010 and settlement is scheduled for 27 April 2010.

1. On 29 March 2010, the Bank’s solicitors wrote to Ms Spagnolo informing her of the sale and requesting a withdrawal of caveat by 8 April to enable settlement to occur.  The letter was addressed to Ms Spagnolo at her 19 Welwyn Pde, Deer Park address given in the caveat.

1. The letter was also addressed to Ms Spagnolo at 15 Blackley Court, Deer Park which, I am told by counsel for the Bank on instructions, was her last known address recorded by the Bank.  This address is the one appearing on the certificate of title as the address for Ms Spagnolo and Mr Kermici as registered proprietors of the property.

1. The Bank’s letters dated 29 March 2010 warned that proceedings would be commenced if a withdrawal of caveat were not forthcoming.  It also stated that ‘all costs associated with the removal of the caveat’ would be ‘passed on’ to Ms Spagnolo, in those circumstances.

1. There was no response to either letter.

1. On 20 April 2010, the Bank commenced this proceeding by originating motion, relevantly seeking orders for the removal of the caveat and costs calculated on an indemnity basis.  The application by summons on the originating motion was supported by an affidavit sworn on 20 April 2010 by Ms Julie Callea-Smyth of the Bank’s solicitors.

1. On 21 April 2010, the Bank’s process server attempted to serve the originating motion, summons and affidavit upon Ms Spagnolo at 19 Welwyn Parade, Deer Park, (her address in the caveat).  The process server was informed by an occupant that the house had been sold by Ms Spagnolo some four years earlier and that she no longer lived there.

1. On 22 April 2010, the same documents were served on Ms Spagnolo at the address for service in the caveat, the office of the solicitors, Frank J Sagaria.

1. The Bank’s solicitors made another search of the title to the property this afternoon.  An affidavit attesting to the search and its results was sworn today by Ms Karen Koleski of the Bank’s solicitors.  Ms Koleski deposes that the search reveals that the caveatrix’s address for service remains, ‘Frank J Sagaria, Solicitors, 141 Union Road, Ascot Vale Victoria 3032’. 

1. In all the circumstances, there is an issue as to whether the originating process has been served in accordance with the Supreme Court (General Civil Procedure) Rules 2005 (‘the Rules’).

1. I am satisfied that it has, because the requirements for service of proceedings in respect of the caveat under s 89(4) of the TLA have been met.

1. The requirement for personal service of originating process under r 6.02(1) of the Rules applies ‘[e]xcept where otherwise provided under any Act’.

1. Ms Hamill of counsel for the Bank has assisted me by referring to the decisions of Kaye J in Zampichelli v Zampichelli[1] and Batt J in National Australia Bank Ltd v Dyer & Anor[2] where it was held that service of originating process in accordance with the requirements of s 89(4) of the TLA falls within that express exception in r 6.02(1) and is proper service. I respectfully agree with their Honours’ conclusions and the reasons they give for them.

   [1][2009] VSC 489.

   [2][1996], 6620 (Unreported, Supreme Court of Victoria, Batt J, 14 August 1996).

1. There has been proper service of the originating process, summons and affidavit materials in support in this case.  There has been no appearance by or on behalf of Ms Spagnolo nor has she sought to persuade the Court that the maintenance of her caveat is justified in the circumstances.

1. The evidence establishes that the Bank exercised its power of sale as registered mortgagee after obtaining possession by order of the Court. The material reveals no challenge to the propriety of the sale under s 77 of the TLA, nor does it suggest that the sale should be impeached for any other reason.

1. I agree with counsel’s submission to the effect that Ms Spagnolo’s alleged caveatable interest as stated does not entitle her to maintain the caveat and thereby frustrate the sale.

1. I note that the second defendant, the Registrar of Titles, has been served with the application and did not appear.  Nor did the Registrar write to the Court indicating an intention not to appear.  I was however satisfied that there had been proper service upon the Registrar and made the order sought accordingly.

1. Although I ordered that Ms Spagnolo pay the Bank’s costs of the proceeding, I declined to make the order for costs on an indemnity basis in all the circumstances.