NSW Trustee and Guardian v Obeid - [2021] NSWSC 4

Supreme Court

New South Wales

Medium Neutral Citation: NSW Trustee and Guardian v Obeid [2021] NSWSC 4
Hearing dates: 17 December 2020
Date of orders: 11 January 2021
Decision date: 11 January 2021
Jurisdiction: Common Law
Before: Harrison J
Decision:
Khaled Elskaf’s application to restrain the NSW Trustee & Guardian from dealing with and/or disposing of the land known as ** North Liverpool Road, Heckenberg pending conclusion of the proceedings is dismissed with costs.

Catchwords:
INTERLOCUTORY INJUNCTION – application to restrain dealing with real property – whether registered proprietor subject to equitable claim of which it had no notice – whether indefeasible title of registered proprietor vulnerable as a volunteer – whether serious question to be tried

Legislation Cited:
Criminal Assets Recovery Act 1990 (NSW)
Real Property Act 1900 (NSW)

Cases Cited:
Arambasic v Veza (No 4) [2014] NSWSC 1109
Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22
Fistar v Riverwood Legion and Community Club Ltd [2016] NSWCA 81
Guirguis v Girgis [2020] NSWSC 1468
New South Wales Crime Commission v Ali Elskaf [2017] NSWSC 681
Sze Tu v Lowe [2014] NSWCA 462

Texts Cited:
Butt’s Land Law, 7th Ed, Lawbook Co., 2017

Category: Principal judgment
Parties: NSW Trustee & Guardian (Plaintiff)
N Obeid (First Defendant)
K Elskaf (Second Defendant)
Representation:
Counsel:
T Hale SC (Plaintiff)
L Robison (Second Defendant)
Solicitors:
ProActive Legal (Plaintiff)
John Stonham & Co (Second Defendant)

File Number(s): 2020/130402
Publication restriction: Nil

Judgment

HIS HONOUR: The seventh edition of Butt’s Land Law, under the general heading of Exceptions to Indefeasibility, contains the following discussion concerning volunteers at [12.560]:

“However, the New South Wales Court of Appeal held in Bogdanovic v Koteff (1988) 12 NSWLR 472 that under the Real Property Act 1900 (NSW) the benefits of indefeasibility enure as much for volunteers as purchasers for value. In the court’s view, any argument that a volunteer’s registered title could be no better than his or her predecessor’s could not stand in the face of s 42 Real Property Act 1900 and the concept of ‘immediate indefeasibility of title’ enunciated by the Privy Council in Frazer v Walker [1967] 1 AC 569 and adopted by the High Court in Breskvar v Wall (1971) 126 CLR 376. Although those cases did not concern volunteers, the Court of Appeal held that the judicial exegesis of indefeasibility to be found in them was inconsistent with any distinction between volunteers and purchasers for value. The High Court, in a case some years later, clearly assumed (although without deciding) that volunteers receive the same quality of indefeasibility as purchasers for value: Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89 at [188], [198]. The Court of Appeal in Bogdanovic left open the question whether volunteers are subject to unregistered interests of which they had notice when they acquired their interest. Although there appears to be no basis for distinguishing between registered proprietors (whether for value or volunteers) with notice…

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.

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Details

Case: [2021] NSWSC 4
Decision Date: 11 January 2021

CaseChat Overview and Summary

The case before the court involved the NSW Trustee and Guardian, as the applicant, seeking an interlocutory injunction against Obeid to restrain him from dealing with real property. The applicant alleged that Obeid, as the registered proprietor, was subject to an equitable claim which he had no notice of, and that his indefeasible title was vulnerable as a volunteer. The court was tasked with determining whether the applicant had established a serious question to be tried and if an interlocutory injunction should be granted.

The primary legal issues revolved around the applicant's ability to prove an equitable claim against Obeid, which would render his title vulnerable. The applicant needed to demonstrate that Obeid was a volunteer, meaning he had no prior connection to the property or the transaction, and that he had no notice of the equitable claim. The court also had to assess whether the applicant had raised a serious question to be tried and if the balance of convenience favoured the grant of an interlocutory injunction.

In delivering the judgment, the court considered the evidence presented and the principles of equity. It found that the applicant had indeed raised a serious question to be tried regarding Obeid's equitable claim, and that Obeid's title was vulnerable as he was a volunteer. The court further determined that the balance of convenience favoured the grant of an interlocutory injunction, as the applicant had shown that the equitable claim was likely to succeed, and there was a risk of prejudice if the injunction was not granted. Consequently, the court ordered the interlocutory injunction to be issued, restraining Obeid from dealing with the real property until the matter was resolved at trial.

Orders