Reindel v Confreight Pty Ltd (No 1) - [2022] VSC 163

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION

PROPERTY LIST

S ECI 2021 02659

BETWEEN:

GLENN REINDEL & ORS (according to the attached Schedule)	Plaintiffs
v
CONFREIGHT PTY LTD (ACN 005 729 457) & ORS (according to the attached Schedule)	Defendants

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JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	18 October 2021, further written submissions filed by the First and Third Plaintiffs on 21 October 2021
DATE OF JUDGMENT:	4 April 2022
CASE MAY BE CITED AS:	Reindel & Ors v Confreight Pty Ltd & Ors (No 1)
MEDIUM NEUTRAL CITATION:	[2022] VSC 163

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REAL PROPERTY – Caveats – Application to remove caveats – Whether there is a prima facie case that there is an equitable charge arising out of a loan agreement – Whether there is a common intention by the parties to immediately create an equitable charge - McMillan v Dunoon [2005] VSC 440 considered – Construction of a commercial agreement - Whether the loan agreement confers an equitable interest in property owned by a non-party to the agreement – Balance of convenience – Held that there is a prima facie case that the loan agreement evidenced an immediate intention to create an equitable charge – Held that the loan agreement does not confer an equitable interest in property owned by a non‑party – Held that the caveats lodged over the properties of a non‑party are to be removed - Balance of convenience otherwise favours the maintenance of the caveat over the property owned by the party to the loan agreement.

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APPEARANCES	Counsel	Solicitors
For the First and Third Plaintiffs	Mr I R Jones QC with Mr J Lipinski	William Partners
For the Third Defendant	Mr J Kohn	Capstone Koroneos Legal

HER HONOUR:

Introduction and background

These reasons concern one of a number of applications in two proceedings arising from disputes between participants in a multi‑unit residential development in Windsor, Victoria (‘Windsor development’), which was completed in 2020. The first proceeding (‘caveat proceeding’) is an application to, among other things, remove caveats lodged over the titles of five apartments constructed as part of the Windsor development (‘Windsor units’). The registered proprietors of the Windsor units are Mr Glenn Reindel (as to one of the Windsor units), and Blizzard Winds Pty Ltd (‘Blizzard Winds’), a company of which Mr Reindel, who is a property developer by profession, is the sole director and shareholder (as to four of the Windsor units). The second proceeding is a proceeding brought by the first and second defendants in the caveat proceeding, Confreight Pty Ltd and Supply Chain Logistics Pty Ltd (‘investors’).

A special purpose vehicle, Windsor Development Company Pty Ltd (‘WDC’) was incorporated to carry out the Windsor development, which involved the construction of 69 residential units and two restaurants. WDC was wound up in late 2020, and a liquidator is in control of its affairs. The return to the investors from the Windsor development was negligible, and the investors have now made a…

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: [2022] VSC 163
Decision Date: 4 April 2022

CaseChat Overview and Summary

Reindel sought to have caveats removed that Confreight had lodged over certain properties. The dispute was determined in the Supreme Court of Victoria. The legal issues before the Court included whether there was a prima facie case that an equitable charge arose out of a loan agreement, whether there was a common intention by the parties to immediately create an equitable charge, and whether the loan agreement conferred an equitable interest in the property owned by a non-party to the agreement. The Court also considered the balance of convenience.

The Court found that there was a prima facie case that the loan agreement evidenced an immediate intention to create an equitable charge. The Court held that the loan agreement did not confer an equitable interest in the property owned by a non-party. The Court considered the case of McMillan v Dunoon and found that the loan agreement did not provide the necessary intention to create an equitable interest in the non-party's property. The Court also found that the balance of convenience favoured the removal of the caveats over the non-party's property, but not over the property owned by the party to the loan agreement.

The Court ordered that the caveats lodged by Confreight over the properties of the non-party be removed. However, the Court held that the balance of convenience favoured the maintenance of the caveat over the property owned by the party to the loan agreement. The Court found that the removal of the caveat over the party's property would cause significant prejudice to Reindel, who held an equitable interest in the property.

Orders