Reschke v Trevor Reschke Nominees Pty Ltd - [2018] SASC 120

SUPREME COURT OF SOUTH AUSTRALIA
(Appeal from a Master)
RESCHKE v TREVOR RESCHKE NOMINEES PTY LTD
[2018] SASC 120
Judgment of The Honourable Justice Nicholson
30 August 2018
REAL PROPERTY - TORRENS TITLE - CAVEATS AGAINST DEALINGS - REMOVAL
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH DISCRETION OF COURT BELOW
Appeal against the decision of a Master to refuse to extend the time for the removal of a caveat.
In January 2017, the appellant lodged a caveat over a parcel of real property registered in the name of the respondent, on the basis of the appellant’s claim to an equitable interest in the property. The caveat was warned and the appellant made an application for an order extending the time for its removal pursuant to s 191(1)(g) of the Real Property Act 1886 (SA).
The application was heard by a Master of this Court, who ordered that the time for the removal of the caveat should be extended until further order, as the appellant had established a prima facie case and the balance of convenience lay in favour of allowing the caveat to remain.
The respondent subsequently applied to set aside that order on the basis of material non-disclosure by the appellant with respect to the sale of a different parcel of contiguous land held by the appellant. A different Master made orders setting aside the earlier order extending the time for removal of the caveat on the basis of the appellant’s non-disclosure but allowing the caveat to remain in place for a short period of time.
On 26 March 2018, the Master who heard the original application heard a fresh application by the appellant seeking a further extension of the caveat. The appellant contended, in essence, that the new information as to his sale of the other land had no effect on the question of whether he had established a prima facie case or as to the balance of convenience.
The Master dismissed the application. Her Honour remained satisfied that the appellant had established a prima facie case. However, her Honour found that, on the evidence now before her Honour, the balance of convenience did not lie in favour of extending the caveat and that the appellant had not established that damages would not be an adequate remedy.
The appellant appeals against these findings, contending that the Master erred in finding that the balance of convenience did not favour the making of an order to further extend the caveat.
During the hearing of the appeal, both parties sought to read new affidavit evidence in addition to that relied on before the Master. The material was received de bene esse.
Held per Nicholson J, dismissing the appeal:
1.       The Master did not err in finding that the balance of convenience did not lie in favour of extending the time for removal of the caveat, nor in declining to find that damages would not be an adequate remedy.
2.       The Master’s finding was not unreasonable or plainly unjust in the sense of falling outside the decisional freedom available, given the state of the evidence before her Honour.
3.       None of the affidavits received de bene esse will be admitted into evidence.
4.       Parties to be heard on the question of a short extension of time for removal of the caveat pending any application for permission to appeal to be made and as to costs.
Real Property Act 1886 (SA) s 191, referred to.
Sunlight Nominees Pty Ltd v Zotti & Zotti [2017] SASC 176, applied.
Australian Coal and Shale Employees' Federation v The Commonwealth (1953) 94 CLR 621; McInnes v Davies [2014] SASC 184, considered.

RESCHKE v TREVOR RESCHKE NOMINEES PTY LTD
[2018] SASC 120
Appeal from a Master
NICHOLSON J.
Introduction

These reasons concern an appeal against a decision of her Honour Judge Bochner, a Master of the Supreme Court, dated 26 March 2018. Her Honour refused the appellant’s application pursuant to section 191(1)(g) of the Real Property Act 1886 (SA) for an extension of time for the removal of a caveat lodged over a parcel of real property registered in the name of the respondent. However, orders were made by Judge Bochner and another Judge of this Court preserving the appellant’s position until shortly after the hearing of this appeal.
At the conclusion of the appeal hearing, I made an order extending the time for the removal of the caveat until further order, on the basis that the undertaking as to damages previously given by the appellant in this matter was to remain in place. For the reasons that follow, I would dismiss the appeal.
Background
The caveat was lodged by the appellant on 9 January 2017 and has been the subject of numerous orders extending the time for its removal. The property the subject of the caveat (the caveat property) formed part of a group of adjacent parcels of land in the Coonawarra region held by the Reschke family. The various properties were held by the appellant’s father Trevor Reschke, and by companies controlled by him, until his death in 2008.
By his will, Trevor Reschke effectively divided ownership of the family land holdings predominantly between his two sons, being the appellant and the appellant’s brother Dru Reschke. The caveat property was given to the respondent, a company now controlled by Dru Reschke and Vivian Reschke, the mother of the appellant and Dru Reschke and the wife of Trevor Reschke.
A sufficient description for present purposes of the location of the family land holdings, in relation to each other and as relevant to the dispute, is as follows. The appellant initially owned or controlled three adjacent parcels of land to the north. He now only controls two which share a common boundary. The third was recently sold by the appellant as explained later in these reasons. Of the two remaining parcels, one shares a common boundary with the caveat land (the central parcel) which is further to the south and owned by the respondent. Immediately further south and sharing a common boundary is a parcel described as the “Rocky Castle” or “Fabriano” land. This land is held by the Rocky Castle Trust, of which Fabriano Pty Ltd, a company controlled by Vivian Reschke, is the trustee. The family land holdings thus described form a contiguous whole. In effect the four parcels are in a line from north to south. The northern most is controlled by the appellant and shares a border with his second parcel, that second parcel shares a border with the caveat land (the central parcel) which in turn shares a border with the southern most parcel, the Rocky Castle land.
The appellant contends that he has an equitable claim to all of the family land holdings, including the caveat property, by virtue of promises made to him by his father and grandfather since his childhood with respect to his inheritance.
On 29 May 2017, the appellant issued proceedings against the respondent and three other companies controlled by Dru Reschke and Vivian Reschke, by way of summons and a statement of claim. In those substantive proceedings, the appellant seeks an order for the transfer of ownership of parts of the family land holdings and business to him, or equitable or legal compensation in lieu, on the basis of proprietary estoppel, promissory estoppel and other equitable causes of action. As at the date of the hearing of this appeal, no defence had been filed.[1] Counsel indicated that this was by agreement between the parties.
[1] According to my examination of the Court record, this was still the position as at 8 August 2018.
In December 2016, the respondent entered into a contract for the sale of the caveat property to a near neighbour, Greg Gartner. The respondent submits that the sale was for the purpose of reducing debt. Settlement was to take place on 27 January 2017. On 9 January 2017, the appellant lodged the caveat over the caveat property to prevent its sale, on the basis of his claim to an equitable interest in it. The caveat was warned and the appellant made an application to extend the time for the removal of the caveat.
Proceedings before Judge Bochner
The application was heard by Judge Bochner on 14 March 2017. The appellant provided extensive evidence in support of his contention that he had an equitable interest in the caveat property by virtue of the promises made by his father and grandfather and his reliance upon those promises.[2]
[2] Reschke v Trevor Reschke Nominees Pty Ltd, No. SCCIV-17-122, Reasons of Judge Bochner, 11 May 2017 at [4]-[6].
The appellant also submitted that the balance of convenience lay in favour of allowing the caveat to remain, it being of significant importance that adjacent parcels of land forming the family land holdings remained a contiguous whole. The appellant submitted that, were the caveat land to be sold, damages would not be an adequate remedy should he be successful in his claim for an equitable interest in the family land, including the caveat land.
The respondent disputed the appellant’s contentions as to both his equitable entitlement to the caveat land and the importance of the caveat land not being sold.
On 11 May 2017, Judge Bochner delivered reasons and ordered that the time for the removal of the caveat should be extended until further order. Her Honour also ordered that the appellant file and serve a statement of claim asserting his substantive rights within seven days.
Her Honour found that the appellant had established a prima facie case as to the existence of his claimed proprietary interest.[3] Her Honour also accepted that the balance of convenience lay in favour of allowing the caveat to remain:[4]
In ordinary circumstances, I would allow the property to be sold and the proceeds of sale to be paid into Court pending the outcome of the substantive action.
This is not, however, an ordinary case. This is land the plaintiff says he does not want to sell, and for which money would not be an adequate compensation. There is conflicting evidence as to the plaintiff’s previous willingness to sell. Nevertheless, I am of the view that the status quo should be maintained while the trial of this action is heard.
[3] Reschke v Trevor Reschke Nominees Pty Ltd, No. SCCIV-17-122, Reasons of Judge Bochner, 11 May 2017 at [40]-[41].
[4] Reschke v Trevor Reschke Nominees Pty Ltd, No. SCCIV-17-122, Reasons of Judge Bochner, 11 May 2017 at [48]-[49].
After her Honour made the order on 11 May 2017, it came to the respondent’s attention that the appellant had entered into a contract with the same neighbour to sell to him the third parcel of the family land holdings held in the appellant’s name. The offer was received by the appellant on 3 March 2017, being prior to the hearing of the application before Judge Bochner. However, the appellant entered into the contract for sale on 10 April 2017, after the hearing of the application but while judgment was reserved.
Proceedings before Judge Roder
As a result, the respondent applied to set aside Judge Bochner’s order of 11 May 2017 extending the caveat on the basis of material non-disclosure by the appellant. The application was heard by another Master, his Honour Auxiliary Judge Roder. The plaintiff was cross-examined on his affidavit evidence.
On 20 November 2017, Judge Roder made orders setting aside the orders made by Judge Bochner on the basis of the appellant’s material non-disclosure of his sale.[5] However, his Honour ordered that the time for the removal of the caveat be extended for a short time to allow the appellant to make a further application for another order extending the time for removal should he so choose.
[5] Reschke v Trevor Reschke Nominees Pty Ltd, No. SCCIV-17-122, Reasons of Judge Roder, 20 November 2017.
Proceedings before Justice Doyle
The appellant appealed from the decision of Judge Roder to a single Judge of this Court, on the grounds that his Honour had erred in concluding that the appellant’s non-disclosure was material and of a kind that warranted the setting aside of Judge Bochner’s order, and had erred in permitting cross-examination of the appellant beyond the scope contemplated. On 7 March 2018, Doyle J dismissed the appeal.[6] As I understand the position, an appeal or application for permission to appeal to the Full Court from the decision of Doyle J has been filed.
[6] Reschke v Trevor Reschke Nominees Pty Ltd [2018] SASC 22.
Further proceedings before Judge Bochner – the subject of this appeal
On 26 March 2018, and as foreshadowed in the reasons of Judge Roder, Judge Bochner heard a new application by the appellant seeking a further extension of time for the removal of the caveat.
The appellant contended, in essence, that the new information as to the appellant’s sale of his third parcel of land had no effect on whether the appellant had established a prima facie case nor whether the balance of convenience lay in favour of the caveat remaining.
It was submitted that this parcel of land had been sold due to financial necessity and that it was of materially different importance as compared with the caveat land. The appellant submitted that the caveat land remained of significant importance to the contiguity of the overall land holdings and the use of the available infrastructure and that its sale would prevent the appellant, if successful in the substantive proceedings, from inheriting and farming the entirety of the family land.
The respondent contended that the appellant had failed to establish a prima facie case, as the evidence relied upon by the appellant was not confirmed by any independent evidence and was refuted by evidence relied on by the respondent. With respect to the balance of convenience, the respondent disputed the appellant’s contentions as to the significance of the caveat land in relation to infrastructure and contiguity. The respondent further submitted that the appellant’s sale of his third parcel of land was contrary to the appellant’s claim as to the necessity of retaining the family land holdings in their entirety.
Judge Bochner delivered ex tempore remarks dismissing the application.[7] Her Honour treated the application as a fresh application to be determined on the evidence before her Honour at that time, without regard to the reasons for the non-disclosure and without regard to the findings of Judge Roder with respect to the appellant’s credit.
[7] Reschke v Trevor Reschke Nominees Pty Ltd, No. SCCIV-17-122, Reasons of Judge Bochner, 26 March 2018.
Her Honour remained satisfied that the appellant had established a prima facie case as to his claim to a proprietary interest, albeit not a strong case. However, her Honour determined that the balance of convenience no longer favoured the extension of the time for removal of the caveat. Judge Bochner made the following remarks.
At the first hearing of this matter the plaintiff’s position was that the land should not be sold so that the family property may remain intact. His position now is that parcels of land may be sold where it is commercially convenient to do so.
In the circumstances where the plaintiff’s case has gone from one of emotional attachment to commercial expediency, I do not accept that damages would not be an adequate remedy. The loss of infrastructure currently located on the subject land can be compensated for by an award of damages. There are no other circumstances which suggest damages would not be an adequate remedy.
I also note various assertions made by the plaintiff as to the necessity of the land to maintain its viability as a farm and also as to the amounts of money he has spent on the land in improving it over the years that he has farmed it. This evidence is not supported by any other evidence filed on behalf of the plaintiff, whether that is evidence of an expert or any other lay witness, it is simply assertions made on behalf of the plaintiff and the plaintiff’s evidence in this regard has been specifically refuted by evidence filed on behalf of the defendant.
I made no findings in relation to these matters, I simply note that there is a dispute as to whether the plaintiff’s position as to viability of this farm should that land be sold and the amounts of money that he has spent on it would be found as a fact.
The present appeal
The appellant contends that the Judge erred in finding that the balance of convenience did not favour the making of an order to further extend the caveat.
The appeal is from a discretionary order made at an interlocutory stage of the proceedings by a Master of this Court. As such, the appeal lies to a single Judge of the Court and as of right.[8] The appeal is by way of rehearing such that it is one of fact and law and I am to make an independent review of the evidence that was before the Judge and of her reasons in order to determine whether a proper determination has been arrived at. The proper approach of an appellate court, ordinarily applicable to such an appeal, has been described by Stanley J in McInnes v Davies.[9] As observed by his Honour, it is not permissible for an appeal court “to substitute its opinion for a discretionary order of a judge possessed of the requisite jurisdiction and powers in the absence of relevant error”.[10] Kitto J, in Australian Coal and Shale Employees’ Federation v The Commonwealth,[11] described that notion of relevant error in terms similar to those used by the High Court in its more well known and later decision of House v The King.[12] Kitto J said this.[13]
…[T]he true principle limiting the manner in which appellate jurisdiction is exercised in respect of decisions involving discretionary judgment is that there is a strong presumption in favour of the correctness of the decision appealed from, and that decision should therefore be affirmed unless the court of appeal is satisfied that it is clearly wrong. A degree of satisfaction sufficient to overcome the strength of the presumption may exist where there has been an error which consists in acting upon a wrong principle, or giving weight to extraneous or irrelevant matters, or failing to give weight or sufficient weight to relevant considerations, or making a mistake as to the facts. Again, the nature of the error may not be discoverable, but even so it is sufficient that the result is so unreasonable or plainly unjust that the appellate court may infer that there has been a failure properly to exercise the discretion which the law reposes in the court of first instance.
[8] Rules 17, 280 and 288 of the Supreme Court (Civil) Rules 2006.
[9] [2014] SASC 184.
[10] McInnes v Davies [2014] SASC 184 at [7].
[11] [1953] HCA 25; (1953) 94 CLR 621.
[12] [1936] HCA 40; (1936) 55 CLR 499 at 404-405 (Dixon, Evatt and McTiernan JJ).
[13] Australian Coal and Shale Employees’ Federation v The Commonwealth [1953] HCA 25; (1953) 94 CLR 621 at 627.
However, both parties sought to read affidavit evidence before me on appeal in addition to that relied on before the Judge. The acceptance of such additional evidence on the appeal would result in my having to exercise the discretion afresh based on the whole of the evidence before the Court including that which was before the Judge and the additional evidence received on appeal.
During the hearing of the appeal, I received a number of affidavits from both the appellant and the respondent de bene esse. The respondent’s affidavits were produced by the respondent by way of response to the matters raised in the appellant’s new affidavits. But for one matter that might be considered as genuine fresh evidence produced on the behalf of the respondent,[14] the respondent’s affidavits would not need to be addressed in the event that the appellant’s affidavits were not to be received.
[14] The respondent has adduced evidence that the contract to sell the caveat land to the neighbour has remained on foot since the decision of Bochner J and that the purchaser is making noises about not proceeding because of the delays.

It was common ground between the parties that, in determining the question of admissibility of the new affidavit evidence on appeal, the usual requirements for the admission of fresh evidence apply. Those requirements were recently helpfully summarised by Doyle J in Sunlight Nominees Pty Ltd v Zotti & Zotti.[15]
In terms of the principles governing the plaintiff’s application to adduce the above evidence, the Court has a broad discretion under r 286(3)(a) of the Supreme Court Rules 2006 (SA) to receive further evidence on a question of fact in an appeal such as the present. The discretion is not circumscribed by the common law principles governing the reception of “fresh evidence” on appeal,[16] although similar considerations will often be relevant. In particular, it will generally be relevant to consider:[17]
·Whether the evidence was available, or could with reasonable diligence have been obtained for use at trial.
·Whether the evidence is such that it would have had an important influence on the result of the trial. While it need not necessarily be decisive, it must be more than merely useful.
·The likely impact of the evidence in terms of whether it is controversial or contested, and if so likely to require cross-examination, further responding evidence and/or that the matter be remitted for rehearing.
·The public interest in the finality of litigation.
Whilst these principles have been described in the context of an appeal following a trial on the merits, they are of general application.
The affidavit material that was before Judge Bochner and that sought to be relied on for the first time on the appeal
[15] [2017] SASC 176 at [82].
[16] CDJ v VAJ (No 2) (1998) 197 CLR 172 at [52], [104]-[108].
[17] CDJ v VAJ (No 2) (1998) 197 CLR 172 at [55], [111]-[116] and [186]-[189]; Viscariello v Livesey [2013] SASC 99 at [132].
Given the history of this matter and the number of hearings that have been conducted, the parties have managed to generate a remarkable plethora of filed documents all directed at the issue of whether the caveat should remain. The Court registry file document numbering system records that the multi-volume file now contains some 80 documents including numerous affidavits with exhibits.
There is only one ground of appeal and that is that the Judge erred in her assessment of the balance of convenience. As such, at the outset of the hearing, I required each counsel to identify the affidavits and the particular paragraphs relied on in support of their argument. Counsel did this. I now set out a summary of the affidavit material relied on, including that which was available to the Judge and that which I received de bene esse on the appeal.[18]
[18] Not all of the paragraphs referred to by counsel are expressly mentioned below. However, I have had regard to all those referred to. Some do no more than restate or are argumentative concerning the principal contentions relied on by the parties.
Plaintiff material
First affidavit of Burke Reschke (FDN 2) sworn and filed 3 February 2017
The appellant relies on paragraph [48] of this affidavit in support of his contention that he would suffer irreparable harm if a sale of the caveat land were to occur such that an award of damages or compensation in the substantive proceedings would not be an adequate remedy. A sale of the caveat land would be of concern to the appellant for the following reasons.
·The land is located across the centre of the northern holdings and its loss would eliminate the advantages of contiguity.
·The sale of the land would reduce the “scale” of the northern holdings.
·The land contains important farming infrastructure used for farming operations on adjoining blocks, including cattle and sheep yards, a shearing shed, a hay shed and large scale irrigation.
·The sale of the caveat land in isolation would not realise the full value of the land as it is more valuable in common ownership with adjoining blocks.
Third affidavit of Burke Reschke (FDN 19) sworn 26 May 2017, filed 29 May 2017
At paragraphs [6.1]-[6.6], the appellant sets out his reasons for selling the parcel of land he sold in April 2017 and why that land was not of the same significance as the caveat land. The appellant relies on this material in contending that Judge Bochner, in determining the question of balance of convenience, failed to address this evidence and wrongly characterised the appellant’s position as being that land might be sold where it is commercially convenient to do so. Her Honour found this position to be inconsistent with the appellant’s stated position that it was important that the family land holdings remain intact.
In paragraph [6.3], the appellant again explained why the caveat land is a “strategic parcel of land within the whole Reschke estate”. It is contiguous with other parts of valuable land controlled by the appellant and includes agricultural infrastructure, parts of which were developed at the appellant’s expense. If the caveat land were to be unavailable, this would significantly affect the viability of the whole Reschke estate as a farming enterprise.
In paragraph [6.6], the appellant explained why the land he sold is of less strategic importance and was “the logical part” to sell in order to keep the farming business afloat.
·The sold land did not form part of a contiguous block with the Northern Holdings, being to the eastern side of the main part of the Northern Holdings. The sale of this land did not affect the north-south contiguity of the Northern Holdings. In contrast, the sale of the caveat land would divide the Northern Holdings into two separate parts.
·The sold land is the least valuable part of the Northern Holdings on a per acre basis.
·The sold land contains no infrastructure necessary to the operation of adjoining blocks.
The appellant also asserts that the caveat land is encumbered “to a significant degree” by way of security for debts incurred by Dru Reschke personally and by his business. The appellant would have to assume responsibility for and service this debt were his equitable claim to succeed.
At paragraphs [6.4]-[6.5], the appellant has explained that, in anticipation of succeeding with his claim, he determined that the level of debt would be difficult to sustain and the sale of the other land was necessary to enable him to service the debts secured by the caveat land. This was his motivation for selling.
Fourth affidavit of Burke Reschke (FDN 22) sworn 4 July 2017, filed 5 July 2017
This affidavit contains further details of the appellant’s steps taken towards the sale of the land, which he relies upon in support of his claim that his sale of other land owned by him does not indicate a willingness to sell land simply where commercially convenient, inconsistent with his claim of moral attachment to the caveat land.
The appellant deposes to having engaged in preliminary enquiries regarding a letter of offer received in order to maintain the option to sell if necessary. However, he put the issue to one side in the lead up to the hearing before Judge Bochner and no further steps were taken before the hearing. However, he proceeded to execute a contract for sale when it became clear that there was not to be a quick resolution to the issue of the ownership of the caveat land. He remained keen to avoid a sale if possible.
Sixth affidavit of Burke Reschke (FDN 71) sworn and filed 12 April 2018
This affidavit was received de bene esse. The appellant intends it to be in response to the second affidavit of Dru Reschke (FDN 56) which had been filed some days before the hearing before Judge Bochner.
Paragraph [4] is directly responsive to paragraph [3.7] of the second affidavit of Dru Reschke which purports to outline the relatively limited financial costs that would be incurred by the appellant were he to rebuild somewhere else the infrastructure located on the caveat land. The appellant relies on the matters at paragraph [4] to challenge the reliability of the respondent’s submission that the appellant would not suffer significant financial prejudice if the caveat land were to be sold. The appellant asserts that a quote exhibited to the second affidavit of Dru Reschke for the construction of cattle yards (the equivalent of those located on the caveat land) fails to take into consideration significant associated costs. Further, it does not address the replacement of other infrastructure on the caveat land (including sheep yards and sheds).
At paragraph [5], the appellant responds to paragraph [4.5] of Dru Reschke’s second affidavit, challenging Dru Reschke’s claim that he contributed to the capital improvements on the caveat land to a substantial extent. The appellant asserts that the money is likely to have been expended by other entities, not the respondent, and that any such expenditure related to other land. The appellant complains that Dru Reschke has not quantified the amount of money said to have been spent in relation to capital works and challenges claims concerning expenditure in relation to such items as a pump and a drip line.
In paragraph [6], the appellant restates matters in support of the strategic importance of the caveat land. He asserts that it would be available for use for sheep grazing by way of challenge to Dru Reschke’s claim that there is no advantage of contiguity because much of the family land holdings are deployed as vineyards.
In paragraph [7], the appellant asserts that the sale of the appellant’s other land was a matter of financial necessity, rather than for commercial gain or opportunity, and was in response to financial pressure from the appellant’s financiers arising as a result of the non-receipt of the family land.
Affidavit of Digby Luckhurst-Smith (FDN 72) sworn and filed 19 April 2018 (exhibiting affidavit of Guy Stratford)
The Stratford affidavit was received de bene esse. It is responsive to the second affidavit of Dru Reschke, filed on 19 March 2018, that was before Judge Bochner. This affidavit is relied upon as supporting the appellant’s assertions as to the necessity of retaining the caveat land and as to his capital contributions. By this affidavit, the appellant seeks to address Judge Bochner’s finding that the appellant’s evidence on these matters had been refuted by the respondent’s evidence and that his assertions were not supported by any other evidence adduced on the appellant’s behalf.
From late 2000 to mid-2006, Stratford was General Manager of Koonara Management Pty Ltd, an entity controlled by the appellant. In about July 2007 he recommenced a professional relationship with the appellant in his capacity as an independent contractor providing agricultural and viticultural contracting services. At paragraph [18], Stratford deposes to conversations with the appellant and with Trevor Reschke from which he inferred “it has always been my understanding that the Land, and in particular the Rocky Castle land … was to be left to the [appellant]”. This understanding was also based on the appellant’s conduct including his physical and financial contributions, his “appearing … to take responsibility for the direction and management of the land” and his appearing to make other life decisions on the basis he would inherit the land.
At paragraphs [22]-[26], Stratford discusses the appellant’s capital contributions to the caveat land that he had observed after he commenced employment with Koonara Management.
At paragraphs [27]-[38], Stratford describes his relationship with Dru Reschke. He asserts that Dru “possessed little or no training in agriculture or experience” and that this was a view shared by Trevor Reschke. Stratford provides examples of Dru Reschke’s “basic and at times flawed” understanding of agricultural and viticultural practices. This is relied on as supporting the appellant’s contention that it was he who was to be the farmer of the entirety of the family land, rather than Dru, and as supporting his equitable claim to the land.
Respondent material
First affidavit of Dru Reschke (FDN 6) sworn 8 February 2017, filed 9 February 2017
The respondent relies on paragraphs [24]-[36] with respect to the question of balance of convenience and in particular as bearing on the appellant’s submissions as to his attachment to the land; demonstrating that the appellant was a willing prospective seller in circumstances where it was commercially convenient; and demonstrating the prejudice suffered by the respondent as a result of the delay and the risk of termination of the contract for sale of the caveat land.
Paragraphs [24]-[30] are relied upon as evidence of the appellant’s willingness to sell portions of the family farming land for commercial convenience in 2016, in the lead up to the respondent taking initial steps to sell the caveat land. Dru Reschke asserts that, throughout 2016, he and the appellant discussed the sale of the caveat land, as well as portions of land owned or controlled by the appellant. Exhibits DWR5, 6, 7 and 9, comprise correspondence and contractual documents relating to arrangements for the sale of the caveat land and portions of the appellant’s land.
Dru Reschke deposes that he and the appellant engaged in discussions during 2016 regarding the sale of parts of the property. The respondent relies on this in submitting that, during the discussions, no claim to ownership nor any claim that the land should not be sold for this reason was raised.
Dru Reschke asserts that he and the appellant had discussed many times since September 2016 that the purpose of the sale of the caveat land was to help pay off debt.
The contract between the respondent and the proposed purchaser (Gartner) provided for settlement on 27 January 2017. Dru Reschke asserts that the delay in settlement means that his interest expense continues to accrue at $383 per day. The payment of this interest consumes most of his and his wife’s income.
Dru Reschke asserts that, if the delay continues, the purchaser may terminate the contract, resulting in a loss of opportunity for the respondent to sell the caveat land. He has “used [his] best endeavours … to ensure the contract remains on foot and that settlement may occur upon the removal of the [appellant’s] caveat”.
Third affidavit of Mark James Gowans (FDN 15) sworn and filed 16 May 2017
Mr Gowans is the respondent’s solicitor. The respondent relies on paragraphs [5]-[6] as evidence of the appellant’s sale of land controlled by the appellant. That this sale occurred is not challenged. It was the subject of the non-disclosure proceedings before Judge Roder.
Second affidavit of Dru Reschke (FDN 56) sworn 16 March 2018, filed 19 March 2018
Paragraph [3.7] of this affidavit is relied upon to challenge the appellant’s assertion that the caveat land should not be subject to sale because cattle yards that are crucial to the operation of the surrounding parcels of land are located on the caveat land.
Dru Reschke states that he obtained a quote of $74,504.95 on or about 30 May 2017 for the construction of cattle yards the equivalent of those located on the caveat land (exhibit DWR14). Counsel submitted that, even if the appellant’s case as to the importance of the infrastructure on the caveat land were to be accepted, it would be a relatively minor matter to construct alternative yards.
At paragraphs [5]-[11], Dru Reschke asserts that the delay in settlement of the sale to Gartner has caused significant financial harm by way of accrued loan interest and that there continues to be a risk of the purchaser terminating the contract. According to the respondent, all sale proceeds will be paid to the secured lenders as no equity remains in the property. The respondent relies on exhibit DWR17 in this respect. Exhibit DWR17 is a proposed settlement statement date of 14 March 2018 which records an intention that the bulk of the moneys to be received on settlement were to be directed to Rabobank.
Affidavit of Phil Wood (FDN 58) sworn 16 March 2018, filed 19 March 2018
Mr Wood worked for Trevor Reschke between 1990 and 1992. This affidavit was also before Judge Bochner. The respondent relies on paragraph [11]. Mr Wood asserts that, when cattle were being moved from other land to cattle yards on the caveat land, as a matter of practice, the cattle were always moved along the road, rather than through the caveat land. This was due to the properties not having laneways and also the risk of mixing different groups of cattle. This evidence is relied upon by the respondent as challenging the appellant’s assertion that the caveat land, given its central location, was critical to the network of family land. The respondent also relies on this affidavit in support of the contention that other cattle yards can be built for a relatively modest sum such that the presence of cattle yards on the caveat land is not a matter relevant to the question of balance of convenience.
Affidavit of Brad Batt (FDN 57) sworn 16 March 2018, filed 19 March 2018
Mr Batt was employed as a farm manager by the Reschke family between 1994 and 2007. The respondent relies on paragraphs [4]-[5] of his affidavit as evidence of Dru Reschke’s involvement with the operation of the farm and to challenge the appellant’s assertions purporting to diminish the extent of his involvement.
According to Mr Batt, Dru Reschke regularly came home to help on the farm and, in the later years of his employment, Mr Batt observed Dru Reschke to be actively involved on a regular basis in the overall operation of the farm. In contrast, he did not observe the appellant to attend the farm with any frequency. He worked on the farm on “very rare occasions”.
Third affidavit of Dru Reschke (no FDN as not filed) sworn 11 April 2018
This affidavit was sworn after delivery of judgment by Judge Bochner on 26 March 2018 and was also received by me de bene esse. It is relied upon to challenge the appellant’s assertions as to the importance of the caveat land to the overall farming operations.
At paragraphs [7]-[15], Dru Reschke refers to the current usage of the land to the north of the caveat land. The two parcels of land to the north are both used as vineyard land, except for a small portion (approximately 4.2 hectares) which is too small to use for cattle grazing. The only gate access to the caveat land is at a section planted as vineyard land. If cattle were run from the north to and through the caveat land, they would need to be run through the vineyard land.
At paragraphs [26]-[30], Dru Reschke refers once again to his endeavours to ensure that the contract has remained on foot. In a letter dated 11 April 2018 (exhibit DWR 26), Gartner stated that he “need[s] to take possession of the property as the cropping of it fits in with my farm rotation. Ideally, I would like to settle now as I would need to start my cropping program in approximately 3 weeks. … The delays are starting to cost me, in addition to having finance set aside and ready for this purchase”.
At paragraph [28], Dru Reschke refers to a conversation he had with Gartner prior to receiving the letter, in which Gartner said words to the effect that he had grown weary with the delays to settle as a result of the caveat and, unless the sale can settle reasonably expediently, he was considering pulling out of the sale.
Ninth affidavit of Mark James Gowans (FDN 70) sworn 11 April 2018, filed 12 April 2018
This affidavit was received de bene esse. Exhibited to this affidavit are various documents that are said to bear on the financial circumstances of the appellant.
Tenth affidavit of Mark James Gowans (FDN 74) sworn and filed 27 April 2018
The affidavit was received de bene esse. It exhibits a copy of an affidavit of James Black, sworn on 26 April 2018 in which Black challenges the credit of Guy Stratford. Black makes various disparaging comments about Stratford arising from their commercial dealings. I am in no position to make any findings as to credit of either Stratford or Black and the affidavit would be of no assistance even if admissible.
Eleventh affidavit of Mark James Gowans (FDN 75) sworn and filed 27 April 2018

This affidavit was received de bene esse. It exhibits an email from Phil Schell from CBRE Agribusiness, which is relied upon as evidence of steps taken by the appellant to sell other portions of his land and the question of his willingness to sell land where commercially convenient. Counsel for the appellant objected to the receipt of this affidavit on the basis of hearsay. The respondent submits that it is responsive to the “fresh” evidence of the appellant.
Fourth affidavit of Dru Reschke (FDN 76) sworn 26 April 2018, filed 30 April 2018
This affidavit was received de bene esse. The respondent relies on this affidavit in its entirety. It is relied on as being responsive to the affidavit of Guy Stratford and adopts the numbering used in that affidavit.
At paragraphs [18]-[19], Dru Reschke deposes to the fact that the Rocky Castle land was purchased by Fabriano Pty Ltd in or about July 1989. He asserts that the appellant has had use of the property for the past 20 years and that, since 2012, this has been by way of the appellant leasing the Rocky Castle land from Fabriano Pty Ltd through Koonara Management Pty Ltd, an entity controlled by the appellant. Dru Reschke asserts that the appellant has failed to make any rental payments for most of the period since 2012 and owes more than $100,000 in unpaid rent.
Dru Rechke also disputes and puts in issue various assertions in the Stratford affidavit as to the plaintiff’s capital contributions. Dru Reschke also responds to assertions by Stratford about particular occasions that Stratford relies upon as evidence of Dru Reschke’s lack of training and expertise with respect to agriculture.
Twelfth affidavit of Mark James Gowans (no FDN) sworn 1 May 2018, handed up in Court on 1 May – to be filed if accepted
This affidavit was received de bene esse. It exhibits an email from Peter Westley of Westley DiGiorgio Norcock (solicitors/conveyancers) dated 27 April 2018 in relation to the settlement of the Contract for Sale and Purchase of the caveat land. The email is addressed to Dru Reschke and requests that a letter be provided by Dru Reschke’s lawyer to the proposed purchaser explaining what is happening with the sale due to the extended delays.
Did Judge Bochner err?
In the first instance, I will confine myself to the question whether Judge Bochner erred in the exercise of her discretion, having regard to the relevant materials before her, that is, excluding the affidavit material received by me de bene esse.
The appellant’s contentions bearing on the balance of convenience question are first, that he has made out a prima facie case with respect to an equitable interest in the caveat land and second, that damages or equitable compensation would not be an adequate remedy if he were to succeed at trial.
As far as the first proposition is concerned it is to be remembered that, in making this finding Judge Bochner qualified it by observing that the prima facie case was “perhaps not a strong one”.
In support of the second proposition, the appellant has submitted, and adduced some evidence in support, that the existence and location of the caveat land is, of itself, significant in that his control of the caveat land would enhance the utility and value of the other land held in his name and other land presently under the control of his brother and mother to which the appellant also lays claim. There appear to be two main bases for this primary contention that the caveat land has value to the appellant in addition to its intrinsic value as a parcel of agricultural land.
The first is that it would assist with stock movement from property to property. Further, if the caveat land were unavailable to the appellant, he would be in the position of having to farm his two parcels to the north and a non-adjacent parcel immediately to the south of the caveat land such that the advantages of contiguity, that is, working one composite parcel, would be lost. However, it must be noted that this “contiguity” submission assumes that the appellant will be successful not just with respect to his claim to the (central) caveat land but also with respect to the land to the south (the “Rocky Castle” land) owned by a trust controlled by his mother. Whilst the appellant has made out a prima facie case in this respect, “although perhaps not a strong one”, experience suggests that it will be very difficult for the appellant to establish an entitlement to the whole of the family land holdings to the exclusion of both his mother and his brother. Unless the appellant were to succeed with respect to the “Rocky Castle” land, the asserted benefit of contiguity will not eventuate.
A second basis for the primary contention is that the caveat land is the location of valuable infrastructure which is, or would be, important to the conducting of operations on the land to the south and to the north. If the appellant had control of this infrastructure, it would enhance the value to him of these other two parcels of land.
In further support of the balance of convenience argument, the appellant relies on the contention that he has contributed financially, in a substantial way, to the infrastructure on or capital improvements to the caveat land.
Adding to these matters, the appellant relies on a moral and emotional attachment to, or obligation with respect to, the caveat land. This is a central component of the family land holdings he was led to understand would be his. The appellant has planned for and worked to prepare himself for the eventuality of owning and working the family land holdings since adolescence.
The respondent challenged each of these contentions before Judge Bochner, in particular the genuineness of the asserted emotional attachment, the asserted value of contiguity in practical terms and the extent to which the appellant has, in fact, contributed to the infrastructure. In addition, the respondent relies on the very substantial interest expense which is continuing to be incurred as a result of the high level of debt carried by the caveat property, the fact that the respondent is in a position to discharge much or all of this debt if the sale of the caveat land were to proceed, and the risk of losing the sale as the delay in resolving the appellant’s claim continues.
Judge Bochner’s reasons were brief. Her Honour found that the appellant’s position “now” was that parcels of land may be sold where it is commercially convenient to do so and that the appellant’s case has gone from one of emotional attachment to commercial expediency. In these circumstances, her Honour did not accept that damages would not be an adequate remedy. The appellant contended, on appeal, that Judge Bochner erred in making these findings.
The finding that the appellant had departed from his emotional attachment was perhaps more stark than it needed to be. There remained evidence in support of an emotional attachment notwithstanding the sale by the appellant of his third parcel of land. However, there was also evidence, adduced by the respondent, of the appellant’s previous willingness to sell land if commercially necessary, in particular, to reduce the pressure of debt. In my view, Judge Bochner’s finding was open on the evidence. In any event, I am satisfied for reasons I will come to that Judge Bochner was correct in declining to find that damages would not be an adequate remedy.
The appellant also complains that Judge Bochner erred in failing to make particular findings as referred to in the last paragraph of the earlier quoted extract from her Honour’s reasons.
The onus was on the appellant to persuade the Judge of relevant factors – such as the value of retaining contiguity and the extent (and relevance) of the appellant’s financial contributions – to an extent sufficient to support the appellant’s balance of convenience case. The evidence adduced was very general and in large part argumentative. It was countered by the respondent to similar effect. It is debatable whether Judge Bochner was ever in a position to make specific findings of fact. What is clear is that Judge Bochner was not persuaded that the appellant’s evidence with respect to these matters added sufficient weight to his argument that the balance of convenience favoured retention of the caveat.
I am not satisfied that Judge Bochner committed any process error in the House v The King sense. I am also not satisfied that there has been an outcome error in the House v The King sense. The finding “that the balance of convenience does not dictate that the caveat should remain” was not unreasonable or plainly unjust in the sense of falling outside the decisional freedom available to Judge Bochner given the state of the evidence before her Honour. Further, on my review of the evidence that was before Judge Bochner, I would have decided the matter in the same way.
The infrastructure issue is one that can be dealt with appropriately by an award of damages or equitable compensation. I would place limited weight on the contiguity arguments. Plainly there are advantages to being able to farm a large contiguous whole as compared with a collection of non-contiguous parcels. However, any such disadvantages are routinely overcome by farmers with non-contiguous holdings. It is a matter that can be accommodated by damages. Further, as earlier explained, the contiguity argument assumes complete success by the appellant at trial. Such an assumption must be treated with considerable reserve at the interlocutory stage.
The appellant’s emotional attachment argument is to be accorded weight. Historically, equity has specifically protected interests in land because any particular parcel can be viewed as unique and special as far as a party claiming title is concerned; hence the development in equity, for example, of the remedies of specific performance and injunction (to which a caveat, very broadly speaking, can be seen as being related). However, the appellant’s emotional attachment must be tempered by the facts that the appellant’s and Dru Reschke’s father died in 2008, following which a division of the properties according to his will was effected, yet it was not until May 2017 that the appellant commenced proceedings in this Court asserting his substantive claims. Even so, these proceedings were commenced only because such was made a condition of the appellant being able to retain the caveat. Further, since then, by agreement of both parties, there has been, in effect, a cease fire apart from these extremely prolonged interlocutory proceedings.
On the other side of the ledger, the respondent points to the evidence, which appears to be unchallenged, to the effect that the caveat land forms part of the security given in support of substantial debt owed by the respondent or related entities and that the interest expense is substantial. The appellant appears to accept that the secured creditor’s interest in the caveat land would take priority over his asserted interest. According to the respondent, there is no equity in the caveat land. In these circumstances, it is of great importance to the respondent to be able to sell the caveat land, to which it has title according to the terms of the father’s will, in order to discharge debt and stop interest accruing. There is a willing buyer at a price acceptable to the respondent.
The potential disadvantage to the respondent, in the event that the caveat were to remain but the appellant fail to succeed at trial with his claim against the caveat land, is very substantial. This risk must be evaluated against the background of the snail’s pace at which the appellant’s claim has been proceeding.
If I am wrong such that Judge Bochner did commit a process error in the exercise of the discretion, for the reasons just given I would exercise the discretion in the same way in any event. I, also, do not accept that damages would not be an adequate remedy. Overall the appellant has not persuaded me that the balance of convenience favours the continuation of the caveat.
To this point, I have not taken into account any of the evidence received de bene esse. In my view, the appellant’s affidavits do not satisfy either of the first two requirements in the summary by Doyle J in Sunlight Nominees as set out earlier in these reasons.
The information in and deponents to the appellant’s affidavits were readily available to him at the time of the hearing before Judge Bochner. Further and perhaps more importantly when it comes to exercising the discretion whether to admit, none of the “new” information is such that it would have had an important influence on the outcome. The proposed new affidavits contain additional poorly substantiated propositions in support of matters already raised and relied upon. As far as the respondent’s proposed new affidavits are concerned, they are by and large responsive to and purport to counter the appellant’s further material.
On my assessment of all of the proposed new affidavit evidence for both parties, I would not come to any conclusions different from those I have already expressed. None of the affidavits received de bene esse will be admitted into evidence.
I dismiss the appeal. I propose to discharge the order I made extending time for the removal of the caveat until further order. However, there remains the possibility of the appellant before me seeking permission to appeal to the Full Court from my decision.[19] Subject to hearing further from the parties, I would consider making a new order extending time for the removal of the caveat for a short period, to enable the appellant to bring the matter before a Full Court. I will also hear the parties on questions of costs.
[19] I am unsure of the present status of the appeal or application for permission to appeal from the decision of Doyle J earlier filed by the appellant.