Reschke v Trevor Reschke Nominees Pty Ltd (NO.2)

[2019] SASCFC 42

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court)

RESCHKE v TREVOR RESCHKE NOMINEES PTY LTD (NO.2)

[2019] SASCFC 42

Judgment of The Full Court

(The Honourable Chief Justice Kourakis, The Honourable Justice Bampton and The Honourable Justice Parker)

1 May 2019

REAL PROPERTY - TORRENS TITLE - CAVEATS AGAINST DEALINGS - EXTENSION

REAL PROPERTY - TORRENS TITLE - CAVEATS AGAINST DEALINGS - REMOVAL

Application for costs by the Respondent in Reschke v Trevor Reschke Nominees Pty Ltd [2019] SASCFC 27, in which the appeal was dismissed.

Held by the Court, allowing the appeal:

1.  The appellant should have brought the appointment of receivers and managers to Reschke Vineyards to the attention of the Court. The contracts for sale entered into by the receivers and managers left the appellant’s application for an extension of time devoid of merit. If the Court had been properly and fully informed, permission would not have been granted, or alternatively, it would have been withdrawn.

2.  The appointment of receivers and managers and the advertising of land for sale also rendered the appeal against the setting aside decision otiose, and was therefore futile and unreasonably caused the respondent to incur costs.

3.  The fate of the underlying proceedings is best left to the Judge who is case managing them.

Real Property Act 1886 (SA) s 191(1)(g), referred to.
Reschke v Trevor Reschke Nominees Pty Ltd [2018] SASC 22; Reschke v Trevor Reschke Nominees Pty Ltd [2018] SASC 120, discussed.

RESCHKE v TREVOR RESCHKE NOMINEES PTY LTD (NO.2)
[2019] SASCFC 42

Full Court:  Kourakis CJ, Bampton and Parker JJ

1. THE COURT:      This is an application for costs by Trevor Reschke Nominees Pty Ltd (TRN Pty Ltd), the respondent to an appeal, the substantive aspects of which were determined by this Court in Reschke v Trevor Reschke Nominees Pty Ltd[1] (the primary judgment).  We adopt the abbreviated references in that judgment.  The respondent seeks the following orders:

   [1] [2019] SASCFC 27.

   1.1 The appellant to pay the respondent’s costs of the appeal which was heard and determined by Justice Doyle;

   1.2 The appellant to pay the respondent’s costs of the appeal from the decision of Justice Doyle;

   1.3 The appellant to pay the respondent’s costs of the appeal from the decision of Justice Nicholson;

   1.4 The appellant to pay the respondent’s costs of its application to adduce further evidence on appeal;

   1.5 The appellant to pay the respondent’s costs of the appeals from the decisions of Justice Doyle and Justice Nicholson on an indemnity basis:

   (a)     from 16 May 2017 or, in the alternative, from 19 March 2018 by reason of the appellant’s failure to permit completion of the sale of the land by the respondent; 

   (b)    from 6 September 2018 or, in the alternative, from 19 November 2018 by reason of the appellant’s failure to disclose certain facts.

   1.6The proceedings otherwise be dismissed.

2. The order sought in paragraph [1.1] is for the costs of what is described in the primary judgment as the setting aside decision.  TRN Pty Ltd successfully applied before Auxiliary Master Roder to revoke an extension of time to remove the caveat on the ground that Burke failed to disclose that he had contracted to sell a parcel of the Reschke farming land left to him, whilst simultaneously claiming that the Reschke farming land should be maintained as a whole to protect the integrity of its operations.   Doyle J dismissed an appeal from that decision.[2]  Burke’s case was that the land he sold was less strategic to the future viability of the overall farming operation and that his brother Dru knew of the sale.

   [2]    Reschke v Trevor Reschke Nominees Pty Ltd [2018] SASC 22.

3. In the primary judgment, the Court found in the appellant’s favour that Dru knew of the proposed sale of land by Reschke Vineyards, Burke’s corporate vehicle.  Nonetheless, for reasons explained in the primary judgment, the sale of the parcel of land was in itself reason enough to review the first caveat decision.  Moreover, for the reasons given by Nicholson J in the caveat refusal decision,[3] a review of the changed circumstances militated strongly against granting Burke an extension of time.  For those reasons, in the primary judgment this Court affirmed the decision of Doyle J.  Burke does not oppose the application for the costs of that appeal.  We therefore make the order sought in paragraph [1.1]. 

   [3]    Reschke v Trevor Reschke Nominees Pty Ltd [2018] SASC 120.

4. Burke does not oppose an order that he pay the costs of TRN Pty Ltd’s application to adduce further evidence as sought in paragraph [1.4].   In any event, it was Burke’s obligation to put that evidence before the Court.  We make the order sought.

5. For the reasons which follow the Court orders that the appellant pays the costs of both appeals as sought in paragraphs [1.2] and [1.3] to this Court on an indemnity basis from 6 September 2018.

6. Burke appealed to this Court, with permission given on 17 October 2018.  However, when granting permission, the Court was not informed that receivers and managers had been appointed to Reschke Vineyards and other of Burke’s corporate vehicles between June and August 2018.  By the time the appeal was heard in November 2018, the receivers and managers had entered into contracts for sale for all of the land held by the corporate entities, being land contiguous to the caveat land.  Burke’s primary ground for seeking an extension of time to remove the caveat was the importance of that contiguity with his land so that the Reschke farming land could be operated as a whole.  The circumstances and effect of the appointment of the receivers and managers are discussed in paragraphs [67]-[76] of the primary judgment.  The contracts for sale entered into by the receivers and managers left Burke’s application for an extension of time devoid of any merit whatsoever.

7. Burke should have brought the appointment of receivers and managers to Reschke Vineyards to the attention of the Court after their appointment and by no later than 9 November 2018 when that land was advertised for sale.   As it was, the Court only became informed of those matters on allowing the respondent’s application to adduce further evidence on the hearing of the appeal.  If the Court had been properly and fully informed, permission would not have been granted, or alternatively, it would have been withdrawn. 

8. Moreover, on the appeal from the caveat refusal decision of Nicholson J, Burke’s primary contention, raised for the first time on the appeal, was that this Court should depart from a long line of established authority in this Court that the balance of convenience should determine whether an extension of time should be granted pursuant to s 191(1)(g) of the Real Property Act 1886 (SA). Burke contended instead that the extension should be granted unless there was good reason not to. That submission was unsupported by authority and would have unfairly skewed the exercise of the statutory discretion against the registered proprietor. The Court rejected that contention.

9. The appointment of the receivers and managers and the advertising of the land for sale also rendered the appeal against the setting aside the decision of Doyle J otiose.  Pursuit of the appeal against the judgment of Doyle J was therefore futile and unreasonably caused TRN Pty Ltd to incur costs. 

10. The fate of the underlying proceedings is best left to the Judge who is case managing them.  Accordingly, the Court declines to make the order sought in paragraph [1.6].