REAL PROPERTY - GENERAL PRINCIPLES - EJECTMENT - DEFENCES - IN EQUITY
LANDLORD AND TENANT - LEASES AND TENANCY AGREEMENTS - CONSTRUCTION AND INTERPRETATION - SURROUNDING CIRCUMSTANCES
The plaintiff is the registered proprietor in fee simple of a farm which is located at Langhorne Creek.
The plaintiff became the registered proprietor upon purchasing the farm from Rabobank. Rabobank sold the farm in its capacity as mortgagee in possession, orders having been made granting Rabobank possession in 2008. The defendant was then the mortgagor. The defendant has remained in possession of the farm and has continued to farm it.
The plaintiff contends that the defendant occupies the farm pursuant to a lease executed by him and the defendant upon the plaintiff purchasing the farm, but since March 2015 the defendant has occupied the farm as a trespasser.
The defendant, by counterclaim, denies that the lease was the basis of his occupation of the farm and seeks a declaration that the plaintiff holds the land on trust. He contends that there was an agreement whereby the plaintiff agreed to purchase the farm for the defendant upon the defendant agreeing to indemnify him for all costs related to the running of the farm and servicing the loan, and that the defendant would have the opportunity to repurchase the farm in the future at fair-market value.
The plaintiff served a notice of re-entry and re-possession upon the defendant. The plaintiff contends that the defendant has breached the lease by falling into arrears in rental payments. The defendant failed to deliver up the farm. The defendant has twice harvested grapes on the farm after being served the notice of re-entry. The plaintiff seeks an order for the delivery up of possession of the farm and damages for trespass and for the conversion of the grapes.
Whether the lease is of valid force and effect. Whether the lease was validly terminated. Whether the plaintiff holds the land on trust. Whether the defendant is liable for damages for trespass to the land. Whether the defendant is liable for damages for conversion.
Held:
1. The plaintiff did not hold the land on trust for the defendant. The counterclaim is dismissed.
2. The lease was validly terminated one month from the date of service of the statement of claim.
3. The defendant is liable for damages for trespass from the date of the termination of the lease.
4. The defendant is liable for damages for any conversion of the grapes from the date of the termination of the lease.
[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
AGLC
Roberts v Eckert [2016] SASC 197
Case
[2016] SASC 197
Decision Date
CaseChat Overview and Summary
The case of Roberts v Eckert involved a dispute over the termination of a lease and subsequent trespass and conversion claims. The plaintiff, Paul Roberts, sought relief under the Real Property Act 1900 (SA) and damages for trespass and conversion of grapes harvested by the defendant, Christopher Eckert, after the lease had been terminated. Eckert counterclaimed for relief in equity, asserting that an agreement existed for Roberts to purchase the property and that he should be allowed to remain on the land. The matter was heard in the Supreme Court of South Australia.
The primary legal issues that the court had to resolve were whether the lease was validly terminated and whether Eckert was liable for trespass and conversion of the grapes after the termination. Additionally, the court had to determine whether Eckert was entitled to relief in equity based on an alleged agreement for Roberts to purchase the property.
The court found that the lease was validly terminated one month from the date of service of the Statement of Claim. It held that Eckert had remained in possession of the farm as a trespasser after this date, and the grapes picked and sold by Eckert after this point constituted conversion. The court rejected Eckert's counterclaim for relief in equity, finding no evidence of an agreement for Roberts to purchase the property. The court concluded that Eckert was liable for damages for trespass and conversion from the date of the termination of the lease.
In conclusion, the court dismissed Eckert's counterclaim and granted the relief sought by Roberts under the Real Property Act 1900 (SA). Eckert was held liable for damages for trespass and conversion of the grapes. The court remitted the question of the quantum of damages to a Master of the Court and scheduled further hearings to address the form of the final orders, the timing of the delivery of vacant possession, and the costs of the proceedings.
Orders
Orders of the court
Full text does not contain this section.
Background
Background to the litigation
I would dismiss the counterclaim and grant the relief sought by Mr Roberts under the RPA. I would also hold that Mr Eckert is liable for damages for trespass and for the conversion of those grapes harvested after one month from the date of service of the Statement of Claim filed in this Court on 5 August 2015.Background The following is not disputed and I find established on the balance of probabilities. Paul Roberts is 37 years old. He has been a farmer since 2003-2004. He has his own 150 acre block on Nine Mile Road, Milang (Nine Mile farm) which he bought in 1999 with the assistance of his mother. He bought the Nine Mile farm from his parents upon his parents’ marriage ending. That property is used for cropping and sheep. There is no residence on the property, but Mr Roberts has installed a shed that has power. Mr Roberts does not work the Nine Mile farm exclusively. Since 2004, with the exception of two periods where he spent time in the United Kingdom, he has also worked for Steven and Dianne Maidment. Since his return from the United Kingdom in late 2008 he has worked fulltime for Mr Maidment. Before turning to farming, Mr Roberts worked in a hardware store in Strathalbyn. It was whilst he worked in that store in 2004 that he met Mr Eckert who was a customer. He had also come across Mr Eckert as a consequence of doing some grape harvesting work for Mr Eckert with his brother, Brenton Roberts, who was a grape harvester contractor. Christopher Eckert is 56 years old and has been married for 28 years to Elizabeth. Mr and Mrs Eckert have two children, a daughter, Rebecca, and a son, Russell. Mr Roberts met Mr Eckert’s daughter, Rebecca, in 2008 when she was working at the travel agency that assisted him in arranging his travel to the United Kingdom. They soon commenced a relationship that led to them buying a house in Mount Barker together in 2009 and ultimately marrying on 18 February 2012. Unfortunately the marriage did not last and Mr Roberts and Rebecca Eckert separated in April 2014. They are not on good terms and are currently embroiled in property division proceedings in the Federal Circuit Court. As mentioned, Mr Eckert lives on Eckert farm and has done so since 1984.[4] The residence on the farm is located on Certificate of Title Volume 6065 Folio 210.[5] A vineyard of approximately 29.3 hectares is located on Certificate of Title Volume 6065 Folio 210 and Certificate of Title Volume 6065 Folio 207.[6] The balance of the land, that subject of Certificate of Title Volume 6065 Folio 209, Certificate of Title Volume 6065 Folio 208, Certificate of Title Volume 6065 Folio 205 and Certificate of Title Volume 6088 Folio 676, is used for cropping and sheep.[7] The land has a number of improvements including the residence to which I have referred, a machinery shed, barn, wool shed, irrigation shed and dam.[8][4] T296.[5] Exhibit P2; T297.[6] Exhibit P2 and P14; T298.[7] Exhibit P2; T298.[8] Exhibit P14; Statement of Claim. In 2001 Mr Eckert first sought financial assistance from Rabobank.[9] In August 2006 arrangements with Rabobank were revisited. At that time Mr Eckert was granted a loan limit/credit facility of $1,615,000.[10] The security provided for the credit facility included all six titles comprising Eckert farm.[11] Mr Eckert was the registered proprietor of five of six of those titles. Mr Eckert’s father, Henry John Eckert, was the registered proprietor of the sixth title. Henry John Eckert provided a guarantee to Rabobank limited to the sixth title as part of the security arrangements accepted by the bank upon granting his son the credit facility to which I have referred.[9] T299.[10] Exhibit P3.[11] Exhibit P3.
Evidence
Evidence Before The Court
I turn to consider the evidence relevant to the question of the existence of an agreement, arrangement or understanding and the detriment that will flow should Mr Roberts not be kept to the terms of any agreement, arrangement or understanding. My recount of the evidence should be read against the background of the facts found at paragraphs [10] to [51] above. c. Mr Eckert’s evidence Approximately six months after Rabobank took possession of Eckert farm the bank advertised for expressions of interest from potential purchasers.[61] No expressions of interest were received to the knowledge of Mr Eckert. At this time he owed Rabobank a little over $2 million.[62][61] T300.[62] T301. On occasion the real estate agent appointed by the bank brought potential purchasers to the farm. From them, and from the agent, Mr Eckert learned that the offers being made were very low and unacceptable to the bank. It was as a consequence of this that Mr Eckert thought it might be possible for someone to buy the farm on his behalf.[63] That thinking ultimately led him to consider the possibility of Mr Roberts and his daughter buying the property in their names. Mr Eckert said he raised this with them at a family meeting or a family meal at his home in April or May 2010.[64] He said he thought it was an opportunity for Mr Roberts and his daughter to purchase the farm as it was going to sell cheap. He said it was after this that Mr Roberts went off and talked to the bank about the possibility of getting a loan.[65][63] T302.[64] T302.[65] T303. Mr Eckert then gave his version of the conversation that in his evidence Mr Roberts had said occurred at the Nine Mile farm (the Nine Mile farm conversation). Mr Eckert thought that it took place at Mr Maidment’s property, but conceded he could be wrong. He agreed that the conversation did occur roughly in May 2010 and that the only people present were himself and Mr Roberts.[66][66] T304. Mr Eckert said the conversation was about Mr Roberts buying the farm and holding it until such time as Mr Eckert had sorted out his difficulties with Rabobank whereupon he could assume responsibility for the loan that Mr Roberts would take out in order to purchase the farm.[67][67] T304. Mr Eckert said he did not go to the Nine Mile farm specifically for the purpose of discussing the issue. He said he and Mr Roberts just happened to be working together on altering an air seeder and the conversation arose.[68] Mr Eckert said:[69]A.The conversation really started from a conversation I had with Steven Maidment the day before, and I said how I was really wanting Paul Roberts to buy the property for me, so therefore he would get the benefit of a title sub-division, whatever you term it. Because if he didn't do it I'd have to go ahead with somebody else that I had teed up and I really wanted Paul and my daughter to get the benefit. Then he subsequently had a conversation with Mr Roberts -Q.You'd better not tell us about your understanding of that conversation, but concentrate on the one you had with Mr Roberts.A.Then the next day Mr Maidment informed me that he'd had a conversation with Mr Roberts and Mr Roberts understood now what I was wanting, and he was prepared to -Q.Again you can't tell us what Mr Maidment told you, stay with your conversation with Mr Roberts.A.Right. So consequently I had a conversation with Mr Roberts, I'm really not 100% sure what - could have been at his place, I thought it was at Maidment's but - but we had a conversation where Mr Roberts had agreed that he would go off to the bank and see about getting funding to buy the property with the intention that his advantage would be a title to sub-divide.[68] T305.[69] T305-6.
Decision
Reasons for decision
HINTON J
(dissent)
I have concluded that the lease was terminated at the conclusion of one month from the date of service of the Statement of Claim. Thereafter Mr Eckert has remained in possession of the farm as a trespasser. From that point in time upon picking the grapes they were reduced to a chattel.[446] Mr Roberts had as from that point in time the immediate right to the possession of such chattel.[447] Thus the picking and sale by Mr Eckert of the grapes after that point in time are actions contrary to the immediate right of possession of Mr Roberts. There can be no doubt that in picking and selling the grapes after one month from the date of service of the Statement of Claim that Mr Eckert has asserted title over the grapes and deprived Mr Roberts of the same. The picking and sale of any grapes after that point in time constitutes the conversion of the grapes.[448] I so hold. [446] Voumard and Wikrama, The Law Relating to the Sale of Land in Victoria, 3rd ed, Law Book Co, 1978 at 54-5; Sale of Goods Act 1895 (SA) s A2.[447] Evans v Roberts (1826) 108 ER 309. [448] Penfolds Wines Pty Ltd v Elliott (1946) 74 CLR 204 at 229 (Dixon J); Mills v Brooker [1919] 1 KB 555; Mulgrave v Ogden (1590) 78 ER 475.Conclusion and orders For the reasons I have given, I order:1.The counterclaim is dismissed.2.The lease was validly terminated one month from the date of service of the Statement of Claim.3.I uphold the claim for possession of the land and action for ejectment.4.The defendant is liable for damages for trespass to the land as from the date of the termination of the lease being one month from the date of service of the Statement of Claim.5.The defendant is liable for damages for any conversion of the grapes grown on the vines on the land after the date of termination of the lease being one month from the date of service of the Statement of Claim. 6.I remit all questions relating to the quantum of damages to a Master of this Court.7.I will hear counsel as to the form of my final orders and as to the question of when vacant possession should be provided. I will also hear counsel as to the question of costs.