Rodda v Ian Rodda Pty Ltd (No 2) - [2015] SASC 128

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
RODDA & ANOR v IAN RODDA PTY LTD & ANOR; IAN RODDA PTY LTD v RODDA & ANOR (No 2)
[2015] SASC 128
Judgment of The Honourable Justice Nicholson
26 August 2015
PROCEDURE - JUDGMENTS AND ORDERS - AMENDING, VARYING AND SETTING ASIDE - OTHER CASES
PROCEDURE - JUDGMENTS AND ORDERS - INTEREST ON JUDGMENTS - RATE
EQUITY - EQUITABLE REMEDIES - EQUITABLE COMPENSATION - OTHER CASES
This action is already the subject of previous reasons for judgment, dealing with the plaintiffs’ claim for equitable relief with respect to valuable farming land and other associated farming assets and based on proprietary estoppel.
In the previous reasons two, in part, alternative pathways for relief were posited “Pathway A” and “Pathway B”. Pathway A provides for the declaration of a constructive trust over a farming property called Ocean Downs and orders for an account of profits together with equitable compensation in the amount of $1.5M. Pathway B provides for additional compensation in the amount of $3.25M in lieu of a constructive trust over the Ocean Downs property.
Further submissions were received bearing on discretionary factors concerning the most appropriate form of relief. In addition, other outstanding issues to be addressed included the rate of pre-judgment interest with respect to unpaid trust distributions and the equitable compensation and matters of form and content of the orders to be made so as to be consistent with the earlier reasons. The defendants also made an application to reopen the judgment with respect to the issue of the date from which the constructive trust, if ordered, was to operate. The application to reopen was heard together with the submissions as to final relief.
Held:
1. Judgment is entered for the plaintiffs in Action 664 of 2014.
2. Judgment is entered for the defendants in Action 846 of 2014, such that the claim of the plaintiff, Ian Rodda Pty Ltd, is dismissed.
3. The defendants’ application to reopen the judgment is dismissed.
4. The final orders are set out in paragraph [79].
Supreme Court Act 1935 (SA) s 30C; Supreme Court Civil Supplementary Rules 2014 (SA) r 208, referred to.
Rodda & Anor v Ian Rodda Pty Ltd & Anor; Ian Rodda Pty Ltd v Rodda & Anor [2015] SASC 95, discussed.
Giumelli v Giumelli [1999] HCA 10, (1999) 196 CLR 101; Smith v New South Wales Bar Association [1992] HCA 36, (1992) 176 CLR 256; Aktas v Westpac Banking Corporation (No 2) [2010] HCA 47, (2010) 241 CLR 570; Autodesk Inc v Dyason [No 2] [1993] HCA 6, (1993) 176 CLR 300; Wentworth v Woollahra Municipal Council [1982] HCA 41, (1982) 149 CLR 672; Farrow Finance Company Pty Ltd (in Liq) v Farrow Properties Ltd (in Liq) [1999] 1 VR 584; Re Dawson (deceased) [1966] 2 NSWR 211; Hagan v Waterhouse (1991) 34 NSWLR 308; Flinn v Flinn (1999) 3 VR 712; Donis v Donis [2007] VSCA 39, (2007) 19 VR 577; Delaforce v Simpson-Cook [2010] NSWCA 84, (2010) NSWLR 482; Sidhu v Van Dyke [2014] HCA 19;,(2014) 251 CLR 505; Pink v Lawrence (1977) 36 P & CR 98; Gillett v Holt [2001] Ch 210, considered.

RODDA & ANOR v IAN RODDA PTY LTD & ANOR; IAN RODDA PTY LTD v RODDA & ANOR (No 2)
[2015] SASC 128
NICHOLSON J.
Introduction

In my reasons for judgment (primary reasons)[1] I indicated a wish to hear further submissions from the parties with respect to a number of issues in order to be in a position to finalise my findings and enter final orders in this matter. The parties provided further written and oral submissions by way of assistance. For a full understanding of the background to what follows, these reasons should be read in conjunction with the primary reasons. In these reasons I will continue to refer to the plaintiffs as Stuart (Rodda) and Shannon (Rodda); to the defendants as IRPL (Ian Rodda Pty Ltd) and Ian (Rodda); to the Ian Rodda Family Trust as the IRFT; and to the Yaringa Proprietors Family Trust as the YPFT.
[1] Rodda & Anor v Ian Rodda Pty Ltd & Anor; Ian Rodda Pty Ltd v Rodda & Anor [2015] SASC 95.
I indicated in my primary reasons two, in part alternative, pathways of remedial relief due to the plaintiffs, as follows.[2]
[2] Primary reasons at [322]-[323].
If I were to proceed down Pathway A, I would make final orders and declarations as necessary, in time, to reflect the following outcomes.
1.Judgment for the plaintiffs in the main action, action no. 664 of 2014.
2.Judgment for the defendants in the subsidiary action no. 846 of 2014 such that the claim of the plaintiff, Ian Rodda Pty Ltd, for repayment of the loan of $135,000 is dismissed.
3.The first defendant, Ian Rodda Pty Ltd, holds the property Ocean Downs on constructive trust for the plaintiffs and has done so since 1 December 2012.
4.The first defendant, Ian Rodda Pty Ltd, and the second defendant, Ian Rodda, are jointly liable to pay the sum of $1.5 million by way of equitable compensation to the plaintiffs.
5.There is to be a mortgage or charge registered on the certificates of title for Yaringa so as to secure the payment by the first and second defendants of the equitable compensation of $1.5 million.
6.There is to be an account of profits (with all due allowances) earned by the first defendant, Ian Rodda Pty Ltd, arising from its possession and use of the Ocean Downs property on and after 1 December 2012.
7.There is to be an order for interest, to be assessed, on the equitable compensation as ordered for the period 1 December 2012 until the date of judgment.
8.There will be judgment for the first plaintiff, Stuart Rodda, against Ian Rodda Pty Ltd as trustee of the Yaringa Proprietors Family Trust in the amount of $308,983.
9.There will be judgment for the first plaintiff, Stuart Rodda, against Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust in the amount of $74,982.
10.There will be judgment for the second plaintiff, Shannon Rodda, against Ian Rodda Pty Ltd as trustee of the Yaringa Proprietors Family Trust in the amount of $313,674.
11.There will be judgment for the second plaintiff, Shannon Rodda, against Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust in the amount of $59,858.
Pathway B
Bearing in mind the potential further application of the approach of the High Court in Giumelli v Giumelli to the facts of this case, it would be open to order, in the alternative to putative orders 3, 4 and 6 above, that the defendants are to pay equitable compensation in the amount of $4.75 million. For this purpose there is no reason not to ascribe a value to Ocean Downs, as at 1 December 2012, of $3.25 million in accordance with the Wapper valuation. In the case of Pathway B, putative order 5 would require a mortgage or charge to be registered over the certificates of title for both Yaringa and Ocean Downs by way of security and putative orders 1, 2 and 7 to 11 inclusive would remain.
I concluded that the plaintiffs were entitled to recover certain unpaid trust distributions due to them according to the accounts of the YPFT and the IRFT, in accordance with proposed Pathway A orders 8 to 11 above. However, a question left for determination was whether or not pre-judgment interest was payable on these sums and, if so, the amount thereof. The parties now agree that interest is payable from the date each of these sums was formally demanded, 11 April 2014, to the date of judgment, 26 August 2015. The parties are in dispute as to the basis upon which applicable rates of interest should be determined. However, neither party challenges the other’s calculations based on that party’s propounded interest rate.
Another part of the relief to which the plaintiffs are entitled is the sum of $1.5M by way of equitable compensation, in lieu of a constructive trust being ordered over a portion of the farming business plant and equipment, the Farm Management Deposits (FMDs) in Ian’s name “and also recognising or allowing for [my] finding that the pre-July 2003 equity bore a relationship to the farming business (ie, including Yaringa) as a whole”.[3]
[3] At [319].
Another component of the relief to which the plaintiffs were found entitled was either a constructive trust over Ocean Downs, being one of the farming properties owned or controlled by the defendants or, in lieu thereof, further equitable compensation in the amount of $3.25M. Whether or not a constructive trust over Ocean Downs or payment of equitable compensation in the amount of $3.25M, is to be ordered, was another matter left outstanding. For the further reasons provided below, I have decided to make orders in accordance with Pathway A which includes the declaration of a constructive trust over Ocean Downs. As such, the plaintiffs are only to be entitled to the sum of $1.5M by way of equitable compensation.
I found, in my primary reasons, that the plaintiffs’ entitlement to relief, with respect to both the constructive trust and any equitable compensation, arose as at 1 December 2012 and that the plaintiffs are to be entitled to interest on the equitable compensation outstanding since 1 December 2012 to the date of judgment.[4] A question still to be determined concerns the appropriate rate(s) of pre-judgment interest. Again, whilst the parties are in dispute as to the basis upon which the relevant rates of interest are to be determined, neither party challenges the calculations put forward by the other party based on the interest rates as propounded by that party.
[4] Primary reasons at [320].
In my primary reasons, and after referring to the approach taken by the High Court in Giumelli v Giumelli,[5] I put forward two alternative means by which the plaintiffs’ equity might be satisfied. Pathway A, in essence, would lead to a declaration of a constructive trust over Ocean Downs, one of the farming properties presently owned and controlled by the defendants, together with additional equitable compensation and consequential orders, including an account of profits consequent on the use of Ocean Downs by the defendants. Under Pathway B there would be no constructive trust over Ocean Downs but a larger sum of equitable compensation ordered together with consequential orders. Before finally determining which remedial approach should be ordered, I provided the parties with an opportunity to make further submissions dealing with discretionary factors that might lead the Court to prefer one pathway rather than the other. In the primary reasons I described the issue in this way.[6]
I am concerned that there may be discretionary factors that should lead the Court to prefer one rather than the other of the two pathways I have resolved to propound including, for example, the desirability of a clean break and the practicality and viability of farming Ocean Downs on a stand alone basis. I am concerned that the parties’ submissions dealing with the appropriate remedy (if any, on the defendants’ case) were given in a broader factual context than now will apply and, to a degree, involved hypothetical considerations. Now that, upon my findings, there is to be a remedy granted and its quantum has been identified, I invite further submissions confined to the nature of the discretionary considerations to which the Court should have regard before determining whether to make orders to bring into effect Pathway A or Pathway B.
This was the third matter still to be determined.
[5] [1999] HCA 10; (1999) 196 CLR 101.
[6] Primary reasons at [327] (footnote omitted).
A fourth matter with respect to which I sought and received further submissions was as to the form of the orders to be made.
At the time of hearing submissions with respect to the above, the defendants also pressed an application for permission to reopen the judgment so as to permit the defendants to make submissions bearing on the date of 1 December 2012, as the date upon which any constructive trust with respect to Ocean Downs arose or any payment of equitable compensation fell due. The defendants do not seek to adduce further evidence. The application was opposed by the plaintiffs. In addition to the four matters already referred to, I heard argument on whether or not to allow the application to reopen. I will address the question of the reopening first and before dealing with the other four issues in the order outlined above.
The application to reopen
No final judgment has been entered and in these circumstances there is a discretionary power in the Court to reopen the judgment. In Smith v New South Wales Bar Association,[7] Brennan, Dawson, Toohey and Gaudron JJ said this.
[I]t has long been the common law that a court may review, correct or alter its judgment at any time until its order has been perfected. ... The power is discretionary and, although it exists up until the entry of judgment, it is one that is exercised having regard to the public interest in maintaining the finality of litigation. ... Thus, if reasons for judgment have been given, the power is only exercised if there is some matter calling for review... . And there may be more or less reluctance to exercise the power depending on whether there is an avenue of appeal. ... It is important that it be understood that these considerations may tend against the re-opening of a case, but they are not matters which bear on the nature of the review to be undertaken once the case is re-opened.
In Aktas v Westpac Banking Corporation (No 2),[8] French CJ, Gummow and Hayne JJ said this.
As Mason CJ rightly said in Autodesk Inc v Dyason [No 2], the exercise of the jurisdiction to reopen a judgment and to grant a rehearing “is not confined to circumstances in which the applicant can show that, by accident and without fault on the applicant’s part, he or she has not been heard”. The jurisdiction is, however, to be exercised with great caution, having regard to the importance of the public interest in the finality of litigation.
Mason CJ, in Autodesk,[9] also drew attention to the observations of the plurality in the High Court in Wentworth v Woollahra Municipal Council[10] to the effect that the public interest in maintaining the finality of litigation necessarily means that the power to reopen must be exercised with great caution and that “generally speaking, it will not be exercised unless the applicant can show that by accident without fault on his part he has not been heard”.
[7] [1992] HCA 36 at [27]; (1992) 176 CLR 256 at 265 (citations omitted).
[8] [2010] HCA 47; (2010) 241 CLR 570 at [6] (citations omitted).
[9] [1993] HCA 6; (1993) 176 CLR 300.
[10] [1982] HCA 41; (1982) 149 CLR 672 at 684 (Mason ACJ, Wilson and Brennan JJ).
The defendants in their submissions also refer to Farrow Finance Company Pty Ltd (in Liq) v Farrow Properties Ltd (in Liq)[11] where, in circumstances described as “heavy and complex litigation” and where there was no question of further evidence being adduced, the trial Judge allowed an application to reopen in order to give further consideration to questions relating to appropriate relief.
[11] [1999] 1 VR 584.
In the present case, the imposition of a constructive trust over the Ocean Downs land or, indeed, over the Ocean Downs land and the Yaringa land and the alternative possibility of equitable compensation in lieu, were central to the relief sought and argued for by the plaintiffs at trial. The timing of the imposition of any constructive trust (and, at the least by inference, any order for equitable compensation in lieu) was necessarily to be considered in the context of any relief, of this nature, allowed.
The question of when any constructive trust would arise or have arisen was referred to, and developed by, senior counsel for the plaintiffs in his opening. The plaintiffs argued for a date earlier than the one ultimately determined by me, on the basis that a constructive trust should be found to have arisen at the time the plaintiffs acted to their detriment. The plaintiffs argued, in the alternative, that a constructive trust over part or all of the farming land arose as early as 1994 or 1996 or 1999.
During the plaintiffs’ opening I posited, arguendo, that the time any constructive trust, if found, might have arisen, might be the time that any induced assumption had been departed from. This would be either 2003 after the defendants’ change of position which took place at the family meeting as ultimately found by me, or in 2012 when the plaintiffs were ordered off the farm and, as I ultimately found, the defendants irrevocably departed from the induced assumption in the form it then stood.
The defendants’ principal position was that no proprietary estoppel had been made out and that no remedy by way of constructive trust or by way of equitable compensation was available. Nevertheless, they did make submissions concerning the terms and nature of any such remedy, should it be awarded.
The question of timing, now sought to be ventilated by the defendants, was an important issue, relevant to remedy, at the trial and should have been dealt with at the trial. I am not aware of anything that might have lead the defendants to fairly assume or understand that any aspect of the remedial relief would be stood over for further submissions save, with respect to matters dealing with the form of orders and, as typically can occur, questions of interest and costs.
I am satisfied that the date upon which any constructive trust might be found to have arisen or to arise, or as from which any equitable compensation ordered in lieu was to be payable, was a significant issue at the trial. The defendants were plainly on notice and had ample opportunity to make submissions at the trial with respect to this issue.
As I have mentioned, the plaintiffs argued, with reference to authority, for a date much earlier than that which I ultimately determined. The only other conceivable alternatives were either the date of trial or the date of judgment (entry of final orders). Each of these latter possibilities (date of trial or date of judgment) has a distinctly arbitrary aspect to it. The defendants now wish to have the trial reopened in order to submit that any constructive trust should be found to arise as at the date of judgment.
I have reviewed my reasons for adopting the date that the relationship irretrievably ended that being the date, on my findings, when Ian irrevocably resiled from the expectations he had induced in the plaintiffs by ordering Stuart off the farm.
I have reviewed the defendants’ quite detailed written submissions as to why the appropriate date for the imposition of any constructive trust or equitable compensation should be the date of judgment. I appreciate that, in the event of any reopening, the defendants would wish to supplement these submissions. Nevertheless, I have sufficient before me to satisfy me that the prospect of succeeding in persuading me to change the date from that which I have chosen to the, somewhat arbitrary, date of judgment, is low.
This is a case where both the public interest and the private interests of the parties, in achieving finality of litigation, at least at the trial level, must be given significant weight. This is particularly so given that the defendants have available to them the avenue of an appeal and that the various arguments they now rely on, no doubt together with others, can be pressed on appeal.
Furthermore, on a reading of my reasons as a whole, the date I have determined as the date on which the constructive trust arose and the entitlement to equitable compensation arose is, to a degree, inter-related with the nature and form of the relief I have granted. Particular difficulties in this case, in terms of formulating the appropriate relief, arose from my findings: that the plaintiffs were induced to have one set of expectations prior to the family meeting in 2003, upon which they materially relied to their detriment and thereafter, were induced to hold a different set of expectations between 2003 and 2012, upon which they also materially relied; and from the need, as explained in the primary reasons, to take account of the issue of acceleration.

I am troubled, that any change to the date might have consequences for other aspects of the relief to be ordered in favour of the plaintiffs and might require a revision of components of the relief presently determined. It is arguable that the question of the date should not be considered in isolation but is best considered as part of the nature of the appropriate relief more generally.
There is merit in the plaintiffs’ submission that any reopening of the date issue would be difficult to confine. It may, necessarily, lead to a reopening of my assessment of the appropriate relief more generally. In other words, there is a real risk that the Court would end up hearing submissions aimed at or which had the effect of seeking a revision of the relief package in toto. This properly would be a matter for appeal.
For these reasons, and given the importance of moving as expeditiously as possible to the entry of final orders, and bearing in mind that, to the extent I might have erred in this or any other respect, the defendants’ position is preserved by their appeal rights, I refuse the application to reopen.
Questions of interest
The Court has a discretion as to the rate of pre-judgment interest payable, in accordance with section 30C of the Supreme Court Act 1935. Section 30C(1) and (2) are in the following terms.
30C—Power to award interest
(1)Unless good cause is shown to the contrary, the court shall, upon the application of a party in favour of whom a judgment for the payment of damages, compensation or any other pecuniary amount has been, or is to be, pronounced, include in the judgment an award of interest in favour of the judgment creditor in accordance with the provisions of this section.
(2)The interest—
(a)     will be calculated at a rate fixed by the court; and
(b)     will be calculated in respect of a period fixed by the court (which must, however, in the case of a judgment given on a liquidated claim, be the period running from when the liability to pay the amount of the claim fell due to the date of judgment unless the court otherwise determines); and
(c)     is payable, in accordance with the court's determination, in respect of the whole or part of the amount for which judgment is given.
The Supreme Court Supplementary Rules 2014, which came into effect on 1 October 2014, also address the question of pre-judgment interest. Supplementary rule 208 provides as follows.
The appropriate rate for the calculation of interest on pre-judgment economic loss under section 30C of the Supreme Court Act 1935 is a matter for determination by the Judge or Master in each case. As a guide only, and subject to any contrary legislative provision, the Court may calculate interest in such cases as follows¾
(a)in respect of the period from 1 January to 30 June or part of that period in a year, the cash rate of interest last set by the Reserve Bank of Australia before that 1 January, plus 4%; and
(b)in respect of the period from 1 July to 31 December or part of that period in a year, the cash rate of interest last set by the Reserve Bank of Australia before that 1 July, plus 4%.
The plaintiffs submit that the Court should exercise the discretion available under section 30C, in the circumstances of this case, so as to apply the indicative interest rates provided for in supplementary rule 208.
The defendants submit that a lower rate of interest, sometimes described as a “trustee rate”, is appropriate in the circumstances of this case. Instead of applying an interest rate 4 per cent above the cash rate set by the Reserve Bank (as indicated in supplementary rule 208) the defendants submit that the appropriate rate of interest should be 1 per cent above the cash rate.
As far as the unpaid trust distributions are concerned, the plaintiffs submit that they have been kept out of monies (totalling almost $760,000) that were properly due to them as at 11 April 2014. The situation is analogous to a debt that has been outstanding since that date. In these circumstances, according to the plaintiffs, the usual interest rate, as envisaged under section 30C and supplementary rule 208, should apply. In this case, there was evidence at trial to the effect that the plaintiffs had been obliged to borrow money in order to buy a small farming property which they could work to produce income, they having been left with no means of income as and from 1 December 2012 when, at the direction of Ian, any involvement by them in the defendants’ farming enterprise ceased.
The defendants submit that the Court should have regard to the circumstances in which the positive balances in the plaintiffs’ loan accounts arose. The amounts were credited to the plaintiffs’ names in the books of each trust not as a result of either plaintiff depositing money by way of loan or otherwise. Rather, the total of approximately $760,000, now recorded in their names in the two trusts, was a direct result of the plaintiffs having been credited with profit distributions during the period 2003 to 2012. During that period, and in broad-brush terms, the plaintiffs were credited with $1.9M and Ian was credited with approximately $900,000. This was the result of instructions given to the defendants’ accountant as to how to allocate farming profits with a view to achieving the best taxation position.
According to the defendants, the monies were not allocated to either Stuart or Shannon on the basis of effort and not on the basis of their effort as compared with Ian’s effort. In other words, the amounts now due and payable form part of a more substantial distribution of profits that were not allocated on the basis of effort or merit. They were, as I have found, “book entries”.
I accept the substance of this submission to the effect that there was an element of gift involved at the time of the making of the distributions. Nevertheless, the amounts, in fact, received by Stuart and Shannon by way of trust distributions and the amounts that remained due and payable, as at 1 December 2012, being the positive balances in their loan accounts, were taken into account as part of my overall consideration of the appropriate remedial response. They were taken into account in the sense of representing part of the remuneration received (or receivable) for work performed by Stuart and Shannon during the period of their involvement until 2012. In this sense, whether or not there was, initially, an element of gift is not material; there has been no windfall.
The debt fell due when demanded on 11 April 2014. From that date, the plaintiffs were rightfully entitled to the monies and IRPL, as trustee of the two trusts, wrongfully retained the monies and had the use of them. The due amounts could have been paid on demand. Apart from an initial dispute as to quantum, there was never any defence to this aspect of the claim. In the circumstances, particularly given that the plaintiffs have had to borrow to tide them over, I am not persuaded to depart from the indicative rate provided for by supplementary rule 208.
In accordance with the parties’ agreed calculations (on the basis of the plaintiffs’ rates)[12] the following interest amounts are payable.
(i)Interest on the debt due from IRPL, as trustee for the YPFT, to Stuart, in the amount of $308,983, from 11 April 2014 until the date of judgment, being 26 August 2015, in the amount of $27,426;
(ii)Interest payable on the debt due from IRPL, as trustee for the IRFT, to Stuart, in the amount of $74,982, from 11 April 2014 until the date of judgment, being 26 August 2015, in the amount of $6,662;
(iii)Interest payable on the debt due from IRPL, as trustee for the YPFT, to Shannon, in the amount of $313,674, from 11 April 2014 until the date of judgment, being 26 August 2015, in the amount of $27,845; and
(iv)Interest payable on the debt due from IRPL, as trustee for the IRFT, to Shannon, in the amount of $59,858, from 11 April 2014 until the date of judgment, being 26 August 2015, in the amount of $5,305.
[12] The parties have agreed the amounts payable from 11 April 2014 until 17 August 2015 together with a daily rate for the nine days thereafter until the date of judgment, 26 August 2015.
With respect to the interest rate(s) applicable to the amount of $1.5M of equitable compensation[13] found due and payable as at 1 December 2012, the plaintiffs relied upon the following statement of principle.[14]
The court can award interest, either simple or compound, under its equitable jurisdiction. In the context of equitable compensation, interest aims to compensate the plaintiff for the loss of the use of the money to the extent that it would have been productive of benefits to her or him. Thus the relevant inquiry focuses on the plaintiff’s alternative investment of her or his funds. In all jurisdictions except Tasmania interest may be awarded pursuant to statute. (Footnotes omitted).
[13] As earlier indicated, given that I have decided to proceed along Pathway A, I am now only interested in this aspect of the equitable compensation foreshadowed in the primary reasons.
[14] Gino Dal Pont, Equity and Trusts in Australia (Lawbook, 6^th ed, 2015) [34.60].
In Re Dawson (deceased),[15] Street J observed that when selecting the appropriate rate of interest, the court’s jurisdiction is exercisable solely for compensatory purposes. The plaintiffs acknowledge that the equitable compensation is not to be awarded for breach of trust but to compensate the plaintiffs with respect to the matters dealt with in the primary reasons at [319]-[321]. In particular, it represents compensation in lieu of obtaining a constructive trust over a portion of the plant and equipment used in the farming business, over the FMDs in Ian’s name and also by way of recognising or allowing for my finding that the pre-July 2003 equity bore a relationship to the whole of the farming business, that is, including Yaringa. As the plaintiffs have submitted, all of those assets will have been put to work by and to the benefit of the defendants. Correspondingly, the plaintiffs, since 1 December 2012, have been deprived of any benefits to be obtained from the use of the underlying assets.
[15] [1966] 2 NSWR 211 at 218.
The defendants submit that one of the features of equitable compensation is that no element of penalty is involved. This proposition emerges most clearly from the cases dealing with awards of interest against defaulting trustees.[16] In this context, a distinction is often drawn between a lower rate, aimed at compensation only and described as the “trustee rate” and a higher rate referred to as a “mercantile rate”, designed as a means of recovering profit received or presumed to have been received by a trustee as a result of gross misapplication of trust funds. There is no suggestion of that in this case.
[16] See Meagher, Heydon and Leeming, Meagher, Gummow and Lehane: Equity Doctrine and Remedies (LexisNexis Butterworths, 4^th ed, 2002) [23-020].
Supplementary rule 208 provides for an indicative rate of 4 per cent above the cash rate set by the Reserve Bank. This is to be seen as more in line with, if not exceeding, a commercial or mercantile rate. It is intended to bring the indicative rate for pre-judgment interest into line with the indicative rate for interest payable on a judgment and contains an element of penalty.
In this case, I have no evidence as to the financial benefit obtained by the defendants by remaining in possession of (or by not having to borrow) the equitable compensation that I have awarded in lieu of the plant and equipment, the FMDs in Ian’s name and the pre-2003 equity. In my view, the appropriate rate is the lower rate put forward by the defendants. To allow the higher rate, as argued for by the plaintiffs, would risk a significant element of punishment being imposed on the defendants and overcompensation for the plaintiffs.
In Hagan v Waterhouse,[17] Kearney J said this.
As was said by Street J in Re Dawson; Union Fidelity Trustee Co Ltd v Perpetual Trustee Co Ltd...
“The general principle is that where a trustee has, through his breach of trust, occasioned loss to the trust estate then he is liable to make good that loss, together with interest.”
. . . .
The “trustee” rate is fixed upon that obtainable from investment in government stock at the time... . The “mercantile” rate is applied as a means of recovering profit received or presumed to have been received by the trustee as a result of misapplication of trust funds.
In this case, the defendants have proffered a series of interest rates for the period from 1 December 2012, representing 1 per cent above the cash rate published by the Reserve Bank from time to time. I accept that the rates throughout that period, as put forward by the defendants, are broadly equivalent to the government bond rate (or, as Kearney J described it in Hagan, the rate obtainable from investment in government stock) so as to be characterised for present purposes as the “trustee rate”.
[17] (1991) 34 NSWLR 308 at 391-392 (citations omitted).
I would award interest on this basis whether applying the equitable jurisdiction to award interest on equitable compensation or whether exercising the discretion available under section 30C of the Supreme Court Act 1935. As explained, I proposed to order equitable compensation in the amount of $1.5M, not $4.75M. Accordingly, I have not considered whether or not the appropriate interest rate, in the later event, would be different.
The interest payable on equitable compensation of $1.5M from 1 December 2012 until the date of judgment, 26 August 2015, and in accordance with the (agreed upon) calculations provided by the defendants, is $149,401.
Pathway A or Pathway B
The plaintiffs submit that orders in terms of Pathway A, that is, including the declaration of a constructive trust over Ocean Downs as from 1 December 2012, together with consequential orders for an account of profits, should be made. The plaintiffs submit that any discretionary considerations strongly favour orders in the nature of Pathway A rather than in the nature of Pathway B (which would include additional compensation in the amount of $3.25M in lieu of a constructive trust over Ocean Downs). The defendants submit that various discretionary considerations favour the making of orders in the nature of Pathway B. Both parties presented written submissions supplemented by oral submissions in support of their respective positions.
The plaintiff submits that the Pathway A orders and, in particular, the imposition of a constructive trust over the Ocean Downs property will meet the primary expectation engendered in the plaintiffs and departed from by Ian. In addition: the plaintiffs have lived at Ocean Downs for almost 20 years; Stuart has farmed that property for almost all of that period of time; the plaintiffs have conducted extensive renovations to the homestead property on two occasions; and the plaintiffs and their children have built their life in the community in and around Ocean Downs.
In the event that Stuart and Shannon were to receive money only, they would have to give up what has been their home for the last 20 years or so. In addition, they would need to look for, and succeed with, purchasing a new farming property, if they were to continue with the work and lifestyle to which they have always been committed. I accept the plaintiffs’ submission, supported by evidence heard during the trial, that farming properties on the Yorke Peninsula and, particularly, within a reasonable distance of that area of the Yorke Peninsula in which the plaintiffs live and very much wish to remain, are not at all easy to come by. I accept that, if the plaintiffs were to look to purchase another farming property in lieu of Ocean Downs, it would be highly likely that they would have to leave the district and that the family would have to start again in terms of being accepted by a new community and of generating a new social and family life within that new community.
I am satisfied, on the evidence given by both Stuart and Shannon, that their commitment to the community in which they presently live is very strong. I accept that it would be quite devastating for them if they had to leave the district and that community.
I also accept that the authorities generally support the proposition that, prima facie, the appropriate relief is to hold a party estopped to the expectation created.[18]
[18] See, for example, Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101 at [40]-[48], Flinn v Flinn (1999) 3 VR 712 at [121] and [170], Donis v Donis [2007] VSCA 89; (2007) 19 VR 577 at [32], Delaforce v Simpson-Cook [2010] NSWCA 84; (2010) 78 NSWLR 482 at [63]-[67], Sidhu v Van Dyke [2014] HCA 19; (2014) 251 CLR 505 at [82]-[86].
The plaintiffs also submit that any concerns about the viability of Ocean Downs, as a stand alone farming property, should not be seen as an impediment. As indicated in my primary reasons,[19] I was not persuaded that Ocean Downs is necessarily unviable. It may not have the attributes of Yaringa but it is an attractive farming property, even on a stand alone basis. The fact that Stuart and Shannon do not see this as an impediment first, suggests that the Court should not be overly troubled by this consideration and second, in the circumstances, underscores the importance to the plaintiffs of having their primary expectation, that is, ownership of Ocean Downs (being part of the family farm) enforced.
[19] At [253]-[259].
The plaintiffs also put submissions to the effect that clean break considerations ought pose no impediment to orders being made in the nature of Pathway A. In short, there should be no need for any interactions between the parties over and above the risk of running into each other as they get about their business in the various townships in the area and as they both interact with other people within the local community. Further, the parties’ financial arrangements are no longer interconnected or, once this litigation has been finalised, their financial arrangements will no longer be interconnected.
The Ocean Downs property and the Yaringa property are not contiguous. As can be seen from the aerial map attached as Annexure A to the primary reasons, Ocean Downs and Yaringa might be regarded as neighbouring properties. However, they do not share a common boundary and there is a public road that separates them. The plaintiffs can live on and farm the Ocean Downs property without any interference from or need to have any involvement with the defendants and the defendants can do the same with respect to Yaringa and its adjacent property on the other side, Lindsays.
I am also satisfied that Yaringa, particularly now that it is farmed by the defendants in conjunction with Lindsays, will be a viable operation for the defendants. I am satisfied that Ocean Downs will provide a good start for the plaintiffs in terms of arable land to farm and that their position can be improved by the judicious application of the equitable compensation of $1.5M by way of acquiring additional land should it become available and/or farming plant and equipment.
The defendants raised seven considerations which they submit militate in favour of orders in the nature of Pathway B.
First, it is submitted that the prima facie fulfilment of the expectation, as found by me, would not be to impose a constructive trust over Ocean Downs as at 1 December 2012, but to impose some form of constructive trust that did not come into effect until Ian’s death. It is further submitted, given that the former is not the “prima facie” fulfilment of the expectation, that there is no presumption in favour of Pathway A. According to the defendants, both Pathway A and Pathway B represent the Court doing something other than fulfilling the expectation.

To my mind, this is an argument that goes to the question of whether a constructive trust over Ocean Downs or equitable compensation in lieu thereof, in the form and as at the date I have proposed, should be imposed at all. The alternative Pathway B equitable compensation is predicated on the plaintiffs, otherwise, being entitled to a constructive trust over Ocean Downs as at 1 December 2012. I have made my decision in this respect. This consideration, raised by the defendants, does not bear on any choice to be made between Pathway A or Pathway B. It is an argument as to the nature of the relief generally (in whichever form) and more appropriate to any appeal.
Further, the fact that the orders I will impose in this respect are to take effect as at 1 December 2012, rather than at some later date, including Ian’s death, has been factored into the quantum of the overall remedial regime. As explained in my primary reasons, the issue of acceleration is an important one and bears on the nature, by way of quantum, of the remedy imposed.
Second, the defendants submit that the Court should be reluctant to enforce an expectation that certain property would be the subject of an inheritance by ordering a transfer, as at the date of the breakdown of the relationship, in circumstances where there is fault on the part of the claimant party. “To do otherwise is to encourage persons in Stuart’s position to take steps to ‘bring forward’ their inheritance without any fear of the consequences.” I agree that this is a factor to be considered. However, in my primary reasons I was not prepared to attribute blame for the breakdown of the relationship other than to find that there was some fault on both sides. I find this consideration to carry little weight, essentially, because in no sense can it be said that Stuart intentionally took advantage of the situation in order to bring his expectation forward. At no time did Stuart want the business relationship to break down. At no time did Stuart want to be ordered to leave the farm.
Each case, in this respect, will need to be decided on its own facts and the circumstances of the breakdown of any such relationship will need to be taken into account when determining what is a fair and just remedy. I endeavoured to do this in my primary reasons.
Third, the defendants have pointed out that Ocean Downs is held by the first defendant (IRPL) on an express trust and has been so held since Stuart was five years old and well before any conduct giving rise to an estoppel. It is submitted that beneficiary rights pursuant to, and objects of, the express trust, while not amounting to a proprietary interest in the trust property, weigh against requiring a transfer of the property, such as Ocean Downs in specie. It is further submitted that, as a matter of principle, a constructive trust should not be used to contradict an expressly declared trust and reference is made to Pettit, Equity and the Law of Trusts,[20] citing Pink v Lawrence.[21]
[20] (9^th ed, 2001) p64.
[21] (1977) 36 P & CR 98 at 101.
The submission here is one that, in substance, is a version of the sixth submission (below) to the effect that a relevant consideration is a need to avoid, where possible, injustice to third parties. The IRFT is a discretionary trust. As constituted, during the period of the relevant events, the capacity to deal with the assets and the income of the trust were under the complete control of IRPL, the directing mind of which was Ian. As a matter of principle, the first defendant, IRPL, has, at all material times, been entitled to deal with the assets of the trust, even to the extent of divesting the trust, by sale or otherwise, of Ocean Downs. As a matter of principle, there is no reason why IRPL, by its conduct, cannot place itself in the position of a constructive trustee of the property. Whether or not, in so doing, IRPL might commit a breach of the express trust might be a matter for another time and at the behest of the beneficiaries of the trust, but it is beyond the scope of this litigation.
The reference by the defendants to the matter of principle said to derive from Pink v Lawrence is, with respect, taken out of context and misconceived.
There remains the question of the extent to which any injustice to third parties which, in this case might include the beneficiaries of the IRFT, is to be taken into account. I will deal with this issue in the context of the sixth matter raised by the defendants and dealt with below.
Fourth, the defendants submit that the form of relief should take into account “the need for a clean break”.[22] The defendants submit that it is necessary to do this so as to “avoid or minimise future friction” between the parties.[23] This is a relevant consideration and is to carry some weight. The possibility, perhaps even the probability that the parties will come across each other within the community and that friction may well arise, cannot be discounted. Nor can the risk be eliminated. Nevertheless, I am satisfied that it is a matter that can be appropriately managed by the parties. As I say, it is a consideration but not one that I find determinative.
[22] Delaforce v Simpson- Cook [2010] NSWCA 84; (2010) 78 NSWLR 483 at [60] and see my primary reasons at [90](v).
[23] Gillett v Holt [2001] Ch 210 at 237.
Fifth, the defendants maintain the position, put by the plaintiffs during the trial, that the economic practicalities of farming one property only, together with the comparative farming merits of the two properties, are relevant to the determination of the form of relief, particularly, in circumstances where the two properties have been farmed as one business since the 1970s.
This is a consideration relevant to the appropriate form of relief. However, for the reasons explained as part of my description and consideration of the plaintiffs’ submissions on this topic, I place only limited weight on this consideration.
The defendants also point to my observation in the primary reasons that the plant and equipment used is of a size and scale appropriate to a farming business comprising all three properties. The submission is not quite accurate. In my primary reasons, I referred to Ian’s evidence[24] that he would need both Yaringa and Ocean Downs together in order to operate the machinery available to him, not all three properties (including Lindsays). In any event, even with the divestment of Ocean Downs, the defendants will continue to have two properties to operate, Yaringa and Lindsays. If, indeed, the plant and equipment presently available exceeds requirements presumably, some of the equipment can be sold and replaced or hired out for use on other farms.
[24] Trial transcript, p1359.
Sixth, the defendants submit that there is a need to avoid injustice to third parties. The defendants raise the position of Mark and Adrian, the two younger sons of Ian. In the primary reasons, I summarised the contributions of Mark and Adrian to the building up of the assets of the defendants and the extent of their work on the farms over the years. In my view, the contributions have been less than modest. I mean no criticism by this. From very early in the piece, each was determined to build a career for himself off the farm and did so successfully.
There is no doubt that the orders I will make (and in whichever form) are likely to have a significant impact on the expected inheritance of Mark, Adrian and their younger sister, Annemarie. However, this is a matter that has already been taken into account and with respect to whichever form of remedial relief is adopted. I am not persuaded that there is any particular injustice that will be caused to any of Stuart’s siblings or to the more remote beneficiaries of either the IRFT or the YPFT in the event that Ocean Downs were to be transferred in specie rather than equitable compensation of $3.25M paid in lieu thereof. None of the siblings had much, if any, day to day involvement with the farming of Ocean Downs (or Yaringa) during the period of Stuart’s involvement over the 18 years or so prior to December 2012. It is true that Adrian has now returned home to assist Ian in the running of the farms and, in effect, to replace Stuart in this respect. But all of this occurred after the relationship with Stuart broke down irretrievably.
Seventh, the defendants submit that the issue of proportionality, whilst a matter that ordinarily goes to the measure of relief, is also relevant to the question of the discretionary form of the relief. It is submitted that there “is an intrinsic and perhaps incalculable value in land over and above its mere monetary value” such that, in this respect, “Pathway A is a disproportionate remedy to that of Pathway B”.
I find this an amorphous consideration to assess. Nevertheless, to the extent that there is an intrinsic value in land over and above its mere monetary value, such a consideration favours Stuart’s position as much as it favours Ian’s. I would not have suggested Pathway A if I had been of the view that it would result in a disproportionate remedy. The notion of proportionality was taken account of in my primary reasons. Further, it is not the case, according to the authorities, that I need to ask the question whether Pathway A is a disproportionate remedy to that of Pathway B. The proper question, or approach, is as I set out in my primary reasons.[25] The short point, of present relevance, is that relief may be limited where the enforcement of a plaintiff’s expectation would be out of all proportion to the detriment incurred. These are the relevant comparators in this respect.
[25] At [90](ix) and (x) and [91].
Ultimately, the appropriate remedy is one for the Court. I have found the arguments concerning the discretionary factors put by the plaintiffs as more persuasive, and significantly so, than those put by the defendants. No discretionary considerations have been drawn to my attention that would cause me to depart from what I consider to be the primary form of relief appropriate in this matter, that is, a constructive trust over the Ocean Downs property together with the consequential orders proposed in Pathway A. I will make orders accordingly.
The form of the orders to be entered
In addition to the matters dealt with to this point, the parties initially were in dispute as to a number of matters relating to the form of the orders. A number of these initial disputes have been resolved by agreement and I now have available a joint draft of proposed minutes of order with respect to Pathway A and a joint draft of proposed minutes of order with respect to Pathway B. Each draft does include some alternative contentions where the parties are not agreed. For the reasons just now given, I will proceed to deal only with the proposed minutes of order with respect to Pathway A.
One new issue arose during the hearing of the further submissions. That concerned the question of which party should be liable for any stamp duty and other government charges consequent on any transfer of the Ocean Downs property. The parties are in agreement that any such charges, if payable, will be substantial; stamp duty in the order of $172,500 (based on a valuation of $3.25M) and transfer registration fees in the order of $25,000. Neither party has a certain position as to whether stamp duty will be payable on such a transaction, although the plaintiffs are optimistic about the arguments available that might render such a transaction exempt. In any event, the parties have agreed that, vis a vis each other, the plaintiffs will assume liability or responsibility for any such statutory charges.
The Pathway A orders are set out at the end of these reasons. There are two remaining disputes between the parties. The first concerns orders 9, 13 and 15. In the chapeau to each of orders 9 and 15, the plaintiffs propose that the matters referred to in those orders are to be attended to “within twenty-eight (28) days of the date of these orders”, whereas the defendants propose “within twenty-eight (28) days of date of any final orders in these proceedings (being these orders or, in the event of any appeal or application to the Full Court of the Supreme Court of South Australia or the High Court of Australia, orders dismissing such appeal or application)”. In order 13, the parties are at odds in the same respect but with the additional difference being that, whilst the plaintiffs seek a 28 day period, the defendants seek a 56 day period.
Order 13 deals with, inter alia, an obligation imposed on IRPL, as trustee for the IRFT and the YPFT, to file and serve on the plaintiffs a detailed account, verified by affidavit sworn by Ian, of each receipt and expense and the net rent and profits derived by IRPL arising from its possession and use of Ocean Downs on and after 1 December 2012. After hearing from the parties, I am satisfied that the defendants should be permitted 56 days within which to perform this task.
Of more potential significance, is the question of whether or not time should run from the date of these orders or the date of resolution of any ultimate appeal or application for special leave to appeal and this affects each of orders 9, 13 and 15. The defendants’ position would achieve a de facto stay of execution of the orders. I have not heard argument on the question of a stay[26] and no application for a stay has, yet, been made other than by way of the defendants’ submission that there should be a delayed implementation of the orders. Nothing has been put, at this stage of the proceedings, to justify orders in terms that would keep the plaintiffs out of their judgment for such an indefinite and potentially lengthy period.
[26] In this respect, and generally, the considerations material to a stay pending an appeal to the Full Court can be different from those material to a stay pending an application for special leave to the High Court.
That is not to say that the defendants may not be able to argue successfully for a stay or a partial stay, perhaps on terms, should any such application be made. But I have not heard full argument on all issues that might be relevant to any such application. Further, it may be (as mooted by counsel for the defendants during argument) that any application for a stay ought to be heard by another Judge.
In any event, and without being seen to be refusing a stay, the orders I propose to make will require the defendants to perform their obligations with respect to orders 9 and 15 within 28 days of the making of these orders and with respect to order 13 within 56 days of the making of these orders.
The last outstanding dispute concerns the plaintiffs’ contention that the mortgage to be registered over Yaringa, in order to secure the plaintiffs’ entitlement to be paid the equitable compensation of $1.5M, the unpaid trust distributions and the interest payments, should also secure any costs order made in favour of the plaintiffs. I have heard submissions directed to this contention, even though the question of costs has not yet been argued or determined. Whilst the plaintiffs have sought an order that their costs of the two actions be paid by the defendants on a party and party basis, I will not be hearing any argument on costs until final orders are entered. Nevertheless, and in any event, I see no justification for elevating the plaintiffs to the status of a secured creditor with respect to any order for the costs of the two proceedings that might ultimately be made in their favour. Such an approach would be unusual and is not justified in the circumstances of this case.
Final orders
I make the following declaration and orders.
THE COURT ORDERS THAT:
1.There be judgment for the plaintiffs in action no. 664 of 2014.
2.There be judgment for the defendants in action no. 846 of 2014, such that the claim of the plaintiff, Ian Rodda Pty Ltd, is dismissed.
THE COURT DECLARES THAT:
3. The first defendant, Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust, holds the whole of the land comprised in Certificates of Title Register Book Volume 6017 Folio 620, Volume 5171 Folio 44 and the land in Crown Lease Volume 1648 Folio 46, being the farming property known as “Ocean Downs” situated in the Hundred of Tiparra (the “Ocean Downs Land”), on constructive trust for the plaintiffs and has done so since 1 December 2012.
AND THE COURT FURTHER ORDERS THAT:
4.The first defendant, Ian Rodda Pty Ltd as trustee for the Yaringa Proprietors Family Trust, and the second defendant, Ian Lewis Rodda, pay equitable compensation to the plaintiffs in the sum of $1.5 million, plus pre-judgment interest from 1 December 2012 to the date of these orders, 26 August 2015, in the additional amount of $149,401.
5.The first defendant, Ian Rodda Pty Ltd, as trustee for the Yaringa Proprietors Family Trust, pay Stuart Rodda the sum of $308,983, plus pre-judgment interest on that sum from 11 April 2014 to the date of these orders, 26 August 2015, in the additional amount of $27,426.
6.The first defendant, Ian Rodda Pty Ltd, as trustee for the Ian Rodda Family Trust, pay Stuart Rodda the sum of $74,982, plus pre-judgment interest on that sum from 11 April 2014 to the date of these orders, 26 August 2015, in the additional amount of $6,662.
7.The first defendant, Ian Rodda Pty Ltd, as trustee for the Yaringa Proprietors Family Trust, pay Shannon Rodda the sum of $313,674, plus pre-judgment interest on that sum from 11 April 2014 to the date of these orders, 26 August 2015, in the additional amount of $27,845.
8.The first defendant, Ian Rodda Pty Ltd, as trustee for the Ian Rodda Family Trust, pay Shannon Rodda the sum of $59,858, plus pre-judgment interest on that sum from 11 April 2014 to the date of these orders, 26 August 2015, in the additional amount of $5,305.
9.Within twenty-eight (28) days of the date of these orders:
9.1     the plaintiffs shall cause the Caveats 11871797 and 12145035 to be removed from the Ocean Downs Land; and
9.2     the first defendant, Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust shall execute and, simultaneously with the removal of the Caveats referred to in the preceding sub-paragraph, hand to the plaintiffs the duplicate Certificate of Title and a duly executed Memorandum of Transfer in registrable form of all of its estate and interest both at law and in equity in the Ocean Downs Land to the intent that the plaintiffs shall henceforth be entitled to the land for their sole use and benefit absolutely without any encumbrance whatsoever.
9.3     The plaintiffs shall pay all stamp duty, registration fees and other associated costs of the transfer of the Ocean Downs Land.
10.If the first defendant refuses or neglects or is unable to execute a memorandum of transfer in registrable form under the provisions of the Real Property Act 1886 (SA) within the period specified in paragraph 9 above, a Master be and is hereby appointed to execute the transfer for and on behalf of Ian Rodda Pty Ltd.
11.An inquiry be made and taken as to the rents and profits earned by the first defendant, Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust and the Yaringa Proprietors Family Trust, arising from its possession and use of the Ocean Downs Property on and after 1 December 2012 until the date of transfer of the Ocean Downs property pursuant to these Orders.
12.Such inquiry and account be listed before, and made and taken by, a Master of this Court reserving liberty to the Master, if thought fit, to appoint an expert to take and report on the said account or assist him or her in that process.
13.Within fifty-six (56) days of the date of these orders: the first defendant, Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust and the Yaringa Proprietors Family Trust, shall file and serve on the plaintiffs their detailed account, verified by affidavit sworn by the second defendant, Ian Lewis Rodda, of each receipt and expense and the net rent and profits (including unrealised rent and profits) derived from it arising from its possession and use of the Ocean Downs Property on and after 1 December 2012:
13.1   the items of the detailed account be numbered consecutively on each side of the account;
13.2   the affidavit specifying, in respect of each receipt or expense, the date and amount of the payment, to whom it was paid and the purpose for which the amount was paid or received;
13.3   the affidavit vouching each income and expenditure item by attaching the relevant receipt or other document supporting the transaction, such that the verifying affidavit annexes or exhibits all documents relevant to the detailed account as are in the possession, custody or power of the defendants;
13.4   the plaintiffs be at liberty within thirty (30) days after service of the said account and documents to apply to the Master to cross-examine the second defendant on identified matters in or arising from the said account and documents;
13.5   the plaintiffs, within thirty (30) days after service upon them of the said account and documents, or within thirty (30) days of the conclusion of the examination of the second defendant referred to in the previous sub-paragraph, be at liberty to file and serve upon the defendants their surcharges, falsifications and objections (if any) thereto.
14.The first defendant, Ian Rodda Pty Ltd as trustee for the Ian Rodda Family Trust and the Yaringa Proprietors Family Trust, pay to the plaintiffs such amount as is determined by the Master on the taking of the account as being due to the plaintiffs after all due allowances are made, together with interest on the amount found to be due from the dates those profits were earned.
15.Within twenty-eight (28) days of the date of these orders:
15.1   the plaintiffs shall cause Caveats 11871797, 11871796, 12145029 and 12145035 to be removed from the whole of the land comprised in Certificate of Title Register Book Volume 5568 Folio 515 and Volume 5568 Folio 516, being the farming property known as “Yaringa” situated in the Hundred of Tiparra (the “Yaringa Land”); and
15.2   the defendants shall execute and, simultaneously with the removal of the Caveats referred to in the preceding sub-paragraph, cause to be registered (on each of the relevant Certificates of Titles) a mortgage (to rank as a first mortgage), in terms reasonably acceptable to the plaintiffs, over the Yaringa Land, to secure the due payment of the amounts and interest payable under paragraphs 4-8 and 14 of these orders and provide proof to the plaintiffs of the registration of such mortgage; provided that, with the prior written consent of the plaintiffs, which consent is not to be unreasonably withheld, the defendants shall be entitled to register a mortgage over the Yaringa Land, which might rank in priority to the mortgage in favour of the plaintiffs described above, on condition that the mortgage only secure borrowings that are used for the sole purpose of satisfying the due payment to the plaintiffs of the amounts and interest described above.
16.If the defendants refuse or neglect or are unable to execute a mortgage in favour of the plaintiffs in registrable form under the provisions of the Real Property Act 1886 (SA) within the period specified in paragraph 15 above, a Master be and is hereby appointed to execute the mortgage for and on behalf of the defendants.
17.Each party shall forthwith execute all such instruments and do all such things as may be necessary to give effect to the terms of this Judgment and these orders, including obtaining the consent of any person required to permit the transfer of the Crown Lease.
18.Liberty to apply on short notice for further directions and orders, including any preliminary question as to the basis on which the inquiry and account described in paragraphs 11 to 14 is to be made and taken.

I still need to hear the parties on the question of costs.