Scott (Trustee) v Le

Case [2021] FCA 1364

FEDERAL COURT OF AUSTRALIA

Scott (Trustee) v Le [2021] FCA 1364

File number: VID 956 of 2017
Judgment of: MOSHINSKY J
Date of judgment: 5 November 2021
Catchwords: BANKRUPTCY – application by trustee in bankruptcy for declaration that first respondent was a joint proprietor of a residential property and for orders for possession and sale – where the name on the certificate of title was different from the name of the first respondent – where the first respondent contended that the joint proprietor was his deceased brother rather than him – whether the trustee in bankruptcy established on the balance of probabilities that the first respondent was a joint proprietor of the property
Legislation: Evidence Act 1995 (Cth), s 140
Cases cited: Le v Scott as trustee of the property of Chanh Tam Le, a bankrupt [2020] FCAFC 12
Division: General Division
Registry: Victoria
National Practice Area: Commercial and Corporations
Sub-area: General and Personal Insolvency
Number of paragraphs: 45
Date of hearing: 3 and 5 February 2021 and 28 April 2021
Counsel for the Applicant: Ms CF Gobbo
Solicitor for the Applicant: Piper Alderman
Counsel for the First Respondent: The First Respondent appeared in person with the assistance of an Interpreter
Counsel for the Second Respondent: The Second Respondent did not appear

ORDERS

VID 956 of 2017
BETWEEN:

ANDREW JOHN SCOTT AS TRUSTEE OF THE PROPERTY OF CHANH T LE, A BANKRUPT

Applicant
AND:

CHANH T LE

First Respondent

HOA TRAN LE

Second Respondent

ORDER MADE BY:

MOSHINSKY J

DATE OF ORDER:

5 NOVEMBER 2021

THE COURT ORDERS THAT:

1.There be a declaration that the first respondent was, at the date of his bankruptcy, a joint registered and beneficial owner in fee simple of a one half share in the property situated at 23 The Avenue, Sunshine West, Victoria, more particularly described in certificate of title volume 10153 folio 183 (the Property), which rights vested in the applicant (the Trustee) upon the bankruptcy of the first respondent.

2.The first respondent and the second respondent give vacant possession of the Property to the Trustee within 30 days of this order.

3.The Trustee be appointed trustee for the sale of the Property, which is to be sold for such price and in such manner and on such terms as the Trustee may in his absolute discretion determine.

4.The Trustee be appointed as attorney for the second respondent for the purposes of effecting the sale of the Property in accordance with the orders including (without limiting the generality of the foregoing) the contract of sale, vendor’s statement, appointment of selling agent and any declaration under the Duties Act 2000 (Vic) and is granted a power of attorney for that purpose.

5.The Registrar of Titles be directed to accept the orders as evidence of the Trustee’s appointment as attorney.

6.The Trustee apply the proceeds of the sale of the Property in the following manner:

(a)first, in payment of any mortgage or encumbrance over or in respect of the title to the Property…

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Scott (Trustee) v Le [2021] FCA 1364
Case
[2021] FCA 1364
Decision Date

CaseChat Overview and Summary

In the Federal Court, Scott (Trustee) commenced proceedings against Le, seeking a declaration that Le was a joint proprietor of a residential property, along with orders for possession and sale. The property in question was registered in the names of Le and another individual, but Le contended that the joint proprietor was his deceased brother, not himself. The matter was remitted by the Full Court, focusing on whether Le was indeed a joint proprietor of the property. The court heard evidence from both parties, including affidavits, documents, and witness testimonies, with Le being self-represented and requiring an interpreter.

The central legal issue was whether the Trustee in bankruptcy had established on the balance of probabilities that Le was a joint proprietor of the property. Given the nature of the proceeding and the gravity of the allegations, the onus of proof lay with the Trustee. The court considered various documentary and testimonial evidence, including birth certificates, citizenship documents, and the certificate of title. Despite Le's contention that his deceased brother was the joint proprietor, the court found that the evidence overwhelmingly supported that Le was indeed a joint proprietor of the property.

After careful consideration of the evidence, the court concluded that the Trustee had successfully demonstrated that Le was a joint proprietor of the property. The court issued a declaration to this effect and ordered the sale of the property, with specific directions on how the proceeds should be distributed. Notably, the court reserved the issue of costs of sale for further consideration, ensuring that these costs would be borne by Le's estate rather than affecting the second respondent.

Orders

Orders of the court

1. There be a declaration that the first respondent was, at the date of his bankruptcy, a joint registered and beneficial owner in fee simple of a one half share in the property situated at 23 The Avenue, Sunshine West, Victoria, more particularly described in certificate of title volume 10153 folio 183 (the Property), which rights vested in the applicant (the Trustee) upon the bankruptcy of the first respondent.

2. The first respondent and the second respondent give vacant possession of the Property to the Trustee within 30 days of this order.

3. The Trustee be appointed trustee for the sale of the Property, which is to be sold for such price and in such manner and on such terms as the Trustee may in his absolute discretion determine.

4. The Trustee be appointed as attorney for the second respondent for the purposes of effecting the sale of the Property in accordance with the orders including (without limiting the generality of the foregoing) the contract of sale, vendor’s statement, appointment of selling agent and any declaration under the Duties Act 2000 (Vic) and is granted a power of attorney for that purpose.

5. The Registrar of Titles be directed to accept the orders as evidence of the Trustee’s appointment as attorney.

6. The Trustee apply the proceeds of the sale of the Property in the following manner:

(a) first, in payment of any mortgage or encumbrance over or in respect of the title to the Property together with any outstanding rates, taxes, charges or other similar outgoings affecting the Property;

(b) secondly, one half of the net balance to the second respondent;

(c) thirdly, in payment of all costs, charges and expenses in selling the Property; and

(d) fourthly, the balance to the Trustee.

7. The Trustee be empowered to execute a “T1” Transfer of Land on behalf of the second respondent.

8. The Registrar of Titles be directed to accept the proper execution by the Trustee of the T1 Transfer of Land on behalf of the second respondent as being sufficiently executed by the second respondent.

9. The Trustee’s costs of the application are proper costs of the bankruptcy of the first respondent.

10. Subject to further order, pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth), and on the grounds in s 37AG(1)(a) and (c) of the Federal Court of Australia Act, paragraphs 11 and 18 of the Court’s reasons for judgment of the date of these orders be and remain confidential to the parties and not be published.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

For the reasons that follow, I have concluded that the Trustee has established, on the balance of probabilities, that the first respondent is a joint proprietor of the Property.Procedural background This matter has had a lengthy procedural history. It is not necessary for present purposes to set out that history. It is sufficient to refer to the judgment of the Full Court of this Court in Le v Scott as trustee of the property of Chanh Tam Le, a bankrupt [2020] FCAFC 12. On 18 February 2020, the Full Court remitted the question whether the first respondent is or was at the relevant time the joint proprietor of the Property, together with any consequential orders arising from that determination, including the allocation of costs of the sale of the Property if applicable. It is that question that is currently before the Court. The listing of this matter for hearing was delayed for some time due to the Coronavirus pandemic and the consequent restrictions which meant that an ‘in person’ hearing could not be scheduled for much of 2020. In circumstances where the first respondent was self-represented and needed the assistance of an interpreter, it was necessary to wait until the hearing could take place ‘in person’. The hearing of the matter commenced on 3 February 2021 and continued on 5 February 2021. The hearing was completed on 28 April 2021. [Redacted.] The second respondent was present in the court room on the first hearing day, but indicated that she did not wish to appear in the proceeding. She did not attend on the second or third hearing days.The evidence The Trustee relies on the following evidence:(a)an affidavit of the Trustee dated 28 August 2017 (Exhibit A1) (the Trustee’s affidavit);(b)an affidavit of Florian Ammer, the solicitor acting for the Trustee, dated 8 October 2019 (Exhibit A2);(c)documents produced in response to subpoenas served by the Trustee, as follows:(i)documents produced by the Department of Veterans’ Affairs (Exhibit A3), comprising pp 1-199 of a folder of documents prepared by the Trustee for the purposes of the hearing (the Court Book);(ii)documents produced by the Department of Home Affairs (Exhibit A4), comprising pp 200-236 of the Court Book;(iii)documents produced by the Department of Foreign Affairs and Trade (Exhibit A5), comprising pp 237-258 of the Court Book;(iv)documents produced by the Roads Corporation trading as VicRoads (Exhibit A6), comprising pp 259-271 of the Court Book;(v)documents produced by the Commonwealth Bank of Australia (Exhibit A7), comprising pp 272-377 of the Court Book;(vi)documents produced by Westpac Banking Corporation (Exhibit A8), comprising pp 378-846 of the Court Book; and(d)a letter from the Department of Home Affairs to the Registrar of this Court, dated 17 July 2020 (Exhibit A9). There was no cross-examination of the Trustee’s witnesses. The first respondent relies on the following evidence:(a)two affidavits of the first respondent, dated 28 October 2019 and 12 November 2019 (Exhibits R1 and R2);(b)a medical certificate (on a Centrelink form) for Chanh Tam Le dated 17 March 2012 (Exhibit R3), located at p 854 of the Court Book;(c)a partially typed and partially hand-written statement of the first respondent dated 13 September 2018 (Exhibit R4), located at p 855 of the Court Book;(d)a Westpac bank statement for the period 29 September 2017 to 29 December 2017 (Exhibit R5);(e)two letters from the Australian Taxation Office dated 21 November 2018 and 26 October 2018 (Exhibits R6 and R7);(f)an affidavit of the first respondent dated 19 July 2020, but not the annexures thereto (Exhibit R8) – this affidavit is unsworn, but was adopted by the first respondent during his oral evidence;(g)a photo of an urn said to contain the ashes of the first respondent’s deceased brother (Exhibit R9), located at p 853 of the Court Book; and(h)a medical certificate for the first respondent dated 4 August 2015 (Exhibit R10).

Evidence

Evidence Before The Court

The second respondent was present in the court room on the first hearing day, but indicated that she did not wish to appear in the proceeding. She did not attend on the second or third hearing days.The evidence The Trustee relies on the following evidence:(a)an affidavit of the Trustee dated 28 August 2017 (Exhibit A1) (the Trustee’s affidavit);(b)an affidavit of Florian Ammer, the solicitor acting for the Trustee, dated 8 October 2019 (Exhibit A2);(c)documents produced in response to subpoenas served by the Trustee, as follows:(i)documents produced by the Department of Veterans’ Affairs (Exhibit A3), comprising pp 1-199 of a folder of documents prepared by the Trustee for the purposes of the hearing (the Court Book);(ii)documents produced by the Department of Home Affairs (Exhibit A4), comprising pp 200-236 of the Court Book;(iii)documents produced by the Department of Foreign Affairs and Trade (Exhibit A5), comprising pp 237-258 of the Court Book;(iv)documents produced by the Roads Corporation trading as VicRoads (Exhibit A6), comprising pp 259-271 of the Court Book;(v)documents produced by the Commonwealth Bank of Australia (Exhibit A7), comprising pp 272-377 of the Court Book;(vi)documents produced by Westpac Banking Corporation (Exhibit A8), comprising pp 378-846 of the Court Book; and(d)a letter from the Department of Home Affairs to the Registrar of this Court, dated 17 July 2020 (Exhibit A9). There was no cross-examination of the Trustee’s witnesses. The first respondent relies on the following evidence:(a)two affidavits of the first respondent, dated 28 October 2019 and 12 November 2019 (Exhibits R1 and R2);(b)a medical certificate (on a Centrelink form) for Chanh Tam Le dated 17 March 2012 (Exhibit R3), located at p 854 of the Court Book;(c)a partially typed and partially hand-written statement of the first respondent dated 13 September 2018 (Exhibit R4), located at p 855 of the Court Book;(d)a Westpac bank statement for the period 29 September 2017 to 29 December 2017 (Exhibit R5);(e)two letters from the Australian Taxation Office dated 21 November 2018 and 26 October 2018 (Exhibits R6 and R7);(f)an affidavit of the first respondent dated 19 July 2020, but not the annexures thereto (Exhibit R8) – this affidavit is unsworn, but was adopted by the first respondent during his oral evidence;(g)a photo of an urn said to contain the ashes of the first respondent’s deceased brother (Exhibit R9), located at p 853 of the Court Book; and(h)a medical certificate for the first respondent dated 4 August 2015 (Exhibit R10). The first respondent was cross-examined by counsel for the Trustee. All of the first respondent’s evidence was given with the assistance of an interpreter. It appeared that the first respondent’s ability to speak English was very limited or non-existent. [Redacted.] I consider that great care (and sensitivity) needs to be taken in assessing the first respondent’s affidavit and oral evidence. There were several parts of his evidence that were simply not credible and that cannot be accepted. For example, the first respondent denied signing some documents that the context makes clear were signed by him. However, I do not consider that the first respondent was lying (as was put to him on occasion during cross-examination). Rather, I consider that the first respondent honestly believed what he said during cross-examination. Further, parts of his evidence were not coherent. Generally, I consider that the first respondent’s evidence lacked credibility and very little weight can be placed on his evidence. However, it also needs to be kept in mind that the first respondent’s ability to present evidence that would help his case was limited by his personal circumstances (as well as being a self-represented litigant).

Decision

Reasons for decision

I therefore conclude that the first respondent is a joint proprietor of the Property.Conclusion It follows that, subject to one qualification, orders should be made as sought by the Trustee in the application. I will make a declaration that the first respondent was, at the date of his bankruptcy, a joint registered and beneficial owner in fee simple of a one half share in the Property, which rights vested in the Trustee upon the bankruptcy of the first respondent. I will also make the orders for possession and sale. The qualification concerns the costs of the sale of the Property, a matter reserved by the Full Court for further consideration. It is apparent from the reasons of the Full Court at [10] that there was a concern that the orders proposed by the Trustee allocated some of these costs to the second respondent, rather than the costs of sale being borne by the bankrupt’s share of the proceeds. In the Trustee’s application dated 31 August 2017, paragraphs 6 and 9 are in the following terms:An order that the Trustee apply the proceeds of the sale of the Property in the following manner:6.1first, in payment of all costs, charges and expenses in selling the Property;6.2second, in payment of any mortgage or encumbrance over or in respect of the title to the Property together with any outstanding rates, taxes, charges or other similar outgoings affecting the Property;6.3third, one half of the net balance to the Trustee; and6.4fourth, and subject to Order (9), the remainder of the net balance to the Second Respondent.…9.An order that the Applicant’s costs of the application are proper costs of the bankruptcy of the First Respondent. In the Trustee’s outline of submissions dated 29 October 2020, it is stated that the Trustee “consents to an order that the costs of sale of the Property are to be borne by the estate of the first respondent such that the words ‘and subject to Order (9)’ are deleted from paragraph 6.4 of the relief sought in the application dated 31 August 2017”. I do not consider the proposed deletion of the words “and subject to Order (9)” from paragraph 6.4 to be sufficient to achieve the position that the costs of sale are borne by the estate of the first respondent. In order to ensure that the costs of sale are borne by the estate of the first respondent, and not by the second respondent, I propose to frame the relevant paragraph of the order as follows:The Trustee apply the proceeds of the sale of the Property in the following manner:(a)first, in payment of any mortgage or encumbrance over or in respect of the title to the Property together with any outstanding rates, taxes, charges or other similar outgoings affecting the Property;(b)secondly, one half of the net balance to the second respondent;(c)thirdly, in payment of all costs, charges and expenses in selling the Property; and(d)fourthly, the balance to the Trustee.

Ratio Decidendi

Legal Principle Established

Neither party led any expert evidence.Consideration As outlined above, the issue to be determined is whether the first respondent is a joint proprietor of the Property. There does not appear to be any issue that the Trustee, as the moving party, bears the onus of proof. Therefore, it is necessary for the Trustee to establish, on the balance of probabilities, that the first respondent is a joint proprietor of the Property. In deciding whether or not the Trustee has established this, the matters to be taken into account include the nature of the cause of action or defence, the nature of the subject-matter of the proceeding, and the gravity of the matters alleged: see Evidence Act 1995 (Cth), s 140(2). I will start with setting out some basic facts, which do not appear to be controversial, and then refer to some aspects of the oral and documentary evidence. I will then set out my reasoning in relation to the issue to be determined. The following basic facts and matters are established on the evidence:(a)The first respondent was born in Vietnam on 10 November 1954. A copy of his Vietnamese birth certificate is in evidence (see the Trustee’s affidavit, annexure “AJS‑1”, p 79). This shows his name as “Lê Chánh Tâm” and his date of birth as 10 November 1954. There are numerous references to 10 November 1954 being the first respondent’s date of birth in the documents in evidence (see, for example, the documents produced by the Department of Veterans’ Affairs, which are Exhibit A3).(b)The first respondent came to Australia in 1984 and became an Australian citizen in 1986. That he arrived in Australian in 1984 is indicated by several documents in the bundle of documents produced by the Department of Veterans’ Affairs (see Exhibit A3, Court Book, pp 58, 113, 194). The evidence includes a copy of the first respondent’s Certificate of Australian Citizenship, which is dated 7 October 1986 (see Exhibit A3, Court Book, p 43). This records his name as “CHANH TAM LE” and his date of birth as 10 November 1954.(c)On 18 March 1996, Tam Chanh Le and the second respondent were registered as “joint proprietors” of the Property (see the extract from the certificate of title at the Trustee’s affidavit, annexure “AJS-1”, p 2). The certificate of title records that they were “both of 569 Ballarat Road Sunshine 3020”.(d)The first respondent has usually used the name “Chanh Tam Le” since he came to Australia. The evidence includes numerous documents in that name, with the first respondent’s date of birth recorded as 10 November 1954. For example, the first respondent’s Victorian Driver’s Licence records his name as “CHANH T LE” and his date of birth as 10 November 1954 (see Exhibit A3, Court Book, p 42). The first respondent’s Medicare card records his name as “CHANH TAM LE” (see Exhibit A3, Court Book, p 42). The first respondent’s Australian Passport (see Exhibit A5, Court Book, p 246), issued on 6 June 2017, records his name as:LECHANH TAMand his date of birth as 10 November 1954. It appears from the passport application that “LE” is the family name and “CHANH TAM” are given names (see Exhibit A5, Court Book, p 249).