SJM v PMD

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE
COMMON LAW DIVISION

PROPERTY LIST

S ECI 2022 00859

BETWEEN:

SJM	Plaintiff
v
PMD & ANOR (according to the attached Schedule)	Defendants

---

JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	8 June 2023
DATE OF JUDGMENT:	23 June 2023
CASE MAY BE CITED AS:	SJM v PMD
MEDIUM NEUTRAL CITATION:	[2023] VSC 349

---

REAL PROPERTY — Caveats — Application to remove caveat pursuant to s 90(3) of Transfer of Land Act 1958 (Vic) — Caveat lodged following the breakdown of the de facto relationship between the plaintiff and first defendant — Final property settlement orders made pursuant to the Family Law Act 1975 (Cth) by consent — Protracted litigation followed — Whether the caveator has a prima facie case that he has a caveatable interest in the property — Piroshenko v Grojsman (2010) 27 VR 489 and Greater Geelong City Council v Giurina [2023] VSC 49 referred to — No prima facie case where questions of law and fact have been determined by a court of competent jurisdiction — Claim to set aside previous orders for fraud weak — Balance of convenience overwhelmingly supports the removal of the caveat — Caveat removed — Litigation history favours granting an injunction to restrain the lodgement of further caveats.

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr S Fuller	Lampe Family Lawyers
The First Defendant in person
No appearance for the second defendant

HER HONOUR:

Introduction and Background

These reasons concern an application by the plaintiff for the removal of a caveat lodged by the first defendant (‘defendant’) over a property in Hoddles Creek, Victoria (‘property’) pursuant to s 90(3) of the Transfer of Land Act 1958 (Vic) (‘TLA’). The plaintiff also seeks orders restraining the defendant from lodging further caveats on the title to the property.

The plaintiff also made an application that the parties be referred to by pseudonyms in all court documents pursuant to s 121 of the Family Law 1975 (Cth) (‘FLA’)[1], and sought leave to file a further amended originating motion to include a compensation claim pursuant to s 118 of the TLA.
[1]Those orders have been made, and accordingly the parties’ names have been anonymised in these reasons.

The plaintiff is the sole registered proprietor of the property.

The plaintiff and the defendant were in a de-facto relationship from around 1998 or 1999. The plaintiff purchased the property in or around March or April 2003.

The parties lived at the property together until 2010, when the plaintiff moved to Western Australia to complete her graduate studies in nursing. The defendant remained living at the property, and the parties agreed that the defendant would contribute to mortgage repayments and pay for the utilities.

The parties’ relationship ended in or around April or May 2010. Following this date, the defendant remained living at the property, leaving the property temporarily when the plaintiff returned from working on Christmas Island and in Western Australia.

In 2012 the plaintiff received a Mortgage Foreclosure Notice. The plaintiff says that she took exclusive possession of the property after receiving the Mortgage Foreclosure Notice, and changed the locks to the property.

On 18 May 2012, the defendant lodged a caveat on the title to the property via his solicitors on the grounds of an “implied, resulting or constructive trust”. The caveat states that the grounds of the defendant’s claim were that: “the registered proprietor [SJM] holds the land described as trustee for [PMD] by virtue of a constructive trust”.

An application seeking, among other things, the transfer of the property to him was filed by the defendant in the Federal Magistrates’ Court pursuant to the FLA on 25 May 2012 (‘family law proceeding’). The parties settled the family law proceeding on 15 August 2012, and final orders were made by consent on that date (‘final orders’). Both parties were represented by solicitors and counsel.

The final orders provided, relevantly, that:

1.That the [defendant] pay to the [plaintiff] the sum of $110,000 (“the payment”) on or before the 15^th day of November 2012 (“the date”).
2.That contemporaneously with the payment:-
2.1The [plaintiff] do all such acts and things and sign all such documents as may be required to transfer to the [defendant] at the expense of the [defendant] all of her right, title and interest in the real property situate at and known as [the property];
2.2The [defendant] indemnify the [plaintiff] against all payments and liability pursuant to the mortgage… and all rates, taxes, and outgoings of or with respect to [the property];
2.3The [defendant] discharge the mortgage registered…

3.That in the event that the [defendant] fails to make the payment and discharge the mortgage by the date then:-
3.1The [plaintiff] shall have the right to elect, within 7 days of the date, to retain the [property];
3.2If the [plaintiff] so elects, the [plaintiff] shall pay to the [defendant] the sum of $50,000 within 45 days of the date and contemporaneously with receipt of that sum the [defendant] shall do all things and sign all documents required to withdraw, at his expense, any Caveat lodged on his behalf against title to the [property]…

4.That in the event that the [defendant] does not make the payment and discharge the mortgage required of him by the date provided for in order 1 and the [plaintiff] does not elect or elects and does not make the payment required of her by the dates provided for in orders in 3.1 and 3.2 respectively as the case maybe:
4.1The [property] be forthwith sold altogether out of Court (“the sale”);

4.2 Upon completion of the sale, the proceeds of the sale be applied;
4.2.1Firstly to pay all costs, commissions and expenses of the sale;
4.2.2Secondly to discharge the mortgage and any other encumbrance affecting the [property];
4.2.3Thirdly the balance then remaining be divided in the proportions of:
4.2.3.1 1/3 thereof to the [defendant];
4.2.3.2 2/3 thereof to the [plaintiff].

5.That pending the payment and discharge of the mortgage required of [defendant] by the date provided for in order 1, the election required of the [plaintiff] by the date provided for in order 3.1 or the payment required of [plaintiff] by the date provided for in order 3.2 or completion of the sale, as the case may be:-
5.1…the [plaintiff] have the sole right to occupy the real property and during such right of occupation the [plaintiff] pay all instalments pursuant to the mortgage and all rates and taxes and like apportionable outgoings of the real property as they fall due;
5.2The parties hold their respective interests in the real property upon trust pursuant to these Orders;
5.3Neither party encumber the real property without the consent in writing of the other party.
…

The final orders concluded as follows:

Then pursuant to Section 81 of the Family Law Act 1975 the parties intend that these Orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.

The effect of the final orders was that the defendant had the option to purchase the property (‘first option’). If he failed to do so within the time specified by the final orders, one of two things could occur. The plaintiff could elect to retain the property herself in accordance with paragraph 3 of the final orders (‘second option’), or, if she did not make such an election, the property would be sold, and the proceeds of sale be distributed in accordance with paragraph 4 of the final orders.

The defendant says that following the making of the final orders, his solicitors attempted to correspond with the plaintiff’s solicitors to arrange for the implementation of the first option, but the plaintiff and her solicitors failed to co-operate to enable the settlement to proceed on the date contemplated by the final orders. On 22 October 2012, the defendant filed an urgent application in the family law proceeding to enforce the final orders (‘enforcement application’).

In the enforcement application, the defendant sought orders that the plaintiff be required to give effect to the first option, and that if the plaintiff failed to comply then the Registrar execute all necessary documents to effect the transfer of the property to him, that the plaintiff be restrained from making the election pursuant to the second option, that the defendant be afforded such additional time for making the payment to effect the first option as may be required by him, that the defendant have occupation of the property until settlement, that the plaintiff be restrained from causing settlement to be delayed, and that the plaintiff withdraw her pending application in the Magistrates’ Court for an intervention order.

The enforcement application was listed for hearing on 31 October 2012, but was not reached on that date. On that day, the plaintiff’s solicitor, Mr Geoffrey Wilson, filed and served an affidavit stating that he held a stamped Transfer of Land form signed by both parties and stamped by the State Revenue Office, and held instructions that the plaintiff was ready, willing and able to settle the sale of the property to the defendant in accordance with the first option on 15 November 2012. Mr Wilson exhibited the Transfer of Land form, and a copy of a letter from the defendant’s loans officer at Westpac to him confirming that Westpac would be able to settle on 15 November 2012.

The enforcement application was re-listed for hearing before Federal Magistrate Turner on 16 November 2012 at 10.00am, the day following the date scheduled for settlement under the first option. By agreement, the parties had extended the date for settlement to 11:30am on 16 November 2012[2], and the enforcement application was stood down to permit settlement to occur. However (and I understand that the defendant disputes this characterisation of what happened that day), the transaction did not settle at 11:30am, as the mortgage document drafted by Westpac, the defendant’s lender, had two mortgagees (the defendant and his mother), but the Transfer of Land form provided that the defendant was the sole transferee of the property.[3]
[2]See the letter from the defendant’s solicitors to the plaintiff’s solicitors dated 15 November 2012.
[3]It seems that the arrangement was that at settlement, there would be a transfer of the property from the plaintiff to the defendant (which was not dutiable), and then a contemporaneous transfer from the defendant to himself and his mother, which would be dutiable. It seems that the transfer of land form giving effect to the second transfer had not yet been prepared, and the stamp duty had not been paid, although these matters were attended to later on 16 November 2012.

The defendant and his solicitors took steps to remedy the situation, and planned to be in a position to settle by 3:30pm that day. However, at around 1:40pm, before the hearing of the enforcement application resumed at around 2:30pm, the plaintiff made an election to proceed with the second option. In response, counsel for the defendant applied for orders compelling the parties to attend settlement at 3:30pm.

His Honour dismissed this application, and the enforcement application on the basis that:

Both parties had complied with their obligations but the bank had prevented settlement[4];
The orders of 15 August 2012 provided that the payment was to be made on or before 15 November 2012, but an agreement was reached that settlement could take place at 11.30am on 16 November 2012. As that settlement did not take place, the respondent elected during the luncheon adjournment, to pay out the applicant pursuant to order 3 made on 15 August 2012[5]; and
[The defendant] then sought an order that the parties attend settlement at 3.30pm on 16 August 2012. The Court declined to do that, as that would have conflicted with the orders of 15 August 2012.[6]

[4][2014] FMCAFam 1427 [8].

[5]Ibid [10].

[6]Ibid.

On 5 December 2012 the plaintiff sent two cheques totalling $50,000 to the defendant’s solicitors. The defendant rejected the plaintiff’s attempts to retain the property pursuant to her election by returning the cheques on 7 December 2012. The plaintiff again attempted to send a cheque to the defendant on 7 February 2014, after the decision of Strickland J referred to in the following paragraphs of these reasons, which was returned to the plaintiff’s solicitors on 14 February 2014.

Subsequent Litigation

On 20 January 2014 Strickland J dismissed the defendant’s application for leave to appeal the decision of Turner FM to dismiss the enforcement application. By the time of the hearing of the application for leave to appeal, the defendant no longer retained solicitors and counsel.

The defendant’s grounds of appeal were as follows:

i.the Federal Magistrate erred in interpreting or applying the final order made 15 August 2012, when finding that the [plaintiff’s] right to elect become operative;
ii.the Federal Magistrate failed to give any or appropriate weight to facts relevant to the proceedings, including the fact that the [defendant] and his bank had been ready and willing to settle for some time and the [plaintiff’s] frustration of the implementation of the terms of the final order and the settlement;
iii.the Federal Magistrate denied the [defendant] a fair or any hearing of his Applications to enforce the final order and effect the settlement;
iv.the Federal Magistrate failed to provide any or adequate reasons for judgment.

Strickland J dismissed the appeal, holding that:

His Honour applied the strict terms of the final orders in finding that the [plaintiff] was entitled to exercise her right to elect to retain the property…thus there is no obvious error here[7];
there was no apparent basis for the Federal Magistrate to take into account the so-called relevant facts[8].
…
In summary then, I find that it was not open to the Federal Magistrate to make the orders sought in the application made on 22 October 2012, and specifically it was not open to his Honour to further extend the time for payment by the [defendant]…[9]
The statement at paragraph 11 that his Honour “declined” to order that the parties attend settlement at 3:30pm that “as that would have conflicted with the orders of 15 August 2012” was all that his Honour needed to say consequent upon setting out the relevant background.[10]

[7][2014] FamCAFC 3.

[8]Ibid [24].

[9]Ibid [43].

[10]Ibid [50].

In his reasons, Strickland J referred to s 90SN(1) of the FLA, as follows:

Pausing there, can I say that on the unchallenged facts in this case I am at a loss to understand why instead of pursuing an appeal, the appellant did not institute proceedings pursuant to s 90SN(1) of the [FLA], and in particular relying on s 90SN(1)(c). In my view, although I cannot bind any court that may subsequently hear such an application, that would have achieved a successful outcome for the [defendant]. Indeed I observe that filing such an application was discussed between bench and bar at the hearing of this matter.[11]

[11]Ibid [31].

Section 90SN(1) of the FLA provides as follows:

(1)If, on application by a person affected by an order made by a court under section 90SM in property settlement proceedings, the court is satisfied that:
(a)there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance; or
(b)in the circumstances that have arisen since the order was made it is impracticable for the order to be carried out or impracticable for a part of the order to be carried out; or
(c)a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order; or
…

the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 90SM in substitution for the order so set aside.
(emphasis added).

However, at no time has the defendant ever made an application to vary the final orders to extend the time for payment under paragraph 1 of the final orders.

On 29 September 2015, the defendant applied to the High Court for special leave to appeal from the orders made by Strickland J on 20 January 2014.

The defendant’s grounds of appeal were that:

The court below failed to provide sealed copies of the orders made 20 January 2014.
The court erred in finding the application filed 22 October 2012 seeking to enforce the final orders of 15 August 2012 was both, too early, as at the date of filing the application, and then, too late, when the application was heard
The court below erred in finding the timeframe within an order to be a substantive order rather than a machinery provision.
Within reasons for judgment 20 January 2014, the court below erred in setting out a “Factual Background” where there had been no trial to establish the facts.

On 17 December 2015, Bell and Gageler JJ dismissed the defendant’s application for special leave on the papers.[12]
[12][2015] HCASL 240.

On 3 February 2014 the defendant filed a contravention application in the Federal Circuit Court of Australia pursuant to Part XIIIA of the FLA, directed at both the plaintiff and her solicitors.[13] In the statement of the alleged contraventions, the defendant contended:

The [plaintiff], willfully aided and abetted by her Solicitor without reasonable excuse failed to, contemporaneously with the payment, do all such acts and things and sign all documents as was required to effect a transfer of real property to the [defendant].
The [plaintiff], aided and abetted by her Solicitors, without reasonable excuse attempted to elect to retain the real property pursuant to Order 3.1 and attempted twice to pay the [defendant] pursuant to Order 3.2 whilst ignoring that it was the [plaintiff] and her Solicitors intentional conduct that prevented the [defendant] from complying with Order 1, 2, 2.2, 2.3. The [defendant] did not fail to make the payment and discharge the mortgage as is the prerequisite of Order 3. The [plaintiff] and her Solicitors used deliberate stall tactics to intentionally prevent the [defendant] from making the payment and discharging the mortgage by the due date.
The [plaintiff] without reasonable cause had other people residing at the real property in breach of her sole right to occupy and failed to pay all the rates of the real property.
The [plaintiff] and her Solicitors without reasonable excuse place a Caveat on the real property without the written consent of the [defendant].
The [plaintiff] without reasonable excuse claimed possession of property belonging to the [defendant] and some belonging to third parties. Some of this property has been sold by the [plaintiff].

[13]By this stage Mr Wilson had joined Lampe Family Lawyers, although the defendant asserted that the representation made to the court that Mr Wilson no longer practiced in his own right was also fraudulent and misleading.

On 1 September 2014, Judge Turner summarily dismissed the contravention application.

In his reasons[14], Judge Turner held that:
[14][2014] FCCA 1944.

It is clear from those reasons that Strickland J found that the [plaintiff] “was entitled to exercise her right to retain the property pursuant to paragraph 3 of the orders”.[15]

…the Court finds that the payment of $110,000.00 not having been made, the [plaintiff] had the right to elect to retain the property. It was not the [plaintiff] or her solicitors that prevented the [defendant] from making the payment, the [defendant’s] bank did…[16]
The [defendant] submits that his bank was ready to settle on 5 September 2012… That statement is in conflict with the [defendant’s] evidence that his bank was not ready to settle at 11.30am on 16 November 2012.[17]
…
The applicant accepted that on 16 November 2012 his bank sought an additional 3 hours to rectify an administrational (sic) error by it (T. p.22 1.16)[18]
The applicant concedes that his solicitor or bank got confirmation that the respondent’s was ready to settle at 4pm on 14 November 2012. The applicant concedes that on 16 November 2012 his bank sought an additional three hours to rectify an administrational error by it (T p.22, 1.16.).
The applicant submits that it was impossible for him to comply with order 1 unless orders 2 and 2.1 were complied with. The Court notes that it is not how the orders by consent were drawn. The transfer had to be given contemporaneously with the payment.
The Court finds that the applicant has no reasonable prospect of successfully prosecuting the proceeding or claims in his Contravention as amended and as further amended. They are dismissed.[19]

[15]Ibid [5].

[16]Ibid [29].

[17]Ibid [46].

[18]Ibid [47].

[19]Ibid [49]-[51].

Orders were made on 3 September 2014 for the defendant to collect his possessions from the property, and for the defendant to pay the plaintiff’s costs of the contravention application.

On 8 September 2014, the defendant filed a notice of appeal to the Family Court of Australia seeking leave to appeal the decision of Judge Turner to dismiss the contravention application.

The grounds of appeal were that:

The Federal Circuit Court Judge erred in not following correct procedure as defined by Federal Circuit Court rule 23B.04 and in particular by not informing the [plaintiff] of the allegation as defined by 25B.04(1) and by not asking the [plaintiff] whether the [plaintiff] wishes to admit or deny the allegation as defined by rule 25B.04(2).
The Federal Circuit Court Judge erred by copying part of a judgment of an Appeal from a different Application without giving any or appropriate weight to the evidence and annexures in affidavit material or argument put forward at the hearing. The evidence contained in the cut and pasted section of His Honours judgment is in conflict with the findings in other parts of His Honours judgment.
The Federal Circuit Court Judge erred in finding that the [plaintiff] was not bound to do all such acts and things as may be required to transfer her right, title and interest in the real property to the [defendant] until the initial payment had been provided. This is in direct conflict with the wording of the Orders and renders the Final Orders as drafted on 15 August 2012 defective and beyond implementation despite having been drafted on a standard form of the Family Court in a standard format.
The Federal Circuit Court Judge erred in finding that the Intervention Order taken out against the [defendant] voided all of the [defendant’s] property rights within the Final Orders…
The Federal Circuit Court Judge erred in failing to address any of the serious allegations and supporting evidence in the [defendants] testimony on affidavit.

In a decision delivered on 15 September 2015[20], Strickland J dismissed the first and second grounds of appeal.
[20][2015] FamCAFC <number>.

Ground three was also dismissed, on the basis that there was nothing unusual in the orders made and “plainly if the [defendant] was not able to tender the required payment then the [plaintiff] was not obliged to do anything to complete the settlement”.[21] Further, his Honour found that Judge Turner did not err in considering whether the defendant failed to make the payment, as: “Clearly, the amount was not paid, and that is all that is required to be established; the reasons for that are irrelevant to the interpretation of the order”.[22] Ground five was also dismissed as it was not a proper ground of appeal.
[21]Ibid [34].
[22]Ibid.

Strickland J did find that the judge erred in finding that the existence of an intervention order in favour of the plaintiff “meant that any items of property not in the shed were items that were in the possession of the [plaintiff], and the [defendant] had no right to possess them”, and upheld the fourth ground of appeal. He remitted the question of whether the defendant retained the right to recover his possessions to be heard by another Federal Circuit Court judge (‘remitter’).

On 12 October 2015, the defendant filed an application to the High Court for special leave to appeal from the decision of Strickland J delivered on 15 September 2015.

The grounds of appeal were as follows:

Without an application in accordance with the approved form, and without the required supporting affidavit, and without the required payment of the prescribed fee, and without the [plaintiff] having filed or served any documents whatsoever, the lower court turned the final hearing 10 July 2014 for the [defendant’s] contravention application into a hearing for summary dismissal.
The lower court allowed the applicant ten minutes to prepare, and respond to this, trial by surprise, summary dismissal hearing, and refused a request for an adjournment.
The lower court ultimately did not summarily dismiss the substantive application. Similarly, the lower court did not dismiss the alleged summary dismissal application. The lower court did however dismiss the substantive application without the application having been heard.
The rules applicable to an application for summary judgment, and the courts power to dispense with rules were discussed before the court below at the hearing of the appeal. This ultimately led counsel for the [plaintiff] to submit, that the substantive application should be remitted to the lower court, as proper procedure needs to be followed. The most significant discussions, and the relevant legislation did not form any part of the court below’s [sic] judgment, and did not raise a mention in the court below’s [sic] reasons.
The court below found the substantive application had been dismissed in reasons for judgment 15 September 2015, and then alternatively, found the substantive application had ben summarily dismissed in reasons for judgment 25 September 2015.

On 6 April 2016, Nettle and Gordon JJ dismissed the defendant’s application for special leave on the papers.

On 31 August 2016, Judge Hartnett heard the remitter. The remitted question was whether:

The [plaintiff] without reasonable excuse claimed possession of the property belonging to the [defendant] and some belonging to third parties. Some of this property has been sold by the [plaintiff].

On 9 September 2016, Judge Hartnett dismissed the application, with costs. It is not necessary for present purposes to canvass the issues in the remitter, and her Honour’s reasons for dismissing the defendant’s application.

On 6 October 2016, the defendant filed a notice of appeal in the Family Court of Australia with respect to the orders made by Judge Hartnett on 9 September 2016. On 2 March 2017, Strickland J dismissed the appeal, and ordered that the defendant pay the plaintiff’s costs of the appeal.

The parties were also engaged in a dispute in 2013 in the Magistrates’ Court at Ringwood regarding an intervention order obtained by the plaintiff in 2012, but it is not necessary to canvass the details of this proceeding in these reasons.

The evidence

The plaintiff relied upon an affidavit sworn by her on 15 January 2023. This affidavit canvassed the following matters:

(a) the relationship between the parties, and the events leading up to the making of the final orders;

(b) what transpired between the making of the final orders and the hearing of the enforcement application on 16 November 2022;

(c) the subsequent history of the litigation between the parties, as summarised in the preceding paragraphs of these reasons;

(d) the plaintiff’s attempts to give effect to the second option by tendering payment to the defendant, and the rejection of the payments;

(e) the requests made by the plaintiff and her solicitors to the defendant with respect to the removal of the caveat between 2015 and 2022, and the defendant’s refusal to remove the caveat;

(f) the plaintiff exhibited an email sent by her to the defendant on 22 February 2022, and his response dated 1 March 2022, where the defendant stated as follows:

There are many issues that have arisen throughout this protracted litigation that have not yet been resolved. I had every intention of commencing further proceedings in order to resolve these issues and had begun making the necessary preparations just prior to covid hitting and shutting everything down.
There is obviously a lot more to it than the three selective orders you have specified in our email. I will get back to preparations and commence further proceedings as soon as practicable as I, just like you, would like to bring this matter to an end.

(g) a summary of the complaints made by the defendant against her, her solicitors and counsel, and magistrates and judges to various heads of jurisdiction and regulators;

(h) the defendant’s failure to make an application under s 90SN(1) of the FLA; and

(i) the defendant’s failure to pay her legal costs pursuant to various court orders, totalling $27,202.55.

Under the heading “The defendant’s motivations”, the plaintiff deposed as follows:

I believe that the reasons why the defendant has pursued all these court applications also includes to harass, stress and punish me.
The defendant has stated in his affidavit material and to me that he wanted to retain my property to live in and so that he could continue to run his business in the shed on my property. He has also said to me that he believed that he would not ever be able to purchase another property of a similar size to mine and with a large shed on it in which he could run his business. He has expressed great anger to me that he has been unable to retain my property so that he could live and run his business there.
The defendant does not have sufficient funds to pay my legal costs as ordered by the court and he has told me that;
242.1He will have to go bankrupt if he does not obtain an Order that my home be transferred to him and then he will not have to pay anything to anyone;
242.2He does not care if costs are awarded against him because he is not going to pay them anyway;
242.3He is “broke”;
242.4He will to continue to litigate until I am as “broke” as him.

Under the heading “My current circumstances”, the plaintiff deposed as follows:

It is 10 years and 4 months since Final Orders were made.
That for more than 10 years after the date on which this court made Final Orders, I have been unable to make any arrangements in respect of my life, financial circumstances nor deal with my home because of the caveat lodged on the title of my home by the defendant is unjust and unreasonable.
The caveat has become a symbol of the control the defendant still holds over my life; a man I have not been in a relationship with for over 12.5 years.
Since June 2012, I have had sole and exclusive use of my property.
…
In or about April 2017, I met my now husband, David Gown and we married in September 2018.
David and I are prevented from living the life we choose as we cannot sell or rent the property and there is no relief in sight.
We are both nearing the age of retirement and would like to have our finances finally under our own control rather than at the mercy of the defendant removing the caveat.
As welcome as I am in my home when my friends are living there, it is not currently my home in the normal sense of a home.
David and I are looking for our “forever home” where we will retire. However, as soon as we think that we might have found that home, we are unable to purchase it as we cannot control our own finances. This is particularly frustrating.
David and I are talking about where and when we would like to retire. Even if we settle on a particular area, we are unable to purchase anything we like as the caveat is still in place. I feel like I am in limbo with no end in sight.
I have belongings stored across the country as I do not know when David and I will be free to make our own choices based on our own needs.
I cannot set a retirement date as I have no idea what my financial circumstances will be once this is over. It has cost me tens of thousands of dollars in legal fees and not knowing when that expenditure might end, makes it impossible to plan.
There are various leave and salary options available to Department of Health staff. I cannot plan what is beneficial to me and my family until I have control of my finances.
Once I have control of my property and finances, I will be able to make decisions based upon my needs and wants rather than the defendant’s control over my life.
I want to settle down in one spot. I am ready to do that and have been for a number of years. The caveat that the defendant has over my property prevents me from making financial decisions and hence plan my future with David.
Currently, David and I make financial decisions based upon whether the caveat has been removed rather than what we actually want to do.
Before commencing these proceedings, I have incurred approximately $190,000.00 in legal fees in defending the defendant’s court applications of which approximately $148,450.00 remains unpaid and my solicitors are demanding that I pay these fees.
In those proceedings, the defendant has been ordered by the courts to pay $27,202.55 of my legal fees but has failed to comply with those court orders and that amount remains unpaid.
I want to refinance the mortgage on my property of which I am the sole registered proprietor and in doing so deal with issues in my life including but not limited to those I have outlined above and the following;
268.1To pay my outstanding legal fees of approximately $148,450.00 plus any costs this court may order that the defendant pay me in these proceedings;
268.2To enable me to use my own funds to meet my obligations to the Applicant pursuant to order 3.2 the Final Orders of $50,000 when he advises me that he would accept payment;
268.3To enable me to access additional funds for my private use including to purchase a home with my husband.

In his affidavit affirmed on 24 April 2023, the defendant:

(a) deposed as to largely uncontroversial matters such as the background to the family law proceeding and the final orders;

(b) in relation to the events leading up to the enforcement application, the defendant deposed as follows:

In the days following the makings of the orders I set about securing the necessary finance to meet my obligations. I also attended my solicitors office and completed my part of the necessary transfer of land of document. My solicitor sent the transfer of land document to the plaintiffs solicitor on 22 August 2012. My bank then confirmed that my finance application had been unconditionally approved on 5 September 2012.
For ten straight weeks following the making of Final Orders, my solicitor did not receive a reply to any of the correspondence that she had sent to the plaintiffs solicitor in an attempt to proceed with the property settlement. Given the lack of response from the plaintiffs solicitor, and with only a few weeks left to the deadline, my solicitor filed an urgent enforcement application under sect. 106A(1)(b) of the Family Law Act 1975 on 22 October 2012.

(c) deposed as to what occurred at the hearings of the enforcement application on 31 October 2012 and 16 November 2012, attributing the fault for the failure to settle to the plaintiff, by reason of her delays and late demands for the payment of rates, not his bank;

(d) deposed as to the change of name and address of the plaintiff’s lawyers;

(e) in relation to the question of whether he ought to have made an application under s 90SN(1) of the FLA, as suggested by Strickland J, he deposed as follows:

It was explained to me starting afresh could result in entirely different orders to what had previously been made by consent. As there was already orders in place that had met with default by the plaintiff, It was certainly possible that the plaintiff could again default on any subsequent orders.
Similar to S 90 Sn of the act, S112AB and S112AD(1)(4) provides for default whilst giving the court the power to make further orders to enforce compliance with existing orders without the necessity of starting all over again. It was on that basis that I filed an application under s112 of the act on 3 February 2014.

(f) deposed that he paid three sets of legal costs to the plaintiff’s solicitors on 4 July 2014;

(g) deposed as to what took place during the contravention application, including the summary dismissal of his application to join the plaintiff’s solicitors to the contravention application;

(h) he exhibited a copy of what was said to be a transcript of a hearing at the Magistrates’ Court at Ringwood in 2013 regarding the intervention order, which I understand the defendant says to be a false document, as transcripts of such proceedings are generally not available; and

(i) he concluded as follows:

The evidence that supports the fact the plaintiff engineers her own default in complying with the Final Orders of 15 August 2012 is significant. The evidence that the plaintiff subsequently produced to defeat any consequence for her actions does not match any of the provable facts.
It is my sincere belief that there is substantial basis to have several of the previous orders made in this case set aside as orders obtained by fraud. Indeed, I was in the process of preparing such an application, and made the plaintiff aware via email on 1 March 2022 only a couple of weeks before the plaintiff commenced this Supreme Court action.
As was my intention before these proceedings commenced, I will continue to proceed with the application to have orders set aside in the Federal Circuit and Family Court of Australia at the conclusion of these proceedings. It is for that reason, and the many reasons highlighted in this affidavit that I will be seeking that the proceedings currently before this Court as commenced by the plaintiff be dismissed.

The defendant exhibited to his affidavit the following documents:

(a) the signed and stamped Transfer of Land form sent by the plaintiff’s solicitors to his solicitors on 29 October 2012;

(b) the affidavit sworn by Mr Wilson on 31 October 2012 said by the defendant to be misleading;

(c) the letter from the plaintiff’s solicitors to the Bank of Melbourne dated 8 November 2012 enclosing a mortgage discharge authority form signed by the plaintiff;

(d) a letter from the plaintiff’s solicitors to the defendant’s solicitors dated 16 November 2012 enclosing a cheque for half of the outstanding rates to be paid to the defendant at settlement;

(e) the payment receipt for the stamp duty paid by the defendant with respect to the second Transfer of Land form[23] on 16 November 2012;
[23]See footnote 3 of these reasons.

(f) a notice of change of address for service served by the plaintiff’s solicitors on 16 January 2013;

(g) an extract from the Legal Services Board register said to show that Mr Wilson continued to practice under the name of this former firm, notwithstanding representations said to have been made to the effect that the plaintiff had changed solicitors during the course of the contravention application;

(h) a receipt for payment of legal costs by him on 4 July 2014;

(i) the email from Mr Wilson to the defendant’s loan officer dated 30 October 2012 requesting urgent confirmation that Westpac was able to settle on 15 November 2012 for the purpose of the plaintiff responding to the enforcement application;

(j) a bill of costs prepared by the solicitors for the plaintiff dated 25 February 2014;

(k) an ASIC record of change of address for the plaintiff’s solicitors;

(l) a document said to be transcript of a hearing at the Magistrates’ Court on 13 September 2013; and

(m) an email exchange between the plaintiff and the defendant in February and March 2022 regarding the caveat over the property.

The plaintiff’s submissions

In her written submissions filed on 5 June 2023, the plaintiff referred to the well-established principles regarding applications made pursuant to s 90(3) of the TLA,[24] being that the onus is on the caveator to demonstrate that there is a prima facie case that he has an interest in the property capable of being protected by the caveat, and that the balance of convenience favours the maintenance of the caveat.
[24]Referring to Piroshenko v Grojsman (2010) 27 VR 489 at 491; Lawrence & Hanson Group Pty Ltd v Young [2017] VSCA 172 at [36]-[38]; AAGG Developments Pty Ltd v Saafin Constructions Pty Ltd [2020] VSC 768 at [8]-[9].

The plaintiff submitted that the defendant lacks a caveatable interest in the property, as the caveat claims that the defendant has an interest in the property on the basis of a constructive trust, but he has failed to adduce any evidence to support a prima facie case that he held a constructive trust over the property at the time he lodged the caveat, or continues to hold such an interest. Further, there is no evidence of a joint venture constructive trust or common intention constructive trust.[25] Finally, any trust created by the final orders in favour of the defendant was extinguished by the plaintiff’s election to retain the property.
[25]Referring to Muschiniski v Dodds (1985) 160 CLR 583; Baumgartner v Baumgartner (1987) 164 CLR 137; Calverley v Green (1984) 155 CLR 242.

The plaintiff submitted that:

(a) the existence of a de-facto relationship does not, by itself, create a caveatable interest in a de facto partner’s property, even where combined with an express or implied undertaking to provide support and accommodation[26];
[26]Cressy v Johnson (No 3) [2009] VSC 52 at [193]-[194] citing Green & Ors v Green (1989) 17 NSWLR 343, 353; Stowe v Stowe (1995) 15 WAR 363, 374.

(b) a mere prospective or actual court proceeding will not, of itself, support a caveat[27];

(c) the defendant is precluded from relying upon matters which would go to the existence of a constructive trust by reason of res judicata, issue estoppel and/or an Anshun estoppel; and

(d) if there was found to be an equitable interest in favour of the defendant pursuant to the final orders, the final orders post-dated the lodgement of the caveat, and the plaintiff’s subsequent election to retain the property pursuant to those orders discharged the defendant’s entitlement to the property, under any trust created by the final orders.

[27]Westpac Banking Corporation v Dimopoulos [2006] VSC 10 at [7]-[9]; Hermiz v Yousif [2019] VSC 160 at [39]; Bell v Graham [2000] VSC 142 at [19].

The plaintiff says that the principles of estoppel by record apply here, and the defendant should be prevented from relitigating matters in this Court, given the public interest in finality of litigation.[28]
[28]Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 50

The plaintiff submitted that the defendant’s allegations of fraud against the plaintiff and her lawyers similarly do not support the maintenance of the caveat, as:

(a) a claim to set aside orders made by a court of competent jurisdiction is a mere equity, that is, an in personam right to sue rather than an in rem right relating to land; and

(b) in any event, the alleged fraud occurred after the final orders were made, and therefore the conduct complained of by the defendant would not fall within the scope of s 90SN(1)(a) of the FLA.

The plaintiff submitted that where there have been final orders made by a court between the same parties and concerning the same issues, this Court is precluded from making findings of fact or law which were necessarily determined in those judgments, as judicial determination of a matter of fact and law disposes once and for all of the issue,[29] noting that orders reached by consent are considered as a judgment on the merits for this purpose.[30] Therefore, in this proceeding (or any other proceeding) the defendant is precluded from challenging those findings.[31]
[29]Blair v Curran (1939) 62 CLR 464, 532-533.
[30]Re South American and Mexican Co Ex p. Bank of England [1895] 1 Ch. 37.
[31]Clayton v Bant (2020) 272 CLR 1.

The plaintiff submitted that whether the plaintiff was entitled to exercise the second option has been determined conclusively by another court, and cannot be agitated by the defendant again in this proceeding. Further, pursuant to the final orders, the defendant was required to withdraw the caveat in accordance with the second option.

The plaintiff submitted that an issue estoppel arises in relation to the interpretation of the final orders is evident from the following findings of fact and law made on various occasions during the course of the enforcement application and the contravention application:

(a) in the reasons for the decisions of Federal Magistrate Turner delivered on 16 November 2012[32]:
[32][2012] FMCAFam 1427.

When the matter came on before the Court at 10am on 16 November 2012, the payment had not been made. Ms Colla represented the applicant and Mr Smith represented the respondent.
Ms Colla advised the Court that settlement was to take place at 11.30am that day, and sought an order that the respondent pay the outstanding mortgage repayments and outgoings of $7,033.38. The matter was stood down to enable the settlement to take place.
On resuming at 2.20pm, the Court was advised that settlement had not taken place because the bank wanted a transfer of land in terms different to those proposed by the parties at settlement.
Both parties had complied with their obligations but the bank had prevented settlement.
The applicant had a cheque ready to make the payment. The applicant then proposed that settlement take place at 3.30pm but the respondent opposed that.
The orders of 15 August 2012 provided that the payment was to be made on or before 15 November 2012, but an agreement was reached that settlement could take place at 11.30am on 16 November 2012. As that settlement did not take place, the respondent elected during the luncheon adjournment, to pay out the applicant pursuant to order 3 made on 15 August 2012.
Ms Colla then sought an order that the parties attend settlement at 3.30pm on 16 August 2012. The Court declined to do that, as that would have conflicted with the orders of 15 August 2012.[33]
[33]Ibid [5]-[11].

(b) in the reasons delivered by Strickland J on 20 January 2014[34] dismissing the defendant’s application for leave to appeal the orders made by Turner FM on 16 November 2012, where his Honour said:
[34][2014] FamCAFC 3.

I must say though that there is no necessary connect between these grounds and the submissions made in respect of them. For example, it is not demonstrated in those submissions how the Federal Magistrate erred in the manner complained of in Ground 1. His Honour applied the strict terms of the final orders in finding that the respondent was entitled to exercise her right to elect to retain the property pursuant to para 3 of the orders. Thus there is no obvious error here. Moreover, with Ground 2, in again applying the strict terms of the orders, there was no apparent basis for the Federal Magistrate to take into account the so-called relevant facts. Thus, there is no obvious error here either.
…it is quite apparent from the transcript of the hearing before his Honour, and his Honour’s brief reasons for judgment, that his Honour was of the view that they were substantive provisions and thus he could not, on the basis of the application that was before him, vary the order to permit settlement to take place later that day. ...
However, it is clearly apparent from the transcript of the hearing that the agreement between the parties was not to extend the time generally to 16 November, but to extend it to 11.30am on that day, and to order settlement later than that required a new agreement…
In summary then, I find that it was not open to the Federal Magistrate to make the orders sought in the application filed on 22 October 2012, and specifically it was not open to his Honour to further extend the time for payment by the appellant of the sum of $110,000.[35]
[35]Ibid [24], [27], [28], [43].

(c) in the reasons of the High Court of Australia dismissing the defendant’s application for special leave to appeal the decision of Strickland J made on 20 January 2014[36], where Bell and Gageler JJ said that:
[36][2015] HCASL 240.

The decision of the Family Court involved the resolution of matters of practice and procedure by the application of well-settled principles. Nothing in the applicant’s application casts doubt on the correctness of the decisions below or suggests that there is a question of principle which warrants a grant of special leave. It would therefore be futile to grant the enlargement of time sought by the [defendant].[37]
[37]Ibid.

(d) in the decision of Judge Turner made on 1 September 2014[38] dismissing the contravention application, where his Honour stated that:
[38][2014] FCCA 1944.

It is clear from those reasons that Strickland J found that the [defendant] “was entitled to exercise her right to retain the property pursuant to paragraph 3 of the orders”.
It is not contested that the payment of $110,000.00 to the [plaintiff] has not occurred. The orders cannot be interpreted as requiring the [plaintiff] to do something, at the same time as something that has not occurred. …
The [plaintiff] was not required to do all things to effect a transfer at the same time as payment, as the payment did not occur…
The Court finds that it is clear from those statements that the [defendant’s] bank prevented settlement and the approval of his finance….
Strickland J. recorded at [12] (supra) that the “[plaintiff] was ‘ready, willing and able to settle the Transfer on 15 November 2012’”. The Court finds no evidence in conflict with that statement; it is accepted…
The Court finds that as the [defendant] did not make the payment to the [plaintiff] required by order 1, the [plaintiff] was never bound by order 2…nor did the [plaintiff] prevent compliance with the order…
The [defendant] concedes that his solicitor or bank got confirmation that the respondent’s bank was ready to settle…The [defendant] concedes that on 16 November 2012 his bank sought an additional three hours to rectify an administrational error by it.[39]
[39]Ibid [5],[22],[23],[26]-[28],[47].

(e) in the reasons of Strickland J delivered on 15 September 2015,[40] which stated:

…In any event, again, I am not persuaded that his Honour erred in considering whether the [defendant] had failed to make the required payment. Clearly, the amount was not paid, and that is all that is required to be established; the reasons for that are irrelevant to the interpretation of the order.[41]
[40][2015] FAmCAFC <number>.
[41]Ibid [38].

The plaintiff submitted that, accordingly, the defendant’s allegations of fraud have been dealt with by a court of competent jurisdiction, and the defendant is simply attempting to re-litigate matters of fact and law which have already been decided elsewhere. The plaintiff submitted that this remarkable litigation history means that the balance of convenience favours the removal of the caveat, in circumstances where a ten year period has elapsed since the making of the final orders. The defendant has not presented anything to this Court which would demonstrate an arguable defence to the application to remove the caveat, but the defendant has refused to remove the caveat when requested, and when required to do so by court orders.

The plaintiff submitted further that the balance of convenience favours the removal of the caveat, given that:

(a) the plaintiff wishes to purchase a home with her husband, and the caveat prevents the plaintiff from borrowing against or selling the property to enable this to occur;

(b) the caveat prevents the plaintiff from setting a retirement date or making other decisions about her future;

(c) the plaintiff wants to refinance the property in order to pay her outstanding legal fees and to discharge the legal entitlement of the defendant pursuant to the final orders;

(d) the defendant has demonstrated a disregard for court orders, has been described as “vexatious” in a Federal Circuit Court proceeding, has shown a disregard for judicial officers and the sanctity of the judicial process, has displayed hostility towards the plaintiff’s lawyers by making serious allegations against them without a proper basis, and has failed to comply with numerous cost orders made against him in favour of the plaintiff in the amount of $27,202.55; and

(e) the defendant seeks to use the court process to vindicate personal grievances rather than assert legitimate legal rights.

The plaintiff submitted that, given the matters referred to at (d) and (e) above, there is a sufficient basis for this Court to restrain the defendant from lodging further caveats against the property, as there is a real risk that he will lodge a further caveat over the title to the property.

The defendant’s submissions

The defendant submitted that the final orders conferred upon him an equitable interest in the property. The defendant submitted that the final orders were structured in such a way as to enable the caveat to remain over the title to the property in order to protect his interest in the property.

The defendant submitted that the evidence filed in this proceeding supports a potential application to have orders set aside for fraud. That material was not available prior to the final orders being made, and as such, the fraud could not be detected at the time the final orders were made. The defendant submitted that the plaintiff was not ready, willing and able to settle in accordance with the first option on 16 November 2012, despite the representations made by Mr Wilson in his affidavit of 31 October 2012, and therefore the defendant, his legal representatives, and the court were misled by the plaintiff and her solicitors. The conduct of the plaintiff’s solicitors and counsel in the enforcement application could not be properly scrutinised given the further misleading representations made by them during the course of the contravention application, which led to his application to join them to the contravention application being summarily dismissed.

The defendant submitted that his interpretation of the final orders are as follows:

(a) he was required to, within the timeframe identified by the first option, to arrange for the payment of $110,000 to the plaintiff and fund the discharge of the mortgage registered against the property;

(b) in that same timeframe, the plaintiff was required to do all such acts and things to transfer the property to the defendant, including to arrange settlement; and

(c) that the two requirements at (a) and (b) above are independent, in that the plaintiff was to arrange settlement in order for the $110,000 to be released to her, which she did not do.

The defendant submitted that the final orders themselves give rise to a caveatable interest, relying upon paragraphs 4.2.3 and 5.2.1 of the final orders.

The defendant says that the orders referred to by the plaintiff in her affidavit, being the orders that “All extant applications are dismissed…” and that “The [defendant] shall do all things and sign all documents required to withdraw, at his expense, any Caveat lodged on his behalf against title to the real property” were not included in the final orders.[42]
[42]However, counsel for the plaintiff drew my attention to the orders signed by Turner FM on 15 August 2012, to which the final orders were annexed. Paragraph 3 of these orders states that “All extant applications are dismissed…” The obligation imposed upon the defendant to remove the caveat is to be found in paragraph 3.2 of the final orders.

The defendant submitted that he does not seek to set aside the final orders, rather that there are issues with how the final orders have been implemented given the fraud committed by the plaintiff in having enforcement application and the contravention application dismissed.

Relevant legal principles

A fundamental feature of a caveat under the TLA is that it must be supported by an estate or interest in land. That interest must be:

must be an interest in respect of which equity would give specific relief against the land itself, either by way of requiring the provision of a registrable instrument or in some other way, for example, ordering a sale to enable a charge to be satisfied out of the proceeds.[43]

[43]Spencer v Spencer, Hedigan J, Supreme Court of Victoria, 16 October 1996, 9; cited in Goldstraw v Goldstraw [2002] VSC 491 [24].

In the recent decision of Matthews AsJ in Greater Geelong City Council v Giurina,[44] the general principles in applications under s 90(3) of the TLA were summarised as follows (omitting footnotes):
[44][2023] VSC 59.

Section 90(3) of the TLA permits any person adversely affected by a caveat, lodged under s 89 of the TLA, to bring proceedings in a court against the caveator for the removal of the caveat. Section 90(3) also empowers a court dealing with such an application to make such orders as the court thinks fit.
The legal principles regarding applications pursuant to s 90(3) of the TLA for the removal of a caveat are well established. Derham AsJ has summarised the applicable principles in AAGG Developments Pty Ltd v Saafin Constructions Pty Ltd as follows:
The applicable principles are not in dispute. In short summary they are:
(a)The application is in the nature of a summary procedure analogous to the determination of interlocutory injunctions. The procedure is consequently interlocutory in substance, even though it may give rise to a final order.
(b)The Court’s power under s 90(3) of the TLA is discretionary.
(c)The caveator bears the onus of establishing that there is a prima facie [case] that it does have the estate or interest in land as claimed.
(d)The prima facie case test is often used interchangeably with whether a serious question to be tried is established. The prima facie case test is to be preferred. That does not mean that the Caveator must show that it is more probable than not that at trial the plaintiff will succeed. The Caveator must show that they have a prima facie case with sufficient likelihood of success to justify the maintenance of the caveat, and the preservation of the status quo pending trial.
(e)If the caveator establishes a prima facie case to be tried in relation to the estate or interest claimed, the caveator must further establish that the balance of convenience favours the maintenance of the caveat until trial.
(f)There is a relationship between the strength of the case in establishing a prima facie case to be tried and the extent to which the caveator must establish the balance of convenience favours the caveator; the stronger the prima facie case, the more readily the balance of convenience might be satisfied. It is sufficient that the caveator show a sufficient likelihood of success that, in the circumstances, justifies the practical effect which the caveat will have on the ability of the registered proprietor to deal with the property in question in accordance with its normal proprietary rights.

An application to remove a caveat involves two steps. First, the Caveator must establish that there is a prima facie case – there is a probability on the evidence before the Court that the Caveator will be found to have the asserted legal or equitable rights or interest in the land. Second, having done so, the Caveator must establish that the balance of convenience favours the maintenance of the Caveat on the title until trial and that probability is sufficient to justify the practical effect which the caveat has on the ability of the registered proprietor to deal with the property in question in accordance with their normal proprietary rights.[45]

[45]Ibid [102]-[103].

Further, in the decision of Piroshenko v Grojsman[46], Warren CJ emphasised that:

The onus which the caveator must discharge is an onus with respect to an interest or rights in land. Caveats are not ‘bargaining chips’. It is not sufficient for the caveator to establish a prima facie case that they have contractual, equitable or statutory rights against the caveatee; their interest must attach to the property with respect to which the caveat has been lodged.[47]
(citations omitted)
[46](2010) 27 VR 489.
[47]Ibid [23].

Discussion

In this case, the matters relied upon by the defendant to establish that he has an equitable estate in fee simple based on a “implied, resulting or constructive trust” and “by virtue of a constructive trust” are:

(a) the final orders, which the defendant says conferred an equitable interest in the property upon him; and

(b) a potential application by the defendant to have the orders dismissing the enforcement application and/or the contravention application varied or set aside for fraud.

The defendant seems to accept that his claim to a constructive trust over the property has been subsumed in the final orders. No formal application for an amendment to the caveat has been made, although for completeness, I will consider whether the defendant has a caveatable interest at all, not just the caveatable interest referred to in the caveat.

However, even though the defendant has foreshadowed that he will make an application to have certain orders set aside for fraud, which seems to me to be the only possible way that he could circumvent the principles of res judicata and issue estoppel, such a claim does not give rise to a caveatable interest.[48]
[48]Westpac Banking Corporation v Dimopoulos [2006] VSC 10 [9].

The plaintiff is correct to say that a cause of action to set aside a judgment for fraud is a mere equity, rather than a proprietary interest in land capable of supporting a caveat.[49] Further, even if, for the sake of argument, that a potential claim of that nature is capable of supporting a caveat, it seems to me that any such claim is very weak.
[49]See my decision in Super Jacobs Pty Ltd v Esera Faalogo [2019] VSC 778 [29]-[33] and Reindel v Confreight Pty Ltd(No 2) [2022] VSC 442 [88]-[91].

An allegation that a decision of a court has been procured by fraud is a serious allegation, requiring solid proof.[50] The evidence adduced by the defendant in this application does not satisfy me that there is a prime facie case, or a serious question to be tried, that the orders made dismissing the enforcement application and the contravention application (which were subsequently upheld on appeal) were procured or otherwise tainted by fraud.
[50]See s 140(2) of the Evidence Act 2008 (Vic).

The defendant relies upon the affidavit filed by Mr Wilson in the enforcement application on 31 October 2012 as being fraudulent and misleading. I understand the defendant’s argument to be as follows: after the making of the final orders, the plaintiff and her solicitors failed to cooperate with the defendant and his solicitors in taking the necessary steps to implement the first option. She refused to settle prior to 15 November 2012, the last day for settlement under the final orders, and dragged her feet in signing the Transfer of Land form.

In Mr Wilson’s affidavit of 31 October 2012, the plaintiff falsely represented to the defendant, his solicitor, counsel and the Court that the plaintiff was ready, willing and able to settle on 15 November 2012. Further, by annexing an email from the defendant’s loans officer to him to the effect that Westpac was ready to settle on 15 November 2012, the solicitor misled the Court into believing that the plaintiff’s bank was ready to settle on 15 November 2012, when it was not, and could not have been.

The defendant exhibited to his affidavit a copy of a letter from the plaintiff’s solicitor to the Bank of Melbourne (the mortgagee of the property) attaching a Discharge Authority Form signed by the plaintiff (required to comply with the first option) dated 8 November 2012, only seven days prior to the scheduled settlement date. However, the defendant also annexed a Bank of Melbourne form headed “Request to amend an existing security”, which included the following instruction:

Note: It is important to lodge this form AT LEAST 10 business days = 14 calendar days (excluding public holidays) prior to settlement.

The defendant relied upon this note to support his allegation that the plaintiff could never have been in a position to settle on 15 November 2012. He also denied that the settlement date had been extended to 16 November 2012 at 11:30am by agreement, and denied that the transaction failed to settle by that time resulted from an administrative error or oversight of his bank.

It is clear from all of the materials in evidence that the defendant is very aggrieved by the plaintiff’s conduct between the making of the final orders and the dismissal of the enforcement application on 16 November 2012. From the defendant’s perspective, the plaintiff dragged her feet when taking steps necessary to comply with what was required by the first option, and then relied upon those delays to thwart the transfer of the property to him.

It may well have been that these delays resulted in the need to delay settlement until 16 November 2012, and that it was unfair (in a practical sense, rather than the legal sense) for the plaintiff to abruptly change her position and exercise her right to elect to enforce the second option in the hours after the scheduled settlement fell over. However, notwithstanding the defendant’s submissions to the contrary, it is clear that it was not the plaintiff’s conduct which caused the settlement scheduled for 11:30am on 16 November 2012 to fall over. It was the defendant’s bank which required the parties to execute a new transfer of land to conform with the terms upon which they had advanced finance to the defendant.

I can infer from the materials that Westpac required that the property be transferred to both the defendant and his mother (referred to as the co-mortgagee), including the fact that the defendant was required to pay stamp duty upon the transfer (no stamp duty being required if the transfer was to the defendant alone). It was not suggested that the plaintiff could have known or should have known that the bank required the execution of a further transfer of land form. The signed and stamped transfer of land form was in Westpac’s hands no later than 30 October 2012, and on 31 October 2012 Westpac’s representative confirmed that it would be in a position to settle on 15 November 2012. How the blame for Westpac’s failure to appreciate that another transfer of land form needed to be executed until the day scheduled for settlement could be sheeted home to the plaintiff escapes me.

That it was the defendant’s bank that was responsible for the failure to settle on 16 November 2012 was acknowledged:

(a) by the defendant’s counsel when the hearing of the enforcement application resumed in the afternoon of 16 November 2012;

(b) in an affidavit made by the defendant in the contravention application on 13 February 2014, where the defendant deposed:

At settlement, my bank (Westpac) hold (sic) up the settlement on my finance relies on an additional transfer of land subsequent to the Court order transfer as security for finance;[51]
[51][2014] FCCA 1944 [24].

(c) in an affidavit made by the defendant in the contravention application on 7 April 2014, where the defendant deposed:

Settlement did not occur due to an administrational error of my bank.

(d) in the reasons of Judge Turner of 1 September 2014[52], where his Honour stated as follows:
[52]Ibid.

The applicant submits that his bank was ready to settle on 5 September 2012 (T p.21, 1.19). That statement is in conflict with the applicant’s evidence that his bank was not ready to settle at 11.30am on 16 November 2012.
The applicant accepted that on 16 November 2012, his bank sought an additional 3 hours to rectify an administrational (sic) error by it (T p.22 1.16)
“…structured in the way are with 1, 2, 2.1, 2.2 and 2.3 to enable order 1 to happen” (sic) (T p.23 1.39)

The applicant concedes that his solicitor or bank got confirmation that the respondent’s bank was ready to settle at 4pm on 14 November 2012. The applicant concedes that on 16 November 2012 his bank sought an additional three hours to rectify an administrational error by it (T p.22 1.16).[53]
[53]Ibid [46]–[49].

(e) in the course of the hearing before Strickland J on 25 February 2015, as shown by the following extract of the transcript of the hearing:

HIS HONOUR: Yes, she was, under the order. And the problem was, you failed to pay the $110,000 by the date that was ultimately to be the end date. That’s the problem. And the only reasons that didn’t happen at the end of the day – forget the issues about, you know, toing and froing about trying to get it done earlier, but on the 16^th, the problem was you had settlement at 11.30. It didn’t go through because the bank said we need another transfer. And anything that happened on the 16^th in terms of extending the time had to be subject of agreement.
There was no agreement, so it was all over. And that was you appeal that you took – the first appeal that you took – and you were unsuccessful. You can’t revisit that, [PMD]. And I understand – I started by saying I understand that’s your concern, but that’s why it happened. At the end of the day, the delay caused by the bank not being prepared to settle it at 11.30 because they wanted another transfer done. If it had settled at 11.30, you wouldn’t have had the problem – no problem.
[PMD]: Well, this leaves - - -
HIS HONOUR: You would have retained that property.
[PMD]: This leaves me in a complete quandary. Well, that wasn’t the only reason why it didn’t happen, but anyway - - -
HIS HONOUR: No. If you’re referring to everything leading up to that, I said put that aside, because at the end of the day, on the 16^th, everybody was ready to settle and complete it at 11.30. Everyone agreed to leave it till 11.30. But the bank said we can’t settle because we need another transfer. Correct?

As can be seen from the above, the issue about who was at fault for the failure to settle on 16 November 2012 has been litigated and re-litigated again and again. However, it was not until the hearing of this application that the defendant contended that the failure to settle on that day was not caused by his bank.

I pause here to note that under s 91(1) of the Evidence Act 2008 (Vic) that evidence of the decision, or a finding of fact in another proceeding is not to prove the existence of a fact in issue in that other proceeding. However, I doubt that section excludes evidence contained in reasons for judgment of admissions or concessions made by a party to the other proceeding in the course of the other proceeding. For example, the concession made by the defendant recorded in the reasons of Judge Turner of 1 September 2014[54] to the effect that the plaintiff’s bank was ready to settle on 14 November 2012 meant that the question of whether the plaintiff's bank was in a position to discharge its mortgage by the date scheduled for settlement was not a “fact in issue” in the contravention application.
[54]Ibid [49].

Finally, the defendant’s contention that the plaintiff was not ready, and did not intend to settle on 16 November 2012 is inconsistent with the plaintiff’s solicitor tendering a cheque for the payment of rates to be exchanged at settlement that day. I understand that there was a dispute between the plaintiff and the defendant about the parties’ liability to pay rates. I also understand that this dispute was not an impediment to settlement.

Accordingly, even if the defendant’s claim to set aside the orders made in the enforcement application and/or the contravention application on the grounds of fraud conferred upon him an equitable interest in the property (which it does not), the defendant’s claim in that regard is very weak. The strength of the caveator’s claim is relevant to the question of whether the caveat should be maintained.[55]
[55]AAGG Developments Pty Ltd v Saafin Constructions Pty Ltd [2020] VSC 768 [8(f)].

For completeness, the defendant alleges that the fraud was procured by the affidavit of Mr Wilson sworn on 31 October 2012, and the statements made by counsel for the defendant during the hearing on 16 November 2012. The defendant also relied upon the Bank of Melbourne document which states that 14 days’ notice was required to be provided to obtain a mortgage discharge, and the evidence that the plaintiff’s bank did not receive the discharge authority until seven days before the scheduled settlement date to submit that Mr Wilson’s statement to the effect that the plaintiff was ready, willing and able to complete the transaction under the first option was misleading.

However, the evidence is to the contrary. The solicitor had provided the signed and stamped transfer of land to the defendant’s solicitor, albeit later than the defendant would have liked. Mr Wilson’s affidavit expressly stated that the email from the defendant’s lending officer was from the defendant’s bank. It is a little odd that Mr Wilson would exhibit a letter from the defendant’s bank rather than something from the plaintiff’s bank, but no reader of the affidavit could have been deceived as to who the email was from. And, while a bank might ordinarily require 14 days to issue a discharge of mortgage, that does not mean a bank cannot turn around a request more quickly: indeed, the evidence is clear that the plaintiff’s bank was ready to settle on the morning of 16 November 2012, just eight days after the request for discharge was sent by the plaintiff’s solicitors to the Bank of Melbourne.

While the evidence only includes part of the transcript of the hearing on 16 November 2012, there was nothing said by counsel for the plaintiff during the hearing which could be characterised as misleading, and no particulars or evidence of misleading statements by counsel were identified by the defendant.

Further, again setting aside the issue that any claim to set aside the judgments in the enforcement application and the contravention application is a mere equity, which confers no proprietary interest in the property upon the defendant, and likewise, any claim under s 90SN(1) is a statutory claim incapable of giving rise to an equitable interest, the interpretation of the final orders and the entitlement of the plaintiff to make the election that she did was the subject of extensive litigation. The defendant has been aware of the contents of Mr Wilson’s affidavit of 31 October 2012 since around that time. I agree that the defendant is estopped from further litigating his entitlements under the final orders and the validity of the plaintiff’s election to retain the property. Even if the question of the alleged fraud has not yet been expressly raised in the applications and appeals summarised earlier in these reasons (which I suspect they may have been) then they should have been, under the principles in Port of Melbourne Authority v Anshun.[56]
[56](1981) 147 CLR 589.

In this decision, the High Court approved the following statement in Henderson v Henderson:[57]

where a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.[58]

[57](1843) 3 Hare.

[58]Ibid, 115.

The High Court went on to say as follows:

In this situation we would prefer to say that there will be no estoppel unless it appears that the matter relied upon as a defence in the second action was so relevant to the subject matter of the first action that it would have been unreasonable not to rely on it. Generally speaking, it would be unreasonable not to plead a defence if, having regard to the nature of the plaintiff's claim, and its subject matter it would be expected that the defendant would raise the defence and thereby enable the relevant issues to be determined in the one proceeding. In this respect, we need to recall that there are a variety of circumstances, some referred to in the earlier cases, why a party may justifiably refrain from litigating an issue in one proceeding yet wish to litigate the issue in other proceedings e.g. expense, importance of the particular issue, motives extraneous to the actual litigation, to mention but a few.[59]

[59](1981) 147 CLR 589, 602-603.

Applying those principles to the assertions made by the defendant to the effect that the orders in the enforcement application and the contravention application were procured by fraud, it seems to me to have been unreasonable for the defendant not to raise those allegations in the enforcement application and/or the contravention application, given that the allegedly fraudulent conduct took place before the hearing on 16 November 2012, and certainly well before the hearing of the contravention application in 2014. Accordingly, the defendant’s prospects of success in prosecuting such an application seem very slim indeed.

Finally, the defendant says that he has an equitable interest in the property by reason of the terms of the final orders. I am prepared to accept, for present purposes, that the terms of paragraph 2 of the final orders conferred upon the defendant an equitable interest in the property akin to the interest of a purchaser of a property under a contract of sale. Further, paragraph 5.2 of the final orders provides that, until the occurrence of certain events, the parties hold their respective interests in the property on trust.

One difficulty facing the defendant’s submissions in that regard is that any equitable interest conferred by the final orders is different than the equitable interest relied upon in the caveat, which was based upon a constructive trust. A constructive trust is of quite a different character than a trust created by the execution of a contract of sale, or the express trust created under paragraph 5 of the final orders. And, while it is possible to amend a caveat, the authorities provide that amendments should not be lightly granted.[60]
[60]In Percy & Michele Pty Ltd v Gangemi [2010] VSC 530, Macaulay J said (at [104]), in respect of the discretion of the Court to amend a caveat “…the court should not readily act in a way which might encourage the belief that caveats can be imprecisely formulated and “fixed up later”…Wrongly formulated caveats should not easily be tolerated.”

However, even if an application to amend the caveat was made and granted, the defendant would face a further difficulty in relying upon the final orders for the purpose of maintaining the caveat. It is clear from the first part of paragraph 5 of the final orders that the trust created in paragraph 5.2 does not survive beyond the occurrence of certain events: namely, the payment of $110,000 by the defendant, the election made by the plaintiff pursuant to 3.1 of the final orders, or the completion of any sale of the property pursuant to paragraph 4 of the final orders. One of those events has occurred, namely, the election of the plaintiff.

I accept that the defendant challenges the entitlement of the plaintiff to make the election, and says that the plaintiff sabotaged his attempts to make the payment required by paragraph 1 of these orders. But, as discussed in the preceding paragraphs of these reasons, these issues have already been extensively litigated by the parties. The final orders remain in force, and will remain in force until set aside, which is unlikely to happen. As a matter of fact, the plaintiff has made her election.

I accept that under the terms of paragraph 5.2 of the final orders it is at least arguable that, given that the defendant had rejected the tender of the payment of $50,000 pursuant to paragraph 3.2 of the final orders, the payment has not been made. Of course, there is a question mark as to whether the defendant ought to be able to rely upon his own defaults to assert an equitable interest in the property. However, that issue can be resolved by imposing a condition on the removal of the caveat which preserves the sum of $50,000 for the defendant.

Accordingly, the defendant has no equitable interest in the property capable of supporting the caveat interest claimed in the caveat. Strictly speaking then, it is not necessary for me to consider where the balance of convenience lies. However, I will do so, remembering that this question only arises in the (unlikely) event that the defendant can:

(a) succeed in an application to either set aside the final orders (leaving him to his constructive trust claim), or to vary the final orders to extend the time for payment under paragraph 1 of the orders to some date in the future; and

(b) if the final orders are varied, succeed in an application to amend the caveat to claim an interest arising out of paragraph 5 of the final orders.

In my view, even in the circumstances above, the balance of convenience is overwhelmingly in favour of removing the caveat. In addition to the general prejudice to the plaintiff in not being able to deal with her property as she sees fit, there is clear and unequivocal evidence from the plaintiff to the effect that the presence of the caveat upon the title to the property is impeding her ability to pay her debts, buy a home with her husband, and prepare for her retirement, some thirteen years after the end of her relationship with the defendant. She has expressed a willingness to negotiate with the defendant since no later than 2018, but all of her attempts have been rebuffed. While the defendant claims that the plaintiff and her legal advisers have engaged in fraud, no attempt has been made to litigate that issue since 2015, and even now, in the face of this proceeding, there is no application on foot to press those allegations, despite signalling his intention to do so more than a year ago.

On the opposite side of the balance, while the defendant says that he wants to complete the purchase of the property in accordance with the terms of the final orders, there is no evidence that he currently has the ability to do so. That he was in a position to do so over ten years ago does not greatly assist me now. Further, it is not entirely clear to me why, even if he was successful in having an entitlement to have the final orders set aside or varied, a monetary remedy falling short of an entitlement to the transfer of the property would not be ordered. While in his evidence before the Federal Magistrates’ Court he said he wanted to live in the property and operate his vehicle repair and restoration business from the property, he has not lived or operated his business from the property since 2012, and the plaintiff’s evidence suggests that the zoning restrictions affecting the property prohibit the defendant from operating his business from the property.

Accordingly, for all the foregoing reasons, the caveat should be removed forthwith, on the condition that upon any sale or refinancing of the property, the sum of $50,000 be set aside to meet the defendant’s entitlements under the final orders. This condition does not preclude the plaintiff from applying to vary or set aside the condition, with the support of appropriate evidence, on the grounds that some or all of the debts owing by the defendant to the plaintiff ought to be set-off against this sum.

As for the injunction sought by the plaintiff in her originating motion, I agree that, given the history of the litigation between the parties, and the circumstances of this case, the defendant should be restrained from lodging any further caveats over the title to the property, as there is a real risk that, unrestrained, he will do so.

I shall hear further from the parties as to the appropriate form of order to give effect to these reasons, directions for the conduct of the plaintiff’s foreshadowed application under s 118 of the TLA and the question of costs.

SCHEDULE OF PARTIES

S ECI 2022 00859
BETWEEN:
SJM	Plaintiff
- v -
PMD	First Defendant
REGISTRAR OF TITLES	Second Defendant

[2023] VSC 349

23 June 2023