Spiteri v Fibreglass Industrial Products Pty Ltd
[2017] VSC 768
•19 December 2017
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST
S CI 2017 00359
| STEPHEN FRANCIS SPITERI | Plaintiff |
| v | |
| FIBREGLASS INDUSTRIAL PRODUCTS PTY LTD (ACN 006 217 590) DE-REGISTERED | First Defendant |
| - and - | |
| THE REGISTRAR OF TITLES | Second Defendant |
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JUDGE: | Garde J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 26 October 2017 |
DATE OF JUDGMENT: | 19 December 2017 |
CASE MAY BE CITED AS: | Spiteri v Fibreglass Industrial Products Pty Ltd |
MEDIUM NEUTRAL CITATION: | [2017] VSC 768 |
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ADVERSE POSSESSION – Claimant fencing and occupying rural land for 29 years – Exclusive physical control of land – Animus possidendi established – Performance of works – Payment of rates – Adverse possessory rights upheld.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | W Gillies of Counsel | P W Johnson |
| For the First Defendant | No appearance | |
| For the Second Defendant | No appearance |
HIS HONOUR:
Introduction
In an unopposed proceeding, Mr Stephen Spiteri seeks a declaration that he is the owner of vacant farming land at Mount Wallace by adverse possession. The land is on the Ballan-Meredith Road and is described in Certificate of Title Volume 9898 Folio 471 being lots 1, 2 and 3 on Title Plan 219259Y[1] (‘the land’).
[1]Formerly known as Crown Allotment 68A1, Part of Crown Allotment 68A and Part of Former Government Road, Section 6, Parish of Bungeeltap of Parent Title Volume 09493 Folio 472 created by Instrument N955013Y on 13 January 1989.
The registered proprietor of the land as shown on the Certificate of Title is a company named Fibreglass Industrial Products Pty Ltd (‘the company’). The company was deregistered on 24 June 1993. In a letter dated 28 February 2017, the Australian Securities and Investments Commission (‘ASIC’) advised that it was the only party legally able to deal with the company’s property.[2] It did not wish to be substituted as the first defendant, or joined as a party to the proceeding. It advised that it had no direct knowledge of the background to this proceeding, and did not wish to be heard. It had no objection to Mr Spiteri seeking a declaration that he is the owner of the land by adverse possession and is entitled to be registered as the proprietor of the land.
[2]Corporations Act 2001 (Cth) s 601AD(2).
In a letter dated 2 March 2017, the Registrar of Titles advised that he did not intend to appear in the proceeding.
Mr Spiteri relies on his own affidavits sworn 23 May 2017 and 8 December 2017 as to the circumstances of his purchase and occupation of the land, and that of his solicitor, Peter William Johnson, sworn 30 March 2017, as to the service of the proceeding. He also relies on written and oral submissions made by counsel on his behalf.
Background facts
In his affidavits, Mr Spiteri deposes that he is a horse agister, and first became aware of the land when he saw it advertised for sale in a newspaper in late April 1988. He engaged the services of Mr Philip Peters, a solicitor, to act on his behalf in the purchase of the land in his own name. He said that he signed the contract to buy the land in his name on or about 13 May 1988 for the sum of $72,000 although in Court he did not recall signing the contract. Mr Spiteri was unable to locate the contract of sale.
Mr Spiteri deposes that he gave Mr Peters the amount of $7,200 deposit for the purchase of the land and later the balance of the purchase price. Mr Spiteri took possession of the land in or about July 1988. The land was unoccupied.
He subsequently learned that Mr Peters had tendered a form of transfer at settlement which named the company as the purchaser rather than himself. Mr Spiteri provided a copy of a transfer of land dated 6 January 1989. The transfer names Fibreglass Industrial Products Pty Ltd as the transferee. Mr Spiteri has signed as ‘Director’ of the company. In a letter from Mr Terry Johansson, Mr Spiteri’s then solicitor, to the Registrar of Titles dated 25 May 2009, Mr Johansson said that Mr Spiteri was never a director of the company and simply signed what his solicitor instructed him to sign. Mr Spiteri says that he did not have any control over or association with the company.
The company was registered as proprietor of the land on 13 January 1989.
Subsequently, Mr Spiteri was advised by Mr Johannson that the company was a shelf company established by a firm of solicitors in November 1983. The two initial subscribers were Richard John Duffy and Anthony Hine Walstab. Both were registered as the directors of the company from its incorporation. A Form 61 lodged in 1992 purported to retrospectively appoint new directors from 1983. Mr Johansson made enquiries as to the whereabouts of the new directors of the company and advised Mr Spiteri that they were either unable to be located or fictitious.
A recent ASIC Current Organisation Extract shows that the company was registered on 22 November 1983 and deregistered on 24 June 1993. A recent search of the title lists the company as the registered proprietor of the land in fee simple and Mr Spiteri as a caveator.
Mr Spiteri deposed that he purchased other properties using Mr Peters as his solicitor. Mr Peters registered these properties in fictitious names without Mr Spiteri’s authority.[3]
[3]By order of Beach J dated 4 November 1994, Mr Peters was struck off the roll of practitioners (1994 No 7536). Criminal proceedings were brought against Mr Peters – see R v Peters [1997] 1 VR 489 and Peters v R (1988) 192 CLR 493.
Mr Spiteri brought a proceeding against Mr Peters in 1991. The proceeding was settled in 1995 and Mr Spiteri received what he describes as a ‘substantial payout’ from the Solicitor’s Guarantee Fund. This payout did not relate to the land.
In November 1998, Mr Spiteri instructed another firm of solicitors, Wilkens and Roach, to lodge a caveat on the land on his behalf. This caveat remains recorded on the title.
Mr Spiteri engaged Mr Johansson to prepare an application under s 60 of the Transfer of Land Act 1958 (Vic), that is, an application for a vesting order based on title by possession, in 2001. The application was lodged by Mr Johansson on 24 September 2008. Mr Spiteri deposes that over 8 or 9 years, he spent over $150,000 on this application.
On 6 July 2009, the Registrar of Titles advised that the application fell outside of the category of cases for which the Registrar of Titles can exercise discretion, and in view of the allegation of fraud by Mr Peters, the claim of adverse possession should be tested in a court of competent jurisdiction.
On 30 April 2010, the application was rejected by the Registrar of Titles.
Possession of the land
Mr Spiteri deposes that he has been in exclusive occupation of the land since around July 1988. The company has never occupied the land. He has never been contacted by any person claiming to be a director of the company. Nor has he been contacted by any other person asserting an interest in the land. He has never acknowledged that anyone else is the owner of the land. His claim to the land has never been challenged.
Mr Spiteri said that he has permitted Mr John Ranken, the owner of adjoining property to the north of the land, to use the land as a licensee from time to time, but always on the basis that Mr Spiteri is the owner of the land.
The land is fully fenced on its boundaries except for the frontage along the Moorabool River. The fences are in good order and maintained at Mr Spiteri’s cost so as to exclude other persons from entering the land. Mr Spiteri has cleared some trees from the land and carried out extensive weed control over the land including aerial spraying. There have been no structural improvements to the land.
Mr Spiteri states that since he took possession of the land, he has always paid the council rates on the land from his bank account. He has ensured that rates notices were sent to him, and updated his address with the Moorabool Shire Council (‘the Council’) whenever he moved. He has most of the stubs from his cheque account evidencing payment of the council rates from 1991.
A letter from the Council to Mr Johansson dated 21 May 2007 states that according to the Council’s records, the property was purchased by Mr Spiteri in February 1989. Not long after this, the Council was notified that in fact the property should be under the name of the company. In his second affidavit, Mr Spiteri states that he is unable to say why this occurred.
The Council also provided a table outlining payment of the rates notices from financial year 1998–99. This table lists Mr Spiteri as the drawer of the cheques from 1999–2007 with the exception of one occasion in each of the years 1999, 2001, 2002, 2004 and 2007 in which the company is shown as the drawer of the cheque. In a letter from Mr Johansson to the Registrar of Titles, Mr Johansson said that the entry of the company as the drawer of the cheque is an error by the Council. As the company was deregistered on 24 June 1993, it was not possible that it paid council rates on five occasions between 1999 and 2007.
Mr Spiteri states that all invoices in connection with the land for items such as repairs and maintenance have been made out to him. He has continued to occupy the land and maintain that he is the owner of the land in all of his dealings.
Relevant statutory provisions
Section 8 of the Limitation of Actions Act 1958 (Vic) (‘the Act’) provides:
No action shall be brought by any person to recover any land after the expiration of 15 years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person…
Section 9(1) relevantly provides that the right of action is deemed to have accrued on the date of the dispossession or the discontinuance.[4]
[4]See further ss 9–13 of the Act regarding when time begins to run.
Section 14(1) relevantly provides that no right of action to recover land shall be deemed to accrue unless the land is in the possession of some person in whose favour the period of limitation can run. Section 18 of the Act provides in substance that at the expiration of the 15 year period, the person’s title to the land is extinguished.
Applicable legal principles
The applicable test is succinctly stated by Dixon J in Cervi v Letcher:[5]
The question is simply whether the putative adverse possessor has dispossessed the paper owner by going into possession of the land, for the requisite period without the consent of the paper owner, with the word “possession” being given its ordinary meaning.[6] Whether the paper owner realises that dispossession has taken place is irrelevant.[7]
[5][2011] VSC 156 [16] (citations in original).
[6]J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419, 434 [36]–[37].
[7]Rains v Buxton (1880) 14 Ch D 537; Re Johnson [2000] 2 Qd R 502, 506.
The principles to be applied in claims for adverse possession were comprehensively outlined by the Court of Appeal decision in Whittlesea City Council v Abbatangelo:[8]
The law is clear enough. A number of the basic principles were summarised by Slade J in Powell v McFarlane.[9] Thus, pertinently:
“(1) In the absence of evidence to the contrary, the owner of land with the paper title is deemed to be in possession of the land, as being the person with the prima facie right to possession. The law will thus, without reluctance, ascribe possession either to the paper owner or to persons who can establish a title as claiming through the paper owner.
(2) If the law is to attribute possession of land to a person who can establish no paper title to possession, he must be shown to have both factual possession and the requisite intention to possess (animus possidendi).
(3) Factual possession signifies an appropriate degree of physical control. It must be a single and [exclusive] possession, … The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed … It is impossible to generalise with any precision as to what acts will or will not suffice to evidence factual possession … Everything must depend on the particular circumstances, but broadly, I think what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no-one else has done so.
(4) The animus possidendi, which is also necessary to constitute possession, … involves the intention, in one’s own name and on one’s own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow … the courts will, in my judgment, require clear and affirmative evidence that the trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world. If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the [requisite] animus possidendi and consequently as not having dispossessed the owner.”
[8](2009) 259 ALR 56, 58 [5] quoting Bayport Industries Pty Ltd v Watson [2002] VSC 206 [39]–[40] (citations in original).
[9](1979) 38 P & CR 452, 472.
To these principles the Court of Appeal added additional principles including the principles outlined by Ashley J (as he then was) in Bayport Industries Pty Ltd v Watson.[10] In summary:
[10][2002] VSC 206 [39]–[40] referring to Powell v McFarlane (1979) 38 P & CR 452, 470-472.
(1) The intention to exercise exclusive control does not necessarily require a conscious intention to exclude the true owner. An intention to control the land, and a belief by the adverse possessor that he or she is the true owner, is sufficient.
(2) Enclosure by itself prima facie indicates the requisite animus possidendi.
(3) An adverse possessor cannot rely on acts which are merely equivocal as regards the intention to exclude the true owner.
(4) Periods of possession may be aggregated, so long as there is no gap in possession.
(5) Acts of possession with respect to only part of land may in all the circumstances constitute acts of possession with respect to all the land.
(6) Where a claimant originally enters upon land as a trespasser, the claimant should be required to produce compelling evidence of intention to possess.
(7) At least probably, once the limitation period has expired, the interest of the adverse possessor, or of a person claiming through him, cannot be abandoned.[11]
[11]The Court of Appeal added further principles, see Whittlesea City Council v Abbatangelo (2009) 259 ALR 56 [6].
Overall assessment
On the uncontested evidence before me, Mr Spiteri has been in exclusive possession of the land since about July 1988 – a period exceeding 29 years. It is a period well in excess of the minimum period of 15 years required to establish adverse possession. Over this time, the land has been fully fenced apart from its river frontage and used for agistment by Mr Spiteri. He has cleared some trees, and undertaken weed control over the land including aerial spraying. I am satisfied that he has paid the rates on the land to the Council since he took possession of the land in 1988.
As to the requirement of ‘animus possidendi’, I am satisfied that this is demonstrated by fencing and using the land for his own purposes. Mr Spiteri has long exercised physical control of the land to the exclusion of all others including the purported registered proprietor. The company named as the registered proprietor was deregistered long ago. No person has ever attempted to claim or assert its interest if indeed the persons named as directors subsequent to the subscribing shareholders and initial directors of the company ever existed.
In addition to his claim for adverse possession of the land, Mr Spiteri may well be able to claim an equitable estate in fee simple of the land based on his payment of the purchase price of the land to his solicitor. However, the claim before me is based on his adverse possession of the land, and there is no need for me to consider whether Mr Spiteri has in the circumstances of this case an equitable interest in the land.
Conclusion
I uphold Mr Spiteri’s claim for adverse possession of the land, and will make orders accordingly.
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