Stacey v Stacey

[2010] WASC 85

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   STACEY -v- STACEY [2010] WASC 85

CORAM:   BEECH J

HEARD:   22 APRIL 2010

DELIVERED          :   22 APRIL 2010

PUBLISHED           :  30 APRIL 2010

FILE NO/S:   CIV 1510 of 2010

BETWEEN:   PHILLIP JOHN STACEY

Plaintiff

AND

JUDITH LORRAINE STACEY
First Defendant

DIANNE FRANCIS DE VOS
Second Defendant

Catchwords:

Injunctions - Interlocutory injunctions - Ex parte injunctions - Exceptional nature - General importance of giving notice to opposing party

Real property - Caveats - Whether claim under Inheritance (Family and Dependants Provision) Act 1972 (WA) constitutes a caveatable interest in land owned by the estate

Legislation:

Inheritance (Family and Dependants Provision) Act 1972 (WA), s 6

Result:

Application dismissed in part and adjourned in part

Category:    B

Representation:

Counsel:

Plaintiff:     Ms H McGeorge

First Defendant             :     Mr P J Rattigan

Second Defendant         :     No appearance

Solicitors:

Plaintiff:     D F Beere

First Defendant             :     Cullen Babington Hughes

Second Defendant         :     No appearance

Case(s) referred to in judgment(s):

Commissioner of Stamp Duties (Qld) v Livingstone (1964) 112 CLR 12; 38 ALJR 197

Dean and Westham Holdings Pty Ltd v Lloyd (1991) 3 WAR 235

Gangemi v Gangemi [2009] WASC 195

Ioppolo v Ioppolo (Unreported, WASC, Library No 2469, 13 November 1978)

Martin v Official Trustee in Bankruptcy [1990] Tas R 65

Meynert v Leafdale Pty Ltd [2005] WASC 102

Official Receiver in Bankruptcy v Schultz [1990] HCA 45; (1990) 170 CLR 306

Parola v Parola [2009] WASC 190

Re Parliamentary Inspector of the Corruption and Crime Commission; Ex parte Corruption and Crime Commission [2008] WASC 305

Swanston Mortgage Pty Ltd v Trepan Investments Pty Ltd [1994] 1 VR 672

BEECH J: 

(These reasons are an edited version of the reasons given extemporaneously on 22 April 2010.)

Background

1. On 16 April 2010 the plaintiff instituted this action and filed a chamber summons for interlocutory injunctions.  Paragraph 1 of the chamber summons seeks an order restraining the first defendant from lodging a vesting application, under s 45 of the Trustees Act 1962 (WA) and s 182 of the Transfer of Land Act 1893 (WA), as sole trustee of the Stacey Family Trust in respect of land referred to as Lot 2 and Lot 144. Paragraph 2 seeks the extension of the operation of the caveat the plaintiff lodged over Lot 144.

The failure to give reasonable notice to the defendants

1. The plaintiff did not serve the chamber summons or writ on the defendants until 21 April 2010.  It appears that the plaintiff had no intention of serving the defendants until the receipt of correspondence from the court on 19 April 2010 inquiring about whether the defendants had been served.

2. The summons was supported by an affidavit of the plaintiff's solicitor sworn 15 April 2010.  As appears from the correspondence  annexed to that affidavit, the parties, through their solicitors, have been in correspondence about issues relating to the subject matter of this action and application for a considerable period of time.

3. The most recent correspondence between the parties that appears from the affidavit is as long ago as 16 March 2010. 

4. In my opinion, there was no justification whatsoever for the plaintiff to have proceeded in this application on the basis that the case would be heard ex parte. The only explanation offered by counsel for the plaintiff (who is not the solicitor for the plaintiff) was based on an impression of s 138C(3) of the Transfer of Land Act.  This section refers to the possibility of an order being made ex parte.  The existence of the power to make an order ex parte does not detract from the need to demonstrate exceptional circumstances to justify proceeding without notice to an affected party. 

5. As it turned out, the first defendant was served only approximately 24 hours before the hearing, leaving the first defendant with an inadequate opportunity to respond.  In the course of submissions counsel for the plaintiff accepted that the delay in notifying the first defendant of the application was entirely inappropriate.  Counsel for the plaintiff could point to no evidence that justifies the bringing of an application for orders in terms of par 1 of the chamber summons on anything less than reasonable notice to the first defendant.  The only element of urgency revealed by the evidence referred to by counsel for the plaintiff related to the caveat which is the subject of par 2 of the chamber summons.  That caveat expires on 26 April.

6. The fact that that caveat expires on 26 April provides no justification whatsoever for a failure to serve the defendants and with reasonable notice.  I refer to what I said in Parola v Parola [2009] WASC 190 [48] quoting Martin CJ in Re Parliamentary Inspector of the Corruption and Crime Commission; Ex parte Corruption and Crime Commission [2008] WASC 305 [13] ‑ [16]. Even when there is a need to bring on a matter very urgently, there is a fundamentally important distinction between the need to bring on a matter urgently and therefore to give only short notice on the one hand and, on the other hand, a justification for giving no notice at all. In this case, it appears that but for the inquiry from the court, no notice of this application would have been given. Special circumstances would be required before a caveator would be justified in proceeding with no notice at all to the registered proprietor. Because of the statutory effect of a caveat there will generally be no opportunity for a registered proprietor to act in a way that would thwart the application.

7. Further, and in any case, there was no high degree of urgency in this application.  The summons was filed on 16 April 2010 in respect of a caveat that was to expire some 10 days later.

8. Counsel for the first defendant said that he was not in a position to deal with the application in terms of par 1 and consequently sought an adjournment.   As I have said, counsel for the plaintiff accepted, rightly in my opinion, that there was no evidence to justify a determination of the application for that order on such short notice to the first defendant.  Accordingly, I will adjourn the application in relation to par 1.

The alleged caveatable interest

1. In the circumstances that I have already outlined, I would have been inclined to take the same course for par 2 of the application as was taken in relation to par 1.  However, it appears to me that there is a fatal obstacle to the extension of the operation of the caveat.  The caveat specifies the interest claimed as being 'an equitable interest in the estate of Brian Arthur Stacey … pursuant to the Inheritance (Family and Dependants Provision) Act 1972.'

2. In my opinion, an existing or potential claim under the Inheritance Act does not create a caveatable interest in property owned by the estate.  I refer in that regard to two lines of authority.  First, there is substantial authority to the effect that prior to the administration of an estate a residuary beneficiary of the estate does not have a caveatable interest in land owned by the estate.  See, for example, Commissioner of Stamp Duties (Qld) v Livingstone (1964) 112 CLR 12; 38 ALJR 197; Official Receiver in Bankruptcy v Schultz [1990] HCA 45; (1990) 170 CLR 306, 311 ‑ 312; Dean and Westham Holdings Pty Ltd v Lloyd (1991) 3 WAR 235, 257; Meynert v Leafdale Pty Ltd [2005] WASC 102 [32] ‑ [39]; and Gangemi v Gangemi [2009] WASC 195 [51].

3. Secondly, it is well established that caveatable interest must be an interest in the property that exists at the time of lodgement of the caveat. It is not sufficient that the party claims that in the future, such as by a court action, he or she may later become entitled to an interest in the property. This is illustrated by the position in respect of a party with a claim under s 79 of the Family Law Act 1975 (Cth): see Ioppolo v Ioppolo (Unreported, WASC, Library No 2469, 13 November 1978); see more generally Martin v Official Trustee in Bankruptcy [1990] Tas R 65, 69; Swanston Mortgage Pty Ltd v Trepan Investments Pty Ltd [1994] 1 VR 672; and Gangemi v Gangemi [40].

4. I raised this fundamental question with counsel for the plaintiff in the course of argument.  Counsel was not able to offer any submissions to support the essential premise of the plaintiff's case on par 2 that a claim under the Inheritance Act creates a caveatable interest in land owned by the estate. 

5. I have considered whether the application as it relates to par 2 should be dismissed or adjourned to allow the plaintiff further time to consider the position in relation to the legal defect as I perceive it that I have mentioned.  I am persuaded by the submission of counsel for the first defendant that no further opportunity should be afforded to the plaintiff in the circumstances of the case.  The plaintiff has brought on this application.  One element of the relief sought by the plaintiff is the extension of the caveat.  It is an essential integer of such a claim that there be a caveatable interest as specified in the caveat.  Accordingly, it was for the plaintiff to be in a position to establish that the claim made gave rise to a caveatable interest. 

6. For those reasons I would dismiss the application as it relates to par 2. 

Orders

1. I will make programming orders in accordance with my exchange with counsel and I will hear from counsel as regards to costs.  I presently consider the appropriate order to be that the first defendant's costs be paid on an indemnity basis by the plaintiff's solicitors, subject to their showing cause otherwise, but I will hear further argument.