Stephens v Liu
[2021] WADC 45 (S)
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: STEPHENS -v- LIU [2021] WADC 45
CORAM: DEPUTY REGISTRAR HEWITT
HEARD: 13 MAY 2021
DELIVERED : 27 MAY 2021
FILE NO/S: CIV 417 of 2021
BETWEEN: MARK STEPHENS
Plaintiff
AND
LIN LIU
Defendant
Catchwords:
Practice and procedure - Specific performance claim - Summary judgment application - Jurisdiction of a deputy registrar - Turns on its own facts
Legislation:
District Court of Western Australia Act 1969 (WA), s 53(1) and s 55(1)(bb)
District Court Rules 2005 (WA), r 8(1) and r 11
Result:
Summary judgment given
Representation:
Counsel:
| Plaintiff | : | Mr D Pratt |
| Defendant | : | In person |
Solicitors:
| Plaintiff | : | Avon Legal |
| Defendant | : | Not applicable |
Case(s) referred to in decision(s):
Nil
DEPUTY REGISTRAR HEWITT:
This action was commenced by a writ of summons filed on 9 February 2021 to which the defendant appeared on 22 February 2021. The plaintiff filed a statement of claim on 25 February 2021 and on 15 March 2021 filed an application for summary judgment and that is the application with which I am required to deal.
Put simply, the plaintiff's claim is that he entered a binding contract for the purchase of a piece of land owned by the defendant and the defendant has refused to perform that contract and he therefore seeks specific performance of it. The first matter to consider is whether or not I, as a deputy registrar, have the power to deal with this application on a summary judgment. Section 50 of the District Court of Western Australia Act 1969 (WA) (the Act), s 55(1)(bb) provides jurisdiction for the court to deal with:
an action for specific performance of or for the rectifying, delivering up, or cancelling of any agreement whatever, where the amount in dispute or the value of the property affected is not more than the jurisdiction limit.
The purchase price of the land subject of the action was $235,000 and is therefore well within the jurisdictional limit of this court.
The next issue to be considered is whether a registrar has power to exercise the jurisdiction conferred upon the court and in that respect s 53(1) of the Act is in the following terms:
Without affecting the generality of the foregoing provisions of this Act, in all actions, matters and causes within the jurisdiction of the Court, a District Court judge has for the purposes of this Act, in addition to the powers and authorities conferred upon him by this Act, all the powers and authorities of a judge of the Supreme Court; and in all such actions, matters or causes, a registrar who is or has been a legal practitioner has, and is deemed to have always had, for the purposes of this Act, in addition to the powers and authorities conferred upon him by this Act, all the powers and authorities of the master and the registrar of the Supreme Court; and every registrar or other officer of the Court shall in all such actions, matters or causes, discharge any duties that a corresponding officer of the Supreme Court has authority to discharge, either under the order of a judge of the Supreme Court or under the practice of that Court, and all officers of the Court in discharging those duties, shall conform to the rules of the court.
I next turn to the District Court Rules 2005 (WA) which in r 8 provides as follows:
(1)A legally qualified registrar may deal with any proceedings that a judge may deal with in chambers other than -
(a)proceedings involving a review of the taxation of costs; and
(b)proceedings in relation to an originating summons that raises for determination -
(i)a question of law; or
(ii)a question as to the construction of a statute or document; or
(iii)a question arising out of an interest in land; or
…
Finally I turn to r 11 which provides, that with certain identified exceptions, proceedings that may be dealt with by a registrar are not to be listed before a judge.
As a result of consideration of these matters I have formed the view that a registrar has the power to deal with the application, and I should deal with the application.
The plaintiff's case is a straightforward one. The defendant is the owner of a property in Maddington which was advertised for sale by an agency called Jim's Realty Pty Ltd which she appointed her agent for the purposes of sale. The plaintiff was interested in purchasing the property and lodged a written offer to purchase with the defendant's agent for $230,000. That offer was not accepted and the defendant countered with an offer to sell for $235,000. That offer was accepted by the plaintiff and upon that acceptance the necessary alterations were incorporated in the original document, initialled by the parties, and signed by the defendant. Pursuant to the terms of the contract the plaintiff paid a deposit of $5,000 to the defendant's agent. That sum was paid on 17 November 2020. Very shortly thereafter the defendant resiled from the contract and instructed her agent accordingly. The plaintiff did not accept that state of affairs and insisted upon proceeding with the purchase. The defendant responded that if he wanted to take possession of the property he would need to take her to court. The defendant continued to resist cooperation in proceeding to settlement and transfer of the property and as a consequence these proceedings commenced.
As can be seen the facts are fairly straightforward. There is in existence a written signed contract for the sale of the property and evidence of a refusal by the defendant to consummate that sale. On the face of matters the plaintiff's claim looks clear and I therefore turn to the matters raised by the defendant to discern if there is any basis upon which she might successfully defend the action.
The first point which is raised is that the deposit of $5,000 was a holding deposit and merely represented an expression of interest. In fact the contract made it clear that the deposit was for the purchase of the land the contract also made it clear that it was intended to be a binding contract for the sale. It is suggested that any deposit less than 10% of the price could not be regarded as a deposit and must be simply regarded as a holding deposit and an expression of interest in proceeding with the sale and that the contract is not complete. It is also relevant to note that the purchase price was arrived at by acceptance of the defendant's counter offer. Hardly consistent with the propositions now advanced by the defendant.
Insofar as it is suggested by the defendant that the contract is not complete her complaint is that she was not provided with a copy of the general conditions of sale. Given that the plaintiff was operating through an agent and there is no doubt that the relevant contract of sale was delivered to the agent I am unable to see how this basis of defence could succeed. The contract for sale by reference incorporates the general conditions of sale and ultimately the contract which the plaintiff pursues was created by an offer by the defendant to him which he accepted. The defendant's complaint about the normal deposit on a sale of land being 10% of the value is correct but it is not a requirement of the contract that it be of that amount and a lesser amount or even no amount at all by way of deposit does not invalidate the contract so entered. A further complaint is made that the defendant has not signed an acknowledgement of the receipt of the relevant general conditions of sale but in my view that confers no basis for a defence.
The next complaint is that the amount is too low and is less than the market value. The defendant is from a Chinese background and speaks Mandarin. The agent appointed likewise speaks Mandarin. There is not, in my view, any basis for complaint that language difficulties led her to executing a contract for a lower price than she now thinks would have been appropriate.
The next point raised by the defendant is that she has tenants in the property with an entitlement to tenancy to July 2025. Presumably the defendant did not regard that as an obstacle when she put the property on the market and it is certainly not an obstacle now.
The next point made is that the defendant lost her job as a cashier during the COVID‑19 crisis and the rental income is her only income. That contention flies in the face of the evidence of Mr Chen who represented the defendant in this transaction. Mr Chen says that the defendant was advised that the presence of the tenants would not be an obstacle to the sale of the property and as a consequence she responded that she would be able to ask the tenants to vacate within two weeks.
As to the issue of the value of the property, Mr Chen states that it had structural issues although they are not specified and an outdoor toilet was installed on the front of the property which had not been approved by the City of Gosnells. Mr Chen states that in respect of the structural issues the defendant advised that she had consulted a builder to provide a quotation for the necessary repairs and compliance issues and was quoted a figure between $80,000 and $100,000.
Also of some importance, is Mr Chen's statement that he was advised that the purpose for the sale of the property was to purchase a property for her son in Melbourne and that in order to achieve that end it was necessary for the defendant to borrow further money. Mr Chen says that he was told by the defendant that the bank was not prepared to advance further monies and as a consequence she no longer wanted to sell the property.
That information throws some light on the defendant's allegation that she needed to retain the property in order to have an income stream. Not only was the defendant selling the property to use towards buying another property for her son but also intended to borrow further money. The effect of that plan, if carried out, would have been to extinguish the income stream from the property the subject of the sale and add an additional burden to service whatever loan she took out to assist in the purchase of the Melbourne property.
The defendant presents herself as a victim, led astray by the agent she appointed. It is not the job of a purchaser accepting an offer made to him by the defendant, to inquire into her relationship with the agent and assure himself that the seller has been properly advised by that agent. The transaction was an arm's length transaction and there is no conduct alleged by the buyer which could in any way impugn the validity of the contract for sale.
As a consequence I have reached the decision that the contract which was entered by the defendant with the plaintiff should be specifically performed and should the defendant not cooperate in that process, that orders should be made to ensure that the sale proceeds.
I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
LF
Court Officer
27 MAY 2021
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS
LOCATION: PERTH
CITATION: STEPHENS -v- LIU [2021] WADC 45 (S)
CORAM: DEPUTY REGISTRAR HEWITT
HEARD: 28 JULY 2021
DELIVERED : 10 AUGUST 2021
FILE NO/S: CIV 417 of 2021
BETWEEN: MARK STEPHENS
Plaintiff
AND
LIN LIU
Defendant
Catchwords:
Practice and procedure - Previous decision - Whether functus officio - Consideration of further evidence - Turns on its own facts
Legislation:
Nil
Result:
Held not functus officio
Reconsideration of matter in light of further evidence
Original decision to order specific performance confirmed
Representation:
Counsel:
| Plaintiff | : | Mr D Pratt |
| Defendant | : | Mr A H M Lai |
Solicitors:
| Plaintiff | : | Avon Legal |
| Defendant | : | AH2 Legal |
Case(s) referred to in decision(s):
Nil
DEPUTY REGISTRAR HEWITT:
In this matter I delivered a decision on 27 May 2021 on the plaintiff's summary judgment application finding in favour of the plaintiff and indicating that I was prepared to make a specific performance order in favour of the plaintiff.
Since the summary judgment application was filed the court has been peppered with written submissions from the defendant, purporting to contain evidence in defence of the application, some of which have been rejected and some of which have made their way onto the court file. None of these were framed as affidavits and none of them were admissible in evidence. That state of affairs may be explained by the fact that the defendant is Chinese and her understanding of and fluency in English is limited and her understanding of court procedures and protocols apparently non-existent.
Nonetheless, shortly before I delivered my written decision I received some more unsworn materials from the defendant which I read. Those materials persuaded me to the view that there was some possibility that because of the language difficulties and unfamiliarity with court processes in this state the defendant had not been able to articulate various matters which may have constituted a defence to the claim.
Since I made no orders on the delivery of my decision, I considered that I was not functus officio and retained the capacity to re-open the summary judgment application and accept further submissions. As I understand the matter both parties agreed with that proposition but in any event my understanding of the law is that until the application is finally determined I retain the ability to act as I have done.
I am now aware that in my original decision my understanding of the manner in which the contract came into existence was flawed. Those errors were in fact irrelevant to the outcome but for the sake of completeness I mention them here.
In my original decision I was under the impression that the final contract relied upon by the plaintiff was arrived at after a counteroffer by the defendant for the sale of land at $235,000 was accepted and thereafter the documentation was completed. That appears to have been wrong. What happened was that the necessary amendments to the plaintiff's offer were written on that offer and it was signed by the defendant and presented to the plaintiff who accepted the transaction proposed and initialled where necessary on the document.
There is an issue remaining between the parties as to whether the defendant initialled the alteration of the purchase price from $230,000 to $235,000. In my opinion there is no merit in that aspect of matters raised by the defendant. The evidence of the defendant makes it clear that alteration was made in her presence after she had signed the contract and with her approval. Various other portions of the contract which had been altered or new materials included were initialled by the defendant and that there is a dispute as to whether the initials appearing on the increased price were inserted by her or by her real estate agent. The evidence in that regard advanced by the defendant is very weak and goes no further than to state in par 66 of the defendant's affidavit lodged 9 July 2021 'I read the attachment SC-3 in Sam's Affidavit and to the best of my knowledge the initial "LL" next to the words "cash $235,000" was not signed by me'. That is not a positive averment that she did not initial that alteration but simply that she does not remember doing so. The defendant's son also swore an affidavit and he was present during these transactions taking place. Likewise he has no recollection as to whether the defendant did or did not initial the alteration. There is however no doubt that the alteration was made by the agent acting for the defendant on her instructions. There is also no doubt that she signed in the position of seller on the contract for the sale of land which ultimately is the basis of the plaintiff's claim.
A number of defences have been advanced by the defendant with which I now deal:
1.That there are tenants in the property which would prevent her from giving vacant possession of the property and thus consummating the contract. As to that proposition it is clear that the defendant did place the property on the market and it is clear that she would have had to deal with the tenants if she achieved a sale. The defence advanced is no better than to say that in light of the tenancy the defendant was not able to sell the property, but that is clearly wrong. The tenants have no registrable interest in the land, the lease agreement being for five years, unregistered, and defeated by the caveat lodged by the purchaser.
2.That the deposit of $5,000, being less than 10% of the purchase price, necessarily invalidated the contract. I dealt with this matter in my last decision commenting that there is no contractual obligation to pay any deposit and therefore the argument must necessarily fail.
3.That the defendant did not initial the alteration to the purchase price and therefore the contract is invalid. On that score the evidence establishes that the alteration to the purchase price was made in her presence by her agent with her acquiescence. In my view it is irrelevant whether or not there are initials to that alteration but in any event there do appear to be initials, they appear to be the same as initials elsewhere on the document, and neither the defendant nor her son who swore an affidavit supporting the defendant's position are able to state in unequivocal terms that she did not initial that alteration. The best either of them can say is they do not recall.
4.That the property generated a significant income upon which she was forced to rely. Clearly if the defendant sold the property she would lose the rental income whether the sale be to this plaintiff or anyone else and that ground of defence has no merit. Additionally, in a document filed in the defendant's usual irregular manner called a 'notice of additional documents for special appointment hearing', the defendant stated that her purpose in selling the property was to find another small property in Perth in which she could settle her tenants who had been residents in her house for approximately eight years. Clearly there would be a significant time interval between the sale of the Maddington property and the purchase of some substitute property and there is no indication in any of the materials that the defendant had any particular property in mind or indeed that she would generate sufficient funds by the sale to be able to carry out this purpose.
5.That the property price was too low. There is no evidence of worth to suggest that the property value was too low. That is purely the subjective opinion of the defendant unsupported by anybody qualified to make that judgement, and in any event irrelevant.
6.That neither the defendant nor the plaintiff signed the contract to acknowledge that each had received a copy of the general conditions of sale and the contract by that reason is unenforceable. I am unaware of any authority supporting that proposition. If the general conditions were not supplied to the defendant by her own agent that is hardly a matter for which the plaintiff is responsible, and the plaintiff makes no complaint. Additionally, the contract incorporates the general conditions by reference to them and the defendant does not refer to any clause within them which is relevant to her defence.
It is quite clear that the reason that the defendant is resisting the present application is that she wanted to achieve a better price for her property than that included on her counteroffer. The opposition is no more and no less than that. However, although that may be the motive for the opposition it is necessary to examine whether there is a potential defence. Of all the various possibilities that have been raised only one, in my view, deserved closer scrutiny. The defendant describes in her affidavit lodged 9 July 2021 the interaction between herself and her agent in regard to the generation of the counteroffer delivered to the plaintiff. Even after she had signed the document the defendant testifies that she required her agent to return the document to her because she wanted more time to think about the offer and in response was told not to worry and the document was not passed back. The defendant states on oath that she reiterated her comment to her agent that she needed to think about it more and the agent left the café where they had met with the document. She testified that after the agent departed with the document she was waiting to be informed whether the buyer would agree to the increase in the price. Ultimately the defendant was informed that the plaintiff did accept the price. She testified that she then considered the position for a couple of days and then decided to tell her agent that she did not want to sell. She advanced as a reason that she could not obtain a loan which was apparently true but not the reason that she wished to resile from the contract. The defendant places great store on the fact that she, as she alleges, did not initial next to the amended purchase price. In my view the presence or absence of the initials to the amendment were irrelevant since the alteration was made in her presence at her direction on a document which she had already signed.
The issue which I must now consider is whether or not there is evidence to show that the contract was delivered to the purchaser despite her directions that she wished more time to consider the matter. The difficulty I have with the proposition is that the only way in which she could possibly have an expectation that she would be informed whether the purchaser agreed to the price increase or not would be if the proposal was communicated to the purchaser. It must therefore follow that the defendant knew that the document would be presented to the purchaser for his consideration and possible acceptance. The defendant alleges that she anticipated another more formal document would be required to consummate the contractual arrangements but as a matter of law the document was complete and required nothing additional to make it a binding contract.
The application is for summary judgment and such a judgment should only be entered when it is clear that there is no arguable defence to the claim. The plaintiff has an executed contract for the sale of land signed by himself and by the defendant. Of the various proposed defences the only one, in my opinion, which deserved consideration is whether the delivery of the amended contract executed by the defendant was consistent with her instruction to her agent. The fact that the defendant deposes that she was waiting to hear from her agent whether the plaintiff accepted the increased price in the counteroffer makes it clear that she did intend for the counteroffer to be communicated to the plaintiff by the defendant's agent.
For these reasons I am of the view that the orders which are proposed in the first decision which was published remain appropriate despite the additional materials which have been presented and which I have reviewed.
I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
DH
Court Officer
10 AUGUST 2021
0