Streeter v Zhang
[2024] VSCA 167
•18 July 2024
| SUPREME COURT OF VICTORIA COURT OF APPEAL |
| S EAPCI 2024 0065 |
| JOHN STREETER | First Applicant |
| AND | |
| ADA STREETER | Second Applicant |
| v | |
| JIE ZHANG | First Respondent |
| AND | |
| LIXIA CAO ZHANG | Second Respondent |
| S EAPCI 2024 0066 | |
| JOHN STREETER | First Applicant |
| AND | |
| ADA STREETER | Second Applicant |
| V | |
| JIE ZHANG | First Respondent |
| AND | |
| LIXIA CAO ZHANG | Second Respondent |
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| JUDGES: | NIALL and KENNY JJA |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | 18 July 2024 |
| DATE OF JUDGMENT: | 18 July 2024 |
| MEDIUM NEUTRAL CITATION: | [2024] VSCA 167 |
| JUDGMENT APPEALED FROM: | Zhang v Streeter (Ruling) (Supreme Court of Victoria, Ginnane J, 31 May 2024) |
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PRACTICE AND PROCEDURE – Interlocutory appeal – Where respondents appealed on questions of law from the Magistrates’ Court to the Trial Division of the Supreme Court – Whether judge erred in granting leave to amend notices of appeal to restate questions of law – Judge had jurisdiction to permit restatement – No error in judge’s exercise of discretion to grant leave – Application for leave to appeal refused.
Civil Procedure Act 2010, ss 7, 8, 9; Magistrates’ Court Act 1989, s 109.
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| Counsel | |||
| Applicants: | In person | ||
| Respondents: | Ms TJ Acreman | ||
Solicitors | |||
| Applicants: | -- | ||
| Respondents: | LWS Lawyers | ||
NIALL JA
KENNY JA:
These proceedings arise out of an underlying dispute between neighbours living in residential properties in East Malvern. The applicants, John Streeter and Ada Streeter, are the registered proprietors of 3 Durward Road, East Malvern having acquired the property on 8 July 1997. The respondents, Jie Zhang and Lixia Cao Zhang, have been the registered proprietors of the neighbouring property at 5 Durward Road, East Malvern since 5 January 2005. The two properties are separated by a fence.
It appears that the fence dividing the properties was in its current position at the time the applicants acquired their property and that it is not erected along the title boundary but encroaches onto the applicants’ land to a relatively small extent. The applicants commenced a proceeding in the Magistrates’ Court, seeking orders that a new fence be erected and that it be erected on the boundary as recorded in the relevant certificates of title. The proceeding was brought in trespass and under the Fences Act 1968.
In response, the respondents advanced a claim of adverse possession in relation to the land. We will refer to the land the subject of the claim of adverse possession as ‘the disputed land’. The disputed land is a triangular strip that is approximately 26 centimetres wide at its widest.
The magistrate dismissed the claim of adverse possession and ordered that the fence be reinstated on the boundary as reflected in the certificates of title. The respondents appealed from that decision to the Trial Division of this Court on questions of law pursuant to s 109 of the Magistrates Court Act 1989. At the conclusion of the hearing of those appeals, on 10 May 2024, the judge permitted the respondents to apply for leave to amend their notices of appeal so as to replead the questions of law. In accordance with directions given by the judge, the respondents applied to amend the notices of appeal. Those applications were opposed and, on 31 May 2024, the judge granted leave to amend.
The applicants now seek leave to appeal from the judge’s orders granting leave to amend.
Facts
Chronology
In his reasons for decision, the magistrate observed that, apart from one presently immaterial matter, the facts were not in dispute. The only area of factual dispute concerned whether the location of the fence, or part of it, was moved in 2011 so as to encroach a further approximately three centimetres into the applicants’ property. That factual dispute can be put to one side for present purposes.
On the undisputed facts, on 8 July 1997 the applicants became the registered proprietors of 3 Durward Road and at that time the fence sat at its present position.
On 6 July 2004, Claire Plunkett, who was then the registered proprietor of 5 Durward Road, passed away. Her niece, Kathleen Jay, became the registered proprietor in September 2004. In October 2004, the respondents purchased the property from Ms Jay and became the registered proprietors on 5 January 2005.
Between 2005 and 2011, the respondents leased the property to tenants. The respondents moved in to the property in late 2011.
In October 2019, the respondents filed an amended planning application in relation to a proposed residential development on their property. The relevant plans showed the boundary of the property reflecting the title boundary.
The magistrate’s findings
The magistrate found that the owners of 5 Durward Road were not in continuous possession of the disputed land for a continuous period of 15 years and, therefore, the claim for adverse possession failed. There were two reasons for this:
(a)In the period in 2004 between the death of Mrs Plunkett and the purchase of the land by the respondents, the magistrate concluded that Ms Jay had ‘abandoned any possessory title against the Streeters’. In so holding, the magistrate observed that the evidence as to Ms Jay’s dealings with the land was ‘slight’ and that he did not ‘agree that the giving of instructions to an agent to sell a property signifies possession, nor … that an agent showing prospective buyers through a house is evidence of possession’.
(b)In 2019, the respondents’ planning application, which referred to the title boundaries, constituted an acknowledgement of the applicants’ title to the disputed land.
In the result, the magistrate dismissed the claim for adverse possession and ordered that the fence be reinstated on the boundary as reflected in the certificates of title.
Proceedings in the Trial Division
As already observed, the respondents appealed on questions of law pursuant to s 109 of the Magistrates’ Court Act 1989. In their notice of appeal in respect of the magistrate’s decision to uphold the applicants’ claim, the respondents identified the following questions of law:
1.Did the learned Magistrate err in failing to apply section 8 of the Limitation of Actions Act 1958 in respect of the strip of land on the title to the [respondents’] land at 3 Durward Rd, Malvern East, but fenced in to the [appellants’] land at 5 Durward Rd, Malvern East?
2.Did the learned Magistrate err in failing to apply section 18 of the Limitation of Actions Act 1958 in respect of the strip of land on the title to the [respondents’] land at 3 Durward Rd, Malvern East, but fenced in to the [appellants’] land at 5 Durward Rd, Malvern East?
3.Did the learned Magistrate err in applying section 14(2) of the Limitation of Actions Act 1958 in respect of the strip of land on the title to the [respondents’] land at 3 Durward Rd, Malvern East, but fenced in to the [appellants’] land at 5 Durward Rd, Malvern East?
4.Did the learned Magistrate err in concluding that an application for a planning permit made by the appellants was an acknowledgement of title pursuant to section 24 of the Limitation of Actions Act 1958 in respect of the strip of land on the title to the [respondents’] land at 3 Durward Rd, Malvern East, but fenced in to the [appellants’] land at 5 Durward Rd, Malvern East?
In their notice of appeal in respect of the magistrate’s decision to strike out their cross-claim, the respondents raised five questions of law. Questions 2 to 5 were in the same form as questions 1 to 4 set out at paragraph 13 above. Question 1 was as follows:
Did the learned Magistrate err in failing to deal with the claim by the second Appellant in proceeding N10221855 by only ordering that the Complaint be dismissed against the first Appellant?
In the exchange of written submissions, the applicants, who were unrepresented, submitted that the questions identified in the notices of appeal were not questions of law and, therefore, the jurisdiction of the Court had not been validly invoked.
Both parties filed extensive written submissions as to whether the magistrate had erred in law in his conclusions on the adverse possession claim.
The appeals came on for hearing before the trial judge on 10 May 2024. The respondents were represented by counsel and the applicants appeared for themselves. Substantial argument was addressed to the Court on the decision of the magistrate. Near the conclusion of the hearing, the judge expressed the tentative view that the notices of appeal may not contain questions of law.
However, the judge said that, if the respondents were going to apply to amend the notices of appeal, he would need to give the respondents the opportunity to do so. As things transpired, at the conclusion of the hearing, the judge gave directions to enable the respondents to file applications to amend the notices of appeal supported by an affidavit in support of the applications to amend.
On 31 May 2024, the judge considered the applications and granted leave to amend the notices of appeal. The questions of law, as stated in the amended notices of appeal, are as follows:
1. Did the Magistrate err in law in concluding that the appellants’ predecessor in title, Ms Jay, had abandoned possession of the disputed strip at any time between 6 July 2004 (when Claire Plunkett passed away) and 5 January 2005 (when the appellants became the registered proprietors of the property at 5 Durward Ave, Malvern East)?
2. Did the Magistrate err in law in concluding that on or around 24 October 2019 the appellants acknowledged the respondents’ title to the disputed strip in documents relating to an amendment to planning permit plans in VCAT proceeding P1184/2019?
3.If the answer to either question 1 or 2 is yes, is the further encroachment into the Respondents’ land which arises from reconstruction of a portion of the fence in 2011 a de minimis encroachment such that there should be no order for that section of the fence to be demolished?
The judge’s decision
The judge noted that, pursuant to r 58.08(3) of the Supreme Court (General Civil Procedure) Rules 2015, ‘[t]he Court may give leave to amend the grounds of appeal or make any other order to ensure the proper determination of the appeal’.
His Honour considered the substantial matter of importance to be the interests of justice considering both parties’ positions. He took into account the overarching purpose of the Civil Procedure Act 2010 and the different aspects of prejudice that the parties may suffer arising from his determination of the applications. In his opinion, an important consideration was that, at the primary hearing, in the submissions filed on appeal and in oral argument on 10 May 2024, the issues of abandonment and acknowledgement, and the de minimis point, had been raised and debated.[1] The judge noted that the magistrate himself expressed views about them. His Honour therefore considered that the balance fell in favour of allowing the amended notices of appeal, subject to him inquiring of the applicants whether they wished to make further submissions about the amended notices.
[1]Citing Paul & Paul v Shacklock [2014] VSC 407.
Proposed grounds of appeal in this Court
The applicants seek leave to appeal against the interlocutory decision of the judge on the following proposed grounds:
1.His Honour erred in applying Rule 58.08(3) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) to grant the respondents leave to make amendments that did not, or could not ensure the proper determination of the appeal.
2.His Honour erred in concluding the application of rule 58.08(3) to replace all questions of law and all grounds of appeal on two notices of appeal, did not subvert section 109(2) of the Magistrates Court Act 1989.
3.His Honour erred in applying Rule 58.08(3) by not giving effect to and the furthering the overarching purpose under sections 8 and 9 of the Civil Procedures Act 2010 and the principles established in Aon v Australian National University (2009) 239 CLR 175.
4.His Honour erred in concluding the irreparable element of unfair prejudice and denial of natural justice suffered by the appellants in the application of rule 58.08(3) to grant the respondents leave to replace all of the questions of law and grounds of appeal, after the proceedings had been heard, could be repaired by allowing further submissions and a further hearing date.
As to ground 1, the applicants submit that the replacement of the original questions of law with what they describe as ‘unrelated’ questions of law created new appeals which could be determined differently. According to the applicants, such amendment could not possibly ensure the proper determination of the original appeals.
The applicants contend that the trial judge erred when he said that the issues of abandonment, acknowledgement and de minimis were raised below and debated on appeal. They argue that, while the broad issues of abandonment and acknowledgement were raised below, only a few of the specific points in relation to these issues had been raised.
As to ground 2, the applicants contend, in substance, that permitting such wide-ranging amendment of the notices of appeal ‘subverts’ s 109(2)(a) of the Magistrates’ Court Act, which provides that an appeal from the Magistrates’ Court to the Supreme Court on a question of law must be instituted within 30 days.
Turning to ground 3, the overarching purpose of the Civil Procedure Act is to ‘facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute’ in civil proceedings.[2] Section 8 of the Act imposes an obligation on courts to ‘seek to give effect to the overarching purpose in the exercise of any of its powers, or in the interpretation of those powers’. Section 9 of the Act provides that, ‘[i]n making any order or giving any direction in a civil proceeding, a court shall further the overarching purpose by having regard to’ certain enumerated objects. The applicants contend that his Honour erred by not giving effect to those overarching purposes.
[2]Civil Procedure Act, s 7.
In Aon Risk Services Australia Ltd v Australian National University (‘Aon’), the respondent sought leave to amend its claim against the appellant on the third day of a four-week trial. The trial judge granted leave and was upheld on appeal by a majority of the Australian Capital Territory Court of Appeal. The appellant successfully appealed to the High Court by a grant of special leave. Justices Gummow, Hayne, Crennan, Kiefel and Bell held:
An application for leave to amend a pleading should not be approached on the basis that a party is entitled to raise an arguable claim, subject to payment of costs by way of compensation. There is no such entitlement. All matters relevant to the exercise of the power to permit amendment should be weighed. The fact of substantial delay and wasted costs, the concerns of case management, will assume importance on an application for leave to amend.
…
A party has the right to bring proceedings. Parties have choices as to what claims are to be made and how they are to be framed. But limits will be placed upon their ability to effect changes to their pleadings, particularly if litigation is advanced.
…
In the past it has been left largely to the parties to prepare for trial and to seek the court’s assistance as required. Those times are long gone. The allocation of power between litigants and the courts arises from tradition and from principle and policy. It is recognised by the courts that the resolution of disputes serves the public as a whole, not merely the parties to the proceedings.[3]
[3]Aon (2009) 239 CLR 175, 217 [111]–[113] (citations omitted); [2009] HCA 27.
The applicants submit that the judge erred in not giving effect to the principles established in Aon. The applicants argue that the respondents’ applications to amend their notices of appeal have resulted in the addition of two further hearing dates.
By ground 4, the applicants submit that the damage occasioned by what they allege to be a denial of procedural fairness by the judge is ‘incurable and cannot be repaired by any subsequent action of the court’. According to the applicants, that damage is measured in lost income and time in researching and preparing their case, and additional stress and uncertainty in a case that has already run for years. They contend that the only way for the prejudice they have suffered to be redressed is for the judge’s decision to be set aside.
Decision
The orders of the judge granting leave to amend the notices of appeal, and preserving the opportunity of the applicants to file any further submissions in response, were interlocutory orders on matters of practice and procedure. In order to succeed in an appeal, the applicants would have to show an error of the kind explained by the High Court in House v The King.[4]
[4](1936) 55 CLR 499, 504–5 (Dixon, Evatt and McTiernan JJ).
Further, this Court must exercise particular caution in reviewing an interlocutory decision on a matter of practice and procedure. Before the Court will intervene, there must be an error in principle, and the decision appealed from must work a substantial injustice to one of the parties.[5] The question of injustice flowing from the order appealed from will generally be a relevant and necessary consideration.[6]
[5] Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170, 177 (Gibbs CJ, Aickin, Wilson and Brennan JJ); [1981] HCA 39 (‘Adam P Brown’); Australian Dairy Corporation v Murray Goulburn Cooperative CoLtd [1990] VR 355, 364–5 (McGarvie J), 381 (Marks J).
[6]Adam P Brown (1981) 148 CLR 170, 177 (Gibbs CJ, Aickin, Wilson and Brennan JJ); [1981] HCA 39.
Although the applications for leave to amend the notices of appeal were made very late in the proceedings and an appeal under s 109(1) of the Magistrates’ Court Act must be brought within 30 days, there is no doubt that the judge had the power to permit an amendment to the questions of law, including by allowing new questions to be advanced where the newly formulated questions serve to clarify or remediate existing but infelicitously expressed questions.
We accept the submissions of the applicants that the existence of a question of law is both a qualifying condition to ground an appeal and the subject matter of an appeal.[7] It is necessary for such questions to be identified with some precision. In this sense, the existence of a question of law is jurisdictional.
[7]Osland v Secretary to the Department of Justice (2010) 241 CLR 320, 333 [21] (French CJ, Gummow and Bell JJ); [2010] HCA 24, citing TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation (1988) 19 ATR 1067, 1070 (Gummow J); [1988] FCA 198.
The applicants accept that, in the amended notices of appeal, question 2 was not new but reflected an existing question. They submit that question 1 is not merely a reframing of existing questions and that question 3 is entirely new.
The judge concluded that, having regard to the existing questions and the course of argument before him, the proposed new questions captured the arguments that had been put based on the existing questions, the written arguments and oral submissions. The judge was best placed to make that assessment. In terms of the new question 2, it was open to his Honour to conclude that it was captured by the arguments on existing question 3/4,[8] which had referred to s 14(2) of the Limitation of Actions Act 1958 and whether the magistrate was correct to find, by reason of a break in possession or abandonment, that the disputed land had ceased to be in adverse possession during the period between the death of Mrs Plunkett and the acquisition of the land by the respondents. Question 3 is new but is ancillary and is only relevant in the event that the appeals from the magistrate’s decision succeed.
[8]As noted above, the question number depends on the relevant proceeding.
It follows that the judge did not permit the respondents to advance new appeals because the reframed questions properly expressed the original questions as elucidated in the parties’ submissions and the leave to amend did not frustrate the time limit in s 109 of the Magistrates’ Court Act, nor did the grant of leave require the judge to be satisfied that there were exceptional circumstances justifying the amendments.
For these reasons, the applicants’ attack on the jurisdiction to permit the amendments fails.
Turning to the exercise of the judge’s discretion, it is apparent that the judge was conscious of the prejudice that might be occasioned to the applicants were leave to amend to be granted. He took that prejudice into account and was mindful of the lateness of the applications. This was also reflected in the orders he ultimately made.
Essentially, however, the judge reasoned that the proposed questions of law related to the arguments that had been presented in writing and at the hearing on 10 May 2024 and that the grant of leave to amend the notices of appeal afforded an opportunity to regularise the proceedings rather than to authorise the advancement of an entirely new case by the respondents.
It is important, in this context, that the facts were not in dispute and the critical questions that were ventilated at the hearing concerned whether, on those facts, the magistrate was correct to find that there had been a break in possession and that Ms Jay had abandoned ‘any possessory title’ against the applicants.
Whether, on the facts found, the conduct of Ms Jay was inconsistent with continuing possession or amounted to abandonment was the subject of argument and the grant of leave to amend the notices of appeal afforded the respondents the opportunity to frame the questions of law to capture the arguments that they had put. Similarly, the arguments concerning acknowledgement had, at their heart, a legal question as to whether the making of the planning application amounted to an acknowledgement of the applicants’ title.
In our view, it has not been shown that the judge took into account any irrelevant considerations, failed to have regard to the matters relied on by the applicants or otherwise committed any specific error in the exercise of his discretion. Further, once it is appreciated that the grant of leave afforded no more than an opportunity to regularise the proceedings, it cannot be said that the decision was not open to the judge. Finally, and importantly, although the applications for leave to amend and the amendments will prolong the proceedings and have necessarily caused delay and inconvenience to the applicants, we are not satisfied that the leave to amend resulted in injustice to the applicants such as to permit this Court to intervene in respect of a matter of practice and procedure. The judge was concerned that any amendment application should be on notice and on proper material and directions were given to allow that to occur. The prolongation of the proceedings was in part a function of allowing the applicants a proper opportunity to respond to the amendment applications and served to minimise rather than exacerbate prejudice.
Given that the applicants had put the validity of the questions of law in issue in a timely way, it may be said that the arguments against the grant of leave were not without merit. Indeed, it is very regrettable that the applications to amend was made so late and only after the judge expressed doubt about whether the original notices of appeal properly identified questions of law. The explanation that the respondents’ lawyers did not think that the adequacy of the questions of law remained an issue was, to our mind, weak given the onus on the respondents to formulate questions of law and that the written submissions of the applicants had not been withdrawn. Nevertheless, it has not been shown that the decision was not open to the judge in the proper exercise of his discretion. There are no reasonable prospects of the appeal succeeding and, accordingly, the applications for leave to appeal must be refused.
The respondents have applied for costs. In our view, this is a case in which there should be no order as to costs. The circumstances giving rise to the underlying need for amendment of the notices of appeal and the subject matter of the applications for leave to appeal do no credit to the respondents. In circumstances where those issues could have been avoided by attending to the issue of amendment well before the hearing before Ginnane J, it is impossible to separate the events that have transpired and the current applications for leave to appeal. Accordingly, in the particular circumstances of the case, we consider that there should be no order as to costs.
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