Tomcsanyi v National Australia Bank Limited

[2019] WASC 347

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION:   TOMCSANYI -v- NATIONAL AUSTRALIA BANK LIMITED [2019] WASC 347

CORAM:   KENNETH MARTIN J

HEARD:   6 SEPTEMBER 2019

DELIVERED          :   6 SEPTEMBER 2019

PUBLISHED           :   24 SEPTEMBER 2019

FILE NO/S:   CIV 2575 of 2019

BETWEEN:   MICHELLE ELIZABETH TOMCSANYI

Plaintiff

AND

NATIONAL AUSTRALIA BANK LIMITED

Defendant

Catchwords:

Property - Real property - Application for extension of caveat - Whether applicant's claim has or may have substance - Claim of interest based in Family Law - Whether a spouse has property rights under the Family Law Act 1975 (Cth) - Application dismissed - Turns on own facts

Legislation:

Family Law Act 1975 (Cth)
Transfer of Land Act 1893 (WA)

Result:

Application dismissed

Category:    B

Representation:

Counsel:

Plaintiff	:	In person
Defendant	:	Mr W C J Zappia

Solicitors:

Plaintiff	:	In person
Defendant	:	Allens

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

Bevan v Bevan [2013] FamCAFC 116; (2013) 279 FLR 1

Fisher v Fisher [1986] HCA 61; (1986) 161 CLR 438

KENNETH MARTIN J:

(This judgment was delivered extemporaneously on 6 September 2019 and has been edited from the transcript.)

Introduction

1. I am dealing with the urgent application of the plaintiff, Mrs Michelle Tomcsanyi made in person.  For the purposes of this hearing I have treated the communication received by the court on 4 September 2019 as a minute of proposed orders outlining the caveat extension relief she seeks.

2. Essentially, by her application Mrs Tomcsanyi seeks an order from the court preventing the lapse of a caveat she has lodged.  I have made Mrs Tomcsanyi's application urgently returnable before me today, being 6 September 2019, given the terms of a notice as issued by the Registrar of Titles (the Registrar) of 15 August 2019 regarding the expiry of Mrs Tomcsanyi's caveat.  The Registrar's notice would see her caveat expire at midnight on 6 September 2019, if the court does not make an order extending its duration beyond then.

3. The caveat at issue is caveat number N839196.  It has been lodged against lot 4331 on deposited plan 202986 vol 1789 folio 527 and lots 4308 and 4309 on deposited plan 202976 vol 1895 folio 652 (together, the Properties).  On the materials before me the Properties are registered properties held in the name of Mrs Tomcsanyi's husband, Mr Lewis Tomcsanyi.

4. The defendant bank who currently holds a first registered mortgage over the Properties has attended the hearing to contest Mrs Tomcsanyi's caveat extension application.

Conditional appearance by Mr Lewis Tomcsanyi

1. At the commencement of the hearing before me today, Mrs Tomcsanyi made an oral application for her husband, Mr Tomcsanyi, to be granted leave to speak on her behalf (see ts 2).  I had concerns regarding this given the potential conflict of interest between the husband and wife which I raised with Mrs Tomcsanyi.  But in the end, I ultimately granted leave for Mr Tomcsanyi to sit next to Mrs Tomcsanyi at the bar table.  I also foreshadowed that, depending on what was said at the hearing, I may grant leave for Mr Tomcsanyi to speak to add something, if I felt that appropriate.

2. Ultimately, Mr Tomcsanyi acted primarily in a McKenzie friend capacity.  He only addressed the court to clarify what Mrs Tomcsanyi's argued caveatable interest in the land was (see ts 10 ‑ 16).  As I understand Mr Tomcsanyi's submission, Mrs Tomcsanyi's interest derives from him - by virtue of their long marriage (ts 11 ‑ 12).  I return to this point later.

Caveats - relevant legal principles

1. The 15 August 2019 notice from the Registrar was sent out after an application by the defendant bank to that end (by its right as a registered mortgagee of the Properties). Notice then issued to Mrs Tomcsanyi under s 138B of the Transfer of Land Act 1893 (WA) (TLA).

2. Section s 138B(1) of the TLA says:

   If a section 138A caveat has been lodged then the proprietor of the land in respect of which the caveat was lodged, or the judgment creditor named in a property (seizure and sale) order registered under section 133 in respect of the judgment debtor's saleable interest in such land, may apply, in an approved form and on payment of the prescribed fee, for the Registrar to serve the caveator with a notice to the effect that, unless the caveator takes the action referred to in subsection (2) within 21 days after the day on which the notice is served, the caveat will lapse.

3. Section 138C(1) then provides:

   A caveator who is served with a notice under section 138B(1) may apply to the Supreme Court, in accordance with rules of the court, for an order extending the operation of the caveat.

4. On the return of such an application, if the court is satisfied that the caveator's claim has or may have substance, the court may take various steps via s 138C(2) TLA.  These include extending the life of a caveat for a period (s 138C(2)(a)(i)) or until further order of the court (s 138C(2)(a)(ii)), or making any further order as the court thinks fit (s 138C(2)(a)(iii)).

5. However, if the court is not satisfied the caveator's claim has or may have substance then, under s 138C(2)(b) of the TLA, the court shall dismiss the application.

Issues on this application

1. The first issue I must address is whether on the material put before me I am satisfied that there is an argument that Mrs Tomcsanyi's claim to her interest in the land as expressed by her caveat has or may have substance.  If I am so satisfied, the second issue is whether I should grant the relief as sought and issue orders extending the caveat.

2. I record that there are two affidavits put before the court on this application.  The first is Mrs Tomcsanyi's affidavit sworn on 3 September 2019.  The second is an affidavit by Gregory John Daniel sworn on 6 September 2019.  Mr Daniel is an employee of the defendant bank and is sworn in opposition to Mrs Tomcsanyi's application.

3. I will also note that some further necessary material was provided to the court by the solicitors for the defendant bank.  This included Mrs Tomcsanyi's statutory declaration as declared on 23 February 2018 in support of her lodgement of her caveat.  There is as well a further statutory declaration of Mrs Tomcsanyi declared 20 March 2018 also made in support of that caveat.  And there is a notice to Mr Tomcsanyi (as registered proprietor) that a caveat had been lodged against the Properties.

Interests over the Properties

1. The registered certificates of titles for the Properties (see affidavit of Gregory John Daniel, pages 209 and 213) show that the defendant bank's first registered mortgage, was filed and registered on 4 March 2009.

2. As to Mrs Tomcsanyi's claimed interest, the only relevant paragraph of her affidavit is par 1, where she says:

   I am the wife of Lewis Michael Tomcsanyi and have a family law interest in all his properties …

3. The balance of Mrs Tomcsanyi's affidavit, pars 2 ‑ 5, advances to address matters more pertinent to Mr Tomcsanyi, as registered proprietor of the properties as regards his dealings with the defendant bank and who holds the first registered mortgage over his Properties.

4. In terms of a basis (ie arguable interest in land) for Mrs Tomcsanyi's caveat to be lodged, I note her statutory declaration lodged on 23 February 2019.  But this does not say anything more than that she was the spouse of her husband (being the registered proprietor) and then, that her caveat was to:

   ... protect my interests in the land described and to protect the land described from illegal actions.

5. The balance of that statutory declaration goes on to deal with extraneous matters about the Banking Royal Commission and complaints to ASIC.  Those issues if relevant at all would be more pertinent to Mr Tomcsanyi, than to Mrs Tomcsanyi.

6. As noted, there was a second statutory declaration by Mrs Tomcsanyi on 20 March 2019, required to persuade Landgate to accept her caveat.  By that further statutory declaration, Mrs Tomscanyi then asserted in terms of her alleged caveatable interest, that:

   The nature of the estate or interest is as a person who is to receive proceeds of land upon sale.

7. That information was apparently enough to persuade the Registrar to accept her caveat.  It was accepted as lodged on 26 February 2018.  Plainly, the defendant bank's first registered mortgage is prior in time to that caveat (being March 2009).

8. More importantly, the defendant bank's interest is a registered interest mortgage security which, under the Torrens land registration system, take priority over an unregistered interest.

Mrs Tomcsanyi's family law interest claim

1. I have been told today by Mrs Tomscanyi that there are presently no proceedings pending in the Family Court as between her and her husband.  However, such proceedings are foreshadowed by them in future.

2. However, even if there were Family Court proceedings currently on foot, the law seems to me to have been settled for some time as regards caveats supposedly justified by reference to possible future outcomes in family court litigation.

3. That law is that spouses do not hold property rights against each other's real property merely by reason of the Family Law Act 1975 (Cth), in particular s 79, unless and until an order is made altering the rights they have as determined by the principles of common law and equity.

4. To that end, I observe that in Bevan v Bevan [2013] FamCAFC 116; (2013) 279 FLR 1, Bryant CJ and Thackray J state at [80]:

   The second 'fundamental proposition' laid down in Stanford is also not novel since, as the plurality noted, it is well accepted that 'title to property and proprietary rights in the case of married persons … rests upon the law': Wirth v Wirth (1956) 98 CLR 228 at 232. Thus, spouses do not have rights to property by operation of s 79 unless and until an order is made altering the rights they have, as determined by principles of common law and equity.

5. Their Honours had in turn relied on a decision of the High Court of Australia, Fisher v Fisher [1986] HCA 61; (1986) 161 CLR 438 per Mason and Deane JJ at 452 - 454 in support of that proposition.

6. I agree that it is clear that merely because a party to a marriage foreshadows or, indeed, commences Family Court proceedings, that will not mean that their potential person against person claim (that they might win on or might not) affords them an arguable interest in the land of their partner sufficient to support a caveat against that land.

Conclusion

1. On that basis, it is regrettably plain that Mrs Tomcsanyi holds no arguable interest in the Properties sufficient to presently justify the court in issuing an order to extend her caveat, which will otherwise expire at midnight tonight.

2. Therefore, by reference to the terms of s 138C(2)(b) of the TLA, I am not left satisfied that the claim of Mrs Tomcsanyi has or may have substance, and consequently I shall dismiss the present application.

3. Final orders will issue in terms:

   1. The plaintiff's application to extend the operation of caveat N839196 under s 138C(1) of the Transfer of Land Act 1893 (WA) is dismissed.

   2. The defendant has liberty to apply, if necessary, on 48 hours' notice, for ancillary orders under s 138C(2)(C) of the Transfer of Land Act 1893 (WA) in relation to the plaintiff's application.

   3. The plaintiff pay the defendant's costs of the application, in an amount to be taxed, if not agreed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

DW
Associate to the Honourable Justice Martin

24 SEPTEMBER 2019