Yates v Jamison Nominees P/L - [2014] SADC 209

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Appeal Under Residential Tenancies Act 1995)
YATES & ANOR v JAMISON NOMINEES P/L
[2014] SADC 209
Reasons of His Honour Judge Beazley
11 December 2014
LANDLORD AND TENANT - TERMINATION OF THE TENANCY
RESIDENTIAL TENANCY – Appeal against findings and orders of the Residential Tenancies Tribunal – whether tenancy validly terminated.
PRELIMINARY POINT OF LAW
Application to the Residential Tenancies Tribunal issued by daughter of a Director of the landlord company - whether application issued without authority of the company - whether application and subsequent orders of the Tribunal a nullity - relevance of the grant of Power of Attorney from Director of the company to his applicant daughter - application by tenants to dismiss or permanently stay the proceedings as an abuse of process - whether appointment of daughter as agent of the company for the purpose of the commencement and conduct of the proceedings subsequently ratified - effect of ratification in a case where the proceedings completed before purported ratification - power of the Court to regularise proceedings.
Held: That although proceedings were issued in the Residential Tenancies Tribunal by the daughter without authority, they were not a nullity. Her authority was duly ratified subsequently by the landlord company so that the ratification of her unauthorised acts has the effect of providing antecedent authority for the proceedings.
Corporations Act 2001 (Cth) s 192; Residential Tenancies Act 1995 ss 41, 93; District Court Act 1991 s 42F, referred to.
2 Elizabeth Bay Road Pty Ltd v The Owners [2014] NSWCA 409; McEvoy v Body Corporate for No 9 Port Douglas Road [2013] QCA 168; Timms v SA Housing Trust (2003) 226 LSJS 42; Mancini v Mancini (1999) 17 ACLC 1570; Cheerine Group (International) P/L v Yeung [2006] NSWSC 1047; Matthews v USPI Electricity P/L [2011] VSC 167; Danish Mercantile Co Ltd v Beaumont [1951] 1 Ch 680; Chalker v Barwon Coast Committee of Management Inc [2003] VSC 286; Berowra Holdings P/L v Gordon (2006) 225 CLR 364; Presentaiones Musicales SA v Secunda [1994] Ch 271; Ox Operations P/L v Landmark Property Developments (Vic) P/L (in liq) [2007] FCA 1221; Raja v Darul-Iman (WA) Inc No 2 [2011] WASCA 251; Multitecfbm (Asia Pacific) Pty Ltd v Seong Myeon Christhan [2008] NSWSC 1339; Harry S Bagg's Liquidation Warehouse Pty Ltd v Whittaker (1982) 44 NSWLR 147; Alexander Ward & Co Ltd v Samyang Navigation Co (1975) 1 WLR 673, considered.

YATES & ANOR v JAMISON NOMINEES P/L
[2014] SADC 209
Preliminary point of law
Introduction

John Bernard Yates and Anne Roose (‘the tenants’) have appealed, pursuant to s 41 of the Residential Tenancies Act 1995 (‘the Act’) from orders made by the Residential Tenancies Tribunal (‘the Tribunal’) on 29 October 2014. The effect of those orders is that the Residential Tenancies Agreement (‘the Agreement’), purportedly entered into by them as ‘tenants’, on 22 July 2010 and extended until 21 July 2015, was terminated, as and from 26 November 2014 pursuant to s 87(2) of the Act.
The Tribunal formally ordered that the tenants must leave 33A/188 Carrington Street, Adelaide (‘the premises’) by 11am on 26 November 2014. It directed that in the event that the tenants failed to comply with that order, it could only be enforced by the Tribunal bailiff.
A preliminary point of law has been raised by the tenants, for the first time, in this Court, as to whether the proceedings in and the orders made by, the Tribunal, were a nullity. They assert that the application to the Tribunal was not authorised by Jamison Nominees Pty Ltd (‘the landlord company’).
It concerns the fact that the application, dated 23 October 2014, purportedly filed on behalf of the landlord company, had been signed by the daughter (‘A P’) of a director of the landlord company to whom I shall refer as (‘C M’).
The applicant was described in the application as ‘Jamison Nominees Pty Ltd – ‘C M’. The signature of ‘A P’ was accompanied by the words ‘A P’ (‘Power of Attorney for ‘C M’’).
It must be borne in mind that the subject appeal involves a private company, in respect of which the majority of shares were controlled by ‘C M’.
In Harry S Bagg’s Liquidation Warehouse Pty Ltd v Whittaker[1], Powell J. expressed his frustration with points of law being taken in respect of proceedings commenced in the name of corporate entities. I paraphrase his Honour’s comments in respect of the subject appeal as follows:
If one’s concern were to mount a campaign for the abolition of exempt proprietary companies, and if one were minded to put forward cases to justify such a campaign, one would hardly do better than to put forward, as one such case, the facts revealed in the present application, for, as the result of either sublime ‘ignorance of … the provisions and requirements of [the Corporations Act], in a proceeding in which the ultimate issue in dispute would have been disposed of in a matter of hours, the time of this court has been occupied in seeking to have determined a purely preliminary issue.
[1] (1982) 44 NSWLR 241.
While the preliminary issue in this matter does raise substantial, indeed, complex issues of law – in particular whether there can, at law, be an effective ratification by a company after unauthorised proceedings have been completed,[2] these issues arise in the context of a residential tenancy dispute, which, of its very nature, ought be determined expeditiously[3] and with the minimum of formality.[4]
[2] McEvoy v Body Corporate for No 9 Port Douglas Road [2013] QCA 168.
[3] Section 21 of the Act.
[4] Section 32 of the Act.
There are some unusual factors which have complicated these proceedings. As will be clear they include the personal nature of the alleged relationship between one tenant and ‘C M’. It may be that the alleged relationship will be considered in proceedings in another jurisdiction.
Time might have been better employed in some form of mediation rather than in pursuing relief which may result in the tenant resuming occupancy of premises controlled by a disaffected landlord.
No point had been taken before the Residential Tenancies Tribunal as to whether the proceedings fell within the jurisdiction of the Residential Tenancies Tribunal nor whether they were issued without the authority of the landlord company.
The relevant provisions of the Act
·Section 21 of the Act provides that:
The Tribunal must, where practicable, determine proceedings within 14 days after the proceedings are commenced and, if that is not practicable as expeditiously as possible.
·S 32(2) of the Act, provides that the Tribunal’s proceedings must be conducted with the minimum of formality and the Tribunal:
(a)    is not bound by evidentiary rules but may inform itself as it thinks appropriate,
and
(b)    must act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms.
·S 33 of the Act provides that:
(1)    The Tribunal may, if satisfied that it would be just and equitable to do so, excuse a failure to comply with a provision of this Act on terms and conditions appropriate.
(2)    The Tribunal may amend proceedings if satisfied that the amendment will contribute to the expeditious and just resolution of the questions in issue between the parties.
·S 87(2) of the Act provides that:
The Tribunal may on application by a landlord (my emphasis), terminate a residential tenancy and make an order for immediate possession of premises if the tenant or a person permitted on the premises with the consent of the tenant has, intentionally or recklessly, caused or permitted, or is likely to cause or permit serious damage to the premises or …
The powers of this Court on appeal
The appeal is to this Court in its Administrative and Disciplinary Division.[5]
[5] Section 41 of the Residential Tenancies Act. cf Timms v SA Housing Trust (2003) 226 LSJS 42.
Section 42F of the District Court Act provides that the court may:
·affirm the decision appealed against;
·rescind the decision and substitute a decision that the Court considers appropriate;
·remit matters to the Tribunal for consideration or further consideration, in accordance with any directions or recommendations of the Court.
Preliminary hearing
The matter came before me on a preliminary hearing, as Short Notice Judge. The subject application was brought on urgently on 25 November 2014, as the order of the Tribunal was to take effect on 26 November 2014.
The tenants initially submitted:
·That the donee of a Power of Attorney could not perform the functions of the donor Director of a company in the place of the donor. Accordingly the donee of that Power of Attorney could not issue proceedings as agent of the company, in that capacity.
·That ‘A P’ was not authorised in any capacity by the landlord company to issue the application on its behalf.
·That the purported Residential Tenancy Agreement was a domestic arrangement and not subject to the Residential Tenancies Act.
·That in any event, the application and the orders made by the Tribunal were a ‘nullity’, which could not be subsequently ratified by the landlord company.
In light of the urgency of the application, I:
·granted a stay of execution of the orders made by the Tribunal until 5.00pm on 12 December 2014;
·directed both parties to file written submissions and;
·adjourned further consideration of the application until 11 December 2014 at 9.15am.
The background
The background circumstances of this matter are most unusual. I have restricted any consideration to the facts which are not in dispute, or deposed to in the respective affidavits filed in this Court.
·On 29 July 2010 the appellants and the respondent purported to enter into a Residential Tenancy Agreement in respect of the premises.
·The agreement was executed by the first appellant, (then known as ‘J B Good’) and the second appellant, as ‘tenants’, and on behalf of the landlord by the letting agent ‘Bruse Real Estate’.
·On 22 July 2011, 22 July 2012 and 22 July 2013, the Agreement was extended by a further twelve months on each occasion. The Notice of Lease extension was signed on behalf of the landlord by its agent Bruse Real Estate.
·On 26 May 2014 the appellants and the respondent, by its agent Bruse Real Estate extended the subject Agreement for a further twelve month period ending on 21 July 2015.
·On 24 September 2014, ‘C M’, the Director and majority shareholder of the landlord company, announced ‘his intention to terminate his relationship in both a personal and financial sense with the first named appellant described as John B Yates’.
·It is alleged that on 16 October 2014 the first named appellant caused malicious damage to the premises which included broken glass, holes in walls, blood stains, an oven door destroyed, front door broken and a shower screen smashed.
·It is further alleged that on 16 October 2014 the first named appellant was escorted to the Royal Adelaide Hospital, and that he was subsequently arrested by police and taken into custody.
·On 17 October 2014 the first appellant was released on bail having been charged with property damage and unlawful threats. The bail agreement obliged him to reside at an address at Bridgewater. He was prohibited from attending at the subject premises, and from making contact with certain members of ‘C M’’s family.
·The second appellant is not, and has not at any time, resided at the subject premises.
·It is asserted that at all times the rent of $625 per week, payable fortnightly, pursuant to the terms of the said Agreement, has in fact been paid by ‘C M’ on behalf of the first appellant, and not by the tenants.
·On 23 October 2014 an application, in the Form 7 prescribed by the Act, was issued in the name of ‘Jamison Nominees Pty Ltd – ‘C M’. That applicant, as landlord sought an urgent hearing to obtain vacant possession of the premises, in consequence of the events of 16 and 17 October 2014. It was signed by ‘A P’ (Power of Attorney for ‘C M’). It purported to be pursuant to a Power of Attorney granted by ‘C M’ to ‘A P’ dated 20 November 1998.
·On 25 November 2014 the landlord company held a meeting of Directors. The minutes of that meeting noted that both of its Directors, which included ‘C M”, had fully supported the steps undertaken by ‘A P’ on behalf of the company and ‘C M’, including her signing of the application on behalf of the company.
The landlord company relevantly resolved, inter alia: -
1       That the application was authorised by the Directors.
2       That the application was appropriate and necessary to protect the company’s registered proprietary interest in the premises.
3       That the application is ratified and approved by the Directors, and
4       That the Directors wish (‘the solicitors’) to take all available steps to resist the appeal lodged on behalf of the Appellants in the District Court of South Australia in order to ensure that the order of the Tribunal dated 29 October 2014 is upheld.
Principal issue
Before turning to the respective submissions of counsel, it is to be noted that the principal issue is not the internal workings of a corporate entity,[6] but one of principal and agent. In particular the issue is whether ‘A P’ was a duly authorised agent of the landlord company, or, if not so authorised, whether her issuing of the application and conducting the hearing before the Tribunal is capable of being ratified by the landlord company.
[6] See Corporations Act, Cwlth, 2001, s 129.
The appellants’ submissions
The appellants confined their submission to whether the application was brought without the authority of the respondent. They abandoned any submission that the ‘tenancy agreement’ was simply a right to occupy a premises under which no rent was payable or was simply some domestic arrangement to which the Act did not apply pursuant to s 5 of the Act. They accordingly concede that the Act applies to the said Agreement.
Counsel for the appellants, Mr Fabbro, directed his submissions to the description of ‘the applicant’ in the subject application to the Tribunal, and the execution of that document by ‘A P’ as donee under the Power of Attorney granted by ‘C M’. He submitted that it was simply not open to the respondent to assert that ‘A P’ had commenced the application in some other capacity as agent for the company. He submitted that the wording of the application was clear, namely that ‘A P’ was purporting to act as ‘C M’’s Attorney, and not as duly authorised agent of the landlord company.
He correctly submitted that a donee under an Enduring Power of Attorney, in general, is authorised only in respect of the personal affairs of the donor, and not in respect of the affairs of a separate legal entity, such as the landlord company.
He referred to the decision in Mancini v Mancini,[7] which is to the effect that unless there is some reference in the constitution of the company to found such authorisation, ‘the office of a director is not a property right capable of being exercised by an attorney or other substitute or delegate of the person holding the office’.
[7] (1999) 17 ACLC 1570 at [30]
In Cheerine Group (International) Pty Ltd v Yeung,[8] an attempt by one Director to appoint another individual as an alternative Director under a Power of Attorney was of no effect. At para [10] Young CJ in eq said:
That resolution is obviously invalid. It has been held on three occasions by judges of this court that a power of attorney given to a person who is also a director of a corporation confers no authority whatsoever for that person virtually to be or appoint an alternative director or exercise the functions of a director of that corporation, even though the donor is a director of the corporation and even though the power of attorney is in very wide terms.
[8] [2006] NSWSC 1047
He also referred to Ledir Enterprises Pty Ltd[9], Keith Dudley (deceased)[10] and Robson v Flight[11].
[9] [2013] NSWSC 1332
[10] [2013] SASC 22
[11] [1865] 4 DeGJ&S 608
Mr Fabbro submitted that the order of the Tribunal was a nullity as it only had power to make such an order upon the application of a landlord pursuant to s 87(2) of the Act. As the application was not made by the landlord, he submitted that the order was ‘attended by jurisdictional error’. He submitted that the order was a nullity as the Tribunal is not a superior court. Its powers are circumscribed by the Act itself, and the order could not be remedied by resort to s 32 of s 33 of the Act.
Mr Fabbro further submitted that as s 41(1) of the Act provided an appeal to this court from a decision or order of the Tribunal made in the exercise (or purported exercise) of its powers under the Act, the Tribunal is functus officio. He cited Purton v Jackson[12] and DPP v Edwards[13].
[12] [2012] TASFC 2
[13] [2012] VSCA 293
As to the question of ratification, Mr Fabbro very properly conceded that the lack of authority for the institution of proceedings could be cured by ratification by the company, but only if effected within a reasonable time. He submitted that the attempt, in this case, to ratify an unauthorised act after the action had been heard, was too late, and could not be said to have been effected within a reasonable time. He submitted that the court ought to conclude that the application was issued without authority, that it was too late to ratify, and that the landlord ought issue a fresh application to the Tribunal.
The respondent’s submissions
Counsel for the landlord company, Mr Iles, submitted that there was no utility in the appeal, as there are ‘no circumstances in which the first appellant could be allowed to resume the residential tenancy in light of the terms of his bail agreement’. He submitted that ‘A P’ is the daughter of ‘C M’ who is one of two Directors and the majority shareholder of the landlord company. He submitted that she had undoubtedly acted with the knowledge and consent of ‘C M’ and indeed the agent, Bruse Real Estate. He submitted that there could be no doubt that the application could have been filed by either ‘C M’ or Bruse Real Estate as agent for the landlord company. Mr Iles submitted that an application under s 87(2) can be made not merely by the landlord in person or by its Directors in respect of a corporate entity, but in fact by anyone as agent of the landlord. He referred, in passing, to the standard Form 7, in the Regulations to the Act, which expressly contemplate an application by either a landlord, an agent or a tenant. He submitted that upon a proper construction of the facts, the application was made as agent behalf of the landlord company and not merely as the donee of the Power of Attorney from ‘C M’. He submitted that this was not an application made by ‘A P’ on a frolic of her own. He submitted that it could not be doubted that the landlord desired that the tenants, be evicted following the events of 16 and 17 October 2014.
Mr Iles submitted that whatever was the position in respect of ‘A P’’s execution of the application, it did not render the Tribunal’s order a nullity. The landlord company had subsequently ratified her actions and indeed confirmed that her execution of and filing of the application had in fact been done with the Directors express knowledge and permission. The nature of the Act is to require applications to be dealt with expeditiously. The Tribunal has wide powers in s 32 and s 33 of the Act to cure any irregularities. It would be a futile exercise to require the landlord to file a fresh application on the same grounds as those contained in the original application dated 19 October 2014, especially when no point had been taken at the hearing as to any want of jurisdiction, and ratification had been effected.

In the alternative, Mr Iles submitted that ‘A P’ did have authority to act as an agent of the landlord not pursuant to the Power of Attorney but because her father as principal Director had requested her to do so. The Tribunal is not a jurisdiction where form prevails over substance and her error in not signing the application as agent ought not stand in her way. No point could have been taken had the application been issued by Bruce Real Estate as an agent.
Discussion
In my opinion this preliminary point of law can be determined by resolving the question whether a company, such as the landlord in the subject case, may ratify an unauthorised act of a person purporting to act as agent in issuing proceedings at a time after the proceedings have been determined. I accordingly do not need to consider the interesting question as to whether ‘A P’ acted in some capacity for the landlord other than as donee under the Power of Attorney. It is inappropriate to consider, at this stage, questions of credibility. Accordingly, I will approach my discussion of the issues upon the assumption that ‘A P’ did not issue the proceedings as a duly authorised agent of the landlord company, but had purported to do so merely as donee of the Power of Attorney for ‘C M’; a director of the landlord company.
I turn directly to the question whether an unauthorised act of an individual to issue proceedings on behalf of a company can be later ratified by the company. There has been a series of recent decisions by various Courts of Appeal in respect of this issue, including 2 Elizabeth Bay Road Pty Ltd,[14] delivered by the Court of Appeal (NSW) on 5 December 2014.
[14] [2014] NSWCA 409
Principles of Law
It is trite that a company, being an artificial body, must act through directors, officers and other agents.
It is for this reason that Form 7 provides for the application to be signed by an ‘agent’.
Companies, at common law, have been able to avoid liability on contracts where a director or other agent had acted outside the scope of their actual or ostensible authority.[15]
[15] Northside Developments Pty Ltd v Registrar General (1990) 170 CLR 146.
Such acts may therefore be capable of ratification by the company.
In Raja v Darul-Iman[16] the Court of Appeal (Western Australia) said that once a court is satisfied that an action was commenced without authority of the person or body whose name appears as plaintiff the proper course is for the court to strike out or the stay of the action. This however was a case where more than six years had elapsed since the question of whether the company had properly authorised lawyers had been first raised. The court did, however, confirm that an action, though brought without authority, is not a nullity but is void ab initio where there is no possibility of subsequent ratification. It affirmed that ratification, once effective, relates back to the date of the institution of the action. Indeed in that case the court simply adjourned the hearing after staying the action pending a determination from those in control of the company as to whether they would ratify the action.
[16] [2011] WASCA 251
The recent case law generally involves legislation which may have resulted in the company, itself, not having power to act and not just the unauthorised act of an agent. In the subject appeal there is no such question. The landlord company was entitled to bring the proceedings before the Tribunal, either by itself or by its duly authorised agent.[17]
[17] See 2 Elizabeth Bay Road Pty Ltd, supra, Berowra Holdings v Gordon (2006) 225 CLR 364 and McEvoy v No 9 Port Douglas Road [2013] QCA 168.
In F.C.T. v Sara Lee Household & Body Care (Aust) Pty Ltd,[18] at [20] the High Court said:
First there is the question of [the agent’s] lack of authority, on or before 31 May 1991, to sign the agreement and the ratification of his act by resolution of the board of directors of the respondent on 30 August 1991. North J and the Full Court applied the general rule that where a principal ratifies the earlier act of a person acting as agent without authority, the ratification relates back to the date of the unauthorised act and the principal is bound as if the agent had authority at this earlier time.
They were correct to do so.
This is not a case in which the rights of third parties have intervened. Although the principle is sometimes described as operating upon the basis of a fiction, it is a well settled rule of common law …
[18] (2000) 201 CLR 520.
A question which has been left unresolved in the case law is whether a company can ratify an unauthorised act involving the institution of proceedings without authority, at a time when those proceedings have been completed.
In Alexander Ward & Co Ltd v Samyang Navigation Pty Ltd,[19] the House of Lords expressly left the question open in the case of an arrest of a vessel, within jurisdiction.
[19] (1975) 1 WLR 673
In McEvoy v Body Corporate for 9 Port Douglas Road[20] the Court of Appeal (Qld) considered those circumstances in a case where the committee of the body corporate had sought to appeal a decision in the QCAT. The committee had failed to obtain a special resolution of the body for the appeal to take place. The QCAT member had failed to deal with the applicant’s submission as to a lack of authority. The body corporate purported to ratify the decision to appeal after the decision was given in its favour. The court had to consider whether the QCAT proceedings were a nullity, or whether there could be an effective ratification after the proceeding was complete.
[20] [2013] QCA 168
Pursuant to s 312 of the Body Corporate and Community Management Act a body corporate could only commence a proceeding if authorised by a special resolution of the body corporate. The respondent had called an extra ordinary general meeting some four and a half months after the QCAT decision was given, to ratify the decision of the committee to bring the appeal.
Holmes JA with whom the other member of the court agreed, said:
‘The fact that proceedings had been commenced without authority does not render them a nullity’. That was recognised by the House of Lords in Russian Commercial & Industrial Bank v Comptoir D’escompte DeMulhouse[21].
[21] [1925] AC 112
His Honour noted that it is well established that the commencement of proceedings without proper authority may be cured by a subsequent ratification. In Danish Mercantile Co Ltd v Beaumont[22] an action was commenced in the name of a company without approval. Jenkins LJ observed that the practice of the court where there was a dispute as to authority was to adjourn any motion to strike out proceedings, to await whether the company will adopt the bringing of the action.
[22] [1951] 1 All ER 925
He explained that it was open, at any time, to the purported plaintiff to ratify the act of the solicitor who started the action and to adopt the proceedings, to approve all that has been done in the past and to instruct the solicitor to continue the action. See Alexander Ward & Co Ltd v Samyang Navigation Co Ltd[23], Ox Operations Pty Ltd v Landmark Property Developments (Vic)[24].
[23] [1975] 1 WLR 673
[24] [2007] FCA 1221
In Victorian Teachers Credit Union Ltd v KPMG[25] the Court of Appeal (Vic) noted that by subsequent ratification the company could validate the commencement of an action brought without authority, with the ratification relating back ‘so as to be deemed equivalent to an antecedent authority’.
[25] [2000] VSCA 23
It is trite that any ratification must be approved by the board within a reasonable time. In McEvoy’s case, supra, the Court of Appeal (Qld) noted that the question as to whether the bringing of a proceeding can be ratified after its conclusion had not been the subject of any contemporary or direct authority.[26] In that case the Court of Appeal accepted the principle that the effect of ratification is to clothe an agent with authority for the purposes of the unauthorised act the body corporate, and would do so retrospectively, then it would authorise the committee to mount the QCAT appeal saying:
That conclusion would be in keeping with the notion that ratification is designed to remedy an inconvenience, it seems clear enough that the body corporate wished to appeal, and that its failure to do so was the product of simple oversight as to the level of authorisation required. The applicants would not be deprived of any right by that resolution.
[26] See also Vitek v Estate Homes Pty Ltd [2013] NSWSC 1764
The court expressly disavowed any suggestion that the order of the Tribunal in that case was rendered a nullity by that want of authority, and relevantly noted that the object in the QCAT Act is to deal with matters in ‘an accessible, fair, just and economical and informal and quick way’.
Relevantly, in light of the matters raised by the landlord company in the subject appeal, it expressed the opinion that had the want of authority been raised before the Tribunal then the Tribunal would have adjourned the hearing to enable the necessary vote of the body corporate to take place.
Significantly, the court noted that if the want of authority were found in favour of the applicants then the resulting order would be the setting aside of the Tribunal decision and remitting of the matter for rehearing in circumstances where the committee’s decision to bring the appeal to the Tribunal had been ratified after the event.
In the event, the Court of Appeal did not have to decide the issue before this court but simply declined leave to appeal, in its discretion, on the ground of the futility of the appeal.
In 2 Elizabeth Bay Road Pty Ltd v The Owners – Strata Plan No 73943, supra, the Court of Appeal (NSW) recently approved the dita in McEvoy’s case. In that case a corporation, which did not have prior approval of its members, was in breach of relevant legislation. The Court held that proceedings brought in breach of the legislation was not a nullity. The prompt ratification of the act cured the breach. The courts have stressed that in respect of any delay, one would expect that the question of want of authority would be raised at the hearing. In the subject case, no such point was taken by the appellants.
In the subject appeal the landlord company had the power and the right to issue the proceedings in its own name. On the undisputed evidence contained, in the minutes of meeting, the two directors of the landlord company had, on 25 November 2014, ratified the unauthorised acts of ‘A P’ in commencing the application to the Tribunal and conducting the proceedings.
Conclusion
I reject the proposition put forward by the appellants that the proceedings were a nullity. In my opinion the proceedings are capable of ratification and were indeed properly ratified by the company subsequently. There was no unreasonable delay in relation to this matter. The appeal came on for hearing soon after the decision of the Tribunal. At no stage had the question of want of jurisdiction or authority ever been raised until it was raised for the first time upon the issue of an Interlocutory Application on 24 November 2014.
I am satisfied that at all times the application to remove the appellants from the premises following the alleged damage to the same was approved by both Directors as confirmed in the minutes.
There is no detriment at all to the tenants who did not fight the proceedings on the basis of any want of authority, nor indeed dispute the damage to the property.
Adopting the words of the court in Matthews v SPI Electricity Pty Ltd[27] ‘I see no good reason for the case to go back to square one. The proceeding if regularised can now move forward rather than go backwards to reissuing and dealing with applications concerning the adoption of previous steps taken in the proceedings’.
[27] [2011] VSC 167 at [117]
In the subject appeal the first named tenant cannot regain possession because of the terms of the bail agreement.
I repeat the dicta in Danish Mercantile Co Ltd, supra:
I think the true position is simply that a solicitor who starts proceedings in the name of a company without verifying whether he has property authority to do so, or under an erroneous assumption as to the authority, does so at his own peril, and that, so long as the matter rests there, the action is not properly constituted. In that sense, it is a nullity and can be stayed at any time provided that the aggrieved defendant does not unduly delay his application. But it is open at any time to the purported plaintiff to ratify the act of the solicitor who started the action, to adopt the proceedings, to approve all that has been done in the past, and to instruct the solicitor to continue the action. When that has been done, then, in accordance with the ordinary law of principal and agent, in accordance with the ordinary doctrine of ratification, in my view, the defect in the proceedings as originally constituted is cured, and it is no longer open to the defendant to object on the ground that the proceedings thus ratified and adopted were, in the first instance, brought without proper authority.
In my opinion it is appropriate to conclude, on the facts of this case, that the ratification of the acts of ‘A P’ by the board of the landlord company was valid notwithstanding that the application had been determined by the Tribunal prior to 25 November 2014.
There can be no prejudice to the first appellant. I do not need to consider, at this time, the status of the second appellant.
The landlord company is a private corporation, effectively controlled by ‘C M’. There is no doubt that on behalf of the company he could have authorised Bruse Real Estate or any other agent to issue the proceedings on behalf of the landlord. The minutes of the meeting evidence the validity of the ratification in this case.
I therefore conclude that the ratification is valid and dismiss the application of the appellants that the orders of the Tribunal are a nullity.
In any event I will proceed to hear the appeal in circumstances where the ratification has been made by the landlord company.
I will hear the parties as to the future conduct of the matter, especially in light of the terms of the bail agreement entered into by the first appellant.