Supreme Court of the NT|1986-03-26|Before: Rice J

Blythe Green & Jordain (Trading) Pty Ltd v Sienna Pty Ltd [1986] NTSC 14; 38 NTR 1; 82 FLR 291 (26 March 1986)

COURT IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA Rice J.(1) CWDS Practice and procedure - Application to strike out so much of the Statement of Claim as relates to enforcement of a lien under the Workmen's Liens Act 1893-1896 - First registered lien "ceased" by operation of s.15 since action to enforce it commenced after expiry of fourteen days from registration - Second lien for same amount subsequently registered and action to enforce it commenced within time - Whether or not second lien and action to enforce it still available. Statute - Workmen's Lien Act 1893-1896 - First registered lien "ceased" by operation of s.15 since action to enforce it commenced after expiry of fourteen days from registration - Second lien for same amount subsequently registered and action to enforce it commenced within time - Whether or not second lien and action to enforce it still available. Supreme Court Rules O.29 R.4 Workmen's Lien Act 1893-1896 ss. 5, 10, 15, 16 and 37. Cases applied: Albert Del Fabbro Pty. Ltd v Wilckens and Burnside Pty. Ltd. (1971) SASR 121 at 138 Del Fabro v Wilckens and Burnside Pty. Ltd. (1970) SASR 277 Metropolitan Brick Company v Hayward and Anor. ; at 467 Cases considered: Birchall Constructions Pty. Ltd. v Jape Nominees Pty. Ltd. and Karki Constructions. Pty. Ltd. Palyaris Constructions Pty. Ltd. v Kauri Timber Co. Ltd. at 43 HRNG DARWIN #DATE 26:3:1986 Counsel for the Applicant Defendant: Mr I. Morris Solicitor for the Applicant Defendant: Poveys Counsel for the Respondent Plaintiff: Mr M. Carter Solicitor for the Respondent Plaintiff: Close and Carter ORDER Application granted. Applicant shall have its costs of and incidental to this application and to the carrying into effect of the orders. JUDGE1 This is an interlocutory application by the defendant under Order 29 Rule 4 of the Supreme Court Rules for the following orders:- "1. That so much of the Statement of Claim of the plaintiff herein that claims a worker's (sic) lien upon the land referred to in the Statement of Claim, namely, Lot 335 in the Town of Alice Springs be struck out. 2. That the plaintiff be ordered to remove the lien registered upon the said land on the 24th of January 1986, namely, Notice of Lien No: 170658." By writ and Statement of Claim issued on 5 February 1986 in this action the plaintiff claims:- "A Workmen's Lien to secure the payments (sic.) of the debt of $15,882-06 due by P.H. Concrete Tanks Pty. Ltd. to the Plaintiff pursuant to the provisions of the Workmen's Liens Act 1893." 2. The plaintiff alleges (inter alia) that in May, June and July, 1985, it sold and delivered to P.H. Concrete Tanks Pty. Ltd. a quantity of steel to be used as reinforcement in a concrete building in the course of erection on the defendant's land and that the building materials were delivered onto the defendant's land with the express or implied consent of the defendant. The plaintiff further alleges that on or about the 20th day of January, 1986, it executed a Memorandum of Lien which was subsequently registered as a Notice of Lien Number 170658 against the defendant's land on the 24th day of January 1986. The subject land is Lot 335 Town of Alice Springs being comprised in Certificate of Title Register Book Volume 89 Folio 88. 3. It was not disclosed before me whether or not the plaintiff has sued P.H. Concrete Tanks Pty. Ltd. for the alleged debt but certainly that Company has not been joined as a defendant in the present proceedings. 4. In support of the application, an affidavit of the defendant's solicitor, Ian McDonald Morris, sworn herein on 4 March 1986, was tendered. He deposes to the fact that on 3 December 1985 a writ in Supreme Court action No. 715 of 1985 between the identical plaintiff and the identical defendant was issued for the enforcement of a "Workmen's Lien (sic.) against the identical land to secure the payment of the identical sum of $15,882-06 alleged to be due to the plaintiff by P.H. Concrete Tanks Pty. Ltd. and another for building materials used on the land. That writ is exhibited to Mr Morris' affidavit as well as a search copy of the relevant Certificate of Title. The endorsements on the Certificate of Title indicate that a Notice of Lien by the plaintiff was registered on 17 October 1985 and that it was subsequently withdrawn and a cessation of that lien was registered on 29 November 1985. Accordingly, apart from other registrations which are not relevant for present purposes, there now remains extant the registration of a Notice of Lien Number 170658 to which the plaintiff refers in its Statement of Claim. 5. In the light of this history it emerges that the first lien ceased because no action to enforce it had been brought against the owner within fourteen days from the registration thereof as required by s.15 of the Act. By its present moves the plaintiff now seeks to start afresh to secure the identical remedy it had previously sought to obtain. 6. A lien envisaged by the Workmen's Liens Act 1893 of the State of South Australia in its application to the Northern Territory is essentially a creature of statute. It relies upon the Act for its conception and is essentially different from a lien at common law. Bright J. in Del Fabro v Wilckens and Burnside Pty. Ltd. in outlining the history of the legislation says at p 281:- "The word 'lien' is not used in its primary or legal sense, which Halsbury (3rd ed. vol. 24, p 142) gives as 'a right in one man to retain that which is rightfully and continuously in his possession belonging to another until the present and accrued claims of the person in possession are satisfied'. See also Montagu's Law of Lien (1821), p 1. On the contrary, a lien under this Act is a charge or encumbrance upon certain land, namely,

land owned or occupied by a person who authorizes the performance of work by a workman, a contractor or a sub-contractor upon that land. A workman has also a lien on goods. In 1896 the South Australian Act was extended to include suppliers of materials (scil. to the land)." 7. The applicant submits that since no action was brought against the owner of the land for the enforcement of the lien within fourteen days from the registration thereof it ceased by virtue of the operation of s.15 which provides as follows:- "Every lien under this Act upon the estate or interest of any owner or occupier shall cease unless an action shall be brought against the owner or occupier for enforcement of the lien within fourteen days from the registration thereof." It was submitted on behalf of the applicant that it does not avail the plaintiff to start afresh since once the identical lien has ceased it ceases forever. In the absence of direct authority on the point, counsel for the applicant relied upon a passge in The Artificer's Lien (1967) a work by the late R.D. Elliott who, at p 101, makes the following observations:- "Once a Notice of Lien has been lodged for registration or deposit, the lienee has 14 days within which to commence an action to enforce his lien. If he does not commence his action within that period the lien ceases. (Section 6 and see the definition of 'contract price' in section 2). Once the action for enforcement has been commenced it must not be discontinued without a Court order giving leave to discontinue and to bring a fresh action for its enforcement. A discontinuance without such an order will cause the lien to become ineffective and unenforceable. (Section 15) It is suggested that it is not possible, when once a lien has arisen under the Act and has then ceased, to make a fresh demandon the person primarily liable to pay the lienee and then lodge a new Notice of Lien claiming either the same debtor the same debt plus another amount which has become payable since the first Notice of Lien was lodged. However a claim for a completely fresh amount which has fallen due and payable to the lienee (even under the same contract) after the original lien has ceased will be effective, but no amount unpaid under an older Notice of Lien can be tacked on to the amount of the new claim. A Court has no power to extend the time for bringing an action to enforce a lien. It can however authorise the discontinuance of an action for enforcement which has been brought within the statutory period, and give a further time to commence a fresh action for enforcement. (Section 16)" (My emphasis throughout.) 8. With due respect to the learned author, I think he meant to say "lienor" and not "lienee" where that term occurs throughout the passage I have quoted. This would then be in accordance with accepted legal usage and drafting terminology. (See Jessup's Lands Titles Office : Forms and Practice, 6th edition, by Maher at p 294 and note 2 at p 295.) 9. The essential question which arises, therefore, is whether or not this proposition as highlighted by me is so clearly tenable as to be free from doubt bearing in mind that this is an interlocutory application. I am prepared to say that it is. 10. This Court reviewed some of the relevant provisions of the Act in Birchall Constructions Pty. Ltd. v Jape Nominees Pty. Ltd. and Karki Constructions Pty. Ltd. (1982) 14 NTR 6. In particular, Gallop J. said at p 11:- "In considering the respective submissions of the plaintiff and the first defendant, I have derived much assistance from the judgment of Bright J in Del Fabrio v Wilckens and Burnside (1970) SASR 277. I think that his construction of the Act is correct. At 284 Bright J stated the following principles as emerging from a proper construction of the statute. A lien exists only after the work has been done or materials supplied, not at the

time of the engagement to do the work. He construed the words 'are done ... and unpaid' in s 6 as meaning 'have been done and not paid for'. He went on to say that the words 'become due' in s 10(2) do not mean the same as the words 'accrued due' in s 5. The sequence is that the sub-contract or portion thereof has been performed, the sub-contract price or a portion thereof has accrued due, and when notice is given pursuant to s 10(2) and the contract price remains unpaid for seven days thereafter, the price or portion thereof which has accrued due is also deemed to become due. A lien exists when the price or a portion thereof has accrued due but is 'available' (as mentioned in s 10(1)) only after it has also become due." 11. In his review of the earlier authorities, Bright J. in the Del Fabro case at p 284 added this further principle which, in my opinion, helps to define the nature, scope and operation of a lien under the Act:- "A lien is not an equitable charge but a statutory

right, and once it has become available it fastens upon the land, at the latest, from the date upon which it becomes available. It relinquishes its hold on the land and ceases to be a security unless registered before the expiration of twenty-eight days from the date which the price has become due, but provided registration is effected and an action is brought in due time it continues to be operative until discharged by payment to the lien holder of whatever sum is properly payable to him pursuant thereto. It is operative as regards moneys then payable and once it has arisen it continues to be effective as regards moneys thereafter becoming payable by the owner in respect of the sub-contract." (My emphasis) 12. Turning now to some of the specific sections of the Act, s.5 provides:- "5. A contractor or sub-contractor shall have a lien for the contract price, so far as accrued due, on the estate or interest in land of any owner or occupier in each of the following cases - (a) Where the work is done, with the assent, express or implied, of the owner or occupier to the land or to any fixture thereon:

(b) Where the materials are, with the assent, express or implied, of the owner or occupier, used or intended to be used in or about work done, or intended to be done, to the land or to any fixture thereon." 13. By the amending Act No. 658 of 1896 it is provided that liens shall be had under "The Workmen's Liens Act, 1893," for materials furnished, although such materials may not be furnished in connection with work. It would appear that this is the case here. 14. Section 10(1) provides:- "10.(1) A lien under this Act with regard to land shall be available only if registered before the expiration of twenty-eight days after the wages or contract price in respect of which such lien has arisen shall for the purposes of this section have become due." 15. In my opinion, this provision, when read in conjunction with s.5, ordains that the statutory lien contemplated by the Act comes into existence when the requirements of s.5 are satisfied, but that the lien thereby created has efficacy only if registered before the expiration of twenty-eight days "after the wages or contract price in respect of which such lien has arisen ..." (My emphasis) 16. In other words, s.10(1) recognises the latent or dormant effect of the lien in its embryonic state but lays down that registration within a specified limited period of twenty-eight days is essential for its continued viability. Moreover, sub-section (3), by implication, recognises the existence of the lien by prescribing the form of notice of it which must be registered. By sub-section (5), once the lienee has paid into Court the amount claimed to abide the event of the action "the lien shall be deemed to cease". 17. This section clearly highlights the object of the Act which seeks to provide security to a claimant under it by ensuring that to be enforceable a lien remains under the control of the Court until the action has been determined or the lien is otherwise satisfied by payment of the amount claimed into Court. In the latter case there is no need for the lien to remain because the claim has been satisfied and hence by force of the Act the lien is deemed to cease. If, however, the claim remains unsatisfied, then the Court will ultimately make its determination and the lien can be enforced in accordance with the later provisions of the Act. 18. In my opinion, the lien referred to in s.15 is one and the same as that created by the operation of s.5; and hence, just as a lien loses its potential viability unless registered under s.10(1) within twenty-eight days of the contract price having become due, so too, a lien created by the operation of s.5 ceases unless an action is brought within fourteen days from the registration thereof. 19. In my opinion, therefore, it is the clear intendment of the Act to enable the creation of one statutory lien only limited in its scope and effect to securing the amount due to the lienor from time to time during the lifetime of that particular lien; and, once extinguished by the operation of s.15, it is incapable of resurrection. Once a lien under the Act "ceases" by force of the Act, its rebirth is impossible. It is only in the case of an action which has been brought within fourteen days from registration and has been discontinued that the Court is empowered to give "further time to bring a fresh action to enforce the lien". These words in s.16, to my mind, clearly indicate the limited extent to which fresh proceedings may be brought in which to enforce a lien which is dormant but nonetheless capable of resuscitation. 20. It was conceded by counsel for the plaintiff that the two debts referred to in the present actions and the earlier one are one and the same. He submitted that the Notice of Lien and the lien itself are the same thing on the ground that the lien only comes into existence when the Notice of Lien is actually registered. I do not agree. In my opinion, the lien and the right to enforce it are separate and distinct and, in particular, the lien has a separate existence prior to registration: see per Napier C.J., (as he then was) in Metropolitan Brick Company v Hayward and another [1938] SAStRp 57; (1938) SASR 462 at p 467:- "It follows that the lien and the right to enforce it are separate and distinct, in the sense that the lien is

capable of lying dormant, whilst there is nothing payable by the owner under his contract, and becoming enforceable whenever money becomes payable. In order to be enforceable the lien has to be registered under sec.10, and an action to enforce it must be commenced within fourteen days from registration (sec. 15); but, if there is no right to enforce it, at that time, I see no reason why the action should not be kept alive until the possibility of enforcement is realized, or is excluded,

by the event. Sec. 16 contemplates a discontinuance 'with an order giving further time to commence a fresh action'; but sec. 23 - as I read it - gives the Court power to make any order 'in relation to the enforcement of the lien' that may be just, and I think that this gives the Court power to do - mutantis mutandis - what the Supreme Court might be expected to do in an action to enforce an equitable charge of a similar nature. If it appears that there is nothing payable to the contractor when the action is heard, but that there is a possibility of something becoming payable in the future, I think that a suitable order would be to declare the existence of the lien, and the right to enforce it in the event of money becoming payable to the contractor, and to stay the action, with liberty to apply for an order enforcing the lien, or dismissing the action, as the case may be." (My emphasis) 21. Support for this view is to be found in the observations of Zelling J. in Albert Del Fabbro Pty. Ltd. v Wilckens and Burnside Pty. Ltd. (Receiver and Manager Appointed) and another (1971) SASR 121 at p 138:- "I also draw attention to the words in s.6 'shall receive notice of the lien or of its registration' which indicates that the lien has a separate existence prior to registration. Further under s.10(4) a lien may be registered after the contract price has become payable although the seven days mentioned in sub-s.(2) of that section in relation to the giving of notice have not commenced to run. Accordingly the High Court's decision in Stapleton v F.T.S. O'Donnell, Griffin and Co. (Q) Pty. Ltd. [1961] HCA 70; (1961) 108 CLR 106 is inconsistent with the reasoning of Murray C.J. and Angas Parsons J. in Miller's Lime Limited v Royal Agricultural and Horticultural Society of Australia [1936] SAStRp 57; (1936) SASR 306 that the lien does not arise until registration in the General Registry Office, and the latter case must be no longer regarded as an authority for the proposition above cited from it." 22. In the same case, Bray C.J. at p 129 et seq. questioned the authority of the earlier Miller's Lime Case ((1936) SASR 366) on the added ground that what was said there on the topic was obiter. 23. As Legoe J. said in Palyaris Constructions Pty. Ltd. v Kauri Timber Co. Ltd. (1980) 24 SASR 41 at p 53:- "... the general scheme of the Workmen's Liens Act is one of imposing strict limitations with respect to time

upon the lienor if he is to obtain the special benefits which the Act confers upon him or it. These strict time limits are clearly expressed in the provisions of the Act,..." 24. To give a claimant a remedy under the Act in the form of a security for the very same amount of his claim after his first lien had ceased by operation of s.15, would, in my opinion, be tantamount to allowing him to circumvent the strictures of the Act for which no warrant to do so exists. Taken to its logical extreme, if this were the case, a claimant could effectively fetter the title to land simply by lodging, intermittently, a series of Notices of Lien for the identical amount without ever having commenced an action to enforce it. Clearly this was never contemplated by the Act and is repugnant to its very purpose; and in the circumstances of the present case I see no good reason for allowing a second Lien to remain on the title. 25. I therefore have no hesitation in granting the application and accordingly there will be an order striking out so much of the Statement of Claim as purports to claim a workman's lien. It may well be that the whole of the Statement of Claim falls to the ground since, as I mentioned at the outset, there is no claim against P.H. Concrete Tanks Pty. Ltd. in the present action, which seems to be confined essentially to the purported enforcement of a workman's lien. I further order pursuant to s.37 of the Act that lien registered Number 170658 be discharged and that the Registrar-General make a Memorandum that the said lien has ceased. The applicant shall have its costs of and incidental to this application and to the carrying into effect of these orders.

Workmen's Liens Act 1893

Workmen's Lien Act 1893

Supreme Court Rules O.29 R.4 Workmen's Lien Act 1893

Workmen's Lien Act 1893

Workmen's Liens Act 1893

Supreme Court Rules O.29 R.4 Workmen's Lien Act 1893

Blythe Green & Jordain (Trading) Pty Ltd v Sienna Pty Ltd [1986] NTSC 14; 38 NTR 1; 82 FLR 291

At a glance

Court

Decision date

Before

Source

Judgment (9 paragraphs)

Blythe Green & Jordain (Trading) Pty Ltd v Sienna Pty Ltd [1986] NTSC 14; 38 NTR 1; 82 FLR 291 (26 March 1986)

Parties

Legislation Cited (6)

Cases Cited (2)