1. Adjourned to further directions hearing 9.30 am, 27 August 2008 at 55 King Street.
2. Costs reserved.

1. This proceeding might be regarded as having something of the Old Testament about it. It is in substance a dispute between father and son. The applicant Mr Gregory Dawson is the son, the respondent Gallant Valley Pty Ltd is the company which I have been told is controlled by Mr Dawson's father.
2. Mr Dawson says that in the 1980s a piece of land was purchased in his name. He says, though this is not necessarily accepted by the respondent, perhaps may be distinctly disputed, that he paid the deposit and some early payments and that at some relatively early stage he was prevailed upon to transfer the land for no consideration to his father's company, the respondent in the proceeding. As a result says Mr Dawson he enjoys an interest in the land by way of constructive trust. Mr Dawson also alleges certain other entitlements based upon alleged breaches of the Fair Trading Act and so on but they need not detain us for present purposes.
3. This proceeding was commenced on 4 December last year and a number of the interlocutory steps have been completed. The respondent, the father's company has now sought the stay or dismissal of the proceedings on what one might describe as a menu of bases. The first two are what one might describe as pure jurisdictional ones. Gallant Valley through its Counsel, Mr Hangay says that the Tribunal's admitted jurisdiction under Part IV of the Property Law Act 1958 to deal with disputes as to co-owned land and goods does not enable the Tribunal to entertain a claim brought by an alleged co-owner whose co-ownership is entirely equitable as of course is necessarily the situation for Mr Dawson who has no legal estate but asserts a claim as beneficiary under a constructive trust.
4. Secondly, in a related but distinct argument, Mr Hangay submits that even if the Tribunal does have jurisdiction to deal with a claim by an owner whose ownership is purely equitable, that jurisdiction is exercisable only where the equitable ownership is admitted. Where it is in dispute it is incumbent upon the person having a dispute as to equitable interests or estates first, to have the existence or otherwise of that interest or estate adjudicated upon by a court of competent jurisdiction.
5. Once a favourable determination is made it would in Mr Hangay's submission, possibly be within this Tribunal's jurisdiction to adjudicate upon the admitted or determined equitable interest or estate and the claim by that equitable co-owner to remedies under Part IV but it is simply not competent says Mr Hangay for someone to ask this Tribunal first, to determine the existence of their claimed equitable interest or estate and then take the next step and give co-ownership remedies under Part IV.
6. The next point raised by Mr Hangay is the admitted fact that Mr Dawson is an undischarged bankrupt. I have been told that the bankruptcy is one that was prolonged beyond the usual three year time limit by reason of Mr Dawson's failure to take certain administrative steps that would have had him discharged by a fluxion of time. His Counsel, Mr Mitchell McKenzie tells me that there is aside from the interest of the official trust deed perhaps in costs of administration, only one creditor of the estate, namely a bank and that matters are in hand to try and resolve the issue of the trustee's costs and reach a composition with the bank such that in one way or another the bankruptcy may be terminated. At any rate, Mr Hangay says that in circumstances where the interest in the subject property if it exists, is by virtue of Section 58 of the Commonwealth Bankruptcy Act 1966 vested in the official trustee, it is simply not competent for Mr Dawson to bring this proceeding seeking to recover property which by virtue of the Bankruptcy Act is vested in the official trustee. The proceeding is incompetent for that reason.
7. Next, says Mr Hangay, if none of these arguments avails, he contends that security for costs should be required from Mr Dawson under Section 79 of the Victorian Civil and Administrative Tribunal Act 1998. Mr Hangay says the status of Mr Dawson as an undischarged bankrupt in itself indicates conclusively his impecuniosity. No further evidence is required of that fact. Mr Hangay conceded that there was no affidavit material as there customarily is, deposing as to the likely high cost of progressing the litigation. Nevertheless, he submitted I should infer that litigation is costly and that in accordance with the usual principles on security for costs, this is an appropriate case to order such security. Implicitly I think he invited me to consider indicating a willingness to order security for costs subject to the provision of affidavit material on quantum.
8. Mr McKenzie opposes any of the steps to block, dismiss, strike out or stay this proceeding. I have already recited his explanation as to his client's status as a bankrupt. Mr McKenzie submits that with regard to security for costs courts and tribunals have customarily been far more reluctant to order such security against individuals than they have been against insolvent companies. Moreover, there was an element of self-protection in the present proceeding given that the case made is that Mr Dawson's father's company is in possession of the subject property and that it under the management of Mr Dawson senior has made large expenditures such that a profitable bed and breakfast business is now carried on on land which in the 1980s was bought for an amount which today would be described as a song or a mere bagetelle.
9. I turn first then to the jurisdictional objection which is raised. Part IV of the Property Law Act 1958 was introduced into the statute by amending Act in 2005. Until that time issues of co-ownership of land and goods were within the sole jurisdiction of the Courts. The 2005 Act, No. 71 of that year, had as its evident objective the provision of a more expeditious and inexpensive remedy particular for property of relatively modest value.
10. Section 222 part of the new inserted Part IV says:

In this Part- co-owner means a person who has an interest in land or goods with one or more other persons as-

1. Land is said to have the same meaning as in the Interpretation of Legislation Act 1984. Nobody I think has raised any question as to whether the subject matter of this proceeding is land and property is defined as follows:

Property means real and personal property including any estate or interest in real or personal property or money, a death, a thing, an action or a right with respect to property.

1. The submission made on behalf of the respondent seeking a jurisdictional dismissal is that the only co-owners that this Tribunal has jurisdiction over under Part IV are those whose co-ownership exists at law.
2. Mr McKenzie on behalf of the applicant however submits there is no reason why co-ownership existing in equity is not also covered by Part IV. The analysis presumably of a situation of constructive trust where the alleged beneficiary of the constructive trust does not claim the entire interest would be that the legal owner is a trustee of the subject land for himself as to an undivided share representing what would popularly be described as his equity and as to the constructive beneficiary as to the balance, hence the two would be co-owners in equity, in the circumstances probably tenants in common rather than joint tenants because of the absence of the four unities, at least one of them being equality of interest.
3. Mr McKenzie submits that the reference to property including any estate or interest in real or personal property tends to underline this point. Mr Hangay however says that a reading of other provisions in the Property Law Act, in particular Part III thereof finds express references to equitable estates and trusts, hence he submits that had Parliament intended this Tribunal to have jurisdiction over those trust and equitable matters, it would have made express reference to them in Part IV, a reference which is singularly absent.
4. This is a difficult issue and one upon which at present we have no guidance from the Supreme Court. Mr McKenzie has referred me to a decision of Senior Member Professor Cremean in the matter of Malton v Borsbloom [2006] VCAT 2294 where it is clear from the orders which the learned Senior Member made that he was in that case purporting to exercise jurisdiction over some period of equitable interest. The determination as found on Austlii really consists of little more than the orders which were made and certainly if the learned Senior Member did consider the jurisdictional issue pressed upon me today he did not offer any explanation as to why he was satisfied that the Tribunal had jurisdiction over equitable co-owners and not merely legal co-owners of land.
5. Historically there has been a very strong tendency in Anglo-Australian law for adjudication on trusts and interests in land to be the sole province of superior courts of record. The entire concept of trusts in equitable estates was developed by the Court of Chancery. It was never in legal history properly the subject of any development by any inferior court. The Court of Chancery part of the now united jurisdiction, was itself a superior court of record, hence a purely historical analysis of these things would give one a very strong bias in favour of accepting Mr Hangay's submission. Countervailing considerations however are as follows: a consideration of the remedies which the Tribunal is given generally in its jurisdiction shows that whatever might have been the case in historical times, the Tribunal is given a wide range of equitable remedies to administer; power to grant interim and perpetual injunctions under Section 123 of the Victorian Civil and Administrative Tribunal Act 1998; power to make declarations under Section 124 of the same Act. Under some enabling enactments such as the Retail Leases Act 2003 and the Fair Trading Act 1999 the Tribunal also has power to grant orders of specific performance or rectification and in those and other Acts, a very wide ranging power to order someone to do something or not do something which presumably would extend to some of the more outré equitable remedies such as delivery up and cancellation, hence the thought that trusts are for superior courts of record and them alone, is perhaps less plausible today than it was a generation or two ago. Again, Clause 66(a) of Schedule 1 of the Victorian Civil and Administrative Tribunal Act provides that in these proceedings under Part IV of the Property Law Act the Tribunal is to be constituted or to include:

A member who in the opinion of the President has knowledge of or experience in Property Law matters.

1. This indicates, I think, that it is not entirely implausible to believe that Parliament might have entrusted jurisdiction in the Tribunal to adjudicate upon equitable interests under Part IV and given that the objective was to provide a speedy and economical form of adjudication rather than an elaborate and fractured one, a construction which allows Part IV to extend to those equitable interests and estates is to be preferred. Section 35 of the Interpretation of Legislation Act 1984 says that we should prefer a construction of a statute which advances the objective of the statute rather than one which retards it. Hence, I do not accept the primary jurisdictional submission put by Mr Hangay that only legal co-owners may apply.
2. A more difficult submission to deal with is the second one, namely that only admitted equitable interests are properly the subject of an adjudication under Part IV of the Tribunal and that the necessarily anterior question as to whether those interests exist is a matter exclusively for the courts and not for the Tribunal. With some hesitation I conclude that the considerations which I mentioned with respect to the first and primary jurisdictional challenge, also lead to the rejection of this secondary jurisdictional challenge. Parliament has enacted that only those people who in the opinion of the President who is by definition a Supreme Court Judge, have knowledge of Property Law, may adjudicate upon these matters, hence I do not regard it as inconceivable or inappropriate that the existence or otherwise of constructive trust could be the subject of an adjudication in this Tribunal. Therefore, I do not accept either of the jurisdictional challenges which have been mounted.
3. Next I turn to the challenge based on standing. Section 58 of the Bankruptcy Act vests the property, both existing and after acquired of a bankrupt in the Official Trustee or any registered trustee who is trustee in bankruptcy of a person. It has been quite common in the short life of the Part IV jurisdiction in this Tribunal for bankruptcy trustees to bring applications here in the Tribunal where the bankrupt was a co-owner of property with a view to the bankrupt's interest being realised for the benefit of creditors. Section 58 of the Bankruptcy Act makes clear that the interest as beneficiary under a constructive trust asserted on behalf of Mr Dawson, if it exists, belongs to the Official Trustee and not to Mr Dawson. In my view it is simply incompetent for Mr Dawson to press on with this proceeding. It may be that he will be able to have his bankruptcy annulled or take some other step the effect of which will be to have his interest in the subject land, if it exists vested in him. That step has not yet been taken. In my view a proper course with this proceeding is to put it on ice for a period of 90 days to see what can be done. If Mr Dawson succeeds in having the interest which he claims he had, re-vested in him by the Official Trustee by one means or another, then that is one thing. If he fails then it may be the proper course at that point to dismiss or strike out the proceeding. The practical answer however is to see what practical success Mr Dawson has in recovering what he says belongs to him.
4. This brings me finally to the issue of security of costs. I have indicated that I do not have what I think would traditionally be regarded as a full set of affidavit materials in respect of that matter. Given that Mr Dawson holds out the possibility that he will cease to be an undischarged bankrupt, the proper course for the application with regard to security for costs is to stand it over to see if Mr Dawson manages to shed the status of undischarged bankrupt. If he does, then not only would it be necessary for us to have material on the costs likely to be incurred in the proceeding but it would be necessary to provide some sort of material to indicate that even in his discharged state Mr Dawson should be regarded as an insolvent or a person of dubious financial standing. That being the case I think the appropriate course as I have said is to put this proceeding on ice, adjourn it for 90 days and see what turns up.