REASONS FOR JUDGMENT
1 This proceeding is presently being heard by Middleton J. It is a representative action arising from a scheme under which a large number of, mainly elderly, couples were induced to "sell" their homes to the first respondent in return for a guaranteed regular income, assured tenure during their life times and other benefits. Various other parties were involved including financiers and third parties to whom the first respondent mortgaged some of the properties.
2 Following protracted negotiations a confidential settlement was reached between some of the applicants and the first and second respondents. The proceeding continued to be contested as between other parties. It will be necessary, under s 33V of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act") for the Court to approve the settlement before orders can be made giving effect to it.
3 On 5 December 2007 the second and third applicants, in order that effect might be given to certain of the settlement terms, moved the Court for orders that:
"1. Pursuant to s 87 of the Trade Practices Act 1974, each of the contracts, transfers of land, deeds of agreements and leases [described in a schedule to the notice of motion] are void ab initio.
2. Upon receipt of written notification from the solicitors acting for the fifteenth respondent that all amounts payable under clause 5.1 of the confidential settlement deed dated 13 November 2007 have been paid, the fourteenth respondent shall rectify the Register maintained under the Transfer of Land Act 1958 (Vic) so as to give effect to the declarations made in paragraph 1 herein by recording each of the persons listed in schedule 2 [to the notice of motion] as the registered proprietor of the fee simple estate of the property listed next to their name and more particularly described in schedule 2 …"
4 I note that a further order which would have required the fourteenth respondent to deliver duplicate certificates of title to relevant properties to named solicitors was not pressed upon the intimation by counsel appearing for the fourteenth respondent that it was the normal practice of the fourteenth respondent to deliver up such certificates upon request.
5 Having heard argument on 5 December 2007 I made the orders sought in paras 1 and 2 of the notice of motion. I advised the parties that I would publish my reasons at a later date. These are those reasons.
6 In order to deal with the motion it was necessary for the Court to have regard to certain of the terms of the confidential deed of settlement. Because he was continuing to deal with the contested proceeding it was not appropriate that Middleton J deal with the motion. It was, accordingly, referred to me.
7 The making of the orders sought was supported by the second and third applicants and by the first, second and fifteenth respondents. The fourteenth respondent opposed the making of proposed order 2. There was no dispute as to the Court's jurisdiction or power to make the order. It was accepted that the Court could make the order in its discretion under s 33ZF of the Federal Court Act. The dispute between the fourteenth respondent and the other parties centred on the means which should be adopted to secure the rectification of the Register upon the determination that the various contracts, transfers, deeds and leases covered by order 1 were void ab initio. The fourteenth respondent contended that this should be effected by what was referred to as "ordinary conveyancing procedure" rather than by Court order.
8 The fourteenth respondent is the Victorian Registrar of Titles. It will be convenient to refer to him hereafter as "the Registrar". In his written submissions, counsel for the Registrar contended that Victorian case law which had developed under s 51 of the Trustee Act 1958 (Vic) and s 103 the Transfer of Land Act 1958 (Vic) rendered a vesting order as a step of last resort for parties who had "no other ordinary conveyancing procedure available to them." Section 51 provided for vesting orders to be made, inter alia, when a trustee, who was under a duty to do so, neglected or refused to convey any property. Section 103 provided for the Supreme Court to direct the Registrar to correct the record in the Register. Reliance was placed on Dotter v Evans [1969] VR 41; Casella v Casella [1969] VR 49 and Re Purkiss [1999] 3 VR 223. In argument counsel agreed that these cases were concerned with the exercise, by the Supreme Court of Victoria, of statutory discretions to direct the Registrar to amend the Register. The Registrar placed particular reliance on the observations of Gillard J in Dotter v Evans at 45 where his Honour said:
"I would, therefore, be inclined to the view that having regard to this policy [of providing for the certificate of title or Crown Grant to be in duplicate], set out or to be discovered in the Transfer of Land Act, a vesting order should not be where it is merely intended to facilitate or be a substitute for ordinary conveyancing practice. In these proceedings supplementary orders are being sought to enforce a judgment for specific performance and it should be assumed that the defendant should and will obey the Court's orders on any directions given. At the initial stages these orders should involve simple conveyancing matters only. Although from the evidence before the Court one may believe that the defendants will prove recalcitrant and will not willingly co-operate to carry out the judgment of the Court, nevertheless at this stage of the proceedings, in asking for supplementary directions, it seems to me that the plaintiff should follow the ordinary practice, both in Court proceedings and in conveyancing. All remedies based on such practices should be exhausted before other extraordinary remedies are granted by the Court."
9 His Honour's observations were made in the course of dealing with a case in which a vendor had failed to comply with an order for specific performance of a contract for the sale of land. Casella v Casella involved the failure by a husband to comply with a Court order to transfer certain land to his wife as part of property arrangements following a divorce. McInerney J refused to make an order under s 103 of the Transfer of Land Act because of a concern that it could lead to the continuance in existence of a duplicate certificate of title which did not reflect the terms of the Register and which might be misused (see at 59-60).
10 Gillard J gave further consideration to the exercise of the Court's discretion to make an order under s 103 of the Transfer of Land Act in Marshall v Williams [1974] VR 592. In that case he made an order under s 103 because the vendor could not be found and the duplicate certificate of title obtained from him. Having referred to his judgment in Dotter v Evans he continued (at 594);
"The basis for my view was that there should be no opportunity for two duplicate certificates of title being in existence at the same time in respect of the same land. It seemed to me that such a situation was contrary to the intent and policy of the Transfer of Land Act. I think, however, that if one follows the order made by Lush J in Ritzos v Ritzos [1970] VR 150 to ensure the old certificate is cancelled and a new duplicate certificate issued, then some of the difficulties that I had foreseen in Dotter v Evans will be overcome."
11 In Re Purkiss, Warren J made an order under s 51 of the Trustee Act 1958 in a case in which no legal entity could be found who could execute a transfer of land. Her Honour referred to Marshall v Williams and held that, in the circumstances, the order which she made was a "step of last resort'. Her Honour did not hold that an order under s 51 could not be made unless all conveyancing processes had been exhausted.
12 As can be seen the principal reason advanced for the reluctance of the Court to order an amendment to the Register was the concern that duplicate certificates of title should not be in circulation thereby giving rise to the risk that a potential purchaser of a property might be misled as to the identity of the owner/vendor. This consideration does not arise in the present proceeding because it is accepted by all parties that the duplicate certificates of title relating to the relevant properties are held by the Registrar. Despite this counsel for the Registrar sought to support the "last resort" approach by reference to the need for normal practice to be followed.
13 The other parties emphasised the broad discretion conferred on the Court by s 33ZF of the Federal Court Act. Section 33ZF(1) provides that:
"(1) In any proceeding (including an appeal) conducted under this Part the Court may, of its own motion or on application by a party or group member, make any order that the court thinks appropriate or necessary to ensure that justice is done in the proceeding."
14 The breadth of the discretion was recognised by Sackville J in Courtney v Medtel Pty Ltd (2002) 122 FCR 168 at 182 where his Honour said:
"There are good reasons to give s 33ZF a generous interpretation. The section is couched in broad terms. Moreover, the Court is given power to act on its own motion. The language, which is described in the Explanatory Memorandum, as "wide", doubtless reflects the drafter's perception that the new statutory procedure for representative proceedings was likely to throw up novel problems that would require close supervision by the Court."
See also McMullin v ICI Australia Operations Pty Ltd (1998) 84 FCR 1 at 4 (per Wilcox J).
15 The other parties submitted that, in the circumstances, it was both appropriate and necessary that the orders sought be made in order to ensure that justice is done. They relied on the following matters:
· The purpose and effect of an order for rescission under s 87 of the Trade Practices Act is to restore the parties to the situation they respectively occupied immediately before the relevant contract was made.
· Although ordinary conveyancing procedure could be adopted in order to restore the parties to their former position such a process would be discordant with the notion of rescission because it would involve the affirmation of the efficacy of the arrangements which were being displaced.
· The adoption of ordinary conveyancing procedure would operate unfairly on some of the parties to the deed of settlement because it would mean that they were more likely to be required to pay imposts such as land tax and stamp duty than would be the case if the orders sought were to be made.
· Resort to the ordinary conveyancing procedure would also occasion legal costs and delay which would not otherwise be incurred.
· There is a risk that, unless the order is made, the settlement agreement may collapse.
16 In my view these considerations support the making of the proposed order.
17 In exercising my discretion I accept that it is appropriate to have regard to the considerations which underpin the "last resort" approach which has been adopted by the Victorian Supreme Court. However, that approach guides the exercise of different statutory discretions. Even then, it does not fetter the exercise of those discretions in any particular case. Indeed it would be improper for it to do so: see Dix v Crimes Compensation Tribunal [1993] 1 VR 297 at 302. The considerations which informed the excercises of discretion in the cases relied on by the Registrar do not apply in the present circumstances. It is also necessary to bear in mind that different and additional matters arise for consideration when the Court's discretion under s 33ZF is exercised. In particular the power can be exercised to facilitate settlement of class actions which can and do involve complicated issues which impinge on the parties who may be interested in pursuing settlement negotiations. It is relevant in the present proceeding that, if the proposed order is not made, there is a possibility that the settlement agreement will collapse. Moreover I can see no justification in imposing unnecessary costs on the parties who have already suffered greatly both financially and emotionally as a result of being induced to give up title to their homes. The process by which this occurred, in each case, involved a contravention of the Trade Practices Act such as to render the transactions null and void. Unlike the plaintiffs in the Victorian cases the class members are not disadvantaged by reason of the failure of a vendor to deliver up duplicate certificates of title or otherwise failing to facilitate a transfer of title. They are seeking an order which will restore the entry of their names in the Register.
18 The various considerations relied on by the parties who support the making of order 2 strongly justify a departure from the "normal" processes for rectification of the Register. The order should be made.
19 At the hearing I reserved consideration of the costs of the notice of motion until the publication of these reasons. I will now hear the parties as to costs.
I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice TRACEY.