Solicitors:
Slater & Gordon (Plaintiffs)
File Number(s): 2015/56141
[2]
Judgment - ex tempore
By Summons filed on 23 February 2015 the Plaintiffs, Mr Magid Matta and others, seek orders that Messrs Freeman and Miles be appointed trustees for the sale of certain land situated at Prospect, New South Wales and that the property be vested in them on a statutory trust for sale under Pt 4 Div 6 of the Conveyancing Act 1919 (NSW) and for remuneration of the trustees. The Defendant to the application is Ms Cilia Matta. There is evidence of the service of that application upon Ms Matta, to which I will refer below. When the matter was called this morning, Ms Matta did not appear and the matter has proceeded in her absence.
By way of background, an affidavit of Mr Magid Matta filed on 23 February 2015 sets out the ownership of the property and the way it has come about, following the purchase of the property by Mr Matta and his late brother in 1972. Mr Matta's brother died in about 1995, and his half share of the property passed to his wife, Mrs Angela Matta, and then to her children in equal shares, other than for one share that passed to Ms Cilia Matta, who was the wife of one of the late Mr Matta's children, Mr Marcel Matta.
Mr Magid Matta's affidavit sets out efforts to sell or to develop the property over several years, and refers to the fact that he has paid contributions to the costs of the property over that period, and has had difficulties from time to time in procuring contributions to those payments from other co-owners. He refers to several offers to purchase the property, for increasing amounts, by the Land and Property Management Authority, and subsequently NSW Planning and Infrastructure, in the period from 2011 to 2014. His evidence is that all of the owners of the property, other than Ms Cilia Matta, agree to a sale of the property and Mr Matta in particular wishes to sell the property. The proposition that this is the common position of all of the persons interested in the property, other than Ms Cilia Matta, emerges from the fact that all of those persons are Plaintiffs with Mr Magid Matta in this application. Mr Matta's affidavit annexes correspondence with Ms Cilia Matta which refers to his wish to sell the property, at least at the price presently offered for it, and the position of Ms Matta that she presently does not wish to sell the property, and the intention to bring these proceedings.
There is, as I have noted, evidence of service of the proceedings upon Ms Matta, and that she was served with the Summons and Affidavit in support of it on 25 February 2015. A further affidavit of Mr Matta's solicitor, Mr McNamee, sworn 17 June 2015, records further communication with Ms Matta, including a telephone call dated 11 June 2015, when Mr McNamee informed Ms Matta of advice provided by the Court, that the matter would be listed before me today. By letter dated 11 June 2015, Mr McNamee also wrote to Ms Matta providing a copy of an email sent by the Court advising of that matter. By further affidavit dated 24 June 2015, Mr McNamee records a telephone conversation on 23 June 2015 with Ms Cilia Matta, where he referred to the fact that the matter was in Court for hearing today, and asked her whether she was coming, and she advised that she was not. As I noted, the matter was called and Ms Matta did not appear. In these circumstances, I can comfortably be satisfied that Ms Matta has been given substantial notice of the proceedings, and has had an opportunity to appear if she wishes to do so.
There is, I should also note, evidence of the fitness of the two proposed trustees for sale, Mr Freeman and Mr Miles, who are each solicitors, for appointment, and they have each consented to their appointment.
Mr Cassimatis, who appears for the Plaintiffs, draws attention to the fact that the Plaintiffs wish to sell the property, and, I interpolate, that wish is scarcely surprising given that they have had a series of increasing offers to purchase it, and refers to the principles which are applicable to the exercise of the court's discretion under s 66G of the Conveyancing Act in respect of a sale, and to the well-established authorities in respect of those principles. He submits that the Court ought order the appointment of trustees for sale and make ancillary orders and for costs. He submits that, in the circumstances of Ms Cilia Matta's opposition to the sale, and the fact that these proceedings have been necessary, and that she has not appeared at them, the costs of the proceedings should be ordered to be paid out of her share of the proceeds of sale of the property.
Two issues arise in respect of the application, although both involve issues of no particular legal novelty and can be dealt with briefly. The first is whether it is proper to proceed with this hearing in the absence of Ms Cilia Matta. I have noted above that there is evidence that the proceedings have been served upon her so that she has the opportunity to appear. Rule 29.7 of the Uniform Civil Procedure Rules 2005 (NSW) applies where a trial is called on and a party is absent, and provides that the Court may proceed with the trial generally or so far as it concerns any claim for relief in the proceedings, or may adjourn the trial. It is, of course, fundamental that a party who may be adversely affected by the making of court orders has a right to be heard: Cameron v Cole [1944] HCA 5; (1944) 68 CLR 571 at 589. However, that right is a right to an opportunity to be heard, and not a right to frustrate the hearing of proceedings by not attending them. The Court will, of course, not necessarily proceed with an ex parte application, and should have regard to the extent of any hardship to the party against whom an order is sought and to any considerations of urgency: Smirski v Macander [2010] NSWSC 929 at [34]; NSW Trustee & Guardian v Gregory [2012] NSWSC 681 at [22]. In the present case, it cannot be said that there is an immediate urgency with the application, in the sense that it needs to be determined today. However, it must be recognised that it has been on foot for some time; that it is driven by a particular circumstance, namely the existence of an offer to purchase the property; and that the Plaintiffs have given notice of the hearing and an opportunity to appear to Ms Cilia Matta. In these circumstances, I am satisfied that it is proper to proceed to a hearing, notwithstanding that Ms Matta has not attended it.
The second question is whether the orders which the Plaintiffs seek under s 66G of the Conveyancing Act should be made. That section provides broadly that, where a property is held in co-ownership, the Court may, on the application of any one or more of its co-owners, appoint trustees of the property and vest the same in such trustees, subject to encumbrances affecting the entirety, but free from encumbrances affecting any undivided shares, to be held by them on the statutory trust for sale. The form of order sought by the Plaintiffs reflects the provisions of that section.
An order under s66G of the Conveyancing Act is discretionary, at least in a sense, and the Courts have not identified any comprehensive listing of the matters to be taken into account. However, the Court may decline such an order, for example, if there is a proprietary right or other contractual or fiduciary obligation which would be inconsistent with an order for sale: Macnamara and the Conveyancing Act (1961) 78 WN (NSW) 1068. In Tory v Tory [2007] NSWSC 1078 at [42], White J referred to the authorities and noted that an order under that section "is almost as of right unless on settled principles it would be inequitable to allow the application", although also observing that the application could be refused if there were inconsistent rights of the kinds I have noted above. In Joseph v Agrey [2011] NSWSC 1601, White J similarly expressed the view that it would only be in exceptional circumstances that co-owners were not entitled to such an order. I reviewed the relevant authorities at some length in Pascoe v Dyason [2011] NSWSC 1217 at [5]ff, where I referred to the purpose of the section, as providing a mechanism for terminating co-ownership, where the co-owners could not agree how the co-ownership should be determined, and to the fact that the grounds on which the court would ordinarily refuse to make such an order are limited. In Forrest v Nix [2012] NSWSC 493 at [44], Ball J similarly noted that the general principle was that a co-owner was entitled to an order under s 66G of the Conveyancing Act almost as of right. The relevant authorities have again been reviewed, comprehensively and to similar effect, by Hallen AsJ, as his Honour then was, in NSW Trustee & Guardian v Gregory above.
In this case, it seems to me that, even putting aside the fact that an order under s 66G of the Conveyancing Act will ordinarily be made almost as of right, there is a strong case for it. It is plain that the overwhelming majority of the co-owners of the property wish to proceed to a sale of the property. Nothing in the evidence before me suggests that there are any considerations, whether by way of fiduciary duty, contractual arrangement or otherwise, which would prevent such a sale proceeding. I am comfortably satisfied in the relevant circumstances that an order under s 66G of the Conveyancing Act should be made, as sought, and that trustees for sale of the relevant property should be appointed.
An order was also sought authorising the trustees to charge their fees at a rate not exceeding a specified figure, which could fairly be said to be higher than some solicitors' hourly rates and lower than some other solicitors' hourly rates, and up to a specified total. It is understandable that trustees would seek confirmation of their ability to charge for their services, prior to accepting appointment, and it is understandable that parties would wish to avoid the need to return to the Court, and incur additional costs of doing so, in order to obtain approval of a trustee's remuneration. I am prepared to make such an order, after amending it, in a manner that the Plaintiffs do not oppose, such that it authorises the charge of the trustees' reasonable remuneration up to the specified hourly rate and up to the specified total. The ultimate question, in giving effect to that order, will therefore be whether the remuneration was reasonable in the relevant circumstances, as well as being within the relevant rates and the relevant total, and I will reserve liberty to restore if there is any difficulty in determining that matter.
Finally, the Plaintiffs seek an order that the costs of the proceedings be paid out of Ms Cilia Matta's share of the sale of proceeds of the property on the ordinary basis. That order is different from that which will commonly be made, in circumstances that the costs of such proceedings are commonly ordered to be paid out of the proceeds of the property in a manner that would involve their being borne by the relevant owners. Costs are, however, in the Court's discretion, to be exercised judicially in the relevant circumstances. In the present case, the Plaintiffs have been put to the costs of this application and of preparing a significant amount of evidence in order to support it. They have been put to those costs, notwithstanding that Ms Matta has not taken the opportunity, when the matter is listed for hearing, to attend before the Court and identify any reason that the property should not be sold. It would be one thing if, for example, Ms Matta had appeared and contended that there are arrangements between the parties or other reasons which led her to oppose the sale. In that case, a hearing on the merits would have taken place, and an order may or may not have been made. By contrast, the Plaintiffs have been put to the costs of this application, and particularly to the costs of attending today, notwithstanding that no matter has been put in opposition to the sale. In these circumstances, I am also satisfied that the special order for costs that the Plaintiffs seek should be made, and that the costs of the proceedings should be made out of Ms Cilia Matta's share of the proceeds of the sale of the property on the ordinary basis. I will make orders in accordance with the short minutes of order initialled by me and placed in the file.
[3]
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Decision last updated: 20 July 2015