On 29 September and 7 October 2022, the plaintiff gave the usual undertaking as to damages and, without admission, caveat AS406917 (the Caveat) lodged over Lot 1 in Deposited Plan 88540 in Paddington (the Property) was extended until further order of the Court. The matter was listed for final hearing on 18 October 2022.
The registered proprietor of the Property is the defendant, FHT Nominees Pty Ltd. Located on the Property is the "Captain Cook Hotel".
The plaintiff claims its caveatable interest arises from the assignment of an interest from MLR Investments Pty Ltd as trustee for the ML Family Trust (MLR) by deed of assignment dated 19 August 2022.
MLR's rights were as follows. On or about 9 July 2020, MLR signed a Loan Agreement as lender, with BBARC Pty Ltd (BBARC) as borrower, and its director, Stuart Crabb, as guarantor, whereby:
1. MLR loaned BBARC $105,000;
2. The Loan amount and a fee of $45,000 were repayable on 9 January 2021;
3. Mr Crabb guaranteed BBARC's performance.
Clause 5 of the Loan Agreement provides:
(a) BBARC Pty Ltd will on completion hold an equitable interest in the property at … Cowan … (Cowan Property)
(b) If the Loan Repayment Amount has not been repaid within 6 months from the date of this Agreement, the Guarantor authorises the Lender to register a caveat over the Cowan Property or any other property which the Borrower or the Guarantor has an interest in as agreed.
(c) If there is a Default Even of any kind detailed in the agreement the Guarantor agrees to provide details of all properties he or she has an interest in to the Lender upon any request for that information.
It is not in dispute that BBARC and Mr Crabb have failed to pay the $150,000.
On or about 23 April 2021, the Captain Cook Hotel Property Fund - Fixed Unit Trust (Trust) was established under the terms of a deed (Trust Deed). The defendant was, until recently, the trustee of the Trust. Now the trustee is Billericay Nominees Pty Ltd. During the hearing, the plaintiff sought an adjournment to join the new trustee to the proceedings, as the defendant now holds the Property on trust for the new trustee. That adjournment application was refused, but the parties agreed that, should the Court find in favour of the plaintiff, then the new trustee would be notified and provided an opportunity of being heard before orders were made.
On 15 June 2021, the defendant issued seven Unit Certificates for a total of 1,575,000 units under the Trust Deed. Each certificate recorded that an amount of $1 was paid for each unit. BBARC was issued with "Certificate 3" certifying that it holds 225,000 of the units and, therefore, it appears on the face of that Certificate to hold an interest in property of the trust.
The plaintiff submitted that by reason of:
1. BBARC holding units in the Trust;
2. the Trust owning the Property; and
3. clause 5(b) of the Loan Agreement entitling MLR to register a caveat over any property belonging to BBARC or Mr Crabb,
MLR was entitled to register a caveat over the Property and that entitlement was assigned to the plaintiff under the deed of assignment.
At the hearing, no issue was raised about the efficacy of the assignment of MLR's interest to the plaintiff. The question is therefore whether MLR's contractual entitlement to register a caveat under the Loan Agreement created a caveatable interest in the Property.
On 19 August 2022, the plaintiff lodged the Caveat. On 14 September 2022, a lapsing notice was received by the plaintiff.
On 29 September 2022, the plaintiff filed its summons in Court seeking a declaration of its entitlement to the Caveat and that the Caveat be extended. No relief is sought in relation to the repayment of the debt or damages from BBARC or Mr Crabb.
At the commencement of the hearing, the plaintiff was granted leave to file in Court an amended summons seeking a slightly different form of declaration in the following terms:
1. A declaration that the applicant has an equitable charge over in the respondent's property located at 162 Flinders Street, Paddington NSW 2021 (more accurately described as Lot 1 in Deposited Plan 88540) (the Property) to the extent of BBARC Pty Ltd's interest in the Property.
[2]
Determination
The plaintiff relied on:
1. The affidavit of Ms Suzanne Marie Bennet, director of the plaintiff, affirmed 28 September 2022; and
2. The affidavit of Mr Stuart Crabb, former director of BBARC, affirmed 14 October 2022.
In resisting the relief sought by the plaintiff, the defendant relied on:
1. The affidavit of Peter Scott, director of the defendant, affirmed on 14 October 2022 together with its exhibit; and
2. The affidavit of Hamish McLeod, solicitor, sworn 14 October 2022.
The defendant submitted there were various reasons why the Caveat ought not be extended, nor a declaration made. Each is dealt with below.
[3]
Whether clause 5(b) creates a proprietary/caveatable interest
Neither BBARC nor Mr Crabb are the registered proprietor/s of the Property. However, a trust deed can confer a proprietary interest in all trust property on the unit holders: Charles v Federal Commissioner of Taxation (1954) 90 CLR 598 at 609 (Dixon CJ, Kitto and Taylor JJ).
However, the proposition in Charles does not override questions of construction of the particular trust deed, which determines whether there is a proprietary interest in each of the assets in the trust fund: CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 224 CLR 98 at 115 (Gleeson CJ, McHugh, Gummow, Callinan and Heydon JJ).
I accept the submission that the Loan Agreement did not charge any property as security for the repayment of the loan; clause 5(b) is properly construed as the mere grant of an entitlement to lodge a caveat and is insufficient to grant a proprietary interest. This constructional choice is explained below.
A clear distinction exists between clause 2.2 of the Loan Agreement, which provided that one share in BBARC was provided "as security for the repayment of the Loan Repayment Amount", and clause 5(b), which merely provided authority from Mr Crabb for the lender to register a caveat over the Cowan property or other property owned by BBARC or Mr Crabb, without the same or similar language of "security".
A further difference is that clause 2.3 provided that:
When the Loan Repayment Amount is repaid in full, the Lender at the request of the Borrower and the Guarantor will agree and will complete all relevant forms to relinquish the one share held in BBARC Pty Ltd.
There was no equivalent duration stipulated for the relinquishment of the caveat(s) that might be lodged in accordance with clause 5. Counsel for the plaintiff conceded this distinction, but submitted that the Court should draw an imply that the duration of the caveat would only extend as long as the breach was not remedied, that is, until the loan was repaid in full. Counsel suggested such a term could be implied in line with the principles outlined in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283 (Lords Keith and Simon, Dilhorne VC). I do not accept that such a term can be implied, where it would contradict the express terms and language of clauses 2.2 and 2.3. It follows I am not satisfied it is necessary for business efficacy.
I also do not accept the plaintiff's submission that the clauses use different language because they are dealing with security provided at different times; specifically, clause 2 deals with "immediate security" and clause 5 deals with "security on breach". That distinction is artificial when, in both cases, as Counsel for the plaintiff conceded, the clauses concern security.
The plaintiff relied upon Troncone v Aliperti (1994) 6 BPR 13,291 (Troncone) to support the submission that, when authority is given to a lender to lodge a caveat, it can be implied, without express language, that the intention was to provide the lender with a caveatable proprietary interest in the land; that is, the general proposition that "whoever grants a thing is deemed also to grant that without which the grant itself would be of no effect" applies. The plaintiff submitted that the manifest intention of the parties in this case was to provide a caveatable interest, referring to Iaconis v Lazar [2002] NSWSC 1103 (Young CJ in Eq).
However, a general inference that a caveatable interest has been provided can be displaced by indications to the contrary: Iaconis at [23]-[24].
Various other authorities were referred to by the parties, which, together with Troncone, all turn on the proper construction of a particular clause in a particular contract said to give rise to a caveatable interest: see eg Redglove Projects Pty Ltd v Ngunnawal Local Aboriginal Land Council (2004) 12 BPR 22,319; [2004] NSWSC 880 at [17] and [28]-[29] (White J, as his Honour then was); and Bellissimo v JCL Investment Pty Limited [2009] NSWSC 1260 at [18] (White J, as his Honour then was) followed by Bryson AJ in Taleb v National Australia Bank Ltd (2011) 82 NSWLR 489 at 505-507; Aged Care Services Pty Ltd v Kanning Services Pty Ltd (2013) 86 NSWLR 174 at 188 (Gleeson JA, with whom Meagher and Leeming JJA agreed).
The authorities demonstrate:
1. a contractual right to lodge a caveat does not automatically give rise to an equitable interest in the property; and
2. it is necessary to construe the particular clause in a loan agreement authorising the registration of a caveat to determine if there was an intention to create a charge, or instead the parties intended a negative covenant, to the effect that the registered proprietor would not be entitled to deal with the land without the plaintiff's consent.
I do not consider that clause 5 of the Loan Agreement was intended to create an equitable interest or equitable charge in favour of the plaintiff and, therefore, any caveatable interest, for at least the following reasons:
1. The contract was drafted by lawyers.
2. On its terms, the clause does not make clear the nature of the caveatable interest.
3. It is very different to clause 2 and does not specify when the security would be released and does not use any language of "security" or "charge" or "caveatable interest" or "protection of interest": see in contrast the authorities referred to in Ta Lee Investment Pty Ltd v Antonios [2019] NSWCA 24 at [94]-[114] (Bathurst CJ, Beazley P and Macfarlan JA). In Troncone itself, the relevant clause 5 provided "the Debtor authorises the Creditors to lodge a Caveat on any property owned by the Debtors (sic) to protect his interest" (emphasis added).
4. There is no acknowledgement that the lender has a caveatable interest, nor that the loan was to be repaid from the development or sale of the particular land: see eg Coleman v Hart-Hughes [2017] NSWSC 656 (Darke J).
5. While the plaintiff placed reliance on the heading of clause 5 being "Caveat and Mortgage", I consider that this is a case where the headings do not provide much assistance in the process of construing the Loan Agreement as a whole: BP Australia Ltd v Nabalco Pty Ltd (1977) 16 ALR 207 at 217 (Lord Russell, with whom Lords Simon, Salmon, Keith and Sir Richard Wild agreed). This is because:
1. Other headings do not correlate with the substance of the clause, for example, clause 2, which contains details of security for the repayment, is entitled "Advance".
2. The body of clause 5 does not include reference to any "mortgage". In those circumstances, the heading on its own cannot override the meaning of the clause it sits above: see Kim Lewison and David Hughes, The Interpretation of Contracts in Australia (1st ed, 2012, Lawbook Co) at [5.13].
The heading of "Caveat and Mortgage" therefore does not mean the substance of the clause must be construed as creating a proprietary interest, and, consistent with this clause, does not refer to any mortgage at all.
Therefore, I do not consider that the plaintiff has demonstrated that clause 5(b) provides the lender MLR, and therefore, the plaintiff, with a caveatable interest.
While that conclusion is sufficient to deal with the matter, I consider other arguments raised by the parties briefly below.
[4]
Whether BBARC has a right to charge its interest in the Trust Fund
In a related argument to whether the plaintiff had a caveatable interest, the defendant placed reliance on various clauses in the Trust Deed, which are said to mean that BBARC had no right to charge its interest in the Trust Fund and the Trustee is not bound to recognise any such interest.
Clause 4.13 of the Trust Deed provides:
Each Unit will:
(a) entitle the Member, equally with the Members owning all other Units, to the Trust Fund as an entirety; and
(b) not entitle the Members to any particular security or investment comprised in the Trust Fund or any part of the Trust Fund.
As a matter of principle, a unit holder may be able to lodge a caveat over assets of a unit trust; the question is whether that is permitted under the Trust Deed. In Jonsue Investments Pty Ltd v Balweb Pty Ltd [2013] NSWSC 325 at [38], White J observed in relation to a clause similar to clause 4.13:
To say that a unitholder is not entitled to a particular security or investment or part thereof is not the same as saying that a unitholder does not have any interest in any particular security or investment.
Clause 7.5.2 provides:
Except where this Deed otherwise provides
[…]
The Trustee will not be bound by or be compelled to recognise (even when having notice of such interest):
(a) any equitable, contingent, future or partial interest in any Unit; or
(b) any other rights in respect of any Unit,
(c) except an absolute right in the Member to the Units that Member is entitled.
Clause 25.1 provides:
The rights and obligations of each party under this Deed are personal and cannot be assigned, charged or otherwise dealt with, without the prior written consent of all parties.
During argument, Counsel for the plaintiff appeared to accept that clauses 7.5.2 and 25.1 contractually restricted BBARC from dealing with its Units vis-a-vis the parties to the Trust Deed, but did not accept that such contractual restrictions impacted on the underlying promises made by it in the Loan Agreement concerning the granting of the Caveat.
I do not accept the plaintiff's submission. I consider that the clear intention in the Trust Deed was that only the trustee was entitled to deal with the trust property and only the trustee had power to encumber or charge trust property (see also clauses 15.2 and 17.4). Contrariwise, the unit holders were not entitled to in any way impact on the trustee's powers and control of trust property, including granting equitable interests by way of charge or otherwise in relation to their Units.
The authorities relied on by the plaintiff for the proposition that a unit holder has a proprietary interest in trust property, all condition that conclusion on the express terms of the particular trust deed.
1. In Charles v Federal Commissioner of Taxation (1954) 90 CLR 598 at 609, Dixon CJ, Kitto and Taylor JJ stated:
A share confers upon the holder no legal or equitable interest in the assets of the company; it is a separate piece of property … But a unit under the trust deed before us confers a proprietary interest in all the property which for the time being is subject to the trust of the deed…
1. In Binningup Nominees Pty Ltd as Trustee for the Lakewood Shores Unit Trust v Brogue Tableau Pty Ltd [2004] WASC 14, Pullin J stated:
[19] … the holder of a unit in a unit trust has an equitable proprietary interest in all the property which is for the time being subject to the trust deed …
[20] … a unit holder has a proprietary interest in each of the assets which comprise the entirety of the trust fund …
[21] There is no doubt that these conclusions must depend upon the terms of the unit trust in each case and on what effect the law will give to the instrument considered as a whole in the light of applicable principles …
[26] …O'Bryan J seems to have been influenced …by the feeling that if any unit holder could lodge a caveat, that this would be inconvenient to the management of unit trusts … such inconvenience can be easily avoided, if the settlor of such a trust wishes, by including a provision in the trust deed to the effect that unit holders are not permitted to lodge a caveat. …
Neither authority stands for the proposition that a unit holder may encumber its units irrespective of the terms of the relevant trust deed.
Therefore, the question remains whether BBARC was entitled to deal with its Units the way that it is said it did in the Loan Agreement to grant a caveatable interest to MLR. I have concluded that clause 5 does not have that effect.
Even if I am wrong, I do not consider that the Trust Deed permitted the charge being granted. While oral argument before me concerning the point was limited and no written submissions on the point were provided, I consider that the effect of the Trust Deed was to render any purported breach of it by a Unit Holder ineffective: see for example Walker Group Constructions Pty Ltd v Tzaneros Investments Pty Ltd (2017) 94 NSWLR 108 at 129 (Bathurst CJ, with whom Beazley P and Gleeson JA agreed).
[5]
Whether BBARC was a unit holder
The defendant submitted that, while Certificate 3 records the allocation of 225,000 Units to BBARC, the Court ought to find that BBARC does not, in fact, own any units in the Trust and therefore has no interest in the Trust Fund that could be the subject of the Caveat. This submission is based on:
1. The minutes of the meeting of Members of the defendant on 22 July 2021 signed by Mr Scott, which recorded in part:
It had been proposed that each member would hold units in proportion with their financial contribution but some of the proposed unitholders had not contributed the funds required.
Rather than distribute the units as was previously suggested when the lender had requested the information, it was decided that each members contribution to date would be treated as a loan and once the actual contributions had been finalised then the conversion to units would be considered. It was agreed that if there was no financial contribution then no units, when the time came, would be issued.
All members agreed that the draft certificates which were drawn up are no longer relevant and any future units which are issued will only be issued pari passu to the financial contributions.
1. The minutes of the meeting of the Members of the defendant held on 24 November 2021 signed by Mr Scott, which recorded in part:
Due to the financial issues within the business, it was agreed that the units in both the Property Fund and Investment Trust would not be issued until it could be ascertained the contribution of each of the members. A number of members were having to contribute funds to ensure the business kept running and it was agreed that the entitlements should reflect that financial contribution. If there was no financial contribution there was to be no units issued.
1. BBARC had not paid for any Units; and
2. BBARC is not listed on the defendant's Register of Members.
Against this, Mr Crabb's evidence was that, before the issuing of the Certificate to him, Mr Scott agreed that BBARC could defer payment for the Units until after its development at Cowan was complete. That evidence was not contradicted. It was submitted that the Certificate was better evidence than the Register of Members, particularly in circumstances where:
1. Mr Scott had not explained the issuing of the Certificates or the information on the Register;
2. Mr Crabb was not noted as having attended the minuted meetings or having been sent those minutes or any other correspondence from the defendant that notified him of the alleged decision to nullify BBARC's Units.
There are unexplained apparent inconsistencies in the evidence. Had it been necessary to determine, I would have found that the plaintiff had discharged its onus of proving BBARC holds units in the Trust Fund, based on the uncontradicted evidence of Mr Crabbe and the terms of Certificate 3, and the lack of explanatory evidence from Mr Scott.
Two days after judgment was reserved, the plaintiff emailed a Notice of Motion and a new affidavit of Stuart Crabb dated 20 October 2022 to my Associate. The Motion sought orders, including that the plaintiff could reopen its case and have certain other unit holders come and give evidence about the inaccuracy of the defendant's meeting minutes.
The principles concerning re-opening are well known. In Chao v Chao (No 2) [2008] NSWSC 612 at [2], Brereton J (as his Honour then was) stated:
The Court has a discretion to grant a party leave to re-open its case after final submissions have been concluded and the Court has reserved its decision. The ultimate question is whether the interests of justice are better served by allowing or rejecting the application. It is relevant to consider whether prejudice would be occasioned by the late introduction of the evidence to the other party. It will also be relevant to consider the materiality of the proposed additional evidence, and whether it could by reasonable diligence have been discovered before, or at least any explanation for its not having been adduced earlier. If there was a deliberate decision made not to call the evidence when it ought to have been called in the ordinary course of proceedings, that will typically tell decisively against allowing a reopening, although there is no hard and fast rule requiring the Court to reject an application even where the decision not to call a witness or tender a document was a deliberate one.
See also Smith v New South Wales Bar Association (No 2) (1992) 176 CLR 256 at 266-267 (Brennan, Dawson, Toohey and Gaudron JJ).
The plaintiff did not provide any explanation as to why evidence from those potential witnesses was not obtained earlier and in time for the hearing, other than the plaintiff's director being overseas from 29 September 2022. Counsel for the plaintiff submitted that the veracity of the minutes only arose as an issue on the day of the hearing because of "fortuitous text messages and conversations". The fact that they are fortuitous does not mean the plaintiff could not have discovered the evidence with sufficient diligence prior to the hearing date, particularly where the plaintiff had been served with the meeting minutes as part of the defendant's evidence a week before the hearing.
I refuse the plaintiff's application to reopen the case because any fresh evidence concerning the meeting minutes is not material to the outcome of the proceedings and lacks probative value.
[6]
Whether right to lodge a caveat exhausted
Clause 5(b), extracted above at [5], indicates that the lender may register a caveat over the Cowan Property "or" any property, in which BBARC or Mr Crabb have an interest. The plaintiff has previously registered a caveat over the Cowan Property, and counsel for the defendant submitted that such conduct amounted to an election not to register an interest over any other property or an exhaustion of the right.
In support of this construction, it was said that, if clause 5(b) allowed caveats to be lodged over "an unlimited number of other properties that the borrowers or the guarantors may have", that would be disproportionate to the relatively small loan of $105,000 with a $45,000 loan repayment fee.
As a matter of construction, it is no doubt correct that the use of "or" could have the submitted result if read disjunctively. However, it is also possible that the use of "or" is used conjunctively, such that the lender was entitled to register a caveat over any available property in addition to the Cowan property: United Group Rail Services Ltd v Rail Corporation New South Wales (2009) 74 NSWLR 618 at 641-642 (Allsop P).
There are textual matters that point both ways. For example, clause 5(c) requires Mr Crabb to provide details of "properties", the use of a plural, which might suggest more than one caveat was envisaged. However, that is also consistent with the plaintiff being entitled to register only one caveat over "any other property", after it has been given sufficient information about all properties in which BBARC and Mr Crabb have an interest, so that it could make a choice. I note that "caveat" in clause 5(b) is expressed as a singular, while clause 1.2.1(a) states that "unless the context otherwise requires … the singular denotes the plural".
As I have concluded that clause 5(b) does not give rise to any proprietary interest, it is not necessary to reach a definitive conclusion on this question of construction. Were it necessary to do so, I would have considered the better construction to be that advanced by the defendant.
A construction of the clause which allows the registration of a caveat over any other property in which BBARC has an interest in addition to the Cowan property would be uncommercial. It would greatly compromise Mr Crabb's use of BBARC as an investment vehicle if any of his subsequent property investments could be subjected to a caveat. Instead, I consider clause 5(b) only allows a caveat to be registered over "any other property" where the lender has not registered a caveat over the Cowan property. To similar effect, I am not persuaded that there is any absurdity or inconsistency in the words that would make it clearly necessary to supply, omit or correct the use of "or" to "and" in the Loan Agreement: Fitzgerald v Masters (1956) 95 CLR 420 at 426-427 (Dixon CJ and Fullagar J).
[7]
Whether caveat is defective
The defendant submitted that the Caveat does not describe the equitable interest in the property, and cannot be saved by s 74L Real Property Act 1900 (NSW).
The Caveat describes the nature of the estate or interest claimed by the plaintiff in the property as "estate in fee simple"; it claims an interest "arising under the loan agreement assigned to the Caveator on 19 August 2022". The description was conceded by the plaintiff to name the wrong parties to the Loan Agreement, and it was accepted that the Caveat needs to be reworded.
It is a ground for ordering the withdrawal of a caveat that it does not accurately describe the interest actually claimed by the caveator: see, for example, Andrews v Wilcox [2008] NSWSC 280 at [21]-[28] (Hammerschlag J, as his Honour then was).
The defendant also relied upon Stonebark Pty Ltd v Disage Pty Ltd [2022] NSWSC 1015 at [20], where Black J stated:
The real difficulty here is first, the form of the description of the caveat and, second, the absence of any mechanism under the Summons to finally determine the issues between the parties. Mr Vernier rightly draws attention to the decision in Circuit Finance Pty Ltd v Crown and Gleeson Securities Pty Ltd [2005] NSWSC997, where Brereton J referred to several decisions, including the earlier decisions in Multi-Span Constructions No 1 Pty Ltd v 14 Portland Street Pty Ltd [2002] ANZ Conv R 85, Depsun Pty Ltd v Tahore Pty Ltd (1990) ANZ Conv R 334 and Jones v Baker [2002] NSWSC 89, where in emphasising that the characterisation and description of the nature of the estate, interest or right claimed by the caveator went to the heart and substance of the operation of the provisions. His Honour there observed that, without the estate, interest or right claim being described, neither the Registrar General nor a person reading the caveat can know, for the purposes of s 74H(1)(b) of the Real Property Act, whether a dealing would affect the estate claimed, nor can the Court know, for the purposes of s 74K(2), whether the caveator's claim has, or may have, substance. It seems to me that, here, the description of the caveated interest claimed is deficient, and deficient to an extent that s 74L cannot save it.
The interest in Stonebark was described as a "beneficial interest in a trust", which did not provide any indication as to how that interest arose and therefore was defective.
Belatedly, in closing submissions in reply, the plaintiff sought leave to rely upon a further amended summons seeking relief pursuant to s 74O(2)(a) Real Property Act, so that the interest claimed in the caveat would read:
An equitable charge of $150,000 plus interest arising under the loan agreement dated 9 July 2020, assigned to Nationlink Solutions Pty Ltd, where BBARC Pty Ltd charged its interest in its units in the Captain Cook Hotel Property Fund Fixed Unit Trust to the lender.
Leave to rely on this further amended summons was opposed, primarily on the basis that clause 5 does not have the effect asserted and the language proposed is inconsistent with the terms of clause 5 in any event. I refuse leave for the reasons already outlined above and for the reasons submitted by the defendant.
For completeness, I note that counsel for the defendant also submitted that no order under s 74O could be made in circumstances where the caveat has not lapsed, been withdrawn, or is withdrawn or lapses under s 74MA. I do not accept that submission. The only reason the Caveat here has not subsequently lapsed within the meaning of s 74O(1)(a) is because of Court order (by consent). Even if I accepted the defendant's submissions, the Court could nonetheless make an order giving leave to lodge a new caveat to take effect when the first caveat lapsed, which would, in any event, be contemporaneous with the orders in this case: see eg Friend v Sole [2013] NSWSC 1046 at [28] (Kunc J).
[8]
Whether summons defective
I further note that the only final relief sought in the original summons was a declaration that the plaintiff "is entitled to lodge a caveat over the property". It has been held that such a prayer for final relief is insufficient to avoid the problem that a summons seeking an extension of a caveat must also seek final relief in relation to the interest specified in the caveat: Stonebark Pty Ltd v Disage Pty Ltd [2022] NSWSC 1015 at [22]-[23] (Black J); Bellissimo v JCL Investments Pty Ltd [2009] NSWSC 1260 at [23]-[24] (White J).
In the amended summons filed at the hearing, similar final relief was sought by way of final declaration that the plaintiff "has an equitable charge over the [Property] … to the extent of BBARC Pty Ltd's interest in the Property".
I do not consider this amendment cures the problem and in fact perpetuates the issue that the form of order sought would have the effect of the Caveat enduring in perpetuity, which is inconsistent with the plaintiff's own submission that the Caveat was intended only as security for the repayment of the loan.
[9]
Orders
For those reasons, I make the following orders:
1. The orders of Hammerschlag CJ in Eq on 7 October 2022 extending the operation of the Caveat AS406917 cease to have effect as of 31 October 2022.
2. Plaintiff to pay the Defendant's costs as agreed or assessed.
3. Plaintiff's Notice of Motion filed 20 October 2022 is dismissed.
4. Plaintiff to pay the Defendant's costs of the Motion as agreed or assessed.
[10]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 31 October 2022