This matter comes before me, again, by way of a motion filed by the defendant, AR Mortgages Pty Ltd, yesterday. The defendant seeks three orders, being:
1. a declaration that the defendant may sell the livestock which it has in its possession, being 46 cows and 41 calves;
2. an order that Matthew Champion and Tucki Hills Pty Ltd be restrained from engaging in any conduct which would prevent that sale; and
3. costs.
This application is one of a series of applications that have been brought in this matter, arising out of the dispute between the plaintiff, Reavill Farm Pty Limited, and the defendant, AR Mortgages Pty Ltd, as the mortgagee. The matter first came before me as duty judge on 14 April 2020. I dealt with certain of the issues raised by the parties at that time.
The matter came on for further hearing on 29 May 2020: Reavill Farm Pty Limited v AR Mortgages Pty Ltd (No 2) [2020] NSWSC 718.
Ms Cooper appears on behalf of the defendant. The plaintiff, Reavill Farm Pty Ltd, does not appear.
The dispute, which is ongoing, is essentially a dispute between the defendant and Tucki Hills Pty Ltd, a company that owned land adjoining the land owned by the plaintiff. The dispute relates to ownership of cattle currently in the possession of the defendant, and which the defendant is attempting to sell.
When the matter came before me on 14 April 2020, Matthew Champion, a named cross-respondent in the proceedings, sought orders that he be permitted to enter the property, the subject of earlier orders by the court for possession, and remove certain personal items. He also asserted that the defendant had improperly taken 15 head of cattle, which he owned personally. I made orders affording the parties an opportunity to serve evidence as to the ownership of that 15 head of cattle. I also made orders allowing Mr Champion, and his sister, Belinda Nott, who was also an applicant on 14 April 2020, to enter the property and retrieve their personal items. That process was undertaken by Ms Nott and Mr Champion with the cooperation of the defendant. However, the issue of Mr Champion's cattle remains a live issue.
Reavill Farm Pty Limited v AR Mortgages Pty Ltd [2020] NSWSC 740 | Case summary | Zoe
Subsequent to 14 April, another party, Tucki Hills Pty Ltd, sought to raise the proposition that it owned some of the cattle which was in the possession of the defendant, or had earlier been sold by the defendant. Further, Tucki Hills Pty Ltd sought to join two stock agents to the proceedings, who were in the process of selling cattle.
On the last occasion, I dealt with those issues. The application to join the stock agents was discontinued. I made directions in respect of the service of evidence, and listed the motion, which is at the heart of this dispute, for hearing before me on 25 June 2020.
In the meantime, the defendant, maintaining that it only had possession of cattle which were already the subject of orders of the court, continued to market and sell the cattle. It was entitled to do so. There was no application asking that it be restrained from doing so. Nor was there any order of the court restraining it from doing so.
There is a very significant dispute between the defendant and Mr Champion/Tucki Hills Pty Ltd as to ownership of any of the cattle in the defendant's possession. As I have said, that issue will be determined by me on 25 June.
It is apparent that Mr Champion has sought to prevent the cattle from being sold by the defendant. Plainly, the original proposed joinder of the stock agents was intended to have some effect on their role in selling the cattle. Annexed to the affidavit of Ailsa Dunsford of 11 June 2020, being an affidavit on which the defendant relies today, is an email from Mr Champion, dated 1 June 2020, seeking an undertaking from Ben Sharpe at Ray White, who I presume is a stock agent, that the cattle will not be sold or removed from the property until the hearing on 25 June 2020.
Forty-six head of cattle were listed for auction on 29 May 2020. The purchaser entered into an agreement to purchase those cattle, and had intended doing so. However, it is apparent that the purchaser has become aware of the dispute as to the ownership of the cattle. On 4 June 2020, Mr Sharpe sent an email to Ms Dunsford, the administrative services manager of the defendant, in the following terms:
"Ailsa
The purchaser still has interest in the cattle so long as the issue of ownership is sorted out on the 12th or before. For him to proceed he will need to see some documentation from the court confirming that the cattle sold on Auctions Plus are cleared to sell in AR's name and that the court allows the sale to proceed."
Plainly this email has prompted the current application. The defendant is a financier. It is not a farmer. It wishes to sell the cattle of which it has possession. It says it has a buyer. As deposed to in the evidence relied upon by the defendant on this application, it has become very difficult for it to find an agent and sell the cattle having regard to the ongoing dispute with Mr Champion and Tucki Hills.
Ms Cooper submits that the defendant is not sure how it will be able to sell the cattle going forward whilst this dispute goes on, and further that, having regard to the conduct of Mr Champion, it is very difficult to find an agent who might be willing to assist. Importantly, Ms Cooper also submits that if the defendant cannot sell the cattle, it has to organise for someone to look after the cattle. It is not in that business.
Mr Champion appears in person today, although he has lost his voice and his sister, Ms Nott, is speaking for him. I am satisfied that Ms Nott has made submissions based on what she has been told by Mr Champion. I also allowed her to speak on his behalf as they are plainly sitting next to each other.
Mr Champion has made an open offer to the defendant to purchase all of the cattle for the same price that the defendant is proposing to sell the cattle to the third party purchaser.
As set out in the evidence of Mr Champion relied upon for the purposes of this hearing, Mr Champion on behalf of Tucki Hills continues to maintain that the cattle, which the defendant is attempting to sell, is in fact owned by Tucki Hills. There does not seem to be any doubt that the defendant entered the Tucki Hills property to retrieve some cattle but the defendant says it was cattle owned by the plaintiff, Reavill Farm.
There is evidence to the effect that some of the cattle owned by Reavill Farm and on the Reavill Farm property may have been moved to the adjoining Tucki Hills property prior to the defendant being able to take possession of that cattle.
In any event, as I indicated to the parties, I am not acting as a mediator today. I am here to determine the motion filed by the defendant. I raised the open offer made by Mr Champion with Ms Cooper on behalf of the defendant. Ms Cooper raised concerns about the ability of Mr Champion to complete on that offer having regard to earlier experiences.
Mr Champion submitted and assured the Court that he had the finance ready and available to purchase the cattle. Ms Cooper indicated that she did not have instructions to deal with the matter on the basis of the open offer made by Mr Champion.
I thus proceeded to hear argument on the motion and am now making a decision on the motion, not having regard to what Mr Champion might like to do with the cattle, or having regard to whether Mr Champion may or may not want to buy the cattle over the next seven days.
In my view, at the present time the defendant is not prevented from selling the cattle. There is no order of the Court restraining the defendant from exercising what it says is its entitlement to sell cattle of which it has taken possession. There has been no application by Mr Champion or Tucki Hills seeking to restrain the defendant from selling the cattle. Mr Champion's approach has been rather to deal with the issue in a different way.
Having said that, the problem with the application is that the defendant is really seeking a declaration that it is entitled to sell the cattle on the basis that it is the owner of the cattle. I appreciate that Ms Cooper says that is not the declaration she seeks and she recognises there is a live issue of ownership which will be determined on 25 June.
However, she also accepts that the reason that the application is being brought is because of the fact that the third party will apparently not complete unless it is in receipt of an order from the Court as to the ownership of the cattle.
Again, if I go back to the terms of the email from Mr Sharpe, it is apparent that the purchaser wants some documentation from the Court confirming that the cattle listed for sale on Auctions Plus are clear to sell in the defendant's name and that the Court allows the sale to proceed.
I can only repeat that there is no order from the Court preventing the sale of the cattle. However, I am concerned that the defendant is really seeking a declaration from the Court which it wishes to use to convince the third party purchaser that it should proceed with the purchase, that is on the basis that the defendant has "clear" ownership.
As Ms Cooper points out, declarations may be made as to party's rights and obligations. The Court has a wide power under s 75 of the Supreme Court Act 1970 (NSW) to make declarations. However, before it makes a declaration, the Court would ordinarily be satisfied of the factual and legal basis for the declaration sought. In particular, it must be satisfied that the declaration sought is appropriate and that it has practical utility: Neeta (Epping) Pty Ltd v Phillips (1974) 131 CLR 286; [1974] HCA 18.
A declaration will not usually be granted in respect of what might be viewed as a hypothetical question. Further, a declaration should not be made where the terms of the declaration do not necessarily fit satisfactorily with the matters that are affecting the dispute between the parties. Challenge Bank Ltd v Mailman [1993] NSWCA 54.
Whilst I accept Ms Cooper's submission that the terms of the declaration sought are narrow or limited, it is plain that it is intended to have a much broader operation or effect on the prospective third party purchaser.
It does not seem to me that I should make the declaration in those circumstances. Further, I should not make a declaration which might be taken by a third party to have a greater effect than is intended particularly when that is precisely what the party, in this case the defendant, is seeking to achieve through the application.
I hasten to add that is not a criticism of the defendant. It is in a very difficult position as it is dealing with cattle which require care and which are difficult to sell. Its attempts to sell are being thwarted by Mr Champion. Of course Mr Champion says that the cattle belong either to him or to Tucki Hills. That issue will be determined on 25 June.
In the circumstances I am not prepared to make the orders sought in the motion and the motion is dismissed.
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Decision last updated: 15 June 2020