The Tribunals Findings and Decision
- The objects of the AT Act are set out in s3 of the AT Act and include the object of providing a mechanism for settling disputes between parties to agricultural tenancies through applications to this Tribunal.
- S20(1) of the AT Act provides that an owner or tenant may apply to the Tribunal for determination of any of the following:
(a) a dispute relating to a right or obligation conferred by this Act,
(b) a dispute arising from, or relating to, an agreement creating a tenancy or any other dispute (not being a dispute referred to in paragraph (a)) arising from, or relating to, a tenancy,
(c) any other matter that may be determined by the Tribunal under this Act.
- An appeal panel of the Tribunal has described the powers invested in the Tribunal by virtue of the AT Act as "very broad" (Steak Plains Olive Farm Pty Limited v Australian Executor Trustees Ltd [2014] NSWCATAP 85). In particular the wording of s20(1)(b) is sufficiently broad to incorporate a claim brought by an owner against parties who have guaranteed the obligations of the tenant. In the opinion of the Tribunal this claim falls within the language of s20(1)(b) of the AT Act.
- However, s20(2) require an application to the Tribunal to be made not later than three months after the relevant dispute arises or at the end of the tenancy whichever is the later. The applicants did not contend that the application was made within the time required by s20(2) but instead sought to have the Tribunal extend time under s41 of the Act.
- The issues for consideration with respect to an application under s41 have been set out in decisions of appeal panels of the Tribunal - for example see Jackson v NSW Land and Housing Corporation and De Salvo v Leung.
- Having regard to the considerations referred to in those decisions the following findings are made.
- First, the length of the delay is not insignificant. The application was lodged many months after the three month deadline.
- However, there is a reasonable explanation for that delay. The applicants contend they were in discussions with the respondents in the second half of 2013 in an attempt to settle the dispute. They have provided a chronology describing meetings and discussions between July 2013 and February 2014 involving both guarantors. The respondents did not dispute the applicants' contentions that settlement discussions had occurred.
- The respondents referred to the case of Allendale Blue Metal Pty Ltd v Roads and Maritime Services [2013] NSWCA 103 for the proposition that if an applicant makes a forensic decision not to challenge a court decision but rather to wait and see if other proceedings were resolved favourably the applicants should be bound by that forensic decision. However, that decision was made because it was the opinion of the court that the applicants' strategy was not consistent with the statutory objective of the just, quick and cheap resolution of the real issues in dispute under s56 of the Civil Procedure Act 2005 (NSW). Here, the applicants decision to delay commencing proceedings was not in breach of the similar objective contained in s36 of the Act because during the period of alleged delay there were no proceedings on foot. Furthermore the purpose of the delay was to seek to resolve the dispute without having to resort to the Tribunal.
- The applicants contend that the respondents have not suffered any prejudice by reason of the delay in commencing these proceedings. However, the respondents assert that they have been prejudiced and stated that the applicants have neglected the management of the orchard. That neglect was said to prejudice the respondents. In the view of the Tribunal the respondents' assertions concerning any alleged neglect by the applicants can be dealt with in the context of determining whether the applicants alleged losses arose from the respondents breaching their obligations or arose from the applicants neglect or inactions. The Tribunal does not find that the delay in commencing proceedings has caused the respondents prejudice.
- A further consideration in considering whether to extend time is the applicants' prospects of success i.e. whether they have a fairly arguable case.
- In the view of the Tribunal the applicants have a fairly arguable case in that if it can be established by appropriate evidence that the respondents have breached obligations under the leases causing monetary loss to the applicants , the applicants will be entitled to an award subject, of course, to any defence (supported by evidence) from the respondents. This is not a case where it can be said that the applicants' prospects of success are so poor that the discretion to extend time under s41 should not be exercised. Having regard to the other findings of the Tribunal in these reasons the Tribunal finds that the applicants case is not such as to warrant refusing to extend time.
- A final consideration is that in the Tribunal's opinion strict compliance with s20(2) would potentially work an injustice to the applicants if they are precluded from having the Tribunal hear and determine their claims and the respondents defence. The potential injustice is significant when the reason for the delay in commencing proceedings were the attempts by the parties to resolve their dispute by negotiation.
- Section 41 expressly authorises the Tribunal to extend time despite anything to the contrary in the relevant legislation (in this case the AT Act). Having considered the matters referred to above and the obligations of the Tribunal contained in s36 of the Act the Tribunal finds it is just to extend time and will order accordingly.
- The next issue is whether the fact that the lease was not registered means that the principles decided in Chan v Cresden and Barecall v Hoban render the guarantors not liable.
- Chan v Cresden concerned a lease for a term of in excess of 3 years and by reason of s43 of the Real Property Act 1861 (Qld) was required to be registered in order to pass an estate or interest in land. The majority judgment expressly stated that s43 is not a bar to the creation of a lease or tenancy for a term of less than three years otherwise than by registration of a memorandum of lease - see Property Law Act 1974 (Qld), Ss5 (1)(b), 10(1), 10(2)(c).
- Similarly, Barecall v Hoban concerned a lease for more than three years and the decision was based on an implied covenant imposed on the landlord to effect registration by virtue of the agreement to grant a lease which for its validity required registration (see paragraph 186 of the judgment).
- This case is distinguishable from the above two cases in that it concerns a lease for a term of three years. S53 of the Real Property Act NSW 1900 provides for a lease of more than three years to be executed in the approved form. There is no requirement under the RP Act for a lease of three years to be executed in an approved form or registered.
- Here there were a number of leases each for a term of three years with each lease to commence the day after the preceding one comes to an end. There was no evidence that the parties treated these leases on any basis other than on the basis that each lease should be construed as separate agreements.
- Accordingly, the leases the subject of these proceedings do not require to have been registered.
- The provisions of s41 of the RP Act (which provides that no dealing, until registered in the manner provided by the RP Act shall be effectual to pass any estate or interest in land) do not apply to a lease for a term of three years.
- The result is that the Tribunal finds that the fact that the leases the subject of these proceedings were not registered does not affect the efficacy of the leases nor the enforceability of the guarantors given under those leases.
- The respondents relied upon clause 11(b) of the leases for the submission that the parties intended that the leases were to be registered. That clause provides that should the lessor be entitled to re enter and take possession and determine the lease, the lessee appoints the lessor to be the attorney of the lessee to execute and procure the requisition of a surrender of lease.
- The opinion of the Tribunal is that it is not relevant that the parties may have intended, or not intended, to register the lease because the leases were effective and binding whether or not the leases were registered.
- Finally, there is no basis for the respondents to invoke the provisions of clause 10 Schedule 4 of the Act because there is no basis for the conclusion that the applicants are conducting the proceedings in such a way that unreasonably disadvantages the respondents. The respondents submissions concerning clause 10 were largely based on the other submissions made by the respondents and as the Tribunal has found against the respondents with respect to the other submissions it follows that this submission concerning clause 10 also fails.
- The respondents also submitted that as one of the respondents now resides in the Philippines it would cause him disadvantage to have to defend these proceedings. In the opinion of the Tribunal this submission is without merit. If the applicants are successful the fact that that respondent is put to expense and inconvenience in having to return to Australia from the Philippines is not relevant. If on the other hand the applicants are unsuccessful against that respondent the respondent may have a basis for seeking reimbursement of some of the costs incurred in defending these proceedings.
- In conclusion the Tribunal finds that the Tribunal has jurisdiction to hear and determine the application but that it is appropriate to extend the time to commence the application under s41 of the Act to the 25 April 2014 (being the day after the application was lodged with and received by the Tribunal).
- It follows that the Tribunals decision in respect of the three preliminary issues identified towards the beginning of these reasons is:
1. yes
2. no
3. the application was made out of time but the Tribunal extends the time to the day after the day the application was filed.
- It is appropriate to relist the proceedings for the purpose of making directions for the proceedings to be prepared for hearing. The parties may appear at the directions hearing by telephone.
- Orders will be made accordingly.
S Westgarth
Deputy President
Civil and Administrative Tribunal of New South Wales
5 December 2014
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
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Decision last updated: 12 February 2015