Wossidlo v Catt [1934] HCA 52

Wossidlo v Catt [1934] HCA 52 - HCA 1934 case summary — Zoe

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Folio 192 a Commonwealth Bond representing the sum of £200 payable on the fifteenth day of September One thousand nine hundred and twenty-eight and certain household and other effects has requested the said Alfred Clifford Catt to purchase from her the said War Bond household and other effects and the said lands and as consideration for the sale thereof by her to him to pay to her the respective sums - and annuity hereinafter covenanted by him to be paid to her and to execute these presents for securing payment thereof which the said Alfred Clifford Catt has agreed to do' it was witnessed that ' in pur. suance of his said agreement the said Alfred Clifford Catt doth hereby - for himself his heirs executors and administrators covenant with the said Antonie Henriette Matilda Wossidlo that he the said Alfred Clifford Catt his heirs executors or administrators will on the delivery" to him of the said War Bond household and other effects together with the said Certificates of Title and a duly executed transfer to him _ of the said lands pay to the said Antonie Henriette Matilda Wossidlo the sum of One hundred pounds And if the said Antonie Henriette. Matilda Wossidlo shall be living on the 10th day of January One thousand nine hundred and twenty-seven will pay to her a further sum of Four hundred pounds which said sums or such of them as shall become payable pursuant to this covenant shall be the full purchase money of the said War Bond household and other effects. _ 'And as consideration for the sale to him by the said Antonie Hen- riette Matilda Wossidlo of the said lands the said Alfred Clifford Catt doth hereby covenant with the said Antonie Henriette Matilda Wossidlo that he his heirs executors or administrators will during her lifetime pay to her an annuity of One hundred and fourteen" pounds by equal calendar monthly payments computing from the Tenth day of March One thousand nine hundred and twenty-six the first of such payments to be made on the Tenth day of April. next.' On the same day as this deed was signed Mrs. Wossidlo executed a Memorandum of Transfer in these terms: 'I Tony Wossidlo of West Mitcham Married Woman being registered as the proprietor of an estate in fee simple subject however to such encumbrances liens and interests as are notified by such memorandum underwritten or endorsed thereon in the whole of the land comprised _

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to the purchaser, and the vendor has a lien on it for the price which becomes operative as from the time at which the contract ought to have been completed, and continues until the price is paid, unless a contrary intention appears. That intention is to be gathered from the words of the contract and the inferences from the nature of the transaction in question. In the normal course conveyance and - payment are synchronous, but the price may take any form, and if it consists in the giving of a covenant it is " paid " when the covenant is given, notwithstanding that the covenant may itself involve the making of payment. When the consideration is an agreement to pay a life annuity, it is natural to infer that the vendor annuitant - relied upon the coyenant as the substitution for the property. life annuity involves a series of recurrent payments extending over a quite unknown time. No doubt it has a present value, but the vendor has not stipulated for its present value, but for the annual payments. By parting immediately with the legal estate a vendor - in an ordinary case, where the price is a definite sum, may be regarded as anticipating the completion of the transaction by payment. But in the case of a life annuity a very different intention is to be inferre from his parting with the legal estate (Cf. Dyke v. Rindall (1) ; Dion v. Gayfere (2)). If he did not intend the beneficial ownership of the property to be fully imparted to the purchaser until the final payment of the annuity was made, the transaction into which he entered would take rather the complexion of a post mortem disposition, the disponee being let into immediate possession. The obvious purpose of transferring the legal estate to the person undertaking the liability to pay the annuity is to invest him with complete enjoy- ment of the ownership of the land, legal and beneficial, including | the power of alienation. The vendor, in bargaining for a personal covenant only to pay the annuity, has impliedly shown that it upon this she is content to rely. Had it been otherwise the annt

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October 1930 without having transferred the land. After his death the payments of the annuity fell into arrear. The appellant then claimed that the payment of the annuity was secured by a vendor's lien over the land, to protect which she lodged a caveat. The Supreme Court of South Australia, consisting of Murray C.J., Napier and Angas Parsons JJ., has held that no such lien exists, and has reversed a decision to the contrary of Richards J. In the memorandum of transfer, by which the appellant transferred the land to Catt, the consideration was expressed to be a covenant to pay during the transferor's lifetime an annuity of £114. The deed of covenant referred to recited an agreement by Catt to purchase from the' appellant the lands and to pay the annuity therefor. It proceeded to witness that, in pursuance of the agreement and as considerati for the sale of the lands, Catt covenanted that he would, during h lifetime, pay her the annuity by equal monthly instalments. The lien of an unpaid vendor arises by operation of law, but its existence is commonly ascribed to the fact that he does no intend to transfer the beneficial ownership of his estate except in exchange for the stipulated price. Where an owner of land transfers it in exchange for a contractual promise on the part of the transferee to pay a life annuity, and does not secure the annuity over the or take it in the form of a rent charge, it seems difficult to regard the transaction as one to which the doctrine can apply so as to give rise to a vendor's lien. But in an early case of Tardiff v. Serughan, cited in Blackburn v. Gregson (1), Lord Camden decided that an annuity, which children agreed to pay to their parents who trans- ferred their property to them, was secured upon the estate. Sugden, in his Vendors and Purchasers, the first edition of which was publishe in 1805 whilst he was still a young conveyancer and before he w, called to the Bar, accepted this decision as establishing that, whe an estate was sold for an annuity, a vendor's lien was raised in the vendor's favour to secure its payment. But in Mackreth v. Symmons (2) Lord Eldon expressed the contrary view. His opinion app' to have been that, in bargaining for a life annuity as considera for his land, a vendor could scarcely intend to rely on the secur

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work if the annual rent should fall into arrear. Hence, in my opinion, there is no lien in such a case for unpaid purchase-money " (1), _ In In re Brentwood Brick and Coal Co. (2) James LJ. said that the ' nature of the contract in that case "excludes vendor's lien." In - Barker v. Stickney (3), Bankes L.J. relied upon the passage quoted by James V.C. in Earl of Jersey v. Briton Ferry Floating Dock Co, (4) from the judgment of Leach V.C.in Winter v. Anson (Lord) (5), as illustrating a case where a vendor has not a lien. Serutton LJ. asserted that the question whether a contract operated to create lien was to be determined by the following considerations : - T understand the doctrine of a vendor's lien it is this: If the instru- ment of transfer shows an intention that the property shall not transferred absolutely, but subject to a charge in favour of transferor to secure some benefit to himself, he has a vendor's lie

that is, not a possessory lien, with which the common law familiar, but a right in equity, the enforcement of which seems be a matter of difficulty and doubt. If that is the principle to be applied I protest against building up a conventional code of constru tion by which the intention of the parties is to be determined b the use of particular words. I repel the suggestion that the Court is guided towards the intention of the parties to one deed by the light of what was found to be the intention of the parties to another deed after consideration of the intention of the parties to a third dee The difficulties in the construction of wills have, in my view, greatly increased by the way in which cases upon wills used to be argued, and by the elaborate text-books classifying recorde decisions. The problem being to discover what the parties to one instrument intended, the Court ought not to be bound by the con- struction put upon a particular phrase in another document. AS I read the rules proposed by McCardie J. they are attempts fetter the Court by conventional rules of construction. Any such attempt is extremely undesirable, and for that reason I think he proposed rules should not be followed " (6).

At a glance

Court

Decision date

Before

Source

Judgment (83 paragraphs)