Agmon Investments Pty Ltd v Inglis & Ors

[2006] NSWSC 932

CITATION:	Agmon Investments Pty Ltd v Inglis & Ors [2006] NSWSC 932
HEARING DATE(S):	8 September 2006
JUDGMENT DATE :	11 September 2006
JURISDICTION:	Equity Division
JUDGMENT OF:	Palmer J
DECISION:	Application for extension dismissed.
CATCHWORDS:	CAVEAT – EXTENSION – whether a prima facie case for interest claimed in caveat demonstrated.
LEGISLATION CITED:	Conveyancing Act 1919 (NSW) – s.54A Fair Trading Act 1987 (NSW) Real Property Act 1900 (NSW) - s.74K
CASES CITED:	- Hall v Busst (1960) 104 CLR 207 - South Sydney Council v Royal Botanic Gardens (1999) 10 BPR 18,961 - Sudbrook Trading Estate Ltd v Eggleton [1982] 3 All ER 1
PARTIES:	Agmon Investments Pty Ltd – Plaintiff Jeffrey Ronald Inglis – First Defendant Dianne Wendy Inglis – Second Defendant
FILE NUMBER(S):	SC 4644/06
COUNSEL:	F. Kunc – Plaintiff A.J. Greinke – Defendants
SOLICITORS:	Thomson Rich O’Connor – Plaintiff Abbott Pardy & Jenkins – Defendants

Introduction and issues

1 The Plaintiff seeks the extension of a caveat pursuant to s.74K Real Property Act 1900 (NSW). The application is opposed on the ground that the Plaintiff has no caveatable interest. Mr Kunc of Counsel, who appears for the Defendants, acknowledges that in an application to extend a caveat all that the caveator must show is an arguable case, or serious question to be tried, in support of the interest claimed. Nevertheless, he submits that, as the law presently stands, the caveator cannot surmount even this low hurdle.

2    As an alternative argument, Mr Kunc submits that the caveat does not state the true basis on which the Plaintiff claims an interest in the Defendants’ land.

3    The estate or interest claimed by the Plaintiff, as described in the caveat, is as follows:

“Equitable interest as holder of an option granted by the registered proprietors to purchase the estate in fee simple by virtue of … AGREEMENT … [dated] FEBRUARY 1999 [between] Registered Proprietors and Caveator by virtue of [the following] facts:

ANNEXURE A


1. In or about February 1999, the registered proprietor and caveator entered into an agreement in writing (‘the agreement’), being the instrument referred to in Schedule 1.

2. The agreement was signed by the registered proprietor.

3. The agreement provided, inter alia, that:

3.1 the registered proprietor would have use of water from various dams located on properties owned by the caveator and known as “Lilygrove”;

3.2 the caveator was granted an option to purchase the estate in fee simple of one or more of the specified lots, with or without other lots owned by the registered proprietor.

4. In breach of the agreement the registered proprietor intends to sell the estate in fee simple (of the specified lots) to a third party.”

4    It will be noted that the caveat states that the interest claimed arises out of an agreement in writing executed by the Defendants. However, in the Statement of Claim filed by the Plaintiff in order to support the extension of the caveat, quite a different case is pleaded.

5    There, the Plaintiff raises three causes of action: one founded upon contract, one founded upon a proprietary estoppel, and the third founded on the Fair Trading Act 1987 (NSW). The last two causes of action are not, of course, referred to in the caveat. Accordingly, I have confined myself in this application to two questions: whether the claim in contract which is set out in the caveat is supported at all by the Plaintiff’s pleading and evidence and whether, even if it is, the claim is, as the Defendants assert, unarguably doomed to fail.

Whether any evidence to support interest claimed

6    In the Statement of Claim, the Plaintiff alleges that in about January 1999 the Plaintiff and the Defendants agreed that, in consideration for an exclusive right granted by the Plaintiff to the Defendants to remove water from the Plaintiff’s property, the Defendants granted the Plaintiff an option to purchase the subject land. In the particulars to this paragraph it is said that the agreement “was oral and in writing”.

7    It will be seen at once that this allegation is a departure from the facts stated in the caveat, which alleged that the caveat arises from a wholly written agreement signed by the Defendants.

8    The particulars to the pleading then state that the written part of the agreement is contained in a Licence Deed annexed to a contract for sale dated 11 January 1999 and is also contained in a Licence Deed “executed by the defendants” in or about February 1999. This Deed is obviously the “Agreement [dated] February 1999” referred to in the caveat.

9    However, the Licence Deed annexed to the affidavit in support of the application is not signed by the Defendants.

10 Mr Kunc submitted that the Licence Deed, to the extent that it was capable of creating an interest in land, was nevertheless unenforceable under s.54A Conveyancing Act 1919 (NSW). Counsel for the Plaintiff, Mr Greinke, endeavoured to support the enforceability of the Licence Deed by reliance on the doctrine of part performance. From this submission and from the absence of any signed Licence Deed in evidence, I take it to be conceded by the Plaintiff that the Licence Deed is not, in fact, signed by the Defendants. This is another departure from the facts stated in the caveat as supporting the interest claimed.

11    There is, of course, no reference in the caveat to the Plaintiff’s interest arising from part performance of an agreement which is not in writing signed by the party to be charged.

12    It is clear, therefore, that the Plaintiff’s case as pleaded and verified does not support – indeed, it negates – the interest claimed in the Plaintiff’s caveat. This conclusion is sufficient to require the dismissal of the Plaintiff’s for extension of the caveat.

Whether claim as pleaded bound to fail

13    However, most of the debate before me focussed on Mr Kunc’s submission that, even if the facts pleaded by the Plaintiff were fully accepted, the Plaintiff’s claim to an interest in the Defendants’ land was bound to fail because the alleged option agreement was void for uncertainty. In deference to this argument, I should say a few words about it, although these observations are not necessary for the disposition of the present application.

14    The unsigned Licence Deed deals expressly only with water rights. The only reference in it to an option is a passing reference in Clause 1 to the grant of the option as forming part of the consideration for the Deed. There is no dispute that the parties never expressly agreed on a price for the Defendants’ land which the Plaintiff was to pay upon exercise of the option.

15    Consequently, the Plaintiff pleads in the Statement of Claim that the parties orally agreed that the price payable upon exercise of the option would be “a reasonable price”. In the alternative, the Plaintiff pleads that it was an implied term of the option agreement that the purchase price would be “a reasonable price”.

16    Mr Kunc, in his lucid and cogent argument, urges that I am bound by authority to hold that an agreement for sale of land at “a reasonable price” – whether that term is express or implied – is void for uncertainty. He relies on the decision of the High Court in Hall v Busst (1960) 104 CLR 207, at 216-217 and 222, which is certainly authority for that proposition.

17    On the other hand, Mr Greinke points to the decision of the House of Lords in Sudbrook Trading Estate Ltd v Eggleton [1982] 3 All ER 1 as modern authority for the proposition that a contract for sale of land “at a fair and reasonable price” is nevertheless an enforceable contract although such a contract, in essence, leaves it to the Court to decide upon a price for the parties: see e.g. per Lord Diplock at pp.6-7.

18    The reasoning in Sudbrook is directly contrary to that in Hall v Busst – see e.g. per Dixon CJ at 216, and per Fullagar J at 222. As Mr Kunc observes, unpopular though Hall v Busst may be in some quarters at present, the Courts of this State are bound to apply it until the High Court overrules it: see e.g. South Sydney Council v Royal Botanic Gardens (1999) 10 BPR 18,961 at [21]. Accordingly, while Hall v Busst remains good law, the Plaintiff’s claim to enforce an option for the purchase of land “at a reasonable price” must fail.

Orders

19    The Plaintiff’s application for extension of the caveat is, therefore, dismissed.

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