Hulme v Schaecken [1999] NSWSC 1291

New South Wales Supreme Court CITATION : Hulme v Schaecken [1999] NSWSC 1291 CURRENT JURISDICTION : Equity FILE NUMBER(S) : 5048/99 HEARING DATE(S) : 17 December 1999 JUDGMENT DATE : 17 December 1999

PARTIES : Edwin Cuthbert Hulme (P) Robin Marie Schaecken (D) JUDGMENT OF : Austin J

COUNSEL : D Raphael (P) T Faulkner (D) SOLICITORS : Kirkpatrick Farr & Associates (P) CATCHWORDS : REAL PROPERTY - joint tenancy - severance - whether severance by unilateral declaration of intention is effective - whether Court has inherent jurisdiction to effect severance by order - whether commencement of proceedings effects a severance ACTS CITED : Conveyancing Act 1919 (NSW) s 35 Burgess v Rawnsley [1975] Ch 429 Corin v Patton (1990) 169 CLR 540 CASES CITED : McNab v Earle [1981] 2 NSWLR 673 Partriche v Powlet (1740) 2 Atk 54 Re Wilks [1891] 3 Ch 59 Williams v Hensman (1861) 1 J & H 546 DECISION : Application denied

THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

AUSTIN J

FRIDAY 17 DECEMBER 1999

5048/99 - EDWIN CUTHBERT HULME v ROBIN MARIE SCHAECKEN

JUDGMENT (ex tempore; revised 21 December 1999)

1 HIS HONOUR: These proceedings were commenced by summons filed on 16 December 1999 and then amended by an amended summons filed today. One of the forms of relief which the plaintiff seeks is an order that the joint tenancy in which the plaintiff and the defendant hold certain land at 20 Pinetree Crescent, Mount Pleasant ('the Property') be severed. A similar order is sought in respect of another property. 2 By notice of motion filed on 16 December 1999 and returnable today the plaintiff seeks an immediate order for the severance of the joint tenancy of the Property. The application arises because the plaintiff and the defendant have become estranged and, indeed, there appears to be considerable antagonism between them. The plaintiff's desire now is to leave the Property by will rather than to allow it to pass by survivorship. Additionally, there is some evidence that the plaintiff is in extremely poor health and on the basis of that evidence counsel expressed from the bar table an apprehension as to whether the plaintiff would survive even for the next few days. 3 The plaintiff's application assumes that the Court has the power to make an order that a joint tenancy be severed. The notice of motion is framed so that the severance is caused by virtue of the order. However, in submissions the plaintiff contended in the alternative that I should make a declaration to the effect that the plaintiff's own conduct, rather than the order of the Court, has caused severance to occur. The conduct upon which the plaintiff relies in this submission is the filing of the summons, the amended summons and the notice of motion, their service upon the defendant, and the plaintiff's making of the application in the Court today. 4 The defendant has not filed any evidence and so it is difficult for me to form a view as to any matter going to the merits of their respective positions. The defendant simply submits that the Court has no jurisdiction to make an order of the kind sought in the application and that the plaintiff's conduct cannot in law amount or give rise to severance of the joint tenancy. 5 I agree with the defendant's submissions. A joint tenancy may be severed in three ways, as Page Wood V-C said in his well-known judgment in Williams v Hensman (1861) 1 J & H 546; (70 ER 862). He described the first way as follows (at 557): 'An act of any one of the persons interested operating upon his own share may create a severance as to that share. The right of each joint-tenant is a right by survivorship only in the event of no severance having taken place of the share which is claimed under the jus accrescendi. Each one is at liberty to dispose of his own interest in such manner as to sever it from the joint fund - losing, of course, at the same time, his own right of survivorship.' 6 The second and third methods of severance which his Lordship dealt with were severance by mutual agreement and severance in a course of dealing sufficient to make it clear that the interests of all parties were mutually treated as constituting a tenancy in common. Those two methods of severance are not relevant here, as they depend upon a mutuality which is clearly not present. The first method of severance seem to envisage some form of irrevocable step being taken by the joint tenant, such as a transfer to a third party or trustee, a declaration of trust, a transfer of the interest to oneself, or any other form of alienation. On their face, his Lordship's words do not appear to allow severance merely by declaration of an intention to sever or by some other revocable step such as the filing or serving of a summons or application. 7 That this is so is supported by the decision in Re Wilks [1891] 3 Ch 59. In that case a joint tenant issued a summons for payment out to him of one-third of a fund. The joint tenant died before the case came on for hearing and the question for Stirling J was whether the joint tenancy had been severed by the joint tenant making an application which, if acceded to, would imply the severance of the joint tenancy. His Lordship held that no severance had occurred because the joint tenant's conduct in taking proceedings was essentially revocable, since a summons may be abandoned or amended. He observed (at 62) that 'if an act of a joint tenant [is to amount] to a severance it must be such as to preclude him from claiming by survivorship any interest in the subject matter of the joint tenancy.' Those remarks were approved by Needham J in McNab v Earle [1981] 2 NSWLR 673, 676. 8 The law as to severance of a joint tenancy was considered by the High Court of Australia in Corin v Patton (1990) 169 CLR 540. Mason CJ and McHugh J specifically considered whether a unilateral declaration of intention can cause a severance. Relying on observations by Lord Hardwicke LC in Partriche v Powlet (1740) 2 Atk 54, 55 (26 ER 430, 431) to the effect that the declaration of one of the parties to a joint tenancy that it should be severed is not sufficient unless there is an agreement, their Honours found powerful reasons for declining to adopt any alternative approach. 9 In Burgess v Rawnsley [1975] Ch 429, 439 Lord Denning MR had expressed the opinion that it would be sufficient for there to be a course of dealing in which one party makes clear to the other that he desires that their shares no longer be held jointly but be held in common. Mason CJ and McHugh J rejected this approach for several reasons, including the proposition that severance of a joint tenancy can only be brought about by the destruction of one of the so-called 'four unities'. The unity which is most relevant in such a case as the present is unity of title. As to that, their Honours said that unilateral action can only destroy the unity of title if the title of the party acting unilaterally is transferred or otherwise dealt with or affected in a way which results in a change in the legal and equitable estate in the relevant property. In their view a statement of intention, without more, does not affect the unity of title (at 548). This approach was accepted by Brennan J (as he then was) at 565 and by Toohey J at 587, and Deane J took a similar approach at 574 ff. 10 It is true that the High Court's observations about severance by unilateral declaration were obiter dicta, since in the case before the Court there was no evidence of Mrs Patton's intention of severing the joint tenancy having been communicated to Mr Patton. Nevertheless, the statements by members of the High Court are authoritative statements of the law of Australia on this point and no authority has been cited which could justify my departure from their Honours' observations even if I were inclined to do so. 11 Counsel for the plaintiff submitted that the present case is not simply one of unilateral declaration of intention to sever, since the plaintiff has taken some categorical steps by bringing the present application to Court. It seems to me that the principle enunciated by the High Court applies, as nothing which the plaintiff has done in the present case can be said to have affected the unity of title which the joint tenancy has achieved. Additionally, Re Wilks is an obstacle in the way of the plaintiff's submission. 12 In light of Corin v Patton and the other cases which I have mentioned, the contention that the plaintiff's conduct in the present case should be declared to be severance of the joint tenancy is contrary to law and the plaintiff's contention on that point fails. 13 Corin v Patton largely disposes of the plaintiff's other contention, that the Court has some inherent jurisdiction which would entitle it to give effect to a severance of joint tenancy by order, since if there were such an equitable jurisdiction, the Court in its exposition of the principles of severance would have said so. 14 The plaintiff's submission that authority arises by virtue of s 30 of the Conveyancing Act 1919 (NSW) fails because that section does not on its face have any application to Real Property Act land. 15 In summary, I see no legal basis for the Court to intervene by the exercise of some supposed discretion to alter the property rights of the parties before it. 16 Consequently, the plaintiff's application by the notice of motion filed on 16 December 1999 is denied. On the question of costs, although the application has been unsuccessful the plaintiff submits costs of the application be costs of the proceedings. However, the application was made on a ground contrary to law and was in that sense bound to fail. There is no evidence of intransigence on the part of the defendant, or any other evidence which would suggest that the costs of this application not be dealt with now. Therefore, it seems to me that the plaintiff should be ordered to pay the defendant's costs of the application. 17 I make the following orders: