New South Wales Supreme Court CITATION : Wehbe v Abboud [2007] NSWSC 548 HEARING DATE(S) : 21 March 2007 JURISDICTION : Equity Division Duty List JUDGMENT OF : Brereton J EX TEMPORE JUDGMENT DATE : 21 March 2007 DECISION : Order that defendant withdraw caveat. Order defendant pay compensation for loss occasioned by wrongful lodging of caveat. Indemnity costs. CATCHWORDS : REAL PROPERTY – land under Real Property Act – Caveats – Caveats against dealings – where lodged by solicitor claiming interest under contract to which solicitor is not party – where evidence refutes solicitor's claim to have lodged caveat in interests of his former clients LEGISLATION CITED : (NSW) Real Property Act 1900 ss 74MA, 74P PARTIES : Richard Robert Wehbe Leslie Abboud FILE NUMBER(S) : SC 1889/07 COUNSEL : Mr R W Tregenza (plaintiff) Mr L Abboud (in person) SOLICITORS : Carbone Lawyers (plaintiff) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION DUTY LIST BRERETON J Wednesday, 21 March 2007 1889/07 Richard Robert Wehbe v Leslie Abboud JUDGMENT (ex tempore) 1 HIS HONOUR: By summons filed on 19 March 2007, which was made returnable, by leave of the Court granted that day, at 10 am today, with an abridgment of time for service, the plaintiff Richard Robert Wehbe, who is the registered proprietor of the land comprised in Folio Identifier A/357463, situate at and known as 48 Louis Street, Granville, claims an order that the defendant Leslie Abboud forthwith withdraw caveat AC993827, and compensation for damage caused by the lodgement of the caveat pursuant to (NSW) Real Property Act 1900, s 74P. 2 Mr Wehbe has, by contract dated 15 January 2007, agreed to sell the land to Sayde Bazouni. An appointment for completion of that contract had been made for 16 March 2007, but did not proceed due to the existence of the caveat, which had been lodged not many days before 16 March 2007. 3 The caveat identifies the caveator as Leslie Abboud, Solicitor, of 237 Waterloo Road, Greenacre. It claims an interest as "equitable interest" by virtue of "exchange contract of sale of the subject property dated 19 November 2006". 4 Previously, by contract exchanged on 12 September 2006, Mr Wehbe had agreed to sell the subject property to Sayde Bazouni and Souad Bazouni. On the contract of 12 September 2006, the vendor's conveyancer is identified as L & Y Abboud, Conveyancers, and the purchasers' solicitors as Leslie Abboud, Solicitors. There is no evidence before me of any contract dated 19 November 2006 such as is referred to in the caveat, but Mr Abboud informs me that another contract, from Mr Wehbe to Sayde Bazouni, was substituted on or about that date for that dated 12 September 2006. 5 Some time after November 2006 there was a change in the solicitors acting for the parties. On the contract dated 15 January 2007, the vendor's solicitor is identified as Carbone Lawyers, and the purchaser's solicitor is named as Leslie Abboud Solicitors, but it does not follow that Mr Abboud has had any involvement in the preparation of that contract, since ordinarily the identity of the purchaser's solicitors is completed by the vendor's solicitors on instructions, without any necessary involvement on the part of the purchaser's solicitor. 6 On 16 March 2007, a facsimile letter was sent from Leslie Abboud Solicitors to Carbone Solicitors, which recorded: Please note that Mr Wehbe did request a new contract and for us to proceed with the discharge of mortgage for the abovementioned property, hence we proceeded with the request and discharge of mortgage following exchange of contracts with the same purchaser Sayde Bazouni. We believe that the vendor and purchaser were friends and acquainted therefore the promise was that the full amount of monies owing by both parties will be paid on settlement. Due to the conflict of interest we recommended that Mr Wehbe seek your assistance in this matter and we shall send you the file as soon as our fees were paid (Invoices Enclosed). Matter proceeded when both parties' changes solicitors to avoid payments therefore Mr Leslie Abboud (Principal) lodged a caveat on the property pending payments. Please note that we hold a contract executed by vendor and purchaser and no rescinding notice was received by either parties or advice of authority to discharge of file to another legal representative. On numerous occasions, by phone conversation daily, Mrs Wehbe told me on the phone that she will pay her duties and the purchaser was advised and promised to pay on three occasions but to no appearance. Kindly advise your clients instructions as to the payment of our invoices as the withdrawal of caveat is prepared to be picked up by 1 pm this afternoon. 7 Mr Abboud, who appeared on his own behalf today, said, from the bar table, that the signature on that letter was that of his conveyancer – who is also his wife. The invoices enclosed with that letter included an invoice to Mr Wehbe in respect of acting on the sale of the subject property, but also invoices to various members of the Bazouni family in respect of apparently unrelated transactions. 8 Mr Abboud, the caveator, is not a party to the contract for sale of September 2006 – nor, for that matter, that of 15 January 2007; nor, on what he tells me, that of 19 November 2006. It is as plain as can be that he personally has no caveatable interest in the subject land, and there never was the slightest basis for him to lodge a caveat claiming an interest in it. 9 He says that he did so to protect the interest of his former clients, Sayde Bazouni and Souad Bazouni. The first problem with this contention is that it is not what the caveat asserts. The second is that the letter of 16 March 2007, to which I have referred, makes manifestly clear that the real purpose of the caveat was to extract payment of Mr Abboud's fees, and not to protect the interests of his former clients. This is particularly clear from the last paragraph set out above, which, in effect, indicates that a withdrawal of caveat will be given in return for payment of the invoices. 10 I regret, therefore, that I am unable to accept Mr Abboud's submission that the purpose of the caveat was to protect the interests of his former clients – who have each sworn affidavits, which have not been challenged, deposing on oath that, contrary to what Mr Abboud has asserted before me, they did not instruct him to lodge a caveat on the title. As I have said, it is the plainest possible case that Mr Abboud has no caveatable interest. 11 I order, pursuant to Real Property Act, s 74MA, that the defendant withdraw caveat AC993827 in respect of the land comprised in Folio Identifier A/357463 by 4 pm today, 21 March 2007. 12 The evidence of Mr Carbone establishes that, by reason of the caveat, settlement has been delayed by six days with a consequential incurring of interest and additional legal fees, and that the plaintiff has thereby become liable for additional interest of a total of $575.34, additional legal costs payable to the outgoing mortgagee of $220, and additional costs payable to their own conveyancing solicitor of $250. These amounts total $1,070.34. Those amounts would not have been incurred had the matter been able to proceed to settlement when it otherwise would have, on 16 March 2007. 13 I order, pursuant to the Real Property Act, s 74P, that the defendant pay the plaintiff compensation for the loss occasioned by the wrongful lodging of the caveat, assessed in the sum of $1,070.34. 14 I order that the defendant pay the plaintiff's costs of the proceedings on an indemnity basis. 15 I direct that these orders be ordered forthwith. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.