Supreme Court New South Wales Medium Neutral Citation: Scott Darren Pascoe and Mark Robinson in their capacity as trustees for the sale of land known as 124 Tennyson Road Gladesville v Michael James [2013] NSWSC 1067 Hearing dates: 6 August 2013 Decision date: 06 August 2013 Jurisdiction: Equity Division Before: Kunc J Decision: Caveat withdrawn and injunction against further lodgment Catchwords: TORRENS SYSTEM - Caveats - Withdrawal - Serial lodgment of unmeritorious caveats - Injunction against further caveats Legislation Cited: Real Property Act 1900 (NSW) Category: Principal judgment Parties: Scott Darren Pascoe and Mark Robinson (Plaintiffs) Michael James (Defendant) Representation: Counsel: Mr B. Skinner (Plaintiffs) Solicitors: Kemp Strang File Number(s): 2013/233691 Publication restriction: No EX TEMPORE Judgment 1HIS HONOUR: The plaintiffs are trustees for sale of land at Gladesville (the "Land"). 2The matter came before me in the Duty List on the plaintiffs' summons for orders that a caveat lodged over the Land be withdrawn and restraining the defendants from lodging any further caveats on the title to the Land without leave of the Court. The summons also seeks orders that the defendants pay to the plaintiffs any pecuniary loss sustained by them and an order that the defendants pay the costs of the plaintiffs on the indemnity basis. 3The plaintiffs' evidence makes it clear that at least three unmeritorious caveats have been lodged against the Land at the behest of one or more of the defendants in circumstances where the defendants appear to be connected with each other. Earlier caveats referred to in the evidence lodged by one or other of the defendants have either lapsed or been withdrawn. The most recent caveat lodged against the Land is the subject of the relief sought in the summons. 4There is no doubt that the pattern exhibited by the defendants in lodging the caveats suggests that an effort is being made to disrupt the plaintiffs' capacity to sell the Land in an orderly fashion. Contracts have been exchanged for the sale of Land. Owing to delays occasioned at least in part, if not wholly, by the presence of the earlier caveats, the purchaser has been allowed into possession of the Land under license pending the question of the caveats being sorted out. 5When the matter first came before me I was satisfied that proper efforts had been made to notify the defendants of the hearing and the application that would be made at that time. There was no appearance for any the defendants. I made orders for the withdrawal of the caveat that remained on title to the Land, but suspended operation of that order until 5pm today. The purpose of doing so was to give the defendants a further opportunity, if they wished, to be heard on the summons. The jurisdiction the Court was exercising in making the order for withdrawal was that conferred by s 74MA of the Real Property Act 1900 (NSW) (the "Act"). 6I made further directions for the orders which I had made and the further hearing of the summons, fixed for today, to be brought to the attention of the defendants. I am satisfied that the orders for service which I made on the last occasion have been complied with. The defendants were called outside Court this morning and there was again no appearance. Accordingly, the matter has proceeded in their absence. 7In so far as further orders were required today, they concern the modification of the order which I made on the last occasion for the withdrawal of the remaining caveat, an application for the injunction against the defendants restraining them from lodging any further caveats over the Land without leave of the Court and an order that the defendants pay the plaintiffs' costs of the summons to date on the indemnity basis. 8I shall deal with each of these in turn. 9The first order sought by the plaintiffs today is relatively uncontroversial. To engage section 74MA(3) of the Act it is necessary that a time be limited in any order for the withdrawal of a caveat. For good reason when the matter was last before me that was not done. As the defendants have not taken advantage of the further opportunity which has been given to them to come to Court, I am satisfied that it is appropriate to perfect the order I made on the last occasion by making a further order limiting the time within which the caveat must be withdrawn. Once that time expires the plaintiffs will be able to lapse the remaining caveat by serving an office copy of my orders with Land and Property Information. 10The second order concerns an injunction restraining the defendants from lodging any further caveats over the Land without leave of the Court. The Court has jurisdiction to make such an order pursuant to s 74MA(2)(b) of the Act. The evidence satisfies me that the pattern of conduct of the defendants in various combinations to date demonstrates a real risk that they may attempt to disrupt the completion of the sale of the Land by filing a further caveat. It is therefore appropriate in this case to restrain the defendants in the manner sought by the plaintiffs. 11The third matter concerns an application that the defendants pay the plaintiffs' costs on the indemnity basis. 12Mr B Skinner of Counsel, appearing for the plaintiffs, has submitted that there are at least three reasons why an order for indemnity costs should be made. First, he submits that the defendants have been on notice that such an order would be sought as it is included in the summons. Second, the defendants have obviously been involved with lodging the three unmeritorious caveats over the title to the Land and have now forced the plaintiffs into making the present application. Third, Mr Skinner reminds the Court of dicta to the effect that caveats are not be used as a commercial bargaining chip, which can be the only sensible explanation for why the caveats have been lodged by the defendants. 13While all of the reasons advanced by the Mr Skinner have practical and commercial force, I am not satisfied that they are sufficient, taken individually or together, to displace what would otherwise be the usual position that costs should be awarded on the ordinary basis. In particular, the costs jurisdiction is not intended to punish the person against whom the order is made, but is rather intended to provide compensation to the successful party for costs that they have necessarily and reasonably incurred in obtaining relief. I do not think that the evidence goes so far as to allow me to engage the discretion in a principled way to award costs on the indemnity basis. 14While not of determinative weight in the conclusion which I have just reached, I have also taken into account the fact that the matter will return to Court for the disposition of the plaintiffs' application for an order for compensation for pecuniary loss sustained by them attributable to the lodgement of the caveats. Without expressing any view as to the correct answer, it seems to me that, at the very least, it is arguable that the difference between ordinary and indemnity costs is a matter which the Court could take into account in assessing pecuniary loss sustained by the plaintiffs attributable to the lodgement of the caveats. Whether that is ultimately the correct position is a matter for the Court on another day. However, I wish to make it clear that the fact that I have not been persuaded on the evidence before me to award indemnity costs is not, in my view, a proper reason to disentitle the plaintiffs from having a claim considered for pecuniary loss which includes the difference, if any, between the amount recoverable from a costs order on the ordinary basis and their solicitor/client costs. 15Accordingly, I will make the orders in the short minutes of order which I initial and date today and place with the papers. ********** 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. Decision last updated: 08 August 2013