Marco Rossi v Yingyu Si [2016] NSWSC 368

Supreme Court New South Wales

Medium Neutral Citation: Marco Rossi v Yingyu Si [2016] NSWSC 368 Hearing dates: 30 March 2016 Date of orders: 30 March 2016 Decision date: 30 March 2016 Jurisdiction: Equity - Duty List Before: Kunc J Decision: Summons dismissed Catchwords: REAL PROPERTY – Torrens system – Potential rights under family law property settlement insufficient for caveat Legislation Cited: Family Law Act Real Property Act 1900 (NSW); BPR ref Cases Cited: Ho v Ebert [2015] NSWSC 1468 Powell v Stone [2014] NSWSC 574 Category: Principal judgment Parties: Marco Rossi (Plaintiff) Yingsu Si (Defendant) Representation: Mr Rossi (in person) File Number(s): 2016/96223 Publication restriction: No

EX TEMPORE Judgment 1. This is an application brought by the plaintiff, Mr Rossi, for the extension of a caveat (the "Caveat") which Mr Rossi lodged over a property of which the registered proprietor is his former partner, Ms Si (the "property"). According to Mr Rossi, Ms Si actually holds her interests in that property as trustee for her (Ms Si's) mother. But for the making of an extension order, Mr Rossi has informed the Court that the Caveat will lapse today. 2. The Caveat claims this interest: Equitable interest pursuant to renovation works undertaken on the property. 1. The Caveat goes on to specify that the alleged equitable interest is said to arise by virtue of these facts: Between 1 June 2011 and 1 November 2014, the caveator undertook major renovation works on the subject property in the sum of $25,000 and remains unpaid. 1. There are at least three reasons why the Caveat ought not to be extended. Each reason is addressed to the fundamental proposition that Mr Rossi has failed to demonstrate either by the terms of the Caveat or by admissible evidence that he has a legal or equitable interest sufficient to support a caveat in accordance with the provisions of s 74F of the Real Property Act 1900 (NSW). 2. The first reason is that, in its terms, the facts recited in the Caveat are insufficient to create any legal or equitable interest in the property. They do not record, nor do they provide a sufficient basis to infer, facts that would have the legal consequence that Mr Rossi had an interest in the property to, in effect, secure the $25,000 which he said he spent on renovation works. 3. Second, the affidavit in support of the summons (which was filed yesterday and has not been served on Ms Si), does not advance matters. It refers to the fact that Mr Rossi undertook restoration works at the property for an estimated amount of $25,000. In and of itself, that evidence does not support the conclusion that he has a legal or equitable interest in the property. 4. The affidavit also goes on to refer to an application which Mr Rossi is preparing, with the assistance of a solicitor, to be made to the Family Court of Australia for a parenting order and property settlement arising from the termination of his relationship with Ms Si. I will return to the question of the proposed Family Court proceedings later in these reasons. 5. Mr Rossi went on to explain to me, by way of supplementing his evidence, that he entered into an oral agreement with Ms Si's mother (who on his understanding is the beneficial owner of the property) that he would undertake the restoration work and that he would be paid for the expenses he incurred in doing so if and when the property was sold. He informed me that his understanding of that agreement was that he would be reimbursed from the proceeds of sale. The difficulty for Mr Rossi based on those facts is that a right to the proceeds or any part of the proceeds of sale of the property is not an interest in property. In Powell v Stone [2014] NSWSC 574; BP 223 [98674] at [3] per Brereton J: [3] A right to the proceeds of sale of property is not an interest in property: Epple v Wilson [1972] VR 440; Simons v David Benge Motors Pty ltd [1984] VR 585; Efax Proprietary Limited v Charrer (unreported, NSWSC, Young J, 30 October 1987). 1. Quite apart from the terms of the Caveat itself, and the position on the facts as explained to me by Mr Rossi, the third difficulty in Mr Rossi's way arises from the law relating to caveats and potential or actual rights under the Family Law Act. In this case no proceedings have yet been commenced. 2. I considered this question, in relation to a situation where property settlement proceedings had in fact been commenced in Ho v Ebert [2015] NSWSC 1468: [9] The evidence demonstrates that the only basis for the interest in the Property which is claimed by Ms Ho is her alleged entitlement under the FLA to a property settlement. This is not a new problem for this Court. On several earlier occasions judges of this Division have come to the view that a claim grounded only in an alleged entitlement to a property settlement under the FLA does not create a caveatable interest in the land which may be part of the assets available for such a settlement: Ryan v Kalocsay [2009] NSWSC 1009; Choi v Kim [ 2013] NSWSC 1774; Reddacliffe v Strickland [2010] NSWSC 1028; Vo v Nguyen [2014] NSWSC 1622; Wu v Dardaneliotou [2008] 1319. [1] As White J concluded in the second-named of these cases: [3] A claim for such orders pursuant to s 79 of the Family Law Act 1975 (Cth) is not itself a basis for the existence of an estate or interest in land that would be the subject of the orders. See, for example, Wu v Dardaneliotou [2008] NSWSC 1319 at [7], where Brereton J said that: Such a beneficial interest on the part of the husband would fall into the pool of the property divisible under Family Law Act, s 79, but it does not give the plaintiff any caveatable interest in the property. If she wanted to protect any claim that she might have against the property on that basis, then it would have to be by obtaining an injunction, rather than claiming any caveatable interest. (See also Song v Shi [2011] NSWSC 1207 at [8] and [9].) 1. That position applies with even greater force in circumstances such as the present, where no proceedings have yet been commenced in either the Federal Circuit Court or the Family Court of Australia. 2. The proper place for any dispute in relation to the proceeds of sale from the property, and the entitlement which Mr Rossi alleges he has in relation to at least $25,000 of those proceeds, is either the Federal Circuit Court or the Family Court of Australia. Either of those courts could, if satisfied that the facts are sufficient to justify such an order, lay an injunction preventing Ms Si from disposing of $25,000 of the proceeds of sale of the property in aid of preserving such rights as Mr Rossi may have in relation to the property settlement which he proposes to seek from Ms Si. 3. The Court's orders therefore are: 1. Summons dismissed.