Feldman v Blake Napier Ltd

HIS HONOUR: The application before the Court is a notice of motion filed by the plaintiff in Court this afternoon, 9 September 2022.

The application came before the Court today in a context in which the plaintiff had earlier approached myself as Equity Duty Judge ex parte on 7 September 2022.

On that occasion the plaintiff sought leave to file in Court a summons and an affidavit that was said to have been affirmed by her but was not affirmed before any Justice of the Peace or other person authorised to take an affidavit.

I permitted the plaintiff to file the summons upon the plaintiff providing to the Court an undertaking to pay the applicable filing fee.

Because the affidavit had not been properly attested, I had my Tipstaff administer to the plaintiff an affirmation, which affirmation the plaintiff gave affirming the details in the affidavit.

The affidavit did not contain a copy of any caveat or other document apart from the contents in the body of the affidavit.

I asked the plaintiff whether there was a copy of the caveat. She produced a copy of the caveat and that was marked exhibit P1 on that application.

The plaintiff on that occasion and today appeared before me by audio visual means from the ground floor of the Hospital Road Courts in a context in which she was not completely vaccinated and for that reason under Court policy was not permitted to attend in the courtroom.

On 7 September 2022 I made the following orders:

It is approximately 4.07pm and the plaintiff has (for religious observance reasons noted below) terminated her connection to the Court.

The type of claim was described as caveat extension. On the second page of the summons under the heading Relief Claimed there was no detail.

The affidavit in support of the application which was affirmed by the plaintiff by means of audio visual link in Court on 7 September 2022 contains the following paragraphs:

The summons under the orders made on 7 September 2022 was returnable before myself as Equity Duty Judge at 10am this morning, 9 September 2022.

Today the plaintiff appeared and Mr Lloyd, solicitor for the defendant, appeared.

The case was amongst a number of other cases in the list and initially this morning I addressed the parties briefly to establish the nature of the application to be sought.

At least at that point of time, there was some dispute as to whether the caveat had been properly extended or not.

Mr Lloyd asserted that the caveat had lapsed.

The plaintiff asserted that the caveat had been effectively extended.

I indicated to the parties that if an order was sought to extend the operation of the caveat I would need some clarity as to whether the caveat had in fact lapsed or been extended effectively.

At that stage the plaintiff indicated to me that there was potentially another application which she might wish to make pursuant to the provisions of s 74O of the Real Property Act 1900 (NSW). Mr Lloyd indicated to me that there was another application that he may wish to make.

I stood the matter down to until 2pm enable the parties to formulate whatever applications they wished to make and to prepare whatever evidence or to provide whatever evidence they wished to adduce on any such application.

Because of the exigencies of the Court List I sat through the luncheon period until approximately 1.55pm to deliver judgment in another matter.

As my staff and the Court Reporter had not had any break, I adjourned the Court indicating that I would resume at approximately 2.20pm.

On resumption of the matter the plaintiff and Mr Lloyd indicated that they were ready to proceed with the application.

The plaintiff indicated to me that she wished to proceed on a form of notice of motion.

She provided to the Court the form of notice of motion. It sought the following orders:

On the basis of the plaintiff giving an undertaking to pay the applicable filing fee in relation to that, I permitted the notice of motion to be filed in Court.

Mr Lloyd informed me that he did not wish to proceed with the applications that he had foreshadowed earlier.

Having received the notice of motion, Mr Lloyd, who had not prior to then had an opportunity to see it, was given an opportunity to review its contents.

Mr Lloyd indicated to me that he opposed the relief sought in the notice of motion but was content for me to proceed to hear the notice of motion.

On the notice of hearing of the notice of motion the plaintiff relied upon the affidavit that she had affirmed on 7 September 2022.

Mr Lloyd for his part relied upon an affidavit of himself affirmed on 9 September 2022.

Both parties had some objections to parts of the respective affidavits.

I made rulings in respect of those objections, including rulings in respect of relevantly the part of paragraph 4 of the plaintiff's affidavit under the heading "Summary of Claim", which was admitted on a basis pursuant to s 136 of the Evidence Act 1995 (NSW) that it was limited to her beliefs.

Each party sought to rely upon some additional evidence in the form of documents to be tendered.

For the plaintiff's part, the process of identifying the documents she sought to rely upon was somewhat disjointed and the documents she sought to rely upon were during the course of the hearing presented in a somewhat piecemeal way.

Nonetheless the documents which were eventually tendered by the plaintiff were the following documents:

Mr Lloyd for his part tendered a number of documents. These were:

The plaintiff objected to certain of the material in the documents. I permitted the documents to be admitted.

Although there was no clear evidence as to when the defendant became the registered proprietor of the property, I asked the parties when that occurred.

I was informed by Mr Lloyd that it occurred approximately in 2003.

The plaintiff did not appear to demur from that indication.

The caveat is dated 12 July 2022. The caveators being the plaintiff and Pinchus Feldman, who I understand is the plaintiff's husband.

The caveat is said to be based on a claim to an estate or interest in the land specified.

The action prohibited by the caveat contains four sentences numbered 1, 2, 4 and 7:

The estate or interest claimed is an estate said to be by virtue of an agreement between Pinchus Feldman and Pnina Feldman and Blake Napier Limited pursuant to a Deed dated 12 August 2007, a Deed of Settlement dated 14 December 2003.

Beneath that reference is a part of the caveat which is on the first page, the second, the penultimate box:

The plaintiff informed me both on the occasion of her first appearance before me on 7 September 2022 that she and her husband were the former registered proprietors of the property.

In dealing with the matter today, that still appeared to be the plaintiff's assertion and I have proceeded on that basis.

On 14 July 2022 the New South Wales Land Registry Services (Land Registry) sent the defendant a notice that the plaintiff and Pinchus Feldman had lodged a caveat over the property.

A title searched obtained on 26 July 2022 reveals that the caveat was then recorded on the title, being the last of 24 notifications in the second schedule of the computer folio certificate.

In the period from 3 August 2022 to 12 August 2022 the defendant's solicitors (ABL) and Eddy Neumann Lawyers exchanged correspondence in relation to the caveat in which essentially the defendant denied that the plaintiffs had any caveatable interest in the property and demanded that the caveat be removed.

However, that correspondence is not before the Court other than in the form of the letter which is exhibit D1.

On 3 August 2022 the defendant lodged an application for the preparation of a Lapsing Notice with the Land Registry.

On 10 August 2022 the Land Registry issued to the defendant a notice pursuant to s 74J of the Real Property Act.

On 16 August 2022 the defendant’s solicitors caused the lapsing notice to be served on the address specified in the caveat being the offices of Eddy Neumann Lawyers.

There was an issue in relation to the Land Registry not accepting the statutory declaration of the employee of ABL Ms McCunn.

However, that issue was eventually rectified.

On the basis that the lapsing notice was served on 16 August 2022, the caveat would have lapsed on 6 September 2022 in accordance with the 21 day period specified in the lapsing notice.

There was some vacillation in the position of the plaintiff during the course of the hearing as to whether or not the caveat had in fact lapsed prior to the making of the orders that I had made on 7 September 2022.

Eventually the plaintiff's position, as will be recorded in the transcript, was that the caveat had in fact lapsed at 2.30pm on 7 September 2022.

The evidence discloses before me that there was a title search of the land conducted at 6.21pm on 7 September 2022.

The caveat is not included amongst the notifications on that search.

A further search was conducted at 5.33pm on 8 September 2022. The caveat is not recorded amongst the notifications on that title search.

In those circumstances it is certain that in fact the caveat did lapse.

I am dealing with the matter in circumstances where: (a) the caveat is not recorded on the title search to the property; (b) the lapsing notice was served on 16 August 2022; (c) the plaintiff asserts that the caveat had lapsed at 2.30pm on 7 September 2022; (d) the plaintiff proceeded on the basis that the caveat has lapsed and there is no application or basis for me to further extend the operation of the caveat.

Indeed if it is true that the caveat had lapsed at 2.30pm, with the benefit of hindsight, though not known to me at the moment, the caveat had in all likelihood lapsed by the time that the plaintiff had first approached the Court on 7 September 2022, which the record of proceedings shows were heard by me commencing at 3.34pm.

I was informed by the plaintiff on that occasion, when I asked her, that to the best of her knowledge and belief the lapsing notice had been received on 17 August 2022. It was on the basis of that assertion that I extended the operation of the caveat.

Section 74O of the Real Property Act is in the following terms:

On hearing of the application for the relief sought in paragraph 1 of the notice of motion, the plaintiff did not refer me to any specific principles in relation to the application of s 74O.

Mr Lloyd for his part submitted that the relevant principles were those akin to an interlocutory injunction and submitted that for an order to be made there must be a serious question to be tried and there must be shown to be a present entitlement to an interest in the land.

Further, although not referred to in the submissions, on the basis that the interlocutory injunction principles apply, there would also ordinarily be consideration of the balance of convenience.

The plaintiff, in seeking an order to lodge a further caveat in respect of the same estate, interest or right and purporting to be based on the same facts as the first caveat, did not provide me with any form of caveat to be approved.

In those circumstances I can only proceed on the basis that the application in substance was an application to lodge a further caveat in the terms of the caveat lodged dated 12 July 2022 as referred to above.

When one considers the terms of that caveat, the details supporting the claim are said to be a Deed dated 12 August 2007 and the Deed of Settlement dated 14 December 2003.

The plaintiff on the hearing of the application made a number of assertions regarding the documents. In particular she said that the Deed of Settlement was signed in a context of there being fraudulent representations, duress and blackmail.

The plaintiff vacillated between positions during the hearing as to whether the documents were valid or not.

As I understood her ultimate position she asserted that the Deed of Settlement dated 14 December 2003 and the Blake Napier Property Trust were invalid documents.

In relation to the Deed dated 12 August 2007, the plaintiff asserted that there were issues in relation to that Deed as well and that her brother Joseph Gutnick did not have the rights asserted to in that Deed.

The plaintiff (in submissions) did not specifically take me to the parts of the various documents which she tendered and became exhibits although did at an earlier point indicate that there were some highlighted bits of the documents to which I ought to have regard.

In the Deed of Settlement in the Table of Contents, clauses 3 and 6A being respectively Dover Heights Contract and Sale of Dover Heights have been highlighted. Clause 3 of the Deed is also highlighted and the heading in clause 3 of the Deed is highlighted and subclause 5 of clause 3 is highlighted. The clause is relevantly in the following terms:

Clause 6A is highlighted:

No other part of that Deed of Settlement is highlighted.

The document which is described as the Blake Napier Property Trust contains some highlighting.

In the Table of Contents clause 3.8 “Termination” is highlighted. In the body of the Trust Deed clause 3.9 “Termination” is highlighted:

I pause to note that there seems to be some misnumbering in the contents which describes clause 3.8 as "Termination" whereas in the actual body of the document the clause headed "Termination" is in fact clause 3.9. No other part of the property trust document is highlighted.

The Deed dated 12 August 2007 is not highlighted. However, because it was referred to by the plaintiff, I set out the terms of the Deed as follows:

No submission was made to me by the plaintiff regarding the terms of the Articles of Association and I was not taken to any provision of the Articles of Association.

The plaintiff made some reference to the bundle of correspondence from DSM Austin, which is in exhibit P5 and also within exhibit P5 the letter from Schetzer Brott & Appel.

The assertion of the plaintiff was that it was obvious from some of that correspondence that Joseph Gutnick had certain rights.

Conceptually a former registered proprietor of property may have a caveatable interest on the basis that registration of the transfer to the current registered proprietor was procured by fraud: see, for example, Shannon Lindsay, Caveats Against Dealings in Australia and New Zealand (1995, Federation Press) at page 141 citing inter alia Breskvar v Wall (1971) 126 CLR 376 and other cases.

Having regard to the terms of the caveat, the claimed interest is of an estate in fee simple by virtue of the agreement between the plaintiff and Pinchus Feldman on the one hand and Blake Napier, the defendant on the other, and said to be supported by the Deed dated 12 August 2007 and the Deed of Settlement dated 14 December 2003.

I am entirely unpersuaded on the evidence before me, which includes the very serious allegation that the Deed was procured by fraudulent representations, duress and blackmail, that there is a proper basis for the order sought pursuant to s 74O of the Real Property Act.

In any event the evidence leaves entirely unexplained why seemingly there has been no action taken to set aside the Deed, or if there has been any such action taken, there are no details regarding that.

On 7 September 2022, the plaintiff informed the Court that there had been some proceedings taken in 2007 or at some time in respect of the matter by her, which proceedings were not persisted in.

I do not know and the plaintiff did not inform me today whether that is something that has any further relevance bearing upon the matter.

Nonetheless, the position is that the defendant has been registered proprietor of the property since approximately 2003, which is a period of 19 years.

It is in the above context that I decline to make order 1 on the notice of motion.

In relation to order 2 of the notice of motion the order sought is misconceived.

The defendant in the proceedings is the company Blake Napier Ltd.

Order 2 seeks an order that I order “defendants” who are not identified in the notice of motion but are described in the terms, "four of whom are Orthodox Jews", to attend a Jewish Court of Law Arbitration (beis din).

The simple fact of the matter is that there are no natural persons who are defendants to the proceedings. Only a company is the defendant to the proceedings.

There is no basis for me to make such an order.

In those circumstances, I decline to make that order.

Order 3 sought in the notice of motion is an order that I set another date for the hearing of this matter to allow time for the plaintiff to adequately state her case.

In the context of the approach before me on 7 September 2022 and in the hearing which proceeded today, that was the opportunity for the plaintiff to state her case.

The plaintiff earlier in the day informed me that for reasons of religious observance she had limited time to attend today and would need to leave the court by 4pm to go home for the purpose of the Sabbath.

As the matter was being heard I attempted on a number of occasions to remind the plaintiff of the limited time that she had and to attempt to assist her to focus on presenting her case efficiently within the time available so as to permit a proper presentation of her application.

In doing that the plaintiff made a number of choices regarding what she would do.

During the course of the hearing, in particular after 3pm, I asked the plaintiff whether she wished to persist with the application this afternoon or whether she wished to seek to adjourn the application and proceed at another time.

The plaintiff made an informed choice to proceed with the application.

In the above circumstances Mr Lloyd made the submission that there was no proposal put forward by the plaintiff other than dealing with the application which the plaintiff made this afternoon.

As a consequence of the plaintiff proceeding on the application there is no occasion for me to make the relief sought in order 3 of the notice of motion.

It is for the above reasons that I dismissed the relief sought in the notice of motion.

The summons in its terms sought the relief that I have outlined above.

Whilst the summons did not in the part of the (prescribed) form contain any details of relief claimed, I proceeded on the basis that the words, "Caveat Extension", under the heading "Type of Claim" on the first page of the summons was essentially the relief sought.

As the caveat has lapsed (a fact eventually accepted by the plaintiff) and as no further relief was sought in the summons and no application was made before me to further amend the summons, I determine to dismiss the summons.

On the question of costs Mr Lloyd submitted that the plaintiff should pay the costs of the defendant on the indemnity basis.

Ordinarily there must be some specific reason to do so.

The Court has power to order costs be paid on an indemnity basis under s 98 Civil Procedure Act 2005 (NSW).

This is not the occasion to recite all the circumstances in which indemnity costs might be awarded.

In some circumstances indemnity costs may be awarded where a party has misled the Court or maintained proceedings in circumstances where they should have known that there was no real prospect of success or abandoned claims or maintained the proceedings for an ulterior purpose or by their conduct inappropriately extended the proceedings: see, for example, the commentary in Ritchie's Uniform Civil Procedure NSW at [r 42.5].

Mr Lloyd referred to the prior correspondence that had happened that had been exchanged between his firm and Eddy Neumann Lawyers. Whilst his affidavit refers to correspondence in the period from 3 August 2022 to 12 August 2022 the only actual letters before the Court between the firms is that dated 4 August 2022 and the letter dated 10 August 2022 from ABL to Mr Neumann.

Mr Lloyd also referred to the general conduct of the case by the plaintiff.

The correspondence from ABL to Eddy Neumann Lawyers dated 10 August 2022, which is part of exhibit D2, addresses the contention in the letter from Eddy Neumann Lawyers to ABL dated 4 August 2022.

Whilst I am mindful of the fact that I have determined that there is no sufficient basis for me to make the order sought in paragraph 1 of the notice of motion, on balance I am not positively persuaded that an order for indemnity costs is appropriate in the circumstances of this case. For that reason I order that the plaintiff pay the defendant's costs on the usual ordinary basis.

At or very close to 4pm after the hearing of the application had concluded I informed the parties of my decision to dismiss the relief in the notice of motion and gave them a brief opportunity to address on the question of costs which occurred.

I made that determination mindful of the fact that the plaintiff informed me that she needed to leave the court at approximately 4pm of shortly thereafter to attend to her religious observance.

I considered it appropriate in those circumstances to make the decision promptly and to inform the parties, including the plaintiff, of the decision made so that in the event that she left the court she did so in a context in which she understood the orders that I had made.

The plaintiff asked if a copy of the orders could be provided to her. I indicated that my Associate would prepare a formal record of proceedings and that each of the parties would be provided with a copy of the orders made.

I then proceeded to deliver these reasons for judgment ex tempore. I did that for at least some period of time before the plaintiff disconnected the connection, which occurred approximately 4.07pm this afternoon.

The plaintiff asked me if a copy of the reasons could be provided to her.

I informed her of the usual procedure regarding the preparation of transcripts of judgments delivered ex tempore and indicated that once the transcript had been prepared and approved the transcript of the reasons for judgment would be provided to her.

Finally, the plaintiff also asked me for return of the documents that she had tendered.

I indicated that I would make an order returning the exhibits after the reasons for judgment had been transcribed and approved and provided to the parties.

I will do that as I have indicated.

The orders of the Court are as follows: