FEDERAL COURT OF AUSTRALIA

PRACTICE AND PROCEDURE ‑ Dismissal of claim to proprietary interest in land ‑ Appeal to Full Court ‑ Injunction pending appeal ‑ Principles for grant of injunction.

Land Titles Act 1980 (Tas), ss 40, 41.

Alexander v Cambridge Credit Corp Ltd (1985) 2 NSWLR 685

Griffiths v Australian Postal Commission (1987) 87 FLR 139

Enterprise Gold Mines NL v Mineral Horizons NL [No 1] (1988) 91 FLR 403

Orion Property Trust Ltd v Du Care Court Ltd [1962] All ER 466

Wilson v Church [No 2] (1879) 12 Ch D 454

Erinford Properties Ltd v Cheshire County Council [1974] Ch 261

Bercove v Hermes [No 2] (1983) 51 ALR 105

North Flinders Mines Ltd v Hartogen Energy Ltd (1988) 52 SASR 14

Felkro Nominees Pty Ltd v Deputy Commissioner of Taxation (unreported, Sundberg J, 4 September 1996)

Paringa Mining & Exploration Co Plc v North Flinders Mines Ltd (1988) 165 CLR 452

WILLIAM HOLLIER and THE ENGEN INSTITUTE (ARBN: A25398A) v AUSTRALIAN MARITIME SAFETY AUTHORITY, STATE OF TASMANIA and MINISTER FOR WORKPLACE RELATIONS

VG 667 OF 1997

SUNDBERG J

27 APRIL 1998

MELBOURNE

Upon the applicants undertaking:

(a)           to abide by any order the Court may make as to damages in case the Court shall hereafter be of the opinion that the respondents shall have suffered any by reason of this order which the applicants ought to pay, and

(b)          to prosecute the appeal and application for leave to appeal herein with due expedition,

the first respondent undertakes that until the hearing and determination of the appeal or further order it will not transfer the land to the State of Tasmania.

THE COURT ORDERS THAT

1.             The costs of the motion notice of which was filed on 27 March 1997 be reserved for determination on the appeal.

2.             There be liberty to apply.

Note:                Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

BACKGROUND

On 6 March 1998 I dismissed the applicants’ claim to a proprietary interest in Deal Island.  They have sought leave to appeal from rulings I made in the course of the trial and have appealed against the final decision.  The facts are set out in my reasons for judgment.  The effect of my judgment is that the first respondent (“AMSA”) is at liberty to act upon a notice it served on the applicants requiring them to vacate the Island within 90 days.

INJUNCTION PENDING APPEAL

The applicants have applied by motion for orders that pending the outcome of their appeal the respondents be restrained from giving effect to the notice to vacate, from evicting them, and from transferring or dealing with the title to the Island.  Although the motion has been filed in the original proceeding and not in the appeal, I will call the applicants “the appellants”.  The Rules of Court deal with applications for orders staying execution of a judgment pending the outcome of an appeal.  On such an application the Court must be satisfied that the appellant has an arguable ground of appeal, and the appellant cannot expect a stay without showing that there is one: Alexander v Cambridge Credit Corp Ltd (1985) 2 NSWLR 685 at 695; Griffiths v Australian Postal Commission (1987) 87 FLR 139 at 141; Enterprise Gold Mines NL v Mineral Horizons NL (1988) 91 FLR 403 at 410.  This requirement protects the position of a successful litigant where it may be plain that the appeal has been commenced without any real prospect of success and simply in the hope of avoiding an immediate execution upon the judgment: Alexander at 695.  A comparable jurisdiction exists where a stay would achieve no purpose, as where there is an appeal from an application that has been dismissed.  The Court can grant an injunction against the successful respondent for the purpose of preserving the status quo until the appeal is determined, for instance by restraining the respondent from parting with the subject matter of the claim, as in Orion Property Trust Ltd v Du Cane Court Ltd [1962] 1 WLR 1085; [1962] 3 All ER 466.  The principle on which the Court acts in applications for injunctions pending appeal is the same as that applicable where a stay pending appeal is sought.  It is to ensure that the appeal, if successful, is not nugatory: Wilson v Church [No 2] (1879) 12 Ch D 454 at 458; Erinford Properties Ltd v Cheshire County Council [1974] Ch 261 at 268; Bercove v Hermes [No 2] (1983) 51 ALR 105; North Flinders Mines Ltd v Hartogen Energy Ltd (1988) 52 SASR 14.  As on an application for a stay, an appellant who seeks an interlocutory injunction pending appeal must show some prospect of success on the appeal.  That is involved in establishing the existence of a serious question to be tried: Felkro Nominees Pty Ltd v Deputy Commissioner of Taxation (unreported, Sundberg J, 4 September 1996).

EVIDENCE IN SUPPORT

Mr Hollier swore an affidavit in support of the motion.  As corrected by his oral evidence, the affidavit discloses that

·               AMSA has issued proceedings in the Supreme Court of Tasmania for possession of the Island

·               On 23 March 1998 the appellants entered into an agreement with Mr Darren Carmen to maintain a presence on the Island until 3 April 1998 while Mr Hollier and his family came to Melbourne

·               During the trial counsel for AMSA undertook that the appellants  could retain an agent to maintain a presence on the Island

·               Under the agreement Mr Carmen was entitled to bring his uncle, Mr Demado, onto the Island

·               On 31 March Mr Northmore of AMSA informed Mr Carmen (who informed Mr Hollier) that Mr Demado had asked to be taken off the Island, and that Mr Northmore had agreed to provide a helicopter to remove Mr Demado “as well as take possession of Deal Island” pursuant to the notice to quit

·               Mr Hollier contacted AMSA’s solicitors and requested confirmation that AMSA intended to take possession, but obtained no such confirmation

·               The appellants will suffer loss if required to vacate contrary to the expectation induced by AMSA.

THE PARINGA ISSUE

After I had reserved my decision, in the course of exploring the principles governing the grant of an interlocutory injunction pending an unsuccessful applicant’s appeal to the Full Court, I came upon the High Court’s decision in Paringa Mining & Exploration Co Plc v North Flinders Mines Ltd (1988) 165 CLR 452.  The facts were complicated.  Somewhat simplified, but not so as to affect the point of the case, they were that Paringa applied to the Supreme Court of South Australia for an injunction restraining the implementation of a take‑over offer.  A judge refused to grant an interlocutory injunction pending trial.  The same judge subsequently refused to grant an interim injunction pending an appeal to the Full Court against his refusal to grant interlocutory relief, stating that the issues raised on the later application were the same as those raised on the earlier one.  The Full Court was unable to hear Paringa’s application for interim relief pending appeal due to pressure of business, and Paringa applied for special leave to appeal to the High Court from the order refusing interim relief.  Special leave was obtained, and an injunction was granted until Paringa’s appeal from the judge’s first order was heard and determined.  The High Court said (at 459):

Although the judge appealed from has jurisdiction to maintain the status quo pending an appeal, that jurisdiction is concurrent with the jurisdiction of the appellate court to grant similar relief as an incident of its substantive jurisdiction ....  We shall assume without deciding, because we have not heard argument on the point, that the appellate court’s jurisdiction may be exercised ... by a single judge of that court ... but it is not satisfactory to leave to the judge whose order is under review the exercise of the appellate discretion to grant or refuse the injunction pending the appeal, especially when a refusal is said practically to preclude the granting of the substantive relief claimed in the action.  The judge appealed from is necessarily disadvantaged when it comes to an evaluation of the strength of the appellant’s attack on the judge’s original exercise of discretion.

The Court went on to say that the appellant to the Full Court had been denied the “independent consideration of its application for an injunction pending the appeal to which it was entitled”: at 460.

My decision on the present application does not involve any assessment of the appellants’ chances of success on the appeal, on the application for leave to appeal, or on an appeal pursuant to any grant of leave to appeal.  For ease of exposition I will refer to these three steps as “the appeal”.  To the extent to which I refuse the relief sought, the appeal will not be rendered nugatory should the appellants succeed.  In those circumstances, I do not think Paringa requires me to put the parties to the expense of a further hearing before another judge.

NOTICE TO VACATE

I do not propose to enjoin AMSA from acting upon the notice to vacate because I am not satisfied that there is any real risk that AMSA will resort to self‑help, and the denial of that relief will not render nugatory the appellants’ success on the appeal.  As to the first matter, it is true that there is hearsay evidence that Mr Northmore told Mr Carmen that AMSA was intending to take possession of the Island pursuant to the notice to vacate.  But that has to be balanced against two related considerations.  The first is that AMSA has recently commenced proceedings for possession of the Island, suggesting that it intends to recover possession by conventional means.  The second is that in the course of argument before me AMSA’s counsel said that so long as Mr Hollier and his family are permanently residing upon the Island, AMSA did not intend to resort to self‑help and would use the Tasmanian proceedings to obtain possession.  However, if Mr Hollier were to vacate the Island, or were no longer permanently residing there, or if AMSA were to find that the Island was occupied by people who were not authorised by it to be there, it might well exercise some self‑help remedy.  In response to my enquiry whether that in effect amounted to an undertaking or commitment not to resort to self‑help so long as Mr Hollier and his family are on the Island to the exclusion of other people, counsel responded that he did not have instructions to give an undertaking, and that

at present our intention, as disclosed by the fact that we have instituted proceedings in the Supreme Court of Tasmania, is to follow through with the judicial process unless we find that the island is vacated or occupied by people that we haven’t authorised to occupy the island.

In order to understand the significance of Mr Hollier’s presence on the Island and its occupation by unauthorised persons, it is necessary to refer to some additional facts.  By the “Acknowledgment of Agreement” of 16 June 1992 Mr Hollier agreed, in consideration of the grant of occupancy of the Island for twelve months, to keep a continuing manned presence there.  The appellants’ contention, which thus far has been unsuccessful, is that their rights under the Agreement have been replaced by a right of permanent occupancy.  But it is common ground that any such occupancy is subject to the same obligation as that contained in the Agreement, namely to keep a continuing manned presence on the Island.  It is also common ground that the right to occupy the Island was granted to Mr Hollier for scientific purposes and not to strangers who might come there, and that any “permanent” occupancy is restricted to Mr Hollier, his family and Engen.  Hence, counsel’s statement of the circumstances in which AMSA might resort to self‑help merely reflect conditions of the grant asserted by the appellants.  If the appellants do vacate the Island they will be in breach of a basic condition of the very right they assert, and they will have only themselves to blame if AMSA re‑enters for that reason.  I find that there is no real prospect that AMSA will act upon the notice to vacate so long as the appellants remain on the Island as a continuous presence, and do not permit unauthorised persons to come on to the Island and remain there.

The refusal of an injunction restraining AMSA from acting upon the notice to vacate will not render a successful appeal nugatory.  If the Full Court holds that the appellants have a proprietary interest in the Island, and in the meantime the notice has been enforced and they are no longer on the Island, they can return in reliance on the Full Court’s judgment and enjoy the fruits of their success.  All they will have suffered is the inconvenience of having had to leave the Island and then return.  They will not be rendered homeless as a result of their departure from the Island.  They can live at their Black Rock residence, where they stay when they come to Melbourne.  But that inconvenience will, as I have found, not arise so long as the appellants continue to provide a manned presence on the Island to the exclusion of strangers.

TRANSFER TO TASMANIA

Different considerations apply to the injunction to restrain AMSA from transferring the Island.  If no injunction is granted and the land is transferred to Tasmania prior to the Full Court declaring that the appellants have a proprietary interest in the Island, it is at least possible that upon registration of Tasmania as proprietor it would take free from that interest, and the appeal would be rendered nugatory.  I was not taken to the Land Titles Act 1980 (Tas), but an examination of ss 40 and 41 suggests that the risk to which I have referred is real.  Upon the appellants giving the usual undertaking as to damages and undertaking to prosecute any appeal or application for leave to appeal with due expedition, I will accept an undertaking from AMSA that until the hearing and determination of the appeal herein or further order it will not transfer the land to the State of Tasmania.  I will hear the parties on the precise form of the order.  I will grant liberty to apply, because although an undertaking as to expedition was ultimately given (having initially been refused), it was given in a manner that causes me seriously to doubt whether there is any genuine intention to comply with it.

Associate:        

Dated:              27 April 1998