Parker v Glenninda Pty Ltd[1997] QCA 412

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 9462 of 1997

Brisbane

Before Davies J.A.

McPherson J.A.

Muir J.

[Parker & Anor. v. Glenninda P/L]

BETWEEN:

GEORGE JOHN PARKER and

FAYE YVONNE PARKER

Appellants

AND:

GLENNINDA PTY LTD (ACN 009 804 095)

Respondent

McPherson JA

Davies J.A.

Muir J.

Judgment delivered 31 October 1997

Separate reasons for judgment of each member of the Court; McPherson & Davies JJ.A. delivering extempore their concurrence with the order proposed by Muir J.

APPEAL ALLOWED

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 9462 of 1997

Brisbane

Before Davies J.A.

McPherson J.A.

Muir J.

[Parker & Anor. v. Glenninda P/L]

BETWEEN:

GEORGE JOHN PARKER and

FAYE YVONNE PARKER

Appellants

AND:

GLENNINDA PTY LTD (ACN 009 804 095)

Respondent

REASONS FOR JUDGMENT - MUIR J.

Judgment delivered 31 October 1997

The appellants appeal against the dismissal of their application to remove a caveat over a parcel of land (“the land”) registered in the name of the appellants as joint tenants.  The caveat states as its “grounds of claim”–

“Offer in writing by caveator to George John Parker dated 20th February, 1997 of time to pay to caveator $32,180.84 plus interest, upon security of the above described lot 200 accepted by offeree in writing dated 4th March 1997.”

The respondent’s case is as follows.  The appellant, George Parker, had misappropriated a total of approximately $32,000 of the respondent’s money over a considerable period.  Mr Gainford, a director of the respondent, confronted Parker with an allegation of misappropriation and Parker accepted that he owed moneys to the respondent.  On 20 February 1997 Gainford wrote a memorandum addressed to Parker which stated, inter alia–

“I have been advised to offer you seven days to repay the moneys owing to me.

The amounts are made up as follows (a list of moneys allegedly owing and totalling $32,180.40 was then set out).

This offer expires on 12 noon on Thursday 27 February 1997.”

Messrs Gainford and Parker had a conversation, probably on 4 March 1997 in which

“. . Gainford said, `Well write me out a promissory note George, and I want security over your Peregian house’.  Parker said `OK’.”  At the time of the conversation Mr Gainford had with him  the memorandum dated 20 February 1997.  A copy of it had previously been given to Parker by Gainford.  Parker then wrote out the following note and handed it to Gainford–

“I George Parker

Propose to pay Barrie Gainford on the 2nd of April $5,000.

On the 30th of April the balance of moneys owing.”

The document was signed by Mr Parker and dated “4/3/97".  It will be noticed that the note did not make reference to the giving of security.

It is further sworn by Mr Badgery, the respondent’s solicitor, on behalf of the respondent–

“That Gainford made a note on the paper writing of 20/2/97 of the fact the Peregian house was security.”

Mr Badgery’s affidavit does not expressly state when such note was made but I will assume, in favour of the respondent, that it was made on 4 March after Parker made his handwritten note and that the words added to the memorandum of 20 February 1997 were–

“Security:  a lien on your Peregian house.” 

Mr Badgery further swears that on 8 May 1997 he telephoned Mr Parker and had the following conversation–

(Badgery)“I understand you have agreed to give Barrie Gainford’s company a second mortgage over the property at Peregian beach.”

(Parker)“Yes, that is so but I would like you instead to consider taking a mortgage over a property left by my late father at Ashmore on the Gold Coast . .”

Parker swore–

“I have never given the company, whether by writing or otherwise, any security or created any interest in the property at 17 Gouldian Court, Peregian Beach in the State of Queensland, to secure the loan of $12,000 or any other moneys whatsoever; and the company has no interest or entitlement to any interest in the said property, whether legal or equitable.”

He claims never to have seen the 20 February 1997 memorandum prior to its having been faxed to him on 16 October 1997.  Parker’s affidavit does not specifically address the allegations made in Mr Badgery’s affidavit.  Perhaps the explanation for this is that the former may have been sworn before the latter was received by the solicitors for the appellants.  Whatever the reason, the appellants dispute the facts sworn to in Mr Badgery’s affidavit only to the extent described above.

The appellants contend that if there was an agreement for a charge on the land or to create a charge and/or an agreement to create a mortgage over it, as the respondent alleges, there is no memorandum in writing signed by the party to be charged as required by s. 11 of the Property Law Act 1974.

It is plain that the memoranda of 20 February 1997 and 4 March 1997 either alone or together do not constitute “writing signed by the person” disposing of an interest in the land for the purposes of s. 11 of the Property Law Act. 

The note of 4 March, by itself, is insufficient for the respondent’s purposes.  It makes no reference to a lien or charge. 

The respondent seeks to meet this difficulty by submitting that the two memoranda may be read together.  The note of 4 March does not refer to the earlier memorandum, either expressly or impliedly.  It is possible though, for a document signed by the party to be charged, to be linked with another document (unsigned by the party to be charged) to comprise a sufficient memorandum where the former document contains an express or implied reference to a transaction and parole evidence is led to explain the transaction and identify the documents as ones relating to it;  Elias v. George Sahely & Co (Barbados) Ltd (1983) AC 646 at 655 (PC) and Harvey v. Edwards, Dunlop & Co Ltd (1927) 39 CLR 302 at 307.  But even if the respondent succeeded in establishing that the 4 March memorandum referred to a transaction, the terms of that transaction could hardly be those contained in the memorandum of 20 February or in the two memoranda read together.

The offer contained in the memorandum of 20 February 1997 was open for acceptance for seven days.  It was not accepted within that time.  Mr Parker’s memorandum of 4 March 1997, which as I have already pointed out did not refer to the earlier memorandum either expressly or by necessary implication, came into existence some days after the expiration of the appellants’ offer.  Furthermore, on the respondent’s case, Parker assented to the proposition that security be given over the land, but he did not assent, at least at this time, to any particular type of security.  Gainford, however, wrote the words “Security: a lien in your Peregian house on the 20 February memorandum.” 

The foregoing conclusions, subject to the further arguments of the respondent in relation to the possibility of equitable relief, are sufficient to show that the respondent is prevented, by s. 11 of the Property Law Act from relying on any equitable charge.

An equitable charge, if created, creates an interest in land sufficient to support a caveat.  See Avco Financial Services Ltd v White (1977) VR. 561.  In any event, if it did not, there would be no caveatable interest.  It may be doubted though, that the agreement for which the respondent contends does more than constitute an agreement to create a charge in the future.  In that event the respondent is faced with the added difficulty that equity will not assist a volunteer. The agreement for which the respondent contends is not expressed to be in consideration of any forbearance to sue or anything else for that matter.  On the respondent’s version of the events, Parker acknowledged, by implication, a sum of $32,180 to be due and owing and agreed to give a security over the land to secure its payment.  The security was described as a lien. Later, it seems to have been referred to as a second mortgage. (I later discuss in some detail the circumstances  which the respondent submits give rise to an agreement to give a second mortgage.)  It is possible that if this matter were to go to trial the evidence might disclose the existence of a forbearance to sue but the evidence before the Court at first instance and on the hearing of this appeal does not.  The respondent would thus appear to be the position of a volunteer and  not entitled to equitable relief.

The respondent sought to avoid the consequences of the application of s. 11 of the Property Law Act (or of section 59 in the event that there was an agreement to charge rather than a charge) by arguing that–

1. resort may be had to the doctrine that equity will not allow provisions such as s. 11 to be used as an instrument of fraud;
2. the appellants, or at least Parker, are estopped from denying the existence the agreement to give a lien.

Both points lack substance.

The principle relied on for the first point, in my view, does not extend to a situation in which a person has done no more than decline to perfect or acknowledge an assignment the person has agreed to make.  This is not a case in which a person who, by his fraud, has prevented  a transaction from being reduced to writing, cf. Tharp v. Tharp (1916) 1 Ch. 142.  Nor does it fall within the other classes of cases held to have been within the principle on which the respondent relies, such as where a person has become possessed of the property of another under an agreement to hold that property on certain trusts and asserts a right to the property free of the trusts, cf. Organ v. Sandwell (1921) VLR 622.  In short, any alleged fraud has not occurred in respect of the alleged agreement to give the charge.

In my view the evidence does not establish the existence of the estoppel for which the respondent contends. Mr Badgery’s affidavit does not suggest that any forbearance to sue was the subject of conversation between Parker and Gainford in February or March 1993. 

On 28 April 1997 Gainford instructed Badgery to commence proceedings against Parker.  Clearly, at that stage, the respondent was not relying on any representation by Parker.

It seems that another conversation between Parker and Gainford occurred on 8 May 1997.  As a consequence of that conversation Gainford instructed Badgery to suspend action against Parker and to prepare a mortgage over the land.  Also on 8 May, Parker told Badgery, in effect, that he did not have authority to grant a mortgage over his wife’s interest in the land.  He requested that consideration be given to taking security over another property.

On a date which was unstated, but which appears to have been very shortly after 8 May 1997, Gainford instructed Badgery to “have a summons issued for him to serve on Parker in the event of his failing to sign the mortgage documents.”  The summons was issued on 21 May 1997.  The respondent sought to argue that there was a delay in serving the summons as a result of the agreement to give the second mortgage but the evidence does not support that contention.

In those circumstances, it seems to me to be very difficult for the respondent to sustain  its submission that it acted to its detriment in forbearing to sue in reliance on anything Parker said or did.  Nor does it appear that Parker realised or ought reasonably to have realised that the respondent was acting to its detriment as it alleges.  The respondent was aware on 8 May 1997 that, although Parker was acknowledging an agreement to give a second mortgage, he was disclaiming any ability to persuade his wife to join in giving it.

I should mention that the caveat is over the interests of both joint tenants.  There is no evidence that Mrs Parker agreed to charge her interest in the land or that she gave her husband any authority to bind her.  One joint tenant has no authority, by virtue of the relationship of joint tenancy, to bind the other.  Farrelly v. Hircock (No.1) (1971) Qd.R. 341.  In view of the state of the evidence it is unnecessary to consider whether leave should be given to amend the caveat.

I would allow the appeal.