The earthworks, the indebtedness and the caveat

Boccamazzo v Kangaroo Corner Farm Pty Ltd [2020] WASC 234 is a recent example of how a caveat can potentially assist in protecting a party in connection with the performance of work in connection with real property.

Background

Mr Giuseppe Boccamazzo was engaged to do earthmoving works at the direction of a Claire Pragnell and Michael Jackman.¹  They were directors and shareholders of the first respondent (Kangaroo Corner Farm Pty Ltd (KCF)), and another company (OSIB Pty Ltd (OSIB)) which operated a wastewater treatment plant at a property in Forest Hill.  KCF was the registered proprietor of the property.²  

A dispute arose between the parties as to: 

• the way in which Mr Boccamazzo performed the work on the Forest Hill property (a dispute which was the subject of District Court proceedings); 
• which entity authorised and was liable to pay for Mr Boccamazzo’s work; and 
• whether Ms Pragnell and Mr Jackman authorised the work in their own right, or on behalf of KCF or on behalf of OSIB.³

Mr Boccamazzo had lodged an absolute caveat that encumbered KCF’s Forest Hill land.  At the hearing of Mr Boccamazzo’s application to extend the caveat, by consent of the parties the caveat was amended to be a subject to claim caveat. 

Mr Boccamazzo claimed to have an equitable lien over the land, or, at least that there was a serious question to be tried as to whether he had an equitable lien.  Mr Boccamazzo contended the balance of convenience favoured his caveat being extended in circumstances where KCF, as owner of the land, caused the Registrar of Titles to issue him with a 21 day notice.⁴  

KCF argued there was no arguable case any work undertaken by Mr Boccamazzo was done pursuant to a contract between him and KCF,⁵ and so denied he had an equitable lien over its property.⁶ 

Decision

Master Sanderson noted that the real question in dispute was whether there was a direct contractual relationship between Mr Boccamazzo and KCF.  His Honour was prepared to find on the evidence before him that, on balance, he was satisfied it was at least arguable that Ms Pragnell and Mr Jackman were acting as KCF’s agents, and that, as a consequence, Mr Boccamazzo and KCF had entered into a contractual relationship.⁷   It followed then then that it was at least arguable there was an equitable lien in favour of Mr Boccamazzo arising over the Forest Hill property.

The Master referred to the competing affidavit evidence filed in support of the parties’ respective positions as to the existence or otherwise of a contractual relationship being in place and as to whether any party was indebted to Mr Boccamazzo.  But they were not matters the Master was required to determine on Mr Boccamazzo’s application for an extension on the operation of his caveat over the land.  Those were issues to be determined in the District Court proceedings.

Although accepting there was some inconvenience caused to KCF by the caveat being maintained, on balance the Master was not satisfied it was such to warrant refusing the continuation of the injunction.⁸   As such, Master Sanderson held that the caveat ought to be maintained until further order of the court.

Lavan comment

This case demonstrates the importance of: 

• Ensuring that when contracting to provide goods and/or services, the agreement is documented so that the contracting parties and their roles, responsibilities and liabilities are made clear and certain; this is particularly so if pre-contractual negotiations are being conducted on one side by a person who is acting in an agency capacity.
• When preparing a caveat form for lodgement with Landgate the caveator should take care to correctly specify the type of caveat applied for. 
• How a party can seek to protect itself in relation to payment in connection with certain transactions regarding land, and the deployment of a caveat as an option to assist in that regard.

If you have any questions in relation to this article, or wish to discuss further, please do not hesitate to contact Lavan’s Litigation & Dispute Resolution Team.