Browne v Browne
[2019] WASCA 1
•10 JANUARY 2019
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: BROWNE -v- BROWNE [2019] WASCA 1
CORAM: MURPHY JA
BEECH JA
ALLANSON J
HEARD: 22 OCTOBER 2018
DELIVERED : 10 JANUARY 2019
FILE NO/S: CACV 14 of 2018
BETWEEN: EDWARD BROWNE
Appellant
AND
STEVEN EDWARD BROWNE
Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram: SMITH AJ
Citation: [2017] WASC 375
File Number : CIV 2044 OF 2017
Catchwords:
Courts and judges - Reasons for decision - Adequacy of reasons
Equity - Proprietary estoppel - Relief - Whether immediate transfer of property appropriate means to protect plaintiff's expectations - Turns on own facts
Legislation:
Family Provision Act 1972 (WA), s 6
Result:
Appeal dismissed
Category: B
Representation:
Counsel:
| Appellant | : | S Penglis |
| Respondent | : | M N Solomon SC & K A T Pedersen |
Solicitors:
| Appellant | : | Dwyer Durack |
| Respondent | : | Hotchkin Hanly |
Case(s) referred to in decision(s):
Ancient Order of Foresters in Victoria Friendly Society Ltd v Lifeplan Australia Friendly Society Ltd [2018] HCA 43; (2018) 92 ALJR 918
Austotel Pty Ltd v Franklins Selfserve Pty Ltd (1989) 16 NSWLR 582
Barns v Barns [2003] HCA 9; (2003) 214 CLR 169
Bennett v Carruthers [2010] WASCA 131
Bofinger v Kingsway Group Ltd [2009] HCA 44; (2009) 239 CLR 269
Bristol City Council v Lovell [1998] UKHL 8; (1998) 1 All ER 775
Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380
Centex Australasia Pty Ltd v Commissioner for Consumer Protection [2017] WASCA 79
Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394
Delaforce v Simpson‑Cook [2010] NSWCA 84; (2010) 78 NSWLR 483
Falkingham v Hoffmans [2014] WASCA 140; (2014) 46 WAR 510
Fifteenth Eestin Nominees Pty Ltd v Rosenberg [2009] VSCA 112; (2009) 24 VR 155
Flinn v Flinn [1999] VSCA 109; [1999] 3 VR 712
Forrest & Forrest Pty Ltd v Minister for Mines and Petroleum [2017] WASCA 153; (2017) 51 WAR 425
Garrett v Nicholson [1999] WASCA 32; (1999) 21 WAR 226
Gillett v Holt [2001] Ch 210; [2000] 2 All ER 289
Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101
Harrison v Harrison [2013] VSCA 170
McNab v Graham [2017] VSCA 352; (2017) 53 VR 311
Minister for Immigration and Border Protection v SZVFW [2018] HCA 30; (2018) 92 ALJR 713
Mount Lawley Pty Ltd v Western Australian Planning Commission [2004] WASCA 149; [2004] 29 WAR 273
Pascoe v Turner [1979] 2 All ER 945
Rizhao Steel Holding Group Co Ltd v Koolan Iron Ore Pty Ltd [2012] WASCA 50; (2012) 43 WAR 91
Scaffidi v Chief Executive Officer [2017] WASCA 222; (2017) 52 WAR 368
Sidhu v Van Dyke [2014] HCA 19; (2014) 251 CLR 505
SNF (Australia) Pty Ltd v Jones [2008] WASCA 121
Sullivan v Sullivan [2006] NSWCA 312
The Queen v Dennis Bauer (a pseudonym) [2018] HCA 40; (2018) 92 ALJR 846
Vadasz v Pioneer Concrete Pty Ltd [1995] HCA 14; (1995) 184 CLR 102
Vinden v Vinden [1982] 1 NSWLR 618
Warman International Ltd v Dwyer [1995] HCA 18; (1995) 182 CLR 544
JUDGMENT OF THE COURT:
The appellant, Mr Browne, challenges the primary judge's decision,[1] declaring that he holds farming property (Burracoorong) on trust for his respondent son, Steven, and ordering that he transfer Burracoorong to Steven on the condition that Steven pay an annual sum to him for living expenses.[2]
[1] Browne v Browne [No 2] [2017] WASC 375 (primary reasons).
[2] Like the primary judge and the parties, we will refer to the appellant as Mr Browne and to his sons, including the respondent, by their first names.
There is no challenge to the finding that Steven had established the proprietary estoppel claim he advanced at trial. The grounds of appeal relate only to the form of relief granted, namely an order for Burracoorong's immediate conveyance to Steven. The first ground of appeal contends that the primary judge failed to give adequate reasons for her decision to order an immediate conveyance. The other ground challenges that decision on its merits. Mr Browne contends, in substance, that the primary judge should have ordered transfer of the Burracoorong property upon Mr Browne's death, rather than immediately (or at any time prior to his death).
As explained by counsel for Mr Browne,[3] Mr Browne's central point in the appeal is not that the judge erred in ordering an immediate transfer of the Burracoorong land because Mr Browne was entitled, on the primary judge's findings of fact, to the beneficial enjoyment of the land prior to his death. Rather, the alleged error in the order is that an immediate transfer of the land meant that upon his death, Mr Browne's assets would be correspondingly reduced, to the detriment of third parties, being those persons with a statutory entitlement to seek provision from his estate under s 6 of the Family Provision Act 1972 (WA).
[3] Appeal ts 114 - 115.
For the reasons set out below, we would reject both grounds and dismiss the appeal.
Uncontested facts
The following facts either were not contested at trial or are the subject of factual findings which are not challenged on appeal.
Steven is the eldest of Mr and Mrs Browne's four sons, the others being Paul, Michael and Peter.[4] Mr and Mrs Browne also have four daughters.[5]
[4] Primary reasons [1] - [2].
[5] Primary reasons [2].
Mr Browne came from a farming family and had inherited and purchased various pieces of farming property, including Burracoorong and another property referred to as Yargalain (which included land called the Army Blocks).[6]
[6] Primary reasons [3].
In 1974, Mr and Mrs Browne, Steven and Paul entered into a partnership to farm the lands owned by Mr Browne (the partnership).[7] The other sons later joined the partnership and associated companies purchased additional properties to farm, named Yarrawindah and Glenalan.[8] At the end of 1975, Steven commenced full‑time work in the partnership, farming all of the partnership lands, including Burracoorong.[9] By the late 1970s, as well as doing manual farm work, Steven played a central role in the management of the partnership.[10]
[7] Primary reasons [4].
[8] Primary reasons [4], [8], [10].
[9] Primary reasons [5].
[10] Primary reasons [5].
Steven married his wife, Shelley, in 1985 and, by 1992, had four children.[11] Originally, he and his family lived in a donga on Yargalain.[12] In 1988, with Mr Browne's encouragement, Steven and Shelley began building their family home on Burracoorong.[13]
[11] Primary reasons [6].
[12] Primary reasons [6].
[13] Primary reasons [7].
Several family meeting were held in the mid to late 1990s in which Mr and Mrs Browne and their four sons discussed arrangements for the future.[14] Minutes of these meetings referred to the partnership land being divided between the sons on Mr Browne's death.[15] A letter, recording what was discussed at a meeting of 24 August 1998, stated that it had always been the intent that the proceeds of life insurance policies, a unit in Perth and AMP shares would go equally to the daughters of the family.[16]
[14] Primary reasons [11], [139] - [174].
[15] Primary reasons [142], [155].
[16] Primary reasons [164].
Around that time, family discussions arose about ending the partnership and, by early 1999, agreement to do so was reached.[17] At that stage, Mr Browne, or family companies,[18] remained the owner of the land of the partnership.[19] He and Mrs Browne retired from the partnership and, other than the land, gifted their share of the partnership assets to their four sons.[20]
[17] Primary reasons [13], [169].
[18] See primary reasons [8].
[19] Primary reasons [13].
[20] Primary reasons [13].
It was not in dispute that the following arrangements for a split of the partnership were put in place from 1 February 1999:[21]
(a)The brothers' respective equities in the former partnership were Steven (36%), Paul (24%), Michael (16%) and Peter (24%).
(b)Each of the sons was to farm independently on the lands allocated to them. Steven was allocated initially all of Burracoorong, except one paddock (3,206 acres or 32% of the land). Paul was allocated Yarrawindah and the Army Blocks (2,649 acres or 26% of the land). Michael was allocated Glenalan and the 521 (part of Yargalain) acres (1,686 acres or 17% of the land). Peter was allocated the remainder of Yargalain and one paddock of Burracoorong (2,509 acres or 25% of the land).
(c)Each of the sons assumed an equal 25% of the debt assumed by the partnership for the purchase of the Sorrento home for Mr and Mrs Browne.
(d)Peter and Steven were to each pay $16,000 per annum to Mr Browne; and Michael and Paul were to each pay $16,000 per annum to Mrs Browne. In December 1999, following advice from accountant Alan Crawford, it was agreed that the amount should be $18,000 per annum. …
(e)Each son assumed liability for their share of the partnership debt. At the time of the split of the partnership, the combined value of the assets of the partnership, including sheep, were estimated to be valued at $3,109, 988 and the partnership debt was $750,000.
(f)Steven and Peter were to share the use of the infrastructure on Yargalain that did not exist on Burracoorong.
(g)All four sons continued to use the partnership funding facility for their farming businesses which was maintained by Mr Browne until early 2003.
[21] Primary reasons [14].
On 30 April 1999, the partnership increased its debt to Rabobank by $100,000, to $850,000, to enable each of the brothers to farm separately.[22]
[22] Primary reasons [18].
It was later agreed that Steven should also receive the single paddock of Burracoorong originally allocated to Peter.[23] By at least the beginning of 2000, Steven farmed the whole of Burracoorong independently.[24]
[23] Primary reasons [15].
[24] Primary reasons [15].
From shortly after the partnership split until 2017, Steven undertook work on Burracoorong to improve it.[25]
[25] Primary reasons [17]; see also attachment A to the primary reasons.
In 2002, Peter and the trustee company of the Steven Browne Family Trust (of which Steven and Shelley are shareholders) purchased a further property to improve their economies of scale (Moganmoganing).[26] To purchase the property, Steven and Shelley obtained a $650,000 loan from Rabobank, using Burracoorong as security.[27] Mr Browne executed a deed of guarantee securing the loan over Burracoorong.[28]
[26] Primary reasons [21].
[27] Primary reasons [22].
[28] Primary reasons [22].
On 23 March 2010, Steven and Shelley obtained a second loan facility from Rabobank for the amount of $400,000, with Mr Browne making Burracoorong available as security.[29]
[29] Primary reasons [24].
In 2013, Mr Browne agreed to increase the loan facility on Burracoorong to enable Steven to buy Peter's half share of Moganmoganing.[30] Mr Browne agreed to do so on the basis that Steven agreed to increase his annual payments to Mr Browne from $16,000 to $34,000 per year.[31] The sale did not proceed.[32]
[30] Primary reasons [25].
[31] Primary reasons [25].
[32] Primary reasons [25].
In early August 2013, Steven received a letter from Mr Browne's solicitors, attaching a draft lease to sign.[33] Among other things, the lease provided for a term of 10 years, an obligation of Steven to yield up Burracoorong upon termination and a reservation of Mr Browne's right to sell or lease Burracoorong to others.[34]
[33] Primary reasons [27].
[34] Primary reasons [27].
On 12 August 2013, Steven received a further letter from Mr Browne's solicitors demanding that Steven cease accessing Yargalain.[35] Among other things, the letter threatened criminal charges of trespass if the demand was not met.[36] As a result of being denied access, Steven constructed a fertiliser shed, a shearing shed and sheep yard complex on Burracoorong.[37]
[35] Primary reasons [28].
[36] Primary reasons [28].
[37] Primary reasons [37].
On 12 November 2013, Mr Browne informed Rabobank that he wished to withdraw any further support for Steven and Shelley's indebtedness and required it to make arrangements with Steven and Shelley to remove the mortgage over Burracoorong.[38]
[38] Primary reasons [29].
By 20 November 2013, after an apparent change of heart, Mr Browne signed a deed of acknowledgment that he would continue to honour his commitment under the current funding arrangements.[39]
[39] Primary reasons [31] ‑ [34].
On or about 1 June 2017, Mr Browne refused to continue to guarantee Steven's borrowing secured on Burracoorong beyond the date of expiry of the current facility, being 2 January 2018.[40]
[40] Primary reasons [38].
On 26 June 2017, Steven filed a writ of summons to commence the action below.[41]
[41] Primary reasons [39].
On 4 August 2017, Mr Browne's solicitors sent a letter demanding increased rent from Steven of $61,000 per annum from 1 July 2017.[42]
[42] Primary reasons [40].
That same day, Mr Browne executed a will attaching various conditions to Steven's entitlement to Burracoorong via testamentary trust, including increased payment in rent and payment of $300,000 to each of Steven's four sisters.[43] The will was also subject to revocation or alteration by Mr Browne at any time and manifested an express intention to modify its terms so as to penalise his sons if they failed to honour his wishes during his lifetime.[44]
[43] Primary reasons [41] - [43].
[44] Primary reasons [42].
On 10 August 2017, Mr Browne executed a new will containing the same conditional gift of Burracoorong to Steven as the 4 August 2017 will.[45]
[45] Primary reasons [27].
Steven's claim
At trial, Steven advanced a claim in proprietary estoppel by encouragement.[46] Proprietary estoppel provides relief 'found in an assumption as to the future acquisition of ownership of property … induced by representations upon which there ha[s] been detrimental reliance by the plaintiff'.[47]
[46] Primary reasons [81], [84].
[47] Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101 [6]; Sidhu v Van Dyke [2014] HCA 19; (2014) 251 CLR 505 [2].
Steven claimed that, by 1999, Mr Browne had induced an assumption in him that:[48]
(a)Mr Browne would gift Burracoorong to Steven before, or upon, Mr Browne's death;
(b)Steven could farm Burracoorong independently at his own expense; and
(c)Mr Browne would support Steven's farming by:
(i)allowing access to infrastructure on Yargalain; and
(ii)facilitating Steven's borrowing by permitting the use of the partnership's existing fund facility.
[48] Primary reasons [56]; statement of claim [10], [16] ‑ [18].
Steven also claimed that, on a number of occasions between 2001 and 2013, Mr Browne subsequently repeated his promise to the effect in [29](a) above.[49]
[49] Primary reasons [57]; statement of claim [22].
Steven claimed that he relied upon the promises, Mr Browne made to him, in:
(a)continuing to live on, devote resources to, farm, and undertake development and infrastructure work to Burracoorong at his and Shelley's own expense, instead of investing money elsewhere or pursuing another livelihood;
(b)incurring liability for loans, assuming and continuing to service the partnership debt, making annual payments to Mr Browne and arranging his and Shelley's affairs in reliance on Burracoorong being provided as security; and
(c)encouraging their son to devote his own career, efforts and resources to Burracoorong.[50]
[50] Primary reasons [59]; statement of claim [20].
Steven claimed that Mr Browne had resiled from his promises by:
(a)in about August 2013, preventing Steven's access to infrastructure on Yargalain and demanding Steven sign a lease for Burracoorong;
(b)in or about November 2013, seeking to withdraw his guarantee for Steven's borrowing and informing Rabobank that he would not agree to any extension of borrowings being secured against Burracoorong;
(c)from on or about 1 June 2017, refusing to acknowledge his promise to Steven that he would give Burracoorong to Steven and refusing to continue to guarantee Steven's borrowings;
(d)on or about 4 August 2017, demanding an increased annuity (or rent) from Steven of $61,000 per year and reserving his right to evict Steven from Burracoorong; and
(e)on 4 August 2017, executing a will which attached conditions to Steven's entitlement to Burracoorong which were inconsistent with his promise and in which Steven's entitlement to Burracoorong was expressly revocable and required the payment of an amount he was unable to pay.[51]
[51] Primary reasons [59]; statement of claim [29] ‑ [31].
Steven claimed he would suffer the following detriment consequent upon Mr Browne's resilement from his promises:
(a)he would lose his entire life's investment and effort in Burracoorong;
(b)he would lose his ability to earn an income;
(c)he would remain liable to Rabobank for the funds borrowed and previously secured by Burracoorong; and
(d)he would have no capacity to repay Rabobank and, thereafter, continue to support himself and his family.[52]
[52] Primary reasons [60]; statement of claim [32].
Steven sought the following relief:[53]
(a)A declaration that Mr Browne held Burracoorong on trust for him.
(b)An order that Mr Browne forthwith transfer Burracoorong to Steven.
(c)Alternatively, orders that:
(i)Burracoorong was to be transferred to him on Mr Browne's death and that Mr Browne continue to make it available to secure his loan to allow him to continue farming Burracoorong; or
(ii)Mr Browne pay compensation or damages to him.
[53] Primary reasons [61]; statement of claim prayer for relief.
As will be seen, in substance the primary judge accepted these claims, subject to one qualification. Steven claimed that Mr Browne had induced an assumption in him that Mr Browne would gift Burracoorong to Steven 'before or upon' Mr Browne's death. The primary judge found that Mr Browne, in effect, promised Steven that he would gift Burracoorong to him upon Mr Browne's death; but, the primary judge was not persuaded that Mr Browne agreed to gift Burracoorong to Steven before his death.[54]
[54] Primary reasons [235].
The primary reasons
In light of the limited scope of the grounds of appeal, it is not necessary to detail all aspects of the primary judge's reasons. It is sufficient to summarise her Honour's findings on liability, and outline, in more detail, her Honour's approach to the question of relief.
Mr Browne's promises to Steven
Statements that Steven would be gifted Burracoorong
The primary judge found, and it was not in dispute that, from at least the time of family discussions about ending the partnership, Mr Browne said to each of his sons, on a number of occasions, that the land which they farmed would be transferred to them by will.[55] Specifically, her Honour found that, by at least 1999, all the partners understood that Burracoorong would ultimately be Steven's and would be transferred to him on Mr Browne's death or, if Mr Browne predeceased her, on Mrs Browne's death.[56] Mr Browne agreed that this was always the expectation.[57]
[55] Primary reasons [16].
[56] Primary reasons [152].
[57] Primary reasons [153].
Her Honour found that the conditions of the arrangements for the partnership split, intended to apply until Mr Browne's death, included that:
(a)In Mr Browne's will, Steven was to be gifted the land owned by Mr Browne that Steven farmed.[58]
(b)Steven was to pay Mr Browne 25% (each of the other three sons also contributing 25%) of an annual amount to cover Mr and Mrs Browne's living expenses in their retirement, or to Mrs Browne if Mr Browne predeceased her.[59] In 1999, the sum was fixed at $18,000 per annum. The primary judge found that these annual payments were not rent or a condition of the use of the former partnership land and, further, that Mr Browne had no absolute discretion to unilaterally impose changes in their amount.[60]
[58] Primary reasons [201].
[59] Primary reasons [173.6], [175](d), [199], [201].
[60] Primary reasons [177], [198], [203].
The primary judge found, and it was not in dispute, that, in or about 2001, Steven had a conversation with Mr Browne about transferring Burracoorong to him.[61] Her Honour found that Mr Browne subsequently sought advice about this in a meeting on 11 October 2002, attended by himself, Mrs Browne and Steven, in which he said he would have to change his will and that testamentary trusts were going to be set up to transfer each of the allocated properties to his sons.[62]
[61] Primary reasons [211], [219].
[62] Primary reasons [220] - [221].
The primary judge found that Mr Browne (1) made a further representation on 23 November 2010 about gifting Burracoorong to Steven when he (Mr Browne) died; and (2) told Steven that he (Mr Browne) would need to 'hold Burracoorong in his [Mr Browne's] name' as 'security' to ensure that Steven would not 'renege' on the annual payments.[63]
[63] Primary reasons [227], [231], [233] (emphasis added).
The primary judge was not satisfied that there was reliable evidence from which to draw an inference that Mr Browne agreed to gift Burracoorong to Steven before his death. The evidence at its highest simply established that Mr Browne seriously contemplated doing so in 2001.[64]
[64] Primary reasons [235].
The primary judge characterised the nature of Mr Browne's promise to leave Burracoorong to Steven in his will as irrevocable and found that the only condition attached to it was the making of the annual payments. Her Honour said:[65]
The representation by Mr Browne to gift Burracoorong to Steven on Mr Browne's death can only be objectively understood as an irrevocable promise, notwithstanding it can be characterised as a testamentary promise. It is not a promise that could be objectively understood to be a promise to gift Burracoorong, subject to a number of conditions such as subject to the payment of substantial sums to the daughters of Mr Browne. The only condition of the representations and promises made by Mr Browne which went to the payment of any amount on the death of Mr Browne related to the annual payments to Mr Browne and continuing those payments after the death of Mr Browne to Mrs Browne (if he predeceased her). (emphasis added)
Promise of farming Burracoorong independently
[65] Primary reasons [234]. The judge appears to have used 'promise' and 'representation' interchangeably, but it is not suggested that any error arises from this.
Her Honour found that it could not be disputed that, in 1999, Steven was promised that he could farm Burracoorong 'independently' and at his own expense.[66] This evidently included during Mr Browne's lifetime independently of Mr Browne's direction or interference.
Promise of ongoing support
[66] Primary reasons [242]; see also [275] and [309].
As already noted, the primary judge found that it was an agreed term of the partnership split that Steven and Peter were to share the use of the infrastructure on Yargalain because Burracoorong had no infrastructure at that time.[67]
[67] Primary reasons [14], [253].
At trial, Mr Browne accepted that he agreed to continue to guarantee Steven's proportion of the existing partnership debts for the term of the existing facility at the time of the partnership split.[68] The primary judge found that Mr Browne went further than that, in continuing to guarantee and make security available for Steven's borrowing as it increased, to support his continued farming operation.[69]
[68] Primary reasons [240].
[69] Primary reasons [241].
In effect, the primary judge found that, by what he said and did, Mr Browne promised or represented, and thereby created in Steven an expectation, that Mr Browne (in his lifetime) would facilitate Steven procuring and maintaining debt funding to support his (Steven's) farming operations, including by making the title of Burracoorong available as security for that purpose, on the basis that the funding arranged by Steven would not put the security of Burracoorong at risk, and would not be used for expenses that did not contribute to Steven's farming enterprise. [70] In a similar vein, and expressed more generally, the judge found, in effect, that the expectation induced by Mr Browne was that Steven could 'access the equity' in Burracoorong on 'standard prudential terms'.[71]
[70] Primary reasons [237] - [241], [250], [275](e), [303], [308].
[71] Primary reasons [248].
Her Honour found that (1) there was no evidence that Steven had ever put the security of Burracoorong at risk; and (2) Steven had 'accessed the equity' in Burracoorong 'to enable him to successfully farm' Burracoorong and Moganmoganing.[72]
[72] Primary reasons [252].
Her Honour also found that Mr Browne facilitated improvements to Burracoorong, including the building of infrastructure, which Steven needed in order to continuing farming after he had been locked out of Yargalain.[73]
[73] Primary reasons [241].
Her Honour also rejected arguments by Mr Browne which proceeded on the premise that Mr Browne himself had continuing access to the equity in Burracoorong.[74]
Steven's reliance on Mr Browne's promises
[74] Primary reasons [68] - [69], [234], [322].
The primary judge considered it plain that Steven (and Shelley) had relied upon the reasonable expectation that Mr Browne would not depart from his representation that he would gift Burracoorong to Steven upon his death, together with his representation that Mr Browne, in his lifetime, would provide ongoing support for Steven's debt funding (see [46] above), and by allowing access to Yargalain's infrastructure.[75] The primary judge found that the actions that Steven had taken in reliance on Mr Browne's promises had affected every aspect of his life.[76] More specifically, her Honour found that:
(a)Steven (with Shelley) had arranged Steven's life and affairs on the basis that Burracoorong would belong to him, unencumbered, on Mr Browne's death, subject only to the condition that Steven pay an annual sum to Mrs Browne for living expenses (if Mr Browne predeceased her).[77]
(b)Steven had farmed Burracoorong for over 40 years, since at least the beginning of 1976 (as part of the partnership) and from 2000, on his own account.[78]
(c)Steven (and Shelley) had expended their own money on building, maintaining and improving their substantial family home, in which they and their daughter continued to live.[79]
(d)Steven incurred substantial financial and personal liabilities because of his expectation of owning Burracoorong.[80]
(e)Steven relied upon the expectation of Mr Browne guaranteeing his borrowings, to purchase Moganmoganing.[81]
(f)Steven also relied on the reasonable expectation that Mr Browne would, in his lifetime, provide support for Steven's debt funding.[82]
Mr Browne's resilement from his promises to Steven
[75] Primary reasons [308].
[76] Primary reasons [305].
[77] Primary reasons [138], [307].
[78] Primary reasons [305].
[79] Primary reasons [305]. See also primary reasons [135].
[80] Primary reasons [138].
[81] Primary reasons [303].
[82] Primary reasons [308].
The primary judge found that Mr Browne had resiled from the expectations he had induced in that he:
(a)was pressing a payment of 'rent', to be increased at his unfettered discretion;
(b)was asserting a lease arrangement;
(c)was asserting that evicting Steven would not be inconsistent with a promise to leave Burracoorong to Steven in his will;
(d)was asserting an absolute and unqualified discretion to do as he pleased with Burracoorong;
(e)had stated his intention not to maintain the guarantee in respect of the Rabobank loans and wanted the mortgage on Burracoorong discharged;
(f)had left, in his most recent will, Burracoorong to Steven on conditions that were financially onerous and expressly contrary to the promises and representations he made to Steven from at least 1987 until 2013 and at the latest by 2015;
(g)was expressing an intention to revoke or alter his testamentary disposition so as to penalise Steven if he failed to honour and respect his wishes; and
(h)was expressing a desire to sell or use Burracoorong to secure a loan for funds for him to fund future contingencies if free from Steven's claim.[83]
Steven's detriment upon departure from Mr Browne's promises
[83] Primary reasons [275].
The primary judge found that:[84]
[I]t is plain that leaving aside departure from the promise to allow access to the infrastructure on Yargalain, the detriment that Steven (and Shelley) would suffer, if Mr Browne is allowed to depart from the promises and representations is substantial. They are likely to lose their home as it appears that they will be unable to continue to farm Burracoorong because:
(a)they will lose any advantage of scale of farming Burracoorong and Moganmoganing together and will have no real property upon which debt can be secured; and/or
(b)Mr Browne may sell Burracoorong or seek to secure a mortgage on the land to obtain funds for his exclusive use (as he has expressed a clear intention to do so).
[84] Primary reasons [309].
The primary judge also found that, as a result of being locked out of Yargalain, Steven (and Shelley) built replacement infrastructure on Burracoorong from 2013 to 2016, incurring significant costs, in the form of further debt.[85]
[85] Primary reasons [274].
The judge also said (albeit under the heading 'the measure of relief'):[86]
In this matter, if Steven (and Shelley) are deprived of the equity that they have acquired in their home and in the improvements and infrastructure on Burracoorong, the detriment caused is not simply a financial detriment. Steven has spent most of his adult working life farming Burracoorong in the expectation that it would be his. His future detriment cannot be measured and quantified in monetary terms only. In these circumstances, the enforcement of Steven's expectation would not be disproportionate to his detrimental reliance.
Relief
Legal principles
[86] Primary reasons [317].
In the course of her Honour's survey of relevant legal principles, a number of principles relevant to the identification of the appropriate relief were stated.
The primary judge recognised that the measure of relief should not be out of proportion to the detriment. However, her Honour cited Sidhu v Van Dyke,[87] Delaforce v Simpson‑Cook[88] and Sullivan v Sullivan[89] and said that the starting point may not be the imposition of a remedy to reflect the minimum relief necessary to do justice between the parties.[90]
[87] Sidhu v Van Dyke [84].
[88] Delaforce v Simpson‑Cook [2010] NSWCA 84; (2010) 78 NSWLR 483 [59].
[89] Sullivan v Sullivan [2006] NSWCA 312 [20] ‑ [23].
[90] Primary reasons [97] ‑ [99].
Her Honour said that '[w]here the expectation is undefined or is uncertain, equity must fashion its relief from the circumstances, but where the expectation was defined with certainty by the party estopped, that is where the court must start'.[91] Her Honour evidently regarded this case as coming within the second of those two types of expectation - the expectation was that Steven would obtain full ownership of Burracoorong.
[91] Primary reasons [100], citing Delaforce [92].
Of central relevance to this appeal, her Honour stated:[92]
Equity is flexible and can recognise the need for a clean break. Importantly, equity must do justice to the defendant and must take into account the impact of its orders on third parties or any hardship or injustice they would suffer: Delaforce [59], [60] (Handley AJA); Pascoe v Turner [1979] 2 All ER 945; [1979] 1 WLR 431; Giumelli (113 - 114, 125); Gilett (312); Jennings v Rice [2002] EWCA Civ 159.
[92] Primary reasons [101].
The primary judge recognised that subsequent events may affect the appropriate relief, including an unexpected 'financial reverse' on the part of the defendant.[93]
[93] Primary reasons [102] ‑ [103].
Her Honour outlined relevant submissions on Mr Browne's behalf, and responded to those submissions, as follows:[94]
[106]It is also argued that as a matter of practicalities, none of the putative beneficiaries to Mr Browne's estate are present in these proceedings, notwithstanding that upon Mr Browne's death they would have rights under Mr Browne's will to his estate subject to the operation of s 6(1) of the Family Provision Act 1972 (WA).
[107]Consequently, an argument put on behalf of Mr Browne that the alleged promises would not be enforceable upon Mr Browne's death as equity will not curtail the operation of the statute. As counsel for Steven point out, this submission is not supported by the principles of equitable estoppel, (or made out on the evidence which I will deal with further in this judgment).
[108]It is uncontroversial that the enforcement of irrevocable testamentary dispositions may be contingent upon the provision for eligible dependants: Delaforce [31] - [35] (Handley AJA). It is also plain that the courts will not consider a hypothetical contingency which has not occurred. Therefore, the potential operation of the provisions of the Family Provision Act to the disposition of property by will is a question to be determined upon relevant application in due course. But it does not bar a claim in equity arising in the interim. Even where property is included within a will, its owner may nevertheless deal with the property during their lifetime. This might include a testator selling property for any number of reasons, or conducting themselves in such a way as to give rise to an equitable interest in the property to be held by another.
The measure of relief
[94] Primary reasons [106] ‑ [108].
The primary judge dealt with the question of the measure of relief in [310] ‑ [343] of her reasons.
The primary judge rejected, without challenge on appeal, Mr Browne's contentions that (a) Steven's conduct disentitled him to relief; and, alternatively, that (b) Steven should only be granted equitable compensation, the transfer of Burracoorong being disproportionate to Steven's expectation and detrimental reliance.[95] In the context of the first of these contentions, the primary judge referred to the breakdown in relationship between Mr Browne and Steven.[96]
[95] Primary reasons [310] - [319].
[96] Primary reasons [310].
Although the point was not pleaded by Mr Browne, the primary judge gave detailed consideration to Mr Browne's claim at trial that his circumstances had changed in a manner that affected the appropriate relief.[97]
[97] Primary reasons [320] - [334].
In particular, the judge considered Mr Browne's contention that his circumstances made it inequitable for him to have to relinquish Burracoorong, or be denied the equity in that property, because he and Mrs Browne may need funds for aged care and medical expenses.[98] In this context, the judge referred to the evidence that Mrs Browne has dementia and that Mr Browne was her carer and was concerned that he would need to raise $1 million to place her in an appropriate nursing home at some stage.[99] Her Honour considered Mr Browne's contention was speculative and hypothetical and unsupported by admissible or reliable evidence.[100]
[98] Primary reasons [322].
[99] Primary reasons [320].
[100] Primary reasons [320], [329].
The judge said that recognition that a promisor has experienced a change of position because of life's vicissitudes may (if proven) be relevant to the question of whether it is unconscionable for a promisor to resile from their promise.[101] In such circumstances, her Honour said that equity could fashion a remedy that takes into account both the promisor's change of circumstances and the promisee's 'accrued' equity.[102] In that context, the court focuses on what has actually happened, not on what might have happened in the past or what might happen in the future.[103]
[101] Primary reasons [326].
[102] Primary reasons [327].
[103] Primary reasons [328].
The primary judge also considered Mr Browne's evidence that he wished to leave each of his four daughters with an inheritance of $1 million. The primary judge observed that this could properly be seen as a further basis on which Mr Browne sought to resile from the expectation he had induced.[104]
[104] Primary reasons [330].
The judge found, in relation to this aspect of Mr Browne's evidence, in effect, that:[105]
1.Mr Browne had assets other than Burracoorong;
2.Mr Browne had not given evidence which would enable an estimate to be made of the total value of all of his assets;
3.there was insufficient evidence of Mr Browne's current financial position;
4.the expectation from the partnership split had been that Steven and his brothers would share the land and the daughters would be looked after by gifts of other assets; and
5.there was nothing in the evidence to indicate that any injustice would be raised, either to Mr Browne or to any third party, if Mr Browne was held to his promises to Steven.
[105] Primary reasons [330] - [334].
The primary judge referred to Vinden v Vinden,[106] and stated that the court 'may define the interest which defines [sic - 'satisfies'][107] the equity' arising from the reasonable expectation induced by the promisor.[108] Her Honour said that the court is to do 'what is practically just to make good the expectations and that includes any conditions or cross-promises that attach to the expectations'.[109]
[106] Vinden v Vinden [1982] 1 NSWLR 618.
[107] Vinden (634).
[108] Primary reasons [335].
[109] Primary reasons [335].
The primary judge then came to the following conclusions, which are the subject matter of the appeal:[110]
[336]I am satisfied that the circumstances of this matter are such that good conscience requires that Mr Browne be held to his promises and representations and that the equity raised by Mr Browne's conduct can only be accounted for by granting relief which provides for a clean break.
[337]In my view, Steven's equity will be satisfied by the transfer of Burracoorong to him by Mr Browne, subject to Steven paying Mr Browne an upfront amount of $64,000 and ongoing annual payments calculated at $34,000 per annum from 1 July 2017 to Mr Browne until his death and to Mrs Browne until her death, in the event that Mr Browne predeceases Mrs Browne.
[338]In my opinion, Steven should be held to the cross-promise that he made Mr Browne that he would pay to him during his lifetime, and to Mrs Browne, if Mr Browne predeceased her, 25% of living expenses of Mr and Mrs Browne. Such living expenses should be quantifiable as reasonable to maintain and support Mr and Mrs Browne in their retirement. Any future assessment of these expenses should not have regard to the diminution of assets of Mr Browne by defending these proceedings. (emphasis added)
[110] Primary reasons [336] ‑ [338].
Ground 4 challenges the adequacy of the reasons given for these conclusions. Ground 5 challenges the primary judge's conclusions on their merits.
Grounds of appeal
Grounds 1 ‑ 3 were abandoned.[111]
[111] Appeal ts 36.
The remaining grounds of appeal are to the following effect:
4.The primary judge erred in law in failing to give reasons, or adequate reasons, for the challenged conclusions.
5.The primary judge erred in law in coming to the challenged conclusions. Rather, the judge should have concluded that, in all the circumstances, particularly having regard to the nature of the representation found and third party interests, it was appropriate to order that (1) Burracoorong be transferred to Steven on Mr Browne's death; and (2) Mr Browne continue to make Burracoorong available to secure Steven's loan to allow Steven to continue farming it.
Ground 4
Mr Browne's submissions
Mr Browne submits that it is not possible to discern, or adequately discern, from the primary judge's reasons, the findings of fact and intellectual process which led to her Honour's conclusion that an order for immediate transfer should be made.[112]
[112] Appellant's submissions [40]; appeal ts 40, 41, 45.
Mr Browne's submissions invite a comparison of the reasons in this case with the reasons given in decisions to which the primary judge referred,[113] namely Pascoe v Turner,[114] Flinn v Flinn[115] and Gillett v Holt.[116]
[113] Appellant's submissions [41] ‑ [45]; appeal ts 42.
[114] Pascoe v Turner [1979] 2 All ER 945.
[115] Flinn v Flinn [1999] VSCA 109; [1999] 3 VR 712.
[116] Gillett v Holt [2001] Ch 210; [2000] 2 All ER 289.
Mr Browne submits that [310] - [335] of the primary judge's reasons, summarised at [62] - [67] above, do not explain, or relate to, her conclusion that Burracoorong should be immediately transferred. Rather, these paragraphs relate to the different issue of whether a remedy short of enforcement of the promise was appropriate.[117] It is Mr Browne's submission that 'absolutely nothing' is said as to why the primary judge was satisfied that 'the equity raised by Mr Browne's conduct can only be accounted for by granting relief which provides a clean break'.[118] He appears to submit that the primary judge's findings, of Mr Browne's resilement and the breakdown in his relationship with Steven, do not substantiate her Honour's conclusion because they do not 'obviously' or 'prima facie' provide a reason for a clean break.[119] Mr Browne further submits that there was a heightened need to explain the relief granted because enforcing the promise or expectation is the prima facie remedy for proprietary estoppel and the judge's order 'is greater than perfection of the promise'.[120]
[117] Appellant's submissions [45]; appeal ts 48.
[118] Appellant's submissions [45]; appeal ts 45, 48.
[119] Appeal ts 49 - 50.
[120] Appeal ts 50.
The complaint of inadequacy of reasons in relation to an issue invites attention to the submissions made at trial concerning that issue.
Submissions at trial
Steven's written opening submissions made clear, prior to the commencement of trial, that his primary case was that the nature of Mr Browne and Steven's relationship made a clean break appropriate, such that immediate transfer of title to Steven should be ordered.[121]
[121] Plaintiff's opening submissions for trial [12], [175] - [177], BAB 269, 307.
Mr Browne's opening submissions concerning relief were principally directed to whether compensation, rather than an order for transfer, was appropriate. Insofar as they touched on the issues ventilated in this appeal, they were, relevantly, to the following effect:
(1)Steven sought an inter vivos transfer of Burracoorong, presumably to elevate his rights above the putative beneficiaries of Mr Browne's estate.[122] There would be no basis in the evidence for the court to order an inter vivos transfer or a declaration of trust, particularly where the evidence would be that Mr Browne made a will in which Steven would inherit Burracoorong after Mrs Browne's death.[123]
(2)There were obvious problems with the relief sought by Steven, where Steven established a promise of a transfer upon death. As a matter of practicality, none of the putative beneficiaries of Mr Browne's will were parties to the proceedings, notwithstanding that, upon Mr Browne's death, they would have rights under Mr Browne's will, subject to the operation of s 6(1) of the Family Provision Act.[124] A court order to transfer Burracoorong to Steven on Mr Browne's death would effectively oust the operation of that statute when the statute began to operate.[125]
(3)On Steven's alternative case, the testamentary nature of the promise he alleged was always liable to be affected by the potential operation of s 6 of the Family Provision Act.[126] A promise to leave property in a will is subject to the same legal contingencies as a promise in a contract to not revoke a will, including the impact of the Family Provision Act on such a promise.[127] The promise alleged by Steven would not be enforceable upon Mr Browne's death because equity will not curtail the operation of the statute. The relief claimed by Steven failed to take account of this authority and failed to disclose a cause of action.[128]
(4)The question of whether it is unconscionable for a promise not to be kept takes account of all the circumstances which have actually happened.[129]
(5)Mr Browne's circumstances had changed. There was a real prospect that he would need to place Mrs Browne in a retirement home on account of her disease, meaning that his assets may have to be sold for that purpose.[130]
(6)Mr Browne made substantial submissions in support of the contention that, if Steven was entitled to any relief, a transfer would be out of proportion to the circumstances and an appropriate response would be limited to compensation.[131] Mr Browne submitted, as part of those submissions, that there was no reason, on the facts, for a clean break. He submitted that, if Steven were to pay Mr Browne a fair and reasonable rent, for his use of Burracoorong, Mr Browne would permit him to stay.[132] Mr Browne made detailed submissions as to what a fair and reasonable rate should be, including the submission that Steven's use of Burracoorong had been permitted at a substantial undervalue for more than 18 years, providing Steven with a benefit of more than $1.8 million.[133]
[122] ts 185.
[123] ts 185.
[124] Defendant's opening outline of submissions at trial [92]; ts 185.
[125] Defendant's opening outline of submissions at trial [93]; ts 185.
[126] Defendant's opening outline of submissions at trial [94]; ts 185 - 186, referring to Barns v Barns [2003] HCA 9; (2003) 214 CLR 169 [33], [115], [129].
[127] Defendant's opening outline of submissions at trial [95]; ts 186, referring to Delaforce [31] ‑ [36].
[128] Defendant's opening outline of submissions at trial [94]; ts 186.
[129] Defendant's opening outline of submissions at trial [97]; ts 186.
[130] Defendant's opening outline of submissions at trial [96]; ts 186.
[131] Defendant's opening outline of submissions at trial [111] - [132]; ts 187.
[132] Defendant's opening outline of submissions at trial [120]; ts 188.
[133] Defendant's opening outline of submissions at trial [121] - [122]; ts 188.
The only aspects of Mr Browne's closing submissions directed to whether any order for transfer of the property should operate at Mr Browne's death, as distinct from immediately, were to the following effect:
(1)Mr Browne was leaving the farm to Steven in his will, after Mrs Browne's death. There was no basis for inter vivos relief.[134]
(2)Mr Browne was 89 years of age and his wife had a terrible disease. There was the very real prospect that she would have to go into a nursing home in the then near future. Mr Browne's evidence did not show him to have significant assets apart from his rural property. He required Steven's payment of rent for his income.[135]
Disposition
[134] ts 606.
[135] ts 606.
The principles relevant to an evaluation of the adequacy of reasons are well established and include the following:
(1)Reasons for decision need not be lengthy or elaborate.[136]
(2)Reasons should disclose the intellectual process that led to the decision in sufficient detail and with sufficient certainty to enable the litigant to know why they were unsuccessful and to enable an appeal court to determine whether the decision involved appellable error.[137]
(3)It is certainly not necessary to refer to every submission advanced by a party.[138] However, a tribunal or court must engage with the central element(s) of a losing party's case and explain why that case fails.[139] Considering that party's submissions is an aspect of what procedural fairness requires.[140]
(4)In determining the adequacy of the reasons, the reasons must be read as a whole, and, if necessary, considered in the context of the evidence.[141] An appellate court may take into account what can legitimately be inferred from the reasons.[142] Whether reasons are adequate will depend upon the circumstances of the case and the matters that arose for the judge's consideration.[143]
[136] Mount Lawley Pty Ltd v Western Australian Planning Commission [2004] WASCA 149; [2004] 29 WAR 273 [28].
[137] Garrett v Nicholson [1999] WASCA 32; (1999) 21 WAR 226, 248; SNF (Australia) Pty Ltd v Jones [2008] WASCA 121 [32]; Scaffidi v Chief Executive Officer [2017] WASCA 222; (2017) 52 WAR 368 [201].
[138] Scaffidi [202], citing Centex Australasia Pty Ltd v Commissioner for Consumer Protection [2017] WASCA 79 [103](c).
[139] Scaffidi [202], citing Mount Lawley v Western Australian Planning Commission [28], Centex [103].
[140] Scaffidi [202], citing Forrest & Forrest Pty Ltd v Minister for Mines and Petroleum [2017] WASCA 153; (2017) 51 WAR 425 [103].
[141] Garrett (248); SNF v Jones [32]; Falkingham v Hoffmans [2014] WASCA 140; (2014) 46 WAR 510 [304].
[142] Bennett v Carruthers [2010] WASCA 131 [27] ‑ [28]; Falkingham v Hoffmans [304].
[143] Falkingham v Hoffmans [87], [305].
In our opinion, when the primary judge's reasons are, as they must be, read as a whole, the essential path of reasoning to the impugned conclusions is disclosed with sufficient certainty and in sufficient detail to meet the objects referred to in [80](2). That is so, having regard to the following:
(1)The primary judge found, in effect, that in providing relief, the court may define the interest which satisfies the equity, and that the role of the court is to do what is practically just to make good the expectations, including any conditions or cross‑promises that attached to those expectations.[144]
(2)The primary judge's statement of legal principles included that equity is flexible and can recognise the need for a clean break and that equity must do justice to the defendant and must take into account the impact of its orders on third parties or any hardship or injustice they would suffer.[145]
(3)The primary judge identified, with appropriate precision, the nature and scope of the gift and the conditions to which Mr Browne's promise was subject. Her Honour found that Mr Browne's promise to leave Burracoorong to Steven was subject only to payment to Mr Browne of an annual amount to cover Mr and Mrs Browne's living expenses (fixed by agreement in 1999 at $18,000 per annum).[146]
(4)Her Honour also found that Mr Browne's representations and promises induced in Steven the reasonable expectation that he could farm Burracoorong independently, and that Mr Browne would facilitate Steven procuring and maintaining debt funding to support Steven's farming operations, including by making the title to Burracoorong available as security for that purpose.[147]
(5)The primary judge found that Mr Browne had resiled from the expectations he had induced in Steven in a number of respects, including by expressing a preparedness to evict Steven, an intention to revoke or alter his will to penalise Steven if he failed to honour and respect Mr Browne's wishes, and a desire to withdraw his guarantee and to sell or use Burracoorong to secure a loan for funds for Mr Browne's use.[148]
(6)The primary judge found that the parties were in conflict and the relationship had broken down.[149]
(7)Her Honour recognised the relevance of subsequent events to the identification of the appropriate remedy.[150] The primary judge summarised, and engaged with, Mr Browne's contention that the absence of putative beneficiaries of Mr Browne's estate from the proceedings precluded an order for transfer.[151] Further, her Honour concluded that the contention was not made out on the evidence dealt with later in the reasons. That was evidently a reference to some or all of [320] - [334].
(8)The primary judge gave detailed consideration to Mr Browne's contention that his circumstances were such that it would be inequitable for him to have to relinquish Burracoorong or be denied the equity in the property.[152] The question of whether Mr Browne's circumstances gave rise to an inequity of the kind for which he contended relates primarily, if not exclusively, to the question of the appropriateness of relief that he transfer the property while he was alive. The primary judge was not persuaded by Mr Browne's contentions in this respect.
(9)In all of these circumstances, the primary judge was satisfied that good conscience required that Mr Browne be held to his promises and that the equity raised by his conduct could only be accounted for by providing an immediate transfer, so as to provide for a clean break.[153]
[144] Primary reasons [335].
[145] Primary reasons [101].
[146] Primary reasons [199], [201], [203], [234].
[147] See [43] - [48] above.
[148] Primary reasons [275].
[149] Primary reasons [113], [114], [310].
[150] Primary reasons [102] ‑ [103].
[151] Primary reasons [106] ‑ [108], set out in [60] above.
[152] Primary reasons [322] ‑ [334].
[153] Primary reasons [336].
Further, the primary judge's reasons engaged with the substance of Mr Browne's submissions concerning whether an immediate transfer should be ordered, as outlined in [78] and [79] above. In finding that Mr Browne had resiled from his promise, and the expectation it engendered, by expressing an intention to revoke or alter his will, the primary judge, in effect, rejected Mr Browne's submission outlined at [78](1) and [79](1). By her conclusion at [108] of her reasons, extracted at [60] above, the primary judge rejected Mr Browne's submissions outlined at [78](2) and (3). The primary judge accepted the submission outlined at [78](4),[154] but, after a careful analysis of the evidence, rejected the submission outlined at [78](5) and [79](2).[155] Mr Browne accepts that the primary judge dealt, in detail, with his submission that compensation, not a transfer, should be awarded.[156] The primary judge rejected the other submissions outlined at [78](6), finding that Mr Browne was pressing for payment of rent, to be increased at his unfettered discretion, and was asserting a right to evict Steven.[157]
[154] Primary reasons [327] ‑ [328].
[155] Primary reasons [329] ‑ [334].
[156] Appeal ts 48.
[157] Primary reasons [275].
We do not accept Mr Browne's submissions, outlined at [75] above, that:
(1)the question of compensation or transfer, and the question of whether transfer should be on death or immediate, are distinct; and
(2)the primary judge's reasons at [310] - [335] relate only to the first of these questions.
In this case, several considerations were relevant to both questions. Mr Browne's submissions at trial as to the (absence of) need for a clean break were made in the context of his submissions that compensation should be preferred to an order for transfer. The primary judge's reasons at [310] - [335] responded to, and resolved the issues arising from, Mr Browne's submissions concerning both these issues. Against this background, it is unsurprising that the primary judge expressed her conclusions in relation to both issues in the same paragraph.
As to Mr Browne's submission summarised in the last sentence of [75] above, insofar as there was any 'heightened need' to explain the relief granted, for the reasons already given, the relief granted was adequately explained. In any event, in our view the submission proceeds on a mistaken premise, in asserting that the judge went beyond enforcing 'perfection of the promise' (emphasis added). On the judge's findings there were a number of representations and promises (see [37] ‑ [49] above and see [102] below). The remedy to which Steven was, prima facie, entitled was one that enforced the reasonable expectation induced by the totality of Mr Browne's promises and representations, not solely the promise to leave the properties at death.[158]
[158] As to the relationship between the remedy granted and the totality of Steven's expectations, see [109] below.
Contrary to Mr Browne's submissions outlined at [74] above, evaluating the adequacy of the reasons in this case is not assisted by a comparison with the reasons in other cases, in which similar issues are said to have arisen. The adequacy of reasons is to be assessed in the context of the evidence, issues and submissions in the particular case.
For these reasons, ground 4 fails.
Ground 5
Mr Browne's submissions
Counsel for Mr Browne encapsulated his contentions concerning ground 5, as follows: [159]
(1)The facts found by the primary judge were incapable of sustaining her Honour's conclusion that 'the equity raised by Mr Browne's conduct can only be accounted for by granting relief which provides for a clean break'. It was submitted that this was so even if her Honour's conclusion is, on a proper reading, that providing for a clean break was not the 'only' way to account for the equity raised, but rather 'the preferable way or the most appropriate way'.
(2)The primary judge erred in her treatment of the third party interests of Mrs Browne and Steven's siblings, in misdirecting herself and failing to have regard to those interests, or in failing to have adequate regard to them.
[159] Appeal ts 51 - 53; appellant's submissions [48], [49]. Originally, Mr Browne advanced a further written submission at [48](a) which relied on reasons given in ground 3; as Mr Browne no longer advances ground 3, this aspect of his submission in support of ground 5 falls away.
Mr Browne does not challenge the primary judge's reasoning at [108] in finding that the prospect of a Family Provision Act claim did not bar Steven's claim. However, in developing the two submissions above, he contends that, when considering the question of the appropriate relief, the primary judge was bound to consider all of the circumstances of the case, including the nature of the representation found and the implications for third parties (particularly Mrs Browne and other children) who were not before the court.[160] Mr Browne emphasises the primary judge's finding that Mr Browne promised to gift Burracoorong to Steven on his death, not before his death.[161] In his submission, her Honour failed to 'refer to, let alone consider,' implications for third parties and, as such, failed to have adequate regard to the potential unfairness of the order made in removing Burracoorong from the operation of the Family Provision Act in the following ways:[162]
(a)effectively removing Mr Browne's ability to gift Burracoorong to Steven in his will, which the third parties could have challenged upon Mr Browne's death pursuant to s 6 of the Family Provision Act; or
(b)allowing Steven to deal with Burracoorong and its proceeds so that it is beyond the reach of any orders which may be made upon their application under the Family Provision Act.
[160] Appellant's submissions [54] - [56] citing Giumelli v Giumelli [49] - [51], Flinn v Flinn [121] and Delaforce [93]; appeal ts 54 - 55.
[161] Appellant's submissions [51].
[162] Appellant's submissions [59] - [63].
Mr Browne submits that, if the primary judge had had proper regard to this issue, her Honour would have ordered the alternative relief sought by Steven below,[163] namely:
(a)the transfer of Burracoorong on Mr Browne's death; and
(b)that Mr Browne continue to make Burracoorong available to secure Steven's loan to allow Steven to continue to farm it.
Disposition
The test for error on appeal
[163] Appellant's submissions [64].
Counsel for Mr Browne appeared to accept that, as appellant, Mr Browne was required to establish an error, in the House v The King sense, in the relief granted.[164] Whether that is so is unclear and, as explained below, need not be decided.
[164] See, for example, appeal ts 45, 57.
It is said, so commonly as to be trite, that equitable remedies are discretionary. However, discretion arises in several senses and in several respects, not all of which are to be equated.
When acting in its auxiliary jurisdiction, a court of equity exercises a broad discretionary judgment as to whether to grant an equitable remedy or to leave the plaintiff to their remedies at law. In Cardile v LED Builders Pty Ltd,[165] Gaudron, McHugh, Gummow and Callinan JJ cited with approval the following observations of Lord Hoffmann in Bristol City Council v Lovell:[166]
The reason why an injunction is a discretionary remedy is because it formed part of the remedial jurisdiction of the Court of Chancery. If the Chancellor considered that the remedies available at law, such as damages, were inadequate, he could grant an injunction to give the plaintiff more effective relief. If he did not think that it was just or expedient to do so, he could leave the plaintiff to his rights at common law. The discretion is therefore as to the remedy which the court will provide for the invasion of the plaintiff's rights.
[165] Cardile v LED Builders Pty Ltd [1999] HCA 18; (1999) 198 CLR 380 [32].
[166] Bristol City Council v Lovell [1998] UKHL 8; (1998) 1 All ER 775, 782.
A claim for proprietary estoppel is in equity's exclusive jurisdiction. In that sphere, also, it has often been observed that equitable remedies are discretionary, albeit that the discretion is exercised in accordance with settled principles.[167] Discretionary defences such as laches or unclean hands may be a reason to refuse particular equitable relief.
[167] See, for example, Warman International Ltd v Dwyer [1995] HCA 18; (1995) 182 CLR 544, 559; Vadasz v Pioneer Concrete Pty Ltd [1995] HCA 14; (1995) 184 CLR 102, 114.
The moulding of relief for proprietary or other equitable estoppels has been said, in a number of cases, to involve a discretion.[168] Of course, that is not to suggest it is an unfettered discretion. Rather, it is to be exercised in accordance with settled principles.[169]
[168] Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394, 454; Giumelli v Giumelli [34]; Austotel Pty Ltd v Franklins Selfserve Pty Ltd (1989) 16 NSWLR 582, 616; Delaforce [57] ‑ [58]; Harrison v Harrison [2013] VSCA 170 [140]; McNab v Graham [2017] VSCA 352; (2017) 53 VR 311 [112].
[169] Delaforce [58]. See, and compare, Edelman JJ, 'Remedial Certainty or Remedial Discretion in Estoppel after Giumelli?' (1999) 15 Journal of Contract Law 179; Gardiner S, 'The Remedial Discretion in Proprietary Estoppel' (1999) 115 The Law Quarterly Review 438.
Whether an appeal against relief granted in respect of proprietary estoppel requires demonstration of error in the House v The King sense does not appear to have been authoritatively determined. The question has been left open in a number of cases in the Court of Appeal of Victoria.[170]
[170] Flinn v Flinn [119]; Donis v Donis [17]; Fifteenth Eestin Nominees Pty Ltd v Rosenberg [2009] VSCA 112; (2009) 24 VR 155 [272].
The demarcation between conclusions of a primary judge attracting the House v The King standard of appellate review, and those which attract the correctness standard of appellate review, has recently been analysed by Gageler J.[171] On his Honour's analysis, where the legal criterion to be applied by the primary judge tolerates a range of legally permissible outcomes, the House v The King standard applies; where, on the other hand, the legal criterion to be applied by the primary judge demands a unique outcome, the correctness standard applies.[172] This distinction is not to be equated with the question of whether the outcome was one on which judicial minds might reasonably differ.[173] Rather, the distinction is rooted in the character of the criterion or criteria by which the original decision is to be made.
[171] Minister for Immigration and Border Protection v SZVFW [2018] HCA 30; (2018) 92 ALJR 713 [35] ‑ [50].
[172] SZVFW [43], [44], [47], [49].
[173] SZVFW [49], [150]; The Queen v Dennis Bauer (a pseudonym) [2018] HCA 40; (2018) 92 ALJR 846 [61].
It is a cardinal principle of equity that the remedy must be fashioned to fit the nature of the case and the particular facts.[174] That feature of the identification of the appropriate equitable relief does not, of itself, make it an exercise of discretion and does not make the House v The King standard of appellate review applicable.[175] Thus, identification of the benefit or gain for which a wrongdoer is to be ordered to account falls to be assessed on appeal by the correctness standard.[176]
[174] Warman (559); Bofinger v Kingsway Group Ltd [2009] HCA 44; (2009) 239 CLR 269 [1].
[175] Ancient Order of Foresters in Victoria Friendly Society Ltd v Lifeplan Australia Friendly Society Ltd [2018] HCA 43; (2018) 92 ALJR 918 [83].
[176] Ancient Order of Foresters v Lifeplan [83].
As we have said, no decision appears to determine whether the criteria by which a court of equity decides the appropriate response to a finding of proprietary estoppel is one that admits of a single correct answer or of a range of outcomes.
In the present case, it is not necessary to determine the standard of appellate review because Mr Browne has not demonstrated error, in any sense, in the primary judge's conclusions concerning the relief to be granted. In our opinion, for the reasons that follow, the primary judge reached the correct and preferable conclusion as to the appropriate relief.
The appropriate relief, leaving aside third party interests
Ground 5 relies primarily, if not entirely, on alleged errors concerning third party interests. It is convenient to begin analysis without reference to third party interests. If any alleged third party interests are put to one side, it could not be said, as in the submission outlined at [88](1) above, that the facts found by the primary judge were incapable of sustaining an order for immediate transfer. To the contrary, in our respectful opinion, in the circumstances as found by the primary judge, an order for immediate transfer was plainly the appropriate and correct order. That is so for the following reasons.
The primary judge identified the task in these circumstances as being to do what is practically just to make good Steven's reasonable expectations, taking account of any conditions or cross‑promises attaching to the expectations.[177] Whilst it is true (as Mr Browne emphasises),[178] that the primary judge found that Mr Browne promised to give Steven Burracoorong upon his death, this was not the only finding relevant to the reasonable expectation created or encouraged by Mr Browne. Her Honour also found that Mr Browne's other promises or representations induced Steven's reasonable expectation that he could use the land to farm independently of Mr Browne, and for financing his farming operations (see [43] ‑ [48] above).
[177] Primary reasons [335].
[178] Appellant's submissions [50] - [51].
The scope of Steven's reasonable expectations, induced by Mr Browne's promises, points strongly in favour of an order for immediate transfer for essentially two reasons. The first concerns the obvious prospect of practical difficulties, if Mr Browne were to continue to be the legal owner of Burracoorong. The second concerns the absence of any right, of Mr Browne, to enjoy any aspect of the incidents of beneficial ownership of Burracoorong. We proceed to explain these two points.
First, on the primary judge's unchallenged findings, any relief allowing Mr Browne to continue to be the legal owner of Burracoorong would raise obvious practical difficulties inconsistent with the enforcement of Steven's reasonable expectations created or encouraged by Mr Browne. Mr Browne induced Steven's reasonable expectation that he could continue to farm the property independently and used Burracoorong to finance his farming operations. Mr Browne demonstrated a desire and propensity to defeat those expectations. For example, he threatened to evict Steven. Further, in both 2013 and 2017, he threatened to withdraw his guarantee of the debt associated with Steven's farming operation.[179] If Mr Browne remained the legal owner of the land, the potential for further disputes, concerning access to Burracoorong and, especially, its availability to facilitate the financing of Steven's farming operations, was obvious. Immediate transfer of Burracoorong, with a charge on the land to secure the annual payments, provided appropriate protection of Steven's reasonable expectations, induced by Mr Browne. The same could not be said, with appropriate confidence, of orders for Burracoorong to pass to Steven only upon Mr Browne's death. In our respectful opinion, the primary judge was correct in finding that the enforcement of Steven's reasonable expectations in the circumstances called for a clean break.
[179] Primary reasons [275].
This conclusion is reinforced by Mr Browne's failure, on appeal, to propose or identify any orders which would ensure that Steven's expectations were protected in a workable manner. In his orders wanted, Mr Browne proposed substitute orders that Burracoorong is to be transferred to Steven on Mr Browne's death and Mr Browne is to continue to make Burracoorong available to secure Steven's loans, so as to allow Steven to continue farming Burracoorong.[180] Those orders reflected Steven's alternative claim in the prayer for relief in the statement of claim.[181] Mr Browne accepts that the substitutive orders proposed in his orders wanted would not, in their terms, provide adequate or appropriate protection of Steven's reasonable expectations as found by the primary judge.[182] So much is obvious. For example, the proposed orders wanted do not in terms prevent Mr Browne from denying Steven access to Burracoorong, or prevent Mr Browne from imposing terms upon which he would make Burracoorong available to secure Steven's loans inconsistently with his promise to allow Steven to farm Burracoorong independently (see [43] above).
[180] WAB 21.
[181] Statement of claim prayer for relief.
[182] Appeal ts 112.
Mr Browne recognises, and submits, that further orders would need to be fashioned, as would have been necessary at trial if the primary judge had rejected Steven's primary relief.[183] However, he did not proffer or identify any more detailed orders. In circumstances where Mr Browne, as appellant, asserts error in the primary judge's decision to adopt Steven's primary relief, the absence of alternative proposed orders that provide appropriate and workable protection of Steven's reasonable expectations counts against acceptance of Mr Browne's contention.
[183] Appeal ts 112.
Secondly, as Mr Browne's counsel effectively accepted on appeal,[184] on the reasonable expectations of Steven as found by the primary judge, relief would need to be fashioned on the basis that Mr Browne himself retains no beneficial enjoyment of Burracoorong. In other words, any relief would be on the footing that he was not entitled to enjoy any of the incidents of beneficial ownership of the land. Mr Browne's only remaining interest was in the ongoing receipt of the annuity, a matter which Steven did not contest at trial and which was secured by a charge over the land.
[184] Appeal ts 114 - 115.
Taking that into account, and given the considerations referred to in [102] ‑ [106] above, leaving aside any third party interests, this was an appropriate case for an immediate transfer of Burracoorong.
It might, perhaps, have been suggested that the charge imposed on the land by her Honour's orders should have incorporated a negative pledge not to borrow against the land for purposes other than Steven's farming operations and upon 'standard prudential terms' (see [46] above). However, Mr Browne did not seek such terms at trial and did not contend on appeal that the judge erred in failing to impose such terms. Mr Browne's essential complaint in the appeal was that the judge should not have made any order which recognised or provided for the legal and beneficial interest in Burracoorong to be held by Steven prior to Mr Browne's death. It was not that Steven should have the beneficial interest in the land constrained by contractual stipulations in the form of a negative pledge.[185] Further, and in any event, on the findings of fact referred to in [47] above, the practical need for, or utility of, the imposition of such additional orders is far from evident, given that:
(1)Mr Browne's only remaining interest in Burracoorong secured by the charge is in ongoing receipt of the annuity; and
(2)it would be in Steven's self‑interest only to obtain finance on 'standard prudential terms'.
Third party interests
[185] Cf appeal ts 109; see also 114 - 115.
That brings us to Mr Browne's contentions concerning the relevance of third party interests.
We begin with Mr Browne's submission that the primary judge misdirected herself in relation to third party interests. The submission is that, in finding that the potential operation of the provisions of the Family Provision Act 'does not bar a claim in equity', the primary judge, in effect, found that she need not have regard to it.[186] Further, Mr Browne submits that the primary judge did not, in fact, have regard to it, as is evident from the absence of any mention of a potential Family Provision Act claim in the primary judge's reasons under the heading 'Measure of relief'.[187]
[186] Appeal ts 56, 58, 63.
[187] Appellant's submissions [53]; appeal ts 58, 63.
These submissions must be rejected. They overlook the need to read the primary judge's reasons in the context of the issues fought, and submissions made, at trial. We have detailed Mr Browne's submissions at trial concerning the Family Provision Act at [78](2) and (3) above. Those submissions asserted a bar to the alternative relief claimed by Steven, namely the transfer of Burracoorong on Mr Browne's death; they did not direct attention to a discretionary consideration of the interests of third parties as a reason against an immediate transfer. Mr Browne's submissions were to the effect that the alternative relief sought by Steven would 'oust the operation of' (1) the Family Provision Act;[188] (2) that the alleged testamentary promise 'would not be enforceable' because equity will not 'curtail the operation of the statute'; and (3) that Steven's claimed alternative relief 'fails to disclose a cause of action'.[189] The primary judge engaged fully with these submissions. Her Honour's conclusion that the potential operation of the Family Provision Act 'does not bar a claim in equity arising in the interim' was a response to, and rejection of, those submissions.[190] In that respect, her Honour's conclusion was, with respect, inevitable and plainly correct. Nothing her Honour said reveals or suggests any error.
[188] Defendant's opening outline of submissions at trial [93].
[189] Defendant's opening outline of submissions at trial [94].
[190] Primary reasons [108].
At trial, Mr Browne made no written or oral submission that defeat of a potential Family Provision Act claim, by Mrs Browne or any of Steven's siblings, was a discretionary factor against an order for immediate transfer, rather than transfer upon Mr Browne's death. Further, Mr Browne led no evidence of the financial circumstances of any potential claimant under the Family Provision Act.
In these circumstances and for these reasons, the primary judge did not overlook, or fail to have any regard to, the prejudice to Mr Browne's wife and other children, in defeating their potential claims under Family Provision Act, that would arise from an order for immediate transfer.
That leaves Mr Browne's contention that the primary judge failed to give adequate weight to the potential prejudice to third party interests, outlined at [88] above, and that, had adequate weight been given to this consideration, an order for immediate transfer would not have been made.
To the extent that the decision to mould relief for proprietary estoppel is a discretionary decision to which the need to demonstrate a House v The King error applies, such an argument faces substantial obstacles in principle. Mr Browne accepted as much.[191]
[191] Appeal ts 57 - 58.
In any event, to the extent that this court's task is to identify the correct remedy in the circumstances of the case, no error is revealed in the primary judge's conclusion. On the primary judge's unchallenged findings, any potential prejudice to future claimants under the Family Provision Act did not require or justify an order different from the order for immediate transfer made by the primary judge. As we have said, no evidence was led as to the financial circumstances of any potential claimant under the Family Provision Act. Further, the primary judge found, without challenge on appeal, that Mr Browne had not led sufficient evidence to establish his overall financial position.[192] Thus, the evidence did not indicate the extent of any need for proper maintenance or advancement of any claimant. Nor did the evidence suggest, much less establish, that, if Burracoorong were excluded, Mr Browne's estate would be insufficient to satisfy any claims under the Family Provision Act. In those circumstances, and in the circumstances outlined in [102] ‑ [107] above, the possibility that, upon Mr Browne's death, his wife or one (or more) of his other children might make a claim under the Family Provision Act did not justify or require relief different from that granted by the primary judge.
[192] Primary reasons [333] ‑ [334]; see also [67] above.
If it had been established that the removal of Burracoorong from Mr Browne's estate would render the estate insufficient to meet the likely claims of dependents under the Family Provision Act, questions may have arisen as to the extent to which those circumstances should detract from the enforcement of Steven's prima facie right to have his expectations made good.[193] For the reasons already given, no such questions arose in this case.
[193] Compare McNab v Graham [132] ‑ [134].
For these reasons, in our view, the primary judge's reasons, and the conclusion she reached, reveal no error concerning third party interests. Not only are the facts capable of sustaining the judge's finding as to the appropriate relief, on the facts found by her Honour, we would grant the same relief.
Consequently, ground 5 fails.
Application to adduce additional evidence
Mr Browne applied to adduce additional evidence, contingent upon the success of one of the grounds of appeal. In other words, he proposed that the evidence be received only if a ground of appeal succeeded.[194] As both grounds of appeal fail, the application must be dismissed. However, we would add that, even if a ground of appeal had been successful, we would have dismissed the application for leave to adduce additional evidence.
[194] Appeal ts 39.
The additional evidence sought to be led by Mr Browne comprises a codicil to his will of 4 August 2017 and a deed of irrevocable testamentary disposition. The proposed additional evidence is of no assistance, and should not be admitted, for the following reasons.
First, as noted at [27] above, the codicil is a codicil to a will that Mr Browne has already revoked.[195]
[195] Primary reasons [43].
Secondly, the codicil confirms other parts of Mr Browne's will by which he confirms his right to modify his will if any of his sons fail to honour and respect his wishes.
Thirdly, evidence of arrangements of the kind reflected in the proposed additional evidence could, and should (if it were to be relied on), have been led at trial. The effect of admission of the evidence now would be to allow Mr Browne to run a point not argued below - whether arrangements of the kind reflected in the additional evidence would in all the circumstances satisfy the reasonable expectation which Mr Browne created or encouraged in Steven. No exceptional circumstances have been shown as to why this new point should be permitted to be raised, for the first time, on the appeal.[196]
[196] See, generally, Rizhao Steel Holding Group Co Ltd v Koolan Iron Ore Pty Ltd [2012] WASCA 50; (2012) 43 WAR 91 [48] ‑ [53].
Conclusion
For these reasons, we would dismiss the appeal. We would hear from the parties as to costs.
I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
LW
Associate to the Honourable Justice Beech10 JANUARY 2019
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