Como v Helmers
[2011] WASC 179
•29 JULY 2011
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: COMO -v- HELMERS [2011] WASC 179
CORAM: CORBOY J
HEARD: 13, 22, 29 JUNE, 18 & 20 JULY 2011
DELIVERED : 28 JULY 2011
PUBLISHED : 29 JULY 2011
FILE NO/S: CIV 2002 of 2011
MATTER :Section 138C of the Transfer of Land Act 1893
BETWEEN: MICHAEL BERND COMO
Plaintiff
AND
HELGA-EVA HELMERS
First DefendantTHE REGISTRAR OF TITLES
Second Defendant
Catchwords:
Caveats - Whether caveatable interest by testamentary contract or proprietary estoppel by encouragement or promissory estoppel - Discretion to amend caveat - Turns on own facts
Legislation:
Transfer of Land Act 1893 (WA), s 137, s 138
Result:
Application to extend operation of caveat dismissed
Category: B
Representation:
Counsel:
Plaintiff: Mr C P Stokes
First Defendant : Mr A J Aristei
Second Defendant : No appearance
Solicitors:
Plaintiff: Chris Stokes & Associates
First Defendant : Corser & Corser
Second Defendant : No appearance
Case(s) referred to in judgment(s):
Austotel Pty Ltd v Franklin's Self‑Serve Pty Ltd (1989) 16 NSWLR 582
Bell Group Ltd (In Liq) v Westpac Banking Corporation (No 9) (2008) 39 WAR 1
Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153
Cruz v Osborne [1999] WASC 8
Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42
Delaforce v Simpson‑Cook [2010] NSWCA 84
Donis v Donis (2007) 19 VR 577
Giumelli v Giumelli (1999) 196 CLR 101
Glass v Glass (Unreported, WASC, Library No 950229, 16 May 1995)
J & H Just Holdings Pty Ltd v Bank of New South Wales (1971) 125 CLR 546
Jandric v Jandric [1999] WASC 22
Legione v Hateley (1983) 152 CLR 406
Meynert v Leafdale Pty Ltd [2005] WASC 102
Midland Brick Co Pty Ltd v Welsh [2006] WASC 122
National Australia Bank v McCourt [2010] WASC 237
Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306
Palagiano v Mankarios [2011] NSWSC 61
Palazzo Homes Pty Ltd v Goh [2010] WASC 407
Porter v McDonald [1984] WAR 271
Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466
Sullivan v Sullivan [2006] NSWCA 312
Thorner v Major [2009] 3 All ER 945
Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387
CORBOY J:
(These reasons were delivered orally on 28 July 2011 and have been edited.)
Introduction
The plaintiff, Mr Como, and the first defendant, Ms Helmers, are brother and sister. They were born in Germany; Ms Helmers in 1942 and Mr Como in 1946. Ms Helmers' father died during WW II.
In 1949, Mr Como and Ms Helmers emigrated to Australia with their mother, Alice Rose Emme, and her then husband. Ms Helmers returned to Germany in 1967 and has resided there since that time.
The late Ms Emme subsequently divorced her husband and in about 1961, she became the registered proprietor of lot 185 on plan 2833, being all that land comprised in Certificate of Title vol 1017 folio 305 and being land situated at 125 Coode Street, South Perth (I will refer to the land as the 'South Perth property').
Ms Emme resided at the South Perth property until about 2007 when she relocated to a nursing home. She passed away on 30 September 2009. She remained the owner of the South Perth property at the time of her death.
Ms Emme made a will on 16 May 1982. The will appointed Ms Helmers sole executrix of Ms Emme's estate and devised and made a gift and bequest of all of her property of 'whatsoever nature and wheresoever situated' to Ms Helmers. The will was written in English on a standard form that was commonly used at the time. Probate of the will was granted to Ms Helmers on 30 December 2009 (the grant of probate and the will are annexure 'MBC‑1' to the affidavit of Michael Bernd Como sworn 9 June 2010) (Mr Como's first affidavit).
On 14 January 2010, title to the South Perth property was transferred to Ms Helmers in her personal capacity pursuant to the terms of her late mother's will (see annexure 'CPS‑4' to the affidavit of Christopher Placid Stokes sworn 19 July 2011).
On 21 March 2011, Mr Como lodged a caveat (the Caveat) against the title to the South Perth property (the caveat is annexure 'CPS‑3' to Mr Stokes' affidavit). On 20 May 2011, the second defendant sent a notice to Mr Como under s 138B of the Transfer of Land Act 1893 (WA) (TLA). On 9 June 2011, Mr Como commenced proceedings by originating summons seeking an order extending the operation of the Caveat until further order of the court. On the same day, I made an ex parte order extending the Caveat. Subsequently, I made directions for an inter partes interlocutory hearing of Mr Como's application.
It should be noted that Mr Como has not commenced proceedings to vindicate his claim to an estate or interest in the South Perth property.
The occasion for the issue of the s 138B notice was that Ms Helmers had entered into a contract for the sale of the South Perth property. A copy of the offer and acceptance is attachment 'CKS‑1' to the affidavit of Chau Kim Savas sworn on 18 July 2011. The contract provided for settlement on 1 July 2011 but included as a special condition that 'settlement to be within 10 business days from caveat being removed from the title but not before July 1, 2011'.
The offer and acceptance was not before the court at the time that directions were made for the inter partes hearing of Mr Como's application. However, the court was advised that settlement was scheduled for 1 July 2011 and that inquiries were being made about whether an extension of time could be granted in the light of Mr Como's application. The court was subsequently advised that an extension of the date of settlement to 1 August 2011 had been agreed by the purchasers.
An issue arose in the course of the hearing over the effect of that agreement having regard to the special condition concerning settlement that formed part of the offer and acceptance. The issue was relevant to the balance of convenience.
I have decided that it is not necessary to resolve the issue for the purpose of determining Mr Como's application. The possibility that the purchasers have an enforceable right under the contract for the sale and purchase of the South Perth property to insist on settlement on 1 August 2011 has not been considered in determining this application. However, the possibility that settlement is required to be effected on that date explains why these reasons have been delivered orally and as a matter of some urgency.
The caveat and the proprietary interest claimed by Mr Como
The caveat lodged against the title to the South Perth property stated that:
(a)'my interest being claimed is as beneficiary of the estate of Alice Rose Emme' (that being the description given to the estate or interest claimed);
(b)the estate or interest was claimed by virtue of 'my interest in the claim being made is that I am a beneficiary in my mother's estate by virtue of the facts in my statutory declaration';
(c)the registration of any instrument affecting the estate or interest was absolutely forbidden.
The statutory declaration made by Mr Como in support of the caveat stated:
The interest claimed is that I am a beneficiary in the estate of my mother Alice Rose EMME who is the registered proprietor of lot 185, vol 1017 fol 305. (the estate)
My claim arises by virtue of my mother's wish that the above estate should go to me as a reward for caring for her and her estate for 57 years,,
My sister Helga Eva Helmers of Strullenweg 2, 31848 Bad Muender, Germany, who has been a permanent resident of Germany for 45 years has knowingly presented a superseded will for probate which made her the registered proprietor of the above estate.
A subsequent will does not appoint her as the executor or beneficiary of the above estate.
The most recent will is being challenged and is under arbitration,
Landgate will be advised as to the outcome of the arbitration.
Ms Helmers submitted that the Caveat was in a defective form. That submission is further considered later in these reasons.
The three wills made by Ms Emme
Mr Como referred to three wills in his statutory declaration ‑ a 'superseded' will presented for probate; a 'subsequent' will and the 'most recent' will. The reference to a superseded will must be to the 1982 will as this was the will that was admitted to probate.
The evidence disclosed that there were two further documents signed by Ms Emme and which were expressed to be her wills. The first document was dated 22 September 1987 and the second, 22 July 2004. Both documents were written in German. Each document forms part of annexure 'MBC-2' to Mr Como's first affidavit, pages 15 to 19. There is a translation of each document made by Ms Helmers and forming part of annexure 'MBC-3' to Mr Como's first affidavit, pages 22 to 23. Both parties were content to adopt Ms Helmers' translation of the documents for the purpose of this application.
The September 1987 document appears to have been made before a notary in Germany and contained a declaration that Ms Emme wished to have 'a testament written without any encumbrances of previous wills'. The document then recorded that Ms Emme had declared her last will as follows, 'I herewith declare that my daughter … is to be my only heir'. The document stated the worth of the estate was DM 80,000.
The July 2004 document was handwritten and was, according to the translation, headed 'Last will and testament'. The document stated:
Herewith I, Alice Rose Emme, nee Seltmann, born on 16.June 1915, determine as my will that in the case of my death, my daughter Helga-Eve Helmers nee Emme, born 07.08.1942 living in Strullenweg 2 31848 Bad Munder, Germany will be the sole heir of my flat in Felsenkellerweg 6 Hameln Lower Sachsony.
I declare this in good physical and mental condition.
Perth 22, July 2004
Mr Como did not identify the 'subsequent' will or the 'replacement' will in his statutory declaration nor did he expressly state in his evidence that the 1987 and 2004 wills that he produced were the wills to which he had referred in his declaration. However, the inference from the production of the 1987 and 2004 wills is that they were the 'subsequent' and 'replacement' wills respectively.
The estate or interest claimed by Mr Como
It was contended that Mr Como possessed an estate or interest in the South Perth property by reason of the following matters (which were argued in the alternative):
(a)In about 1989, Ms Emme and he made an agreement by which Ms Emme bound herself to leave the South Perth property to him on her death.
(b)Prior to 1989 and subsequently, Ms Emme promised or represented that she would leave the South Perth property to him and he built a garage on and maintained the property and its garden in reliance on that promise or representation. He also provided care and assistance to Ms Emme.
(c)Following Ms Emme's death, Ms Helmers promised or represented that she would transfer the South Perth property to Mr Como. In reliance on that promise he refrained from instituting proceedings to challenge the grant of probate of the 1982 will or to obtain declaratory or other relief (presumably, so as to vindicate his claim to the South Perth property) or relief under the Inheritance (Family and Dependants Provision) Act 1972 (WA) (Inheritance Act).
The evidence
The evidence can be divided between events that are alleged to have occurred while Ms Emme was alive and exchanges between Mr Como and Ms Helmers following her death. It is not necessary to recount the full detail of the evidence given the interlocutory nature of the application. The summary that follows is organised around the grounds relied on by Mr Como. Conveniently, the grounds follow the relevant chronology.
The evidence concerning the alleged contract to leave the South Perth property to Mr Como
Mr Como contended that a contract was made at the time that he built a garage/shed on the South Perth property by which Ms Emme agreed to leave the property to him in her will. The garage was constructed in approximately 1989 and was described by Mr Como as being a 'significant construction' (par 10 of Mr Como's first affidavit). Mr Como stated at par 11 of his first affidavit that:
On a number of occasions before I constructed the garage my mother said to me that she intended to leave the South Perth property to me on her death. This was said at her home and when we went for our walks around South Perth. It was on the basis of this promise that I decided to construct the garage and to continue to carry out the regular maintenance work.
The evidence relied on in support of a proprietary estoppel
That evidence was also relied on to contend that Mr Como had acquired an equitable interest in the South Perth property through a proprietary estoppel by encouragement. There were other matters that were also alleged by Mr Como in support of that claim:
(a)After his parents were divorced and as Ms Helmers lived in Germany, he had sole responsibility for looking after the care of Ms Emme and the South Perth property (par 8 of Mr Como's first affidavit).
(b)His 'responsibilities' in relation to maintaining the South Perth property included carrying out all maintenance work around the house; planting, watering and maintaining the lawns and gardens; arranging for regular cleaning of the home; painting various rooms in the house; repairing locks and windows and 'generally doing whatever needed to be done' (par 9 of Mr Como's first affidavit).
(c)In the last 31 years of Ms Emme's life he gave up many of his other social and leisure activities to care for her and the South Perth property (par 14).
(d)On several occasions while they were going for a walk, Ms Emme would look back to the South Perth property and ask Mr Como what he was going to do with the house after she was gone (par 15).
The evidence relied on for a promissory estoppel
Mr Como's evidence was that at and immediately following the time of Ms Emme's death he assumed that the South Perth property had been left to him and that he continued to maintain the property in that expectation: par 17 of his first affidavit. However, he apparently took no interest in Ms Emme's will or the administration of her estate as he states that it was only in early July 2010 that he learnt that the South Perth property had been transferred to Ms Helmers. As I indicated earlier, probate had been granted on the 1982 will in late December 2009 and shortly afterwards, the South Perth property was transferred to Ms Helmers in her personal capacity.
I accept for the purpose of this application that Mr Como only learnt of the transfer of the South Perth property in about early July 2010. He stated that he 'then became suspicious' and undertook a search of his mother's will at the probate office, as a result of which he learnt that probate had been granted for the 1982 will. He also confirmed that the South Perth property had been transferred to Ms Helmers by undertaking his own search of the title to the property: par 24 of Mr Como's first affidavit.
Mr Como stated that he decided to write to his sister outlining those matters and demanding that she provide an explanation as to what was happening with the estate: par 25 of Mr Como's first affidavit. He wrote to Ms Helmers by letter dated 13 July 2010 (annexure 'MBC‑4' to Mr Como's first affidavit). The letter commenced:
I want to communicate with you on the matter of Mum's will and estate.
I mentioned it twice in the last 10 months and received a short reply and you moved on without elaborating, eg, 'were you the executor and beneficiary?' "Yes." What will you do with Mum's house, "Don't know".
I left it at that because I thought you were still grieving and working on a plan for our future.
The letter continued by recounting the circumstances in which Mr Como had learnt that the South Perth property had been transferred to Ms Helmers and the searches that he had undertaken at Landgate and the probate office. It then stated:
Mum's will was even more interesting, drafted by you, signed by Mum, and witnessed by Gabbedy on 16 May 1982.
Amazing, 28 years and no updates and amendments.
You said you didn't know what to do with the house and you had 28 years to think about it.
On the 16 May 1982 Mum and you must have planned and discussed the contents of the will before preparing it, why wasn't I mentioned? If Mum wasn't forthcoming with my interests why didn't you mention me? I always looked to you as a fair minded person who stood up for me.
Mr Como inquired as to Ms Helmers' intention in transferring the house into her name. He stated:
Transferring Mum's house into your name was totally unnecessary if you intended to sell it to the public or to me.
I did indicate that I would like to buy your share and develop the two garage site into a two-storey building to compliment the existing building, I remember a no comment response.
That share buyout cannot now be done as the first transfer to you is free of stamp duty under the Probate Act, the next transfer, if you considered me would attract a stamp duty fee of $42,000.
It is to be noted that this part of the letter apparently referred to past discussions that had proceeded on the assumption that Ms Helmers was or would become the registered proprietor of the South Perth property ‑ whether absolutely or as executrix of Ms Emme's estate is not clear as there was no indication as to when Mr Como had suggested that he might buy Ms Helmers' share of the property.
Mr Como continued the letter by stating that, 'What I really need is to buy [Mr Como's former wife and his daughter] a modest home as a divorce settlement and free up the rest of my life.' He requested that Ms Helmers' transfer funds 'so that he could start divorce litigation' (it should be noted that the evidence disclosed that Ms Helmers had control of funds that were acknowledged to be owned by Mr Como).
Mr Como then referred to two matters that he regarded as being important for Ms Helmers in 'making your decisions on Mum's will and estate'. The first of those matters concerned his action in preventing the South Perth property being sold while the Ms Emme was alive. That was said to have occurred in 1989, although Mr Como did not state whether it was before or after the time that the alleged testamentary contract was made with his mother. However, Mr Como did not suggest that he intervened because his mother had promised to give him the property on her death but rather, he acted to prevent the sale because he regarded the sale price to be grossly inadequate. He commented in his letter, 'You have me to thank for maintaining the value of your current house'.
The second matter to which Mr Como referred was that, 'I have been looking after Mum and her house for 56 years starting in 1954 by planting and cutting and watering the lawn and still doing so for you'. Mr Como referred to having given up 'much of my life' and then wrote:
On several occasions as we walked out of the front gate Mum looked back at her house and looked at me for approval and said, 'Do you think I did well in life in achieving and maintaining this house', I agreed. She then said 'What are you going to do with it when you get it, after I'm gone? I said I'd keep it, just to please her, knowing full well in the back of my mind that she had left the house to you.
The letter concluded with a request for further information concerning aspects of Ms Emme's financial affairs.
The terms of Mr Como's letter suggested that he accepted that Ms Helmers was the owner of the South Perth property ‑ she could, for example, 'sell it to the public' and he had acted in the past to maintain the value of 'your current house'. Plainly, he was unhappy with the terms of the 1982 will. However, he did not assert that he was entitled to the property; rather, he appeared to regard the statements that were alleged to have been made by Ms Emme concerning her intention to leave the property to him as being insincere. His final comment in the letter to Ms Helmers was that he had been 'well and truly screwed' by both her and his late mother.
There were references in the letter to shares being held in the property by Ms Helmers and Mr Como. However, it is not possible to fully comprehend those references from the letter and to add to the uncertainty, at one point in the letter Mr Como stated that he had told Ms Emme that he would keep the South Perth property after her death, 'just to please her, knowing full well in the back of my mind that she had left the house to you'.
Two further matters about the letter should be noted.
First, Ms Helmers denies that she was involved in settling the terms of Ms Emme's 1982 will.
Second, as has been already noted, the letter did not contain any assertion of an entitlement to the South Perth property despite the letter having been borne out of Mr Como's suspicions and following a search of the probate and land title offices. Significantly, Mr Como did not suggest that he would challenge or believed that he could challenge the grant of probate of the 1982 will or that he intended to make any application under the Inheritance Act ‑ although, it must be noted that it appears that Mr Como was not aware of the 1987 and 2004 wills at the time that he wrote the letter of 13 July 2010.
I do not consider that Mr Como's failure to assert any entitlement to the South Perth property in his letter can be explained by the fact that it was written without the benefit of legal advice. Mr Como indicated in later correspondence that he had been involved in proceedings in the past in which he had 'challenged' his father's will and he stated in his first affidavit that as at July 2010 he was 'aware of my entitlement as a son of my late mother to bring an "Inheritance Act" claim against the estate' (par 31). I return to that matter later in these reasons.
Ms Helmers replied to Mr Como's letter by letter dated 22 July 2010 (annexure 'MBC‑5' to Mr Como's first affidavit). In summary, she stated that:
(a)The 1982 will was made at a time when there was considerable conflict between Ms Emme and Mr Como 'as your wife was terrorising Mum on the phone and similar'. In that context, she wrote:
When the topic of wills came up in the last years of Mum's life I told you she had put things down in my name to stop your wife getting her fingers on Mum's home by forcing a divorce or similar. I told you we would share when the time comes and I still want to do that. But you were afraid of having property and accounts in your own name because of your wife's cunning and aggressiveness. At least that is what you always told me.
(b)Ms Emme received a pension from the German government which was 'connected' with Ms Helmers' father. Ms Helmers wrote:
I have no father to give me an inheritance so Mum considered her assets in Germany should go to me. But I decided you should have all the money and property in Australia when there is no danger of your wife's taking her share. In my will deposited at the Comm Bank in Sth Pth I have left all moneys and property in Australia to you, hoping that you have a clear status between yourself and your wife by then. If you had been divorced I would have transferred the whole house into your name right from the start as I feel it should have been yours after all the years you spent in looking after Mum and her garden and house.
Ms Helmers again wrote on 26 July 2010 (annexure 'MBC‑6' to Mr Como's first affidavit). She referred once more in that letter to the South Perth property being transferred to Mr Como ‑ 'the $42,000 stamp duty you mention when things are transferred to you are not welcome, admittedly, but they are a better option than losing to your wife ‑ at least that's my opinion on this subject'. She then stated, 'As I wrote in my last letter, I have intended to give you all the assets in Perth when the time comes (when you are not in danger of losing to your wife). That would be a lot more than half of Mum's entire assets.'
The letter continued by reiterating that the 1982 will was made at a time when there was considerable conflict between the late Ms Emme and Mr Como and his wife. She stated, 'Mum and I thought it was in your interest that I take over first till you had sorted out your own family status and she trusted me to keep up to those standards.' Reference was then made to Mr Como putting his 'other property under my name protection'. The letter concluded, 'I want to stress, that I will share at least half of the estates left by Mum but please give me time to sort things out.'
Mr Como stated that, 'as a result of my sister's letters of 22 and 26 July 2010 and the representations made in them that my mother's Australian property, comprising the South Perth property and approximately $500,000 in her bank account would be transferred to me I decided that there was no need for me to challenge the will or to take proceedings to establish my beneficial ownership of the South Perth property' (par 29 of Mr Como's first affidavit). Further, 'it was in reliance on my sister's promise and agreement to me, as set out in her letters of 22 and 26 July, that I did not challenge the grant of probate, or bring a claim against the estate, or lodge an action to prove my beneficial ownership of the South Perth property. I relied upon my sister's agreement' (par 31).
Again, that evidence indicates that Mr Como's letter of 13 July 2010 was written with an appreciation that he might possess rights in relation to Ms Emme's estate, the 1982 will and the South Perth property. The evidence and the terms of the letter of 13 July 2010 raise questions concerning what Mr Como believed at the time that he wrote to Ms Helmers that cannot be resolved in an interlocutory application. I make no finding about that matter beyond what has been recounted in these reasons as to what appears from the letter and the circumstances in which it written, including the knowledge that Mr Como claims he possessed.
Mr Como stated that Ms Helmers came to Perth in March 2011 to arrange for the sale of the South Perth property. She advised him during a meeting in a South Perth restaurant that she intended to only give him half of the proceeds from the sale of the property. He considered that she had broken a 'promise' to give him the house, that he no longer trusted her to 'honour her agreement' and so he lodged the caveat against the title in the South Perth property (par 34 of Mr Como's first affidavit).
Aspects of the evidence of Mr Como that I have summarised are directly and indirectly contested by Ms Helmers. She referred in an affidavit that she made in opposition to Mr Como's application to parts of Mr Como's letter of 13 July 2010 that she considered were inconsistent with the claims that are now made by him. She stated that the letters that she wrote at that time contained statements of her then intentions in respect of property that she owned (by which I understood her to mean, in effect, her then intention to gift some of her property to Mr Como). She also denied Mr Como's version of what occurred in March 2011 and the events leading up to her trip to Australia at that time.
Mr Como made a further affidavit (Mr Como's second affidavit) responding to the evidence contained in Ms Helmers' affidavit. Ms Helmers sought to reply to that material through emails to her solicitors that were annexed to Ms Savas' affidavit (attachments 'CKS‑2' to 'CKS‑7'). That material disclosed, regrettably, that the relationship between Mr Como and Ms Helmers had significantly deteriorated as a result of the dispute that is the subject of these proceedings.
Obviously, it is not possible in an interlocutory application to resolve conflicts in the evidence. The court is required in this application to assess all of the available evidence to form a view as to whether Mr Como has established a prima facie case that he holds a caveatable interest in the South Perth property. Direct conflicts in the evidence created by denials and counter‑denials do not assist the court in making that assessment. Accordingly, I do not propose to set out in detail the balance of the evidence that has been adduced in the application ‑ and see Porter v McDonald [1984] WAR 271, 276 and Glass v Glass (Unreported, WASC, Library No 950229, 16 May 1995) (Murray J). That, of course, does not indicate any view that I have formed about that evidence. It is, as I have explained, merely a reflection of the interlocutory nature of the proceedings. It is, however, also relevant to note what was said by Murray J in Glass:
Of course I may not attempt to resolve factual disputes by preferring one version upon affidavit over another…But in finding the facts, I must have regard to the cogency of the affidavit material and its capacity to command acceptance of an account as being both truthful and accurate on the face of the affidavit and any other material which has been provided by the deponent.
Much of the evidence that has not been summarised concerned the extent to which Mr Como maintained the South Perth property and provided care and assistance to Ms Emme. Again, there were conflicts in that evidence which cannot be resolved in this application. Ms Helmers disputed the extent to which and the basis upon which Mr Como assisted Ms Emme and maintained the South Perth property. She gave evidence of how she and others had provided care and assistance to Ms Emme, suggested that Mr Como had been paid for at least some of the maintenance work that he had performed and stated that at least one other person was involved in attending to maintenance and gardening at the South Perth property. I do not propose to further summarise that evidence for the reason that has already been given.
However, there are two further aspects of the evidence that, in my view, are relevant to the determination of the application.
The first aspect concerns a letter written by Ms Helmers to Mr Como on 15/16 January 2011 (annexure 'MBC ‑21' to the affidavit of Mr Como sworn on 14 July 2010) (Mr Como's second affidavit). The letter referred to a visit that Mr Como had made to Germany. Ms Helmers stated that Mr Como was apparently in favour of selling the South Perth property after 'considering the other options of renting or building alterations and then selling'. She requested that Mr Como make preliminary arrangements to facilitate the sale.
Mr Como gave evidence that he obtained and provided three market appraisals to Ms Helmers in March 2011 in response to that request. He also stated that Ms Helmers had provided him with a written authority in September 2010 to assist him in making inquiries relating to the sale of the property. That is consistent with evidence that Mr Como gave that he visited Ms Helmers in October 2010 and took with him a listing authority for the sale of the South Perth property. At par 32 of his first affidavit, Mr Como stated:
My sister said that she would not sign the listing authority and that she was coming to Perth in March 2011 and would sort the matter out then. I accepted that position but pointed out that I needed to sell the house to have funds to settle with my former wife. She never said that she would not transfer the house to me or not give me the sale proceeds.
Further, Mr Como stated that at the meeting with Ms Helmers in the South Perth restaurant in March 2011 he advised her that he could save 'both of us' the settlement agent's fee on the sale of the property at (Mr Como's second affidavit, par 52(d)).
Mr Como's evidence about the possible sale of the South Perth property and his willingness to assist in its sale is inconsistent with his statement in his first affidavit that he lodged the Caveat because Ms Helmers had indicated at the meeting at the restaurant in March 2011 that she intended to break her promise to give him the South Perth property if a distinction is drawn between a promise to give Mr Como the property - that is, to transfer title to the property - and a promise to give Mr Como the proceeds from the sale of the property or a share of the proceeds. As will be explained, that distinction is critical in the context of this application.
The second aspect of the evidence that must be mentioned concerns correspondence exchanged between Mr Como and Ms Helmers' directly and through Ms Helmers's solicitors following the lodgement of the caveat.
On 31 March 2011, Ms Helmers' solicitors wrote to Mr Como requesting that he remove his personal belongings from the South Perth property and that he return the keys to the property (annexure 'MBC‑8' to Mr Como's first affidavit). Mr Como replied by letter dated 1 April 2011 referring to the 2004 will and asserting, in effect, that the will did not devise any property in Australia to Ms Helmers. The letter further stated that Ms Emme wished that the South Perth property should go to Mr Como as a reward for his services and that he had placed a caveat on the property to protect his interest. The letter continued:
The caveat will be removed when certain conditions and disclosures are met.
I have instructed my solicitor and Landgate to transfer the above property back to Alice Rose Emme.
My daughter Eve Michele Como and I intend to challenge the will of Alice Rose Emme.
The letter did not state the conditions and disclosures that Mr Como required for the caveat to be removed (annexure 'MBC‑9' to Mr Como's first affidavit).
On 12 May 2011 Ms Helmers wrote directly to Mr Como (annexure 'MBC-23' to Mr Como's second affidavit). Much of the letter was devoted to Ms Helmers advising that she was no longer prepared to hold property for Mr Como and indicating what arrangements she proposed to make to relinquish control. However, the letter also stated:
When the house is finally sold, I offer you once again to share the remaining assets 50 – 50 after the deduction of agent and settlement costs. If Mum had left no will you would not have fared better. There is only your word that she wanted to leave the house to you. The will she made and what she told me does not verify that.
Mr Como replied to that letter on the following day (attachment 'HEH‑2' to the affidavit of Helga‑Eva Helmers sworn 7 July 2011). So far as is relevant, Mr Como stated in his letter that:
Your ignorance surrounding the removal of caveats caused you to waste money on solicitors. After you threatened me with legal action to remove me from Coode Street I installed a caveat to protect my interests and advised your solicitor that I would remove the caveat if certain conditions were met. All you had to do was write to me and inquire as to the conditions, meet them and the caveat would be withdrawn. As you didn't do these simple tasks that don't require a solicitor I am not responsible for your ignorance and your solicitor's costs.
By letter dated 21 May 2011, Mr Como responded to a letter from Ms Helmers' solicitors requesting that he immediately withdraw the caveat. In his letter (annexure 'MBC‑12' to Mr Como's first affidavit) Mr Como stated:
The reason for the caveat is as follows, I have known your client for 65 years and she has a history of manipulating and withholding other people's money, especially our mother's and mine, I have invested some money in her account and she refuses to return the full amount until I agree to her demands.
In her recent visit to Perth she has made me an offer in the settlement of my mother's estate, I refused her unsubstantiated offer until the value of the estate can be proven by full disclosure of bank accounts and German estate valuations.
I claim to be a beneficiary in my mother's estate on the grounds that your client has appointed me in her letter on 22 July 2010.
Until your client honours her commitment to me that she promised at our last meeting (see her settlement statement) and to protect me from dishonesty I have registered a caveat on the title. …
I WILL REMOVE the caveat immediately if your client undertakes to pay the promised money into your trust account made payable to myself, this will include the immediate return of my investment money in the Commonwealth Bank a/c … which must include the pre‑arranged interest of 6.25% less her German capital tax.
Your client has had the property at 125 Coode Street valued at $900,000 excluding agents fees. I have made her an offer of $450,000 for her half interest to keep the property in family ownership. She has not responded to this offer to date.
The balance of the letter asserted that a solicitor was to seek leave from the Supreme Court to 'grant authority to challenge my mother's three wills'. It was said that the solicitor had also concluded that the statements made by Ms Helmers in her letter of 22 July 2010 to Mr Como constituted a binding contract to transfer the South Perth property to him 'as a reward for my mother's care and house maintenance for 56 years'. As I have indicated, no proceedings have been commenced by Mr Como and he does not maintain in this application that the letter of 22 July 2011 contained a contractually binding promise.
Again, it is difficult to identify precisely the claim that was being made by Mr Como in his letter to Ms Helmers' solicitors. At one point, he referred to advice that Ms Helmers had agreed to transfer the South Perth property to him. However, at another point he referred to her half interest in the property. Further, the primary purpose of the letter appeared to be to indicate that he would remove the caveat if Ms Helmers agreed to pay a sum of money to him. Although it is not entirely clear, I take the reference to money being paid as being a reference to Mr Como receiving at least half of the proceeds from the sale of the property.
On 23 May 2011, Mr Como again wrote to Ms Helmers' solicitors stating that (annexure 'MBC-14' to Mr Como's first affidavit):
I had a letter from your client stating that all your litigation fees will be deducted from any final settlement, could you please advise her that she is not permitted to do so unless directed by a court.
The garage housing my belongings at 125 Coode street was built and paid for by myself when I was homeless in 1988, My mother gave me permission to store my belongings indefinitely and we had an agreement that when the house is sold my costs would be returned, your client knew the garage was built and owned by me. Maintenance tools and lawn moving equipment for the residence were stored there.
It is a substantial building consisting of concrete floor, brick walls, window, rear door collorbond roof and front rolla door. Its replacement cost is $30,000.
Please advise your client to consider this cost at settlement and respect her mother's wishes mentioned above.
This letter is obviously significant given that it was written after the Caveat was lodged and in the course of correspondence with Ms Helmers' solicitors. The letter is inconsistent with the arguments now advanced by Mr Como – it asserts only an agreement to reimburse him for the cost of the garage; the letter indicates that the garage was used by Mr Como for his purposes as well for storing tools and equipment belonging Ms Emme (and see par 20 of Mr Como's second affidavit) and it apparently accepts again that Ms Emme was entitled to sell the South Perth property.
The principles relevant to an application to extend or remove a caveat
I have set out in National Australia Bank v McCourt [2010] WASC 237 my understanding of the principles relevant to an application to extend or remove a caveat. I have applied those principles in determining this application.
Testamentary contracts
Difficult problems are posed by attempts to enforce statements about testamentary intentions. A will is revocable until death or loss of testamentary capacity. Testamentary intentions can alter with changes in a person's life circumstances, including their family relationships, financial position and the need of those towards whom they feel a responsibility to provide. Statements about testamentary intentions between family members may never have been intended to create or affect legal relations or to bind the future. Equity's intervention is against a background of legislation that is intended to ameliorate against the financial consequences of a testatrix's failure to adequately provide for family members – in this jurisdiction, through the Inheritance Act.
Nevertheless, equity will enforce a contract not to revoke a will or to leave property by a will. That is achieved by fastening a trust on the estate to give effect to the contract rather than by restraining or nullifying an inconsistent will: see Delaforce v Simpson‑Cook [2010] NSWCA 84 [31] (Handley AJA, with whom Giles JA agreed). Similarly, a proprietary estoppel by encouragement may be recognised even if the promises or representations upon which it is based do not take effect as a contract.
Obviously, it will be necessary to consider whether any statement of testamentary intention was truly promissory in nature and satisfied the requirements for an enforceable contract, including whether there was an intention to create legal relations, whether there was consideration and whether the statement relied on was sufficiently certain. As to the first of those matters, it is necessary to distinguish between statements that were promissory and statements that were merely indications of a present intention or expectation: and see Palagiano v Mankarios [2011] NSWSC 61 [15] (White J).
Was there a testamentary contract?
The evidence given by Mr Como at par 11 of his first affidavit (which was reproduced earlier in the reasons) was relied on to contend that Ms Emme had contractually bound herself to leave the South Perth property to Mr Como by her will. In my view, that evidence does not provide a sufficient basis for concluding that Mr Como has established a prima facie case that such a contract was made. The evidence does not suggest that any statement made by Ms Emme was promissory rather than merely a statement of her then intentions.
A contract may exist even though its formation is not susceptible to the analysis of offer and acceptance: see Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153, cited with approval by Owen J in Bell Group Ltd (In Liq) v Westpac Banking Corporation (No 9) (2008) 39 WAR 1 [2653]. The conduct of parties to a purported contract can be the basis for inferring not merely the existence of a contract but also its terms. However, in this instance, there was no evidence of mutual promises or of a standing offer capable of creating a contract on Mr Como building the garage. According to Mr Como, his mother stated on a number of occasions that she intended to leave the South Perth property to him on her death. He then decided to build the garage. There was no evidence that the exchange alleged was to the effect that Ms Emme would leave the South Perth property to Mr Como if he agreed to construct the garage; no evidence that Ms Emme intended that the statements allegedly made by her would have contractual effect if Mr Como constructed the garage or indeed, that there was any connection drawn between her statements and the construction of the garage in what passed between Ms Emme and Mr Como. On Mr Como's evidence, the connection was made only in his mind as a reason why he was prepared to construct the garage. That is substantively different to Mr Como agreeing with Ms Helmers to construct the garage as consideration for a legally binding promise that Ms Helmers would make a will by which he would be given the South Perth property.
That conclusion is reinforced by what Mr Como stated in his letter of 23 May 2011 to Ms Helmers' solicitors about the circumstances in which the garage was built. As has already been noted, the agreement asserted in that letter is entirely different to the contract now alleged.
Proprietary estoppel
The learned authors of On Equity suggest that the following requirements must be met for a proprietary estoppel to arise:
(a)The claimant must assume or expect that they will have, or will acquire, an interest in another's property and must act or abstain from acting in reliance on that assumption or expectation.
(b)The other party must induce the plaintiff to adopt the assumption or expectation or fail to deny the assumption or expectation, with knowledge that the plaintiff was relying on it to their potential detriment and that the expectation could only be fulfilled by transfer of the defendant's property, diminution of the defendant's rights or an increase in the defendant's obligations.
(c)The assumption or expectation that forms the subject matter of the estoppel must also be one that the defendant can lawfully satisfy.
A clear and unequivocal representation is required to give rise to the estoppel or at least, a representation that is 'clear enough' : Legione v Hateley (1983) 152 CLR 406, 436 – 437; Thorner v Major [2009] 3 All ER 945 [56]. There are statements to the effect that at least more certainty is required for an estoppel than for a contractual variation but also statements that a promise or representation may support an estoppel even though it is not sufficiently certain to operate as a contract: and see the observations of Owen J in Bell Group v Westpac at [3546] ‑ [3549].
In Sullivan v Sullivan [2006] NSWCA 312, Hodgson JA (with whom McColl JA agreed) stated that:
Generally, a promise or representation will be sufficiently certain to support an estoppel if it was reasonable for the representee to interpret the representation or promise in a particular way and to act in reliance on that interpretation, thereby suffering detriment if the representor departs from what was represented or promised [85].
That statement accords, in my view, with the basis upon which equity intervenes to prevent an unconscionable departure to the detriment of the plaintiff from an expectation that the defendant has encouraged.
In cases of promissory and proprietary estoppel, the court is not limited to doing 'the minimum equity to do justice to the plaintiff': see Giumelli v Giumelli (1999) 196 CLR 101; Delaforce v Simpson‑Cook and Donis v Donis (2007) 19 VR 577. That is because generally the estopped party can only avoid the detriment that would occur by resiling from the assumption or expectation that they had engendered by making good that assumption or expectation. That is not to say that proportionality between the claimed interest or remedy and the prejudice or detriment is not a relevant consideration: see Delaforce v Simpson‑Cook. The court will not grant relief that exceeds what could be justified by the requirements of conscientious conduct and which was unjust to the estopped party: see Giumelli [443] and Delaforce v Simpson‑Cook. That principle operates as a negative one: Delaforce v Simpson‑Cook [77] (Handley JA).
Is the South Perth property held by Ms Helmers on a constructive trust as a result of the conduct of Ms Emme?
Cases in which courts have recognised a proprietary estoppel in a domestic or family context generally involve acts of reliance and the prospect of detriment that extend beyond what would ordinarily be attributable to natural love and affection and/or the recognition of family ties and obligations. It is that extra dimension in the facts that will often mark the departure or proposed departure from a representation or assumption as unconscionable. It will also stamp the relevant representation or promise with the clarity required for an estoppel and indicate that what was said or done was intended to affect legal relations between the parties.
In my view, the evidence given by Mr Como does not establish a prima facie case that he acquired an interest in the South Perth property through an estoppel by encouragement. Allowing for the interlocutory nature of the application and that only a prima facie case need be established, it still appears that the statements allegedly made by Ms Emme lack the necessary promissory character; they seem to be no more than statements of testamentary wishes that were not intended to affect any legal relations between Mr Como and herself.
Further, the acts of reliance alleged by Mr Como are reasonably capable of being explained by the recognition of a family obligation; indeed, given the apparent history of animosity between Ms Emme, Mr Como and his former wife, they might be explained by a desire to improve a difficult relationship. Ms Helmers also claims that she provided care and assistance for Ms Emme and paid for maintenance work to be undertaken. It will most often be the case that family members do not perform such acts in reliance on an expectation that will found an estoppel.
A possible exception to that observation is Mr Como's act of constructing the garage. However, the statements made in his letter of 23 May 2011 are inconsistent with what is now alleged to have been promised by Ms Emme. It is relevant in this context that the construction of the garage was apparently intended, at least in part, to benefit Mr Como.
I am conscious that the evidence has only been considered in an interlocutory context. I have accepted Mr Como's evidence for the purpose of determining the application except where there are obvious inconsistencies within that evidence. However, I am not persuaded that Ms Helmers' statements contained clear promises or representations that were reasonably capable of inducing Mr Como to undertake maintenance and gardening work at the South Perth property (and from which, therefore, an inference can be drawn that Ms Emme knew and intended that Mr Como would rely on what she said to his potential detriment and that he did so rely). The possibility that family obligations explain the alleged acts of reliance reinforces the need to ensure that the other requirements for an estoppel are established ‑ in particular, that the acts of reliance and the potential detriment are connected to the alleged promises or other acts of encouragement. I am not satisfied that the requirements for an estoppel are established at the level of a prima facie case having regard to the evidence of what Ms Emme is alleged to have said, the claimed acts of reliance and the surrounding circumstances.
Further, I consider that Mr Como's dealings with Ms Helmers following Ms Emme's death indicate that he has abandoned any claim that he might have possessed to the legal and equitable title to the South Perth property. If he had such a claim (a constructive trust over the property), it was effectively replaced with a claim to the proceeds or part of the proceeds from the sale of the property (a constructive trust over the proceeds). He might be entitled in other proceedings to relief in relation to that claim but it is not a claim to an interest in the title to the property; that is, to a proprietary interest that is capable of being protected by a caveat. The effect of the dealings between Mr Como and Ms Helmers is that it is not unconscionable for Ms Helmers to deny that Mr Como has an interest in the South Perth property (equitable title to the property) even if it is thought that he once possessed such an interest, that the interest arose out of dealings between Mr Como and Ms Emme and that he possesses a claim to the proceeds or part of the proceeds from the sale of the property that can be traced back to his dealings with Ms Emme.
Promissory estoppel
There is a detailed discussion of the legal principles applicable to estoppel at common law and in equity in the judgment of Owen J in Bell Group Ltd v Westpac, section 15.3. I will not endeavour to summarise his Honour's reasoning but it captures my understanding of the relevant law and in particular, the principles to be applied when considering a promissory estoppel. I have had regard to what his Honour said in determining this application.
The elements of a promissory estoppel are set out in the judgment of Brennan J in Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387, 428 ‑ 429:
In my opinion, to establish an equitable estoppel, it is necessary for a plaintiff to prove that (1) the plaintiff assumed that a particular legal relationship then existed between the plaintiff and the defendant or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant has induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid the detriment whether by fulfilling the assumption or expectation or otherwise.
A summary of the principles to be distilled from Waltons Stores provided by Priestley JA in Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466, 472 is also often cited. That summary emphasises that an equitable estoppel will operate upon representations or promises as to future conduct, including promises about legal relations. Further, an equitable estoppel may lead to a plaintiff acquiring an estate or interest in land; that is, it may act as a sword, not merely as a shield. See also the judgment of Priestley JA in Austotel Pty Ltd v Franklin's Self‑Serve Pty Ltd (1989) 16 NSWLR 582, 610 where his Honour indicated that for there to be an equitable estoppel there must be the creation or encouragement of an assumption that a contract will come into existence or a promise be performed or an interest granted to the plaintiff by the defendant.
Has Mr Como established a prima facie case of a promissory estoppel?
In his oral submissions, counsel for Mr Como placed most weight on the claim for a proprietary estoppel by encouragement arising out of Ms Emme's alleged statements and Mr Como's reliance on those statements. The events that occurred after Ms Emme's death and about which Mr Como gave evidence were said to be primarily relevant to explaining why Mr Como had not commenced proceedings to revoke the 1982 will or to vindicate his claim to the South Perth property.
It is difficult to assess the effect of the correspondence exchanged between Mr Como and Ms Helmers in July 2010:
(a)Mr Como did not assert an interest in the South Perth property in his letter of 13 July 2010. Further, the letter made no reference to the possibility that he might apply for the grant of probate of the 1982 will to be revoked or for relief under the Inheritance Act. Rather, the letter was primarily a mixture of complaint about the unfairness of Ms Emme's 1982 will and an appeal to Ms Helmers to recognise his contribution in caring for Ms Emme and maintaining the South Perth property. It is significant that in recounting conversations in which Ms Emme is alleged to have asked what Mr Como would do with the house after she passed away, Mr Como stated that, 'I said I'd keep it, just to please her, knowing full well in the back of my mind that she had left the house to you'. However, there may be explanations for the content of the letter that had not yet emerged.
(b)Ms Helmers' letter of 22 July 2010 contained an acknowledgement that Ms Emme intended that Mr Como would share in her estate. She stated that, 'I told you we would share when the time comes and I still want to do that.' She also acknowledged that she thought that it was appropriate that Mr Como receive the house 'after all the years you spent in looking after Mum and her garden and house'.
(c)Further, Ms Helmers' letter of 22 July 2010 contained a representation of existing fact ‑ that she had made a will in which she had left all moneys and property in Australia to Mr Como. As I have indicated, there was no reference to that will in the subsequent communications between Ms Helmers and Mr Como that are in evidence. Further, Mr Como does not assert an estoppel by convention based on any mutual understanding or assumption that the South Perth property would be transferred to him on Ms Helmers' death.
(d)There was apparently some change in Ms Helmers' position in her letter of 26 July 2010. In that letter she stated that she would share at least half of 'the estates' left by Ms Emme rather than that the South Perth property would be necessarily transferred to Mr Como as part of the division of the estate. However, the letter is ambiguous and informal.
Mr Como seeks in these proceedings to extend the operation of a caveat on the basis that he presently has and had as a consequence of the correspondence exchanged between Ms Helmers and himself in July 2010 equitable title to the South Perth property (coupled with the alleged acts of reliance and the detriment that he would suffer if Ms Helmers was not estopped from denying his title). The belief or assumption on which the alleged estoppel is founded must concern title to the South Perth property; that is, it must be a belief or assumption about a state of affairs that would have the effect of constituting Ms Helmers a trustee of the legal title to the South Perth property for the benefit of Mr Como.
In my view, the statements made by Ms Helmers in her letters of 22 and 26 July 2010 were not reasonably capable of inducing such a belief or assumption. The statements might be understood as inducing a belief or assumption that:
(a)Ms Helmers had made a will in which she had left the South Perth property to Mr Como but that would be a belief or assumption that Mr Como would acquire legal and equitable title to the property on Ms Helmers' death and if he survived her; or
(b)Mr Como would share in some way in Ms Emme's estate but that is not a belief or assumption that Ms Helmers had given the South Perth property to Mr Como as a gift or that she acknowledged that Mr Como was the owner of the South Perth property and that she held the legal title to the property in trust for him.
Further, I consider that the events following the correspondence of July 2010 indicate that Mr Como did not believe or assume that he had an interest in the South Perth property (again, drawing a distinction between title to the property and a claim to the proceeds from its sale). The possibility that Ms Helmers might sell the property was raised by Mr Como in his letter of 13 July 2010. There is no suggestion in the evidence of what transpired after September 2010 that Ms Helmers was selling, in effect, Mr Como's property or that Mr Como believed or assumed that she was doing so. Rather, the evidence indicates that she and Mr Como proceeded on the basis that Ms Helmers was selling her own property. Whether the evidence is capable of establishing that Ms Helmers' conduct induced a belief or assumption in Mr Como that he would share in the proceeds from the sale of the house is not to the point in this application.
I also consider that any promise or representation made by Ms Helmers that she would transfer the South Perth property to Mr Como was withdrawn and Mr Como accepted that withdrawal, albeit that it is possible that he did so on an understanding that he would receive instead the proceeds or part of the proceeds from the sale of the property. As I have indicated, that might entitle Mr Como to make a claim in respect of the sale proceeds but that is not a claim that is capable of being protected by the Caveat. I do not consider that the evidence discloses a case with sufficient prospects of success to justify preserving the status quo by extending the caveat that it would be unconscionable for Ms Helmers to deny that Mr Como has an equitable interest in the South Perth property having regard to what has occurred since July 2010.
The form of the caveat
This part of the reasons proceeds on the basis that my conclusion that Mr Como has failed to establish a prima facie case that he has a proprietary interest in the South Perth property is wrong.
Section 137(1) of the TLA provides that any beneficiary or other person claiming any estate or interest in land under the operation of the Act or in any lease, mortgage or charge under any unregistered instrument, document or writing or under any equitable mortgage or charge by deposit without writing or by devolution in law or otherwise may lodge a caveat with the Registrar in an approved form. Section 137(1B) of the TLA requires the person lodging a caveat to support the caveat by a statutory declaration stating the nature of the estate or interest claimed and the title to that estate or interest.
There are discernible differences in the authorities on what is required to comply with those provisions and the effect of non‑compliance. Some of the relevant authorities are discussed at [6.3] of S Colbran and S Jackson, Caveats (1996). In this jurisdiction, there have been differences over whether a defect in the description of the estate or interest claimed or other particulars may be cured by reference to the supporting statutory declaration (compare, for example, Jandric v Jandric [1999] WASC 22 and Cruz v Osborne [1999] WASC 8, and see also Midland Brick Co Pty Ltd v Welsh [2006] WASC 122). There also have been differences over the extent to which the court can permit an amendment of a caveat: see the discussion in Palazzo Homes Pty Ltd v Goh [2010] WASC 407.
I assume for the purpose of this application that it is permissible to have regard to Mr Como's statutory declaration in considering whether he has specified the estate or interest claimed and sufficiently identified the grounds upon which the claim is made.
The Caveat did not describe a proprietary interest in the South Perth property. The caveat claimed an interest as a beneficiary of Ms Emme's estate. The nature of that interest was not identified. A person does not necessarily possess a proprietary interest in an estate asset merely by being a beneficiary. In Official Receiver in Bankruptcy v Schultz (1990) 170 CLR 306, 312 the court said that:
[P]rior to administration of the deceased estate, there is no specific property capable of constituting the subject property of any trust in favour of the beneficiary. It could not be said at that stage what part or parts of the testator's property would need to be realised for the purposes of administration. So … the beneficiary does not have a proprietary interest in each of the assets which are the subject of the devise or bequest such that he or she can say 'this is mine' or 'this belongs to me'.
Consequently, it is only when the administration has been completed that a beneficiary obtains an equitable interest in the asset or assets of the estate to which they are entitled under the will or intestacy: and see On Equity [13.30]. Accordingly, Mr Como's description that he had an interest in the property as a beneficiary of the estate does not identify a proprietary interest capable of being protected by a caveat without further facts being provided: and see Meynert v Leafdale Pty Ltd [2005] WASC 102. Further, Mr Como was not a beneficiary under the will to which probate was granted and, of course, an inchoate right to apply for revocation of a grant of probate cannot create a proprietary interest in any asset of the estate capable of being held by the applicant or indeed, by any person who might become a beneficiary of the estate following revocation.
In any event, the caveat does not describe any estate or interest in the South Perth property ‑ the nature and quantum of the estate or interest is not specified. The caveat does not identify that Mr Como claims an equitable estate or interest in the South Perth property as the beneficiary of a constructive trust by which Ms Helmers holds legal title to the property on trust for him either as a consequence of dealings between Ms Emme and himself or as a result of dealings with Ms Helmers. Nor does the Caveat claim an equitable interest by way of a right to seek specific performance of a testamentary contract made between Mr Como and Ms Emme.
The remaining question is whether Mr Como should be allowed to amend the caveat so that the claimed estate or interest is specified and the grounds upon which it is claimed are properly described.
In Palazzo Homes, Le Miere J stated at [14]:
On an application to extend the operation of a caveat s 138C(2)(a)(iii) confers on the court a limited power to allow the terms of the caveat to be amended. Amendment may be permitted so as to enable the caveat to express better or more fully the interest which is claimed in the caveat. However, amendment is not permitted so as to alter the interest which is claimed and therefore a different interest.
His Honour further held that the reference in s 138C(2) to 'the caveator's claim' was to the estate or interest claimed so that amendments were permitted to better describe that estate or interest but not to alter the estate or interest. As I have indicated, strictly the caveat does not claim any estate or interest. However, I am prepared to assume for the purpose of this application that the power to amend might extend to describing any estate or interest that can be discerned from the statutory declaration made by Mr Como.
I do not consider that Mr Como could be permitted to amend the caveat to describe an equitable interest in the South Perth property as the beneficiary of a constructive trust arising out of either a proprietary estoppel by encouragement or a promissory estoppel or as the party to an enforceable testamentary contract even if a liberal approach to the power to amend is adopted. Each claim goes well beyond the matters stated in Mr Como's statutory declaration; each has a significantly different character to whatever estate or interest is claimed in the Caveat read with the statutory declaration. To allow an amendment would be, in effect, to allow Mr Como to now lodge what in substance would be a new caveat.
The power to permit such an amendment is discretionary. At [24] of Palazzo Homes, Le Miere J observed in relation to the exercise of the court's discretion:
The court should not readily act in a way which might encourage the belief that caveats can be imprecisely formulated and then fixed up later. Caveats act as a form of interlocutory injunction, albeit by an administrative act, and can have powerful and serious consequences. Wrongly formulated caveats should not be easily tolerated: Percy & Michele Pty Ltd…
That observation has particular force in this instance; any amendment would go beyond what should be tolerated. The observation identifies another reason why I consider any application to amend the caveat should not be allowed. In my view, the caveat is not merely imprecisely formulated but it rests on a statutory declaration that is ambiguous and possibly misleading. For example, the truth of the statement that the 'subsequent' will did not make Ms Helmers a beneficiary of the estate depends on reading the definition of the word 'estate' as employed in the declaration in a particular way that is strained. Similarly, the assertion that Mr Como was a beneficiary of the estate could mislead as to the true position on the evidence adduced in this application. I am also troubled by the impression created by Mr Como's statements in that document about Ms Helmers' conduct.
However, my principal concern is with the statements in the declaration that 'the most recent will is being challenged and is under arbitration' and 'Landgate will be advised as to the outcome of the arbitration'. There was no challenge to any will made by Ms Emme on foot at the time that the declaration was made and there is no evidence of, or explanation for, Mr Como's reference to such a matter being arbitrated. A caveat is a notice to the Registrar; a warning to the Registrar of a claim: J & H Just Holdings Pty Ltd v Bank of New South Wales (1971) 125 CLR 546, 558 (Windeyer J). It is obviously important that the Registrar be fully and accurately informed as to the basis upon which a claim is made. On the evidence, the statements made in the declaration concerning a challenge to the will were inaccurate. They were important in the context of the matters declared. It is apparent that Mr Como appreciated their importance; he declared that he would inform Landgate of the outcome of the arbitration.
I make no finding as to whether Mr Como intended to mislead by the statements contained in the statutory declaration. My finding is confined only to the impression created by those statements when considered against the evidence adduced in the application ‑ an impression that may have been innocently created given that Mr Como prepared the statutory declaration himself and without the benefit of legal advice. However, I do not consider that the court should exercise its discretion to permit any amendment having regard to the effect of what was stated in the statutory declaration.
That conclusion is reinforced by the effect of Mr Como's correspondence with Ms Helmers' solicitors following the lodgement of the caveat. He indicated that he was prepared to remove the caveat if Ms Helmers agreed to pay a sum of money to him. That is consistent with the view that I have taken that Mr Como was concerned to pursue a claim over the proceeds of the sale of the property rather than to assert title to the property. It is open to infer that the caveat was lodged not to protect an estate or interest in the property itself but to advance and protect a claim to the proceeds from its sale.
Balance of convenience
I would have concluded that the balance of convenience favoured the extension of the operation of the caveat had I found that Mr Como had established a prima facie case that he had an estate or interest in the South Perth property. That is for the reasons explained by Owen J in Custom Credit Corporation Ltd v Ravi Nominees Pty Ltd (1992) 8 WAR 42. Further, it was accepted that Mr Como's undertaking as to damages was adequate in the context of any possible claim against Ms Helmers for breach of the contract for the sale of the property. However, I would have imposed conditions on any order extending the operation of the caveat requiring Mr Como to immediately commence proceedings to establish his claim to the property and for those proceedings to be expedited.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: COMO -v- HELMERS [2011] WASC 179 (S)
CORAM: CORBOY J
HEARD: 13, 22, 29 JUNE, 18 & 20 JULY, 23 & 25 AUGUST, 19 SEPTEMBER 2011
DELIVERED : 28 JULY 2011
PUBLISHED : 29 JULY 2011
SUPPLEMENTARY
DECISION :10 JANUARY 2012
FILE NO/S: CIV 2002 of 2011
MATTER :Section 138C of the Transfer of Land Act 1893
BETWEEN: MICHAEL BERND COMO
Plaintiff
AND
HELGA-EVA HELMERS
First DefendantTHE REGISTRAR OF TITLES
Second Defendant
Catchwords:
Practice and procedure - Special costs order - Relevant principles - Whether requirements of s 280(2) Legal Practitioners Act 2008 (WA) satisfied
Legislation:
Legal Profession Act 2008 (WA), s 280
Result:
Plaintiff to pay the first defendant's costs of the originating summons with limit on certain items in the Supreme Court scale of costs lifted
Category: B
Representation:
Counsel:
Plaintiff: Mr C P Stokes
First Defendant : Mr A J Aristei
Second Defendant : No appearance
Solicitors:
Plaintiff: Chris Stokes & Associates
First Defendant : Corser & Corser
Second Defendant : No appearance
Case(s) referred to in judgment(s):
Como v Helmers [2011] WASC 179
Fagan v Morien [2008] WASC 54 (S)
Heartlink Ltd v Jones as liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASCA 254 (S)
CORBOY J:
The application and the result
Mr Como and Ms Helmers are brother and sister. By her will, their late mother devised and made a gift and bequest of land located in South Perth to Ms Helmers. Ms Helmers became the registered proprietor of the land in January 2010. Mr Como lodged a caveat over the land in March 2011.
The Registrar of Titles sent a notice under s 138B of the Transfer of Land Act 1893 (WA) to Mr Como in May 2011. Mr Como commenced proceedings by originating summons in June 2011 seeking an order extending the operation of the caveat until further order of the court. An ex parte order extending the caveat was made. A hearing between the parties was subsequently held at which Mr Como's application to further extend the operation of the caveat was dismissed: Como v Helmers [2011] WASC 179.
Mr Como's application was strictly an interlocutory application. However, it was heard a few days before a contract for the sale of the land was due to be settled. In the circumstances, the parties treated the hearing of Mr Como's application for a further extension of the caveat as, in effect, the final hearing of his originating summons. Mr Como had not commenced other proceedings to vindicate any claim that he might have had to an estate or interest in the land.
Ms Helmers sought the costs of the application. Mr Como accepted at the hearing of Ms Helmers' application that he was obliged to pay her costs. He also accepted that the originating summons should be dismissed and that the costs order should be for the costs of the summons and not just the interlocutory application that had been determined in favour of Ms Helmers (ts 112; the originating summons was subsequently dismissed by consent on 18 October 2011). However, Ms Helmers contended that Mr Como should be ordered to pay costs assessed on an indemnity basis. That contention was opposed by Mr Como.
Ms Helmers' application for indemnity costs was rejected. However, she was given leave to make a further application seeking a special costs order. These are my reasons for making such an order.
The orders sought by Ms Helmers
Ms Helmers seeks an order that Mr Como pay her costs of the originating summons without reference to the limits provided for at item 10(a) and item 11 of the Legal Practitioners (Supreme Court) (Contentious Business) Report and Determination 2010 (the Costs Determination).
Item 10(a) of the Supreme Court scale of costs as established by the Costs Determination provides an amount of $10,230 for proceedings in chambers other than proceedings to which item 11 applies. That amount is fixed on the basis of two days' preparation for a one‑day hearing in chambers.
Item 11(a) provides an amount of $31,680 for an originating summons. That is based on two days' preparation for a one‑day hearing and 50 hours' getting up by a senior practitioner.
Mr Como's position
Mr Como did not provide any submissions in response to Ms Helmers' further application for a special costs order. The court is, nevertheless, required to exercise its discretion to award costs judicially and so it is still necessary for it to be satisfied that it is appropriate to make the order sought by Ms Helmers.
The evidence
Ms Helmers' application was supported by an affidavit made by Ronald William Bower, a member of the firm of solicitors who appeared for her in this matter. In summary, Mr Bower stated that:
(a)Ms Helmers resided in Germany (par 7).
(b)The question of whether the caveat ought to have been extended was significant for Ms Helmers as she had entered into a contract for the sale of the South Perth land. As has already been noted, settlement on the sale of the land was scheduled to occur a few days after the hearing between the parties to extend the operation of the caveat on an interim basis (pars 14 and 15).
(c)His firm had instructed Ms Maria‑Luisa Coulson, a legal costs consultant, to 'undertake a global review of the work undertaken and the costs incurred' regarding Mr Como's applications (par 21).
(d)His firm had rendered accounts and had work in progress in respect of Ms Helmers' instructions in a total amount of $42,392.64. Ms Coulson estimated that an amount of $33,252.45 could be claimed from the plaintiff in respect of that work on the basis of the orders sought by Ms Helmers.
(e)Counsel for Ms Helmers had rendered accounts totalling $24,420. Ms Coulson estimated that an amount of $16,027 could be claimed from Mr Como on account of counsel's fees on the basis of the order sought by Ms Helmers.
(e)Much of the work performed by his firm and counsel fell within item 10(a) of the Supreme Court scale of costs.
Ms Helmers' submissions
Ms Helmers submitted that a special costs order may be made if it was established that:
(a)there was a fairly arguable case to be put before a taxing officer to the effect that the bill of costs should tax out at more than the limit that would be imposed by the relevant costs determination;
(b)the action was of 'unusual difficulty' or 'complexity' or 'importance'.
It was contended that the evidence given by Mr Bower of the advice received from Ms Coulson satisfied the first of those requirements. It was further contended that Mr Como's application was of unusual difficulty or complexity or importance having regard to the issues to be determined. Reference was made to the reasons for decision and the advice of counsel.
Determination of the application
Section 280 of the Legal Profession Act 2008 (WA) concerns the effect of a costs determination. Section 280(1) provides that subject to any costs agreement, the taxation of bills of a law practice or any other aspect of the costs charged by a practice is regulated by an applicable costs determination. However, s 280(2) provides that:
Despite subsection (1), if a court or judicial officer is of the opinion that the amount of costs allowable in respect of a matter under a costs determination is inadequate because of the unusual difficulty, complexity or importance of the matter, the court or officer may do all or any of the following ‑
(a)order the payment of costs above those fixed by the determination;
(b)fix higher limits of costs than those fixed in the determination;
(c)remove limits on costs fixed in the determination;
(d)make any order or give any direction for the purposes of enabling costs above those in the determination to be ordered or assessed.
In Heartlink Ltd v Jones as liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASCA 254 (S) the Chief Justice analysed the approach to be taken to the equivalent provision in the Legal Practice Act 2003 (WA) (s 215). His Honour observed that:
The policy considerations that should guide a court when addressing an issue under s 215(2) are, firstly, that the court should not usurp the role of the taxing officer and, secondly, that at least where party and party costs are concerned, the court should make an order that would give effect to the general principle of allowing the successful party to be compensated for their costs by the unsuccessful party, where appropriate. [13]
Ms Helmers' submissions concerning the requirements for a special costs order reflected the Chief Justice's observations about the approach that should be adopted to give effect to those policy considerations.
The Chief Justice also accepted that the word 'unusual' when used in s 215(2) (s 280(2)) only qualified the expression 'difficulty' and not the words 'complexity' or 'importance' [17]. He rejected a submission that the word 'importance' did not relate to the significance attached to the matters litigated by the parties themselves. His Honour held that:
It seems to me that by reference to 'importance' in this context, the legislature is allowing the court to have regard to the question of whether the work done was appropriate to the significance of the issues that arose in the litigation. [19]
Finally, his Honour observed that the question of whether an order should be made under s 215(2) Legal Practice Act/ s 280(2) Legal Profession Act was a matter of 'impression rather than … a matter of detailed evaluation' [20] since the determination was ordinarily made before a taxation had been undertaken.
I, of course, accept the Chief Justice's identification of the relevant principles and apply those principles to determine this application. I would only add that I agree with the submission made by Ms Helmers that the expression 'unusual difficulty' suggests that a matter was more difficult than would ordinarily be expected in an application of the kind under consideration: see Fagan v Morien [2008] WASC 54 (S) [19] (Templeman J).
I am satisfied that the order sought by Ms Helmers should be made having regard to the principles to which I have referred:
(a)I accept that the evidence of Mr Bower concerning the advice given by Ms Coulson is sufficient to demonstrate that it is 'fairly arguable' that a taxing officer might properly fix the costs of the originating summons at more than the limits for the relevant items specified in the Supreme Court scale of costs.
(b)I accept as a matter of impression that Mr Como's application to extend the caveat raised issues that were more difficult than would ordinarily be expected on an application to extend or remove a caveat. I also accept that the application raised a matter of importance to the parties given the imminent sale of the South Perth land and the considerable amount of acrimony and controversy that the terms of their late mother's will had caused between them. The work undertaken by Ms Helmers' solicitor does not appear to have been disproportionate to the significance of the issues raised by Mr Como's application. The matter was dealt with on a reasonably expedited basis, the evidence was extensive and a number of legal and factual questions were argued and determined. Those questions concerned not just whether Mr Como had a caveatable interest (a matter that Mr Como contended could be established on several alternative bases) but also whether the caveat was defective in form and whether it had been lodged for a proper purpose.
It is not immediately apparent to me that much of the work undertaken by Ms Helmers' solicitors and counsel falls to be assessed under item 10(a) rather than item 11 of the Supreme Court scale. That is a matter for the taxing officer. However, I should emphasise (as did Martin CJ in Heartlink) that the only effect of the order to be made is to free the taxing officer from the constraints that would otherwise be imposed by the limits specified for item 10(a) and item 11 in the Supreme Court scale of costs forming part of the Costs Determination. It is entirely a matter for the taxing officer whether, in fact, the amount to be allowed on a party and party basis should exceed the scale allowance for those items ‑ that is, whether the work claimed was properly and appropriately done and if so, the amount that ought to be allowed for that work.
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