Cooper v Lees - [2009] SASC 386

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
COOPER v LEES
[2009] SASC 386
Judgment of The Full Court
(The Honourable Chief Justice Doyle, The Honourable Justice Duggan and The Honourable Justice Nyland)
17 December 2009
LIMITATION OF ACTIONS - EXTENSION OR POSTPONEMENT OF LIMITATION PERIODS - OTHER CAUSES OF ACTION AND MATTERS
FAMILY LAW AND CHILD WELFARE - DE FACTO RELATIONSHIPS - ADJUSTMENT OF PROPERTY INTERESTS - OTHER MATTERS
Respondent brought proceedings against appellant under the De Facto Relationships Act 1996 (SA) - proceedings were brought two years after expiration of time limit for bringing a claim under the Act - trial Judge refused to extend time within which to commence proceedings under the Act and dismissed respondent's claim under the Act - whether Judge erred in declining to extend time for commencing an action under the Act.
HELD: of most significance to the exercise of the power to extend time under s 9(3) of the Act are the prospects of the claim succeeding, the nature and amount of the claim, and the impact on an applicant of the refusal of an exension of time - other relevant factors include the explanation for the delay and the impact of a successful claim on an unsuccessful party - Judge's decision to refuse to extend limitation period not wrong - cross-appeal dismissed.

EQUITY - GENERAL PRINCIPLES - EQUITABLE DEFENCES - LACHES AND DELAY - EFFECT AND AVAILABILITY AS A DEFENCE
Judge upheld respondent's alternative claim in equity and declared that appellant held certain property on resulting and constructive trust for the respondent - whether limitation period applicable to a claim under the Act should apply by analogy to preclude the claims for declarations of constructive and resulting trust.
HELD: no close similarity between the relevant equitable principles and remedies and the remedy under the Act - no basis for importing the statutory time limit to preclude the claims in equity.

EQUITY - TRUSTS AND TRUSTEES - CONSTITUTION AND CLASSIFICATION OF TRUSTS GENERALLY - CLASSIFICATION OF TRUSTS IN GENERAL - IMPLIED TRUSTS
Appeal against declaration that appellant held shares and superannuation funds on resulting trust for the respondent, and held proceeds of sale of house on constructive trust for the respondent - whether the Act displaced the operation of equitable principles - whether Judge otherwise erred in making declarations.
HELD: while the Act allows a broader and more flexible approach than that taken in equity, the Act does not displace equitable principles - it is not unconscionable for a plaintiff to resort to equitable principles after the expiration of the time limit for making a claim under the Act - Judge did not err in making declarations - appeal dismissed.
De Facto Relationships Act 1996 (SA) s 9(3), s 10(1), s 11(1), s 12, s 16; Domestic Partners Property Act 1996 (SA), referred to.
Baumgartner v Baumgartner (1987) 164 CLR 137; Calverley v Green (1984) 155 CLR 242; Muschinski v Dodds (1984-1985) 160 CLR 583; Barker v Duke Group Ltd (In Liq) (2005) 91 SASR 167; The Duke Group Ltd (In Liq) v Alamain Investments Ltd (2003) 232 LSJS 58, applied.

COOPER v LEES
[2009] SASC 386
Full Court: Doyle CJ, Duggan and Nyland JJ

DOYLE CJ: Mr Lees and Ms Cooper cohabited from March 1999 until December 2003. Their relationship was a de facto relationship for the purposes of the De Facto Relationships Act 1996 (SA) (“the Act”), now known as the Domestic Partners Property Act 1996 (SA).
Mr Lees brought a claim against Ms Cooper under the Act. He instituted the claim almost three years after the relationship ended. An application under the Act must be made within one year after the end of the de facto relationship unless the Court “… after considering the interests of both de facto partners, is satisfied that extension of this period of limitation is necessary to avoid serious injustice to the applicant”: s 9(3). In the alternative Mr Lees claimed that certain shares purchased by him in Ms Cooper’s name were held on trust for him; that money that he had invested in superannuation in Ms Cooper’s name was held on trust for him; that he was entitled to repayment or compensation for work he did and expenditure incurred improving Ms Cooper’s house, and that he was entitled to repayment of certain medical expenses incurred by Ms Cooper but paid by Mr Lees.
The Judge refused to extend the limitation period under the Act. He found in Mr Lees’ favour on the other claims. He declared that the shares and superannuation contributions were held on resulting trust for Mr Lees. He found that Mr Lees’ work and expenditure had increased the value of Ms Cooper’s house by $20,000, and declared that she held the proceeds of sale of the house (it having been sold meantime) as to $20,000 on constructive trust for Mr Lees. He gave judgment for Mr Lees for the amount of the medical expenses.
Ms Cooper appeals against the orders in favour of Mr Lees. Mr Lees cross-appeals against the refusal of an extension of time for the making of a claim under the Act.
Facts
The parties met in about October 1995. Their relationship developed from there. Each of them was single at the time.
When the parties met each of them was about 50 years old. Mr Lees was a senior public servant. Ms Cooper had held responsible and well paid positions, and was hoping to establish a new career combining her talent as an athlete with public speaking. A motor vehicle accident in April 1998 put an end to these plans.
The Judge found that each of them was financially secure and had significant investments. Mr Lees owned a house at Gilberton and Ms Cooper owned a somewhat larger and more valuable house at St Peters.
A schedule handed up by Mr Heywood-Smith QC, counsel for Ms Cooper, indicates that at the beginning of the relationship Mr Lees’ assets were worth about $1,436,000, and Ms Cooper’s assets were worth about $868,000.
By March 1999 Mr Lees had moved into Ms Cooper’s house, and was living there with her. There is no dispute that Ms Cooper’s house would have commanded a higher rental than Mr Lees’ house at Gilberton. The parties considered living at Gilberton and renting the property at St Peters, but in the end decided to live at St Peters. The evidence was that the Gilberton property could be rented for about $300 per week, and the St Peters property for about $800 per week. Ms Cooper said that Mr Lees agreed to make up to Ms Cooper the difference of $500 a week, to compensate her for the loss of rental. The Judge apparently found that the rental from the Gilberton property was paid into an identified bank account, and that by agreement Ms Cooper was paid a fee to manage the rental of that property and was entitled to deduct $200 per week from the bank account for her own purposes: [28].
The Judge found that at an early stage the parties sought advice from accountants on how to plan their financial affairs, having regard to their relationship and the assets that they held. This was in May 1998 and again in January 1999. They sought advice because they had or anticipated a long term relationship: [14]. The aim appears to have been to maximise their income and to minimise taxation, as well as making provision for the future: [16]-[20].
The Judge found that a purchase of shares in AMP Limited by Mr Lees, and payments by him into a superannuation fund in the name of Ms Cooper, were made on the basis of that advice: [166]. The Judge rejected evidence from Ms Cooper tending to distance herself from the obtaining of that advice, and also rejected evidence from her that the contributions to her superannuation fund were to compensate her for loss of rental on the property at St Peters: [169].
It was in June 1998 (after the parties first sought advice on the management of their finances) that Mr Lees purchased the shares in AMP Limited in the name of Ms Cooper. The shares cost $18,810.
It is not disputed that Mr Lees made a number of payments into a superannuation fund in the name of Ms Cooper, amounting in all to $139,000.
Mr Lees gave evidence that he did a considerable amount of work renovating Ms Cooper’s house, and in addition spent something more than $60,000 on the renovations. Although the Judge made no specific finding on this, he appears to have accepted the substance of Mr Lees’ evidence on this topic: [188]. The Judge found this work increased the value of the house by $20,000.
The Judge accepted evidence from Mr Lees that he paid medical expenses incurred by Ms Cooper in connection with treatment of the injuries that she sustained in the accident in 1998. The expenses amounted to $6,419: [109], [203].
There was a good deal of other evidence relating to the relationship, and in particular to its financial aspects. The case occupied ten days. It is not necessary to deal with this other evidence in detail on appeal, and I will summarise it very briefly.
Mr Lees retired from employment in April 2001. He received a substantial payment in discharge of entitlements that he had. This was the source of some of the payments that he made into the superannuation fund in Ms Cooper’s name. The decision to cohabit meant that Ms Cooper would no longer receive the Disability Support Pension that she was receiving, as a result of her injuries. The Judge notes that in any event the Pension would have ceased once Ms Cooper recovered.
The Judge appears to have accepted that Ms Cooper helped Mr Lees with the renovations to the St Peters house. He accepted that she carried out work renovating Mr Lees’ house at Gilberton, and provided furniture for that property: [110]-[112]. The Judge found that throughout the relationship Mr Lees “provided most of the living expenses for the relationship”: [25]. It is implicit in this finding that Ms Cooper also met some of the expenses.
The claim under the Act
The objects clause states that the purpose of the Act is:
… to facilitate the resolution of property disputes arising on the termination of de facto relationships…
The object is implemented by giving to the court the power to make an order for division of property “…in a way that is just and equitable”: s 10(1). Section 11 indicates that in the exercise of this power the court is to consider financial and non-financial contributions made by the de facto partners. Section 11(1) provides:
11    Matters for consideration by the court
(1)     In deciding whether to make an order for the division of property under this Part, and if so the terms of the order, the court—
(a)must consider the financial and non-financial contributions made directly or indirectly by or on behalf of the de facto partners to—
(i)the acquisition, conservation or improvement of property of either or both partners; or
(ii)    the financial resources of either or both partners; and
(b)must consider the contributions (including homemaking or parenting contributions) made by either of the de facto partners to the other partner or to children of the partners or either of them; and
(c)must have regard to the terms of any relevant cohabitation agreement; and
(d)     may have regard to other relevant matters.
…
As well, by s 12 the court is required, as far as practicable, to resolve finally all questions about division of property as between the de facto partners.
No doubt the intention of Parliament was to give courts a wider and more flexible power to resolve the claims of de facto partners than the court has when applying established equitable principles, in particular the principles relating to constructive trusts and resulting trusts. It is apparent that in exercising its jurisdiction under the Act, a court proceeds on the basis of principles quite different from those that apply in the exercise of the relevant equitable jurisdiction. No doubt the exercise of the court’s jurisdiction under the Act may be affected by a decision as to existing legal and equitable rights of the parties. But once the jurisdiction of the court under the Act is invoked, it is a jurisdiction to divide property in a way that is just and equitable, taking into consideration a wide range of matters. There will be some overlap between matters relevant under the Act and matters relevant when equitable principles are applied. The Act and equitable principles may well both operate on the circumstances of a given relationship. But it remains the case that relief under the Act is available on a wider, different and more flexible basis than is equitable relief.
The time limit for making an application under the Act is found in s 9(3), which provides as follows:
9 Property adjustment order
…
(3) An application for the division of property must be made within one year after the end of the de facto relationship unless the court, after considering the interests of both de facto partners, is satisfied that extension of this period of limitation is necessary to avoid serious injustice to the applicant.
The Judge found that the de facto relationship came to an end at the end of 2003: [47]. The proceedings were instituted on 16 November 2006, almost three years later.
Ms Cooper opposed the grant of an extension of the limitation period, and the Judge refused to extend the limitation period.
The Judge summarised the submission by counsel for Mr Lees in support of the extension application. The Judge said at [50]:
[50]Mr Mellows, who appeared for the plaintiff, argued that the plaintiff acted reasonably once he became aware of the dilemma in which he was placed. He argued that once the relationship broke down the plaintiff approached the defendant about achieving a settlement of the claim and the defendant was initially responsive to his approaches. He also argued that the plaintiff granted the defendant indulgences to take account of her circumstances, only to find that, at the end of their negotiations, she sought to take advantage of his goodwill. He argued that there could be no serious injustice to the defendant if the claim is allowed to proceed, because she had knowledge of the plaintiff's claim and anticipated it.
The Judge found that there was no conduct by Ms Cooper during 2004 (during which year the claim should have been instituted) that could have led Mr Lees to believe that there was no need to resort to litigation: [59]. The Judge also accepted that Mr Lees was not aware of the 12 month time limit. The Judge accepted a submission that Ms Cooper had, until July 2006, proceeded on the basis that no claim was being made that would involve court proceedings: [64].
The Judge appears to have accepted evidence by Mr Lees that Ms Cooper asked him to defer sorting out their entitlements until a damages claim that she had in respect of the 1998 accident was resolved. At [120] he accepts as accurate a letter from Mr Lees to that effect. The Judge noted that although Mr Lees was aware in November 2005 that Ms Cooper’s claim had settled, he “did nothing” until June 2006, when a claim under the Act was foreshadowed in writing. The Judge also accepted evidence from Mr Lees that in the latter months of 2005 and in early 2006 Mr Lees and Ms Cooper negotiated directly, and that in those negotiations a settlement on the basis of a payment to Mr Lees of an amount ranging from a high of $186,000 to a low of $140,000 was discussed: [141]-[145].
When all of this is put together, it appears that the Judge proceeded on the basis that initially Mr Lees, unaware of the time limit, agreed to defer the sorting out of the financial relationship until the settlement of Ms Cooper’s damages claim. However, during this period Ms Cooper neither said nor did anything to indicate that litigation would not be necessary. Then in late 2005, after Mr Lees learned that the damages claim was settled or close to settlement, there were negotiations between the parties, which in the end did not lead to any agreement. By mid 2006 Ms Cooper was making it clear that she was not prepared to make a payment to Mr Lees. She then realised that Mr Lees was prepared to litigate if necessary.
Mr Wells QC, counsel for Mr Lees on appeal, attacks this conclusion. But he did so on the basis that if Ms Cooper’s appeal failed, Mr Lees did not wish to reopen his claim under the Act. The attack on the refusal to extend time is pressed only in the event of Ms Cooper’s appeal succeeding, wholly or in part.
I am not persuaded that the findings of fact made by the Judge should be set aside. Nevertheless, while the Judge found that Ms Cooper did nothing to suggest during 2004 that there was no need to resort to litigation, the fact is that during that time Mr Lees deferred trying to resolve their financial issues pending settlement of her damages claim. He acted reasonably in that respect. The settlement negotiations in late 2005 and the early part of 2006 provide a reasonable explanation for Mr Lees not taking action during that time, but of course by then a good deal of time had passed.
But having regard to the terms of s 9(3) of the Act, an explanation for a delay of more than one year in instituting proceedings is not the only relevant matter. Apart from the explanation for the delay, which I consider to be relevant, the court must consider the interests of both partners. No doubt that authorises and requires the court to have regard to the likelihood of a claim succeeding, and the impact of a successful claim on the unsuccessful party. But ultimately the court must be satisfied that an extension of the limitation period “… is necessary to avoid serious injustice to the applicant”. Injustice can include the circumstances of and reason for the delay in instituting proceedings. But more significant factors, I consider, will be the prospects of the claim succeeding, the nature and amount of the claim, and the impact on an applicant of the refusal of an extension of time.
In relation to this, the Judge said that he had decided that Mr Lees’ claim would succeed to the extent that I have outlined above. For that reason, the refusal of an extension of time meant that his claim “will not be entirely defeated”: [60]. Accordingly, Mr Lees would suffer no serious injustice if the limitation period was not extended.
Mr Wells did not argue that this was an irrelevant consideration. On reflection, I consider that this is a matter that the Judge was entitled to take into account.
It is significant that Parliament has imposed a specific time limit on claims under the Act, and that it has conditioned an extension of the limitation period upon a finding that an extension is “necessary” to avoid “serious injustice to the applicant”. While experience with other limitation periods has accustomed courts to considering reasons for delay, and the impact of delay upon the fairness of a trial, the language used by Parliament in s 9(3) seems to me to entitle the court to consider also the prospects of a claim succeeding, the amount of the claim, and relevantly, alternative remedies available to the applicant that will achieve results along the lines sought in the proceedings under the Act.
Mr Lees had a substantial success at the end of the day. The Judge must have given some consideration to the order likely to be made if a claim under the Act were to succeed. He also had regard to the settlement negotiations, although I must say that I am not persuaded that the amounts discussed between the parties were relevant.
In the end, I am not persuaded that the Judge erred in finding that, having regard to the relief that he proposed to grant by applying equitable principles, Mr Lees would not suffer serious injustice if the Judge refused to grant an extension of the limitation period. When that is coupled with the circumstance that Ms Cooper did not mislead Mr Lees, I have come to the conclusion that the Judge’s decision to refuse to extend the limitation period is not wrong.

The result is paradoxical. If the appeal by Ms Cooper succeeds wholly or substantially, then the main basis upon which the Judge refused to grant an extension will be removed. As will appear, I consider that the appeal fails, so this oddity does not arise.
It is also unfortunate, in a way, that in determining whether to grant an extension of time the court may have to consider the prospect of the claim succeeding on the merits, and the impact on the plaintiff of refusing an extension. That means that in some cases the extension claim can only be decided when all of the evidence is in. That is inconvenient.
I agree with Mr Wells that the end result is not satisfactory. The Act is a remedial act, conferring on the court wide and flexible powers to do what is just and equitable as between the parties. It must have been intended to provide a form of relief more flexible than that available in the application of equitable principles, and one better calculated to ensure overall justice and fairness. But Parliament has made it clear that the time limit is not easily displaced, and has limited the grounds for doing so. The consequences that I have identified flow from that.
Objection to grant of equitable relief
Mr Heywood-Smith QC submits that Ms Cooper has been dealt with unjustly. Under the Act all relevant assets, and all contributions to them, are to be considered. The Judge’s approach involves a focus on particular assets only, disregarding other assets and contributions by Ms Cooper to them, as well as other contributions to the relationship. In this way he argues Ms Cooper has been disadvantaged.
The fact that Ms Cooper has been disadvantaged was not demonstrated. It would be demonstrated only if it was shown that contributions by her to their respective assets that would have been taken into account in determining the claim under the Act have not been taken into account on the approach actually taken. But I am prepared to assume for present purposes that it is arguable that that has occurred.
But even assuming this premise, there can be no objection in law to what the Judge did. I agree that the Act allows a broader and more flexible approach than that taken in the application of equitable principles. But s 16 of the Act provides:
16 Non-exclusivity of remedies
This Act does not exclude other forms of remedy or relief.
It is clear that equitable principles and remedies continue to be relevant and available. Their application cannot be altered or adjusted simply because, in a particular case, the Act might have been applied but was not applied. In any event, at least when one comes to the question of a constructive trust, based on the principle of unconscionable behaviour, there is scope for the court to have regard to wider considerations.
Mr Heywood-Smith also argued, in a way that I did not fully understand, that the Act has displaced equitable principles. He appeared to say that it was unconscionable for Mr Lees to rely upon the equitable principles, having been denied relief under the Act. I do not accept this submission.
Mr Heywood-Smith argued that the time limit under the Act should be applied to the equitable claims made by Mr Lees. The principles by reference to which a court, asked to apply equitable principles and to grant equitable remedies, may adopt and apply a statutory time limit are well established. I had cause to review them at some length in the The Duke Group Ltd (In Liq) v Alamain Investments Ltd [2003] SASC 415; (2003) 232 LSJS 58. I will not repeat what I said there, because this is clearly not a case in which it is appropriate to apply a statutory time limit to an equitable claim. I summarised the position as follows at [113]-[114]:
[113]The issue is whether the equitable right that is asserted … is so similar to a legal right or claim which is subject to a statutory time limit that the time limit should be applied to the equitable claim.
[114]It is important to emphasise that when a time limit is applied by analogy to a claim in the exclusive jurisdiction of equity, the decision whether the time limit is to be applied is made in light of all the circumstances. It is necessary to consider whether, despite the similarity, it would be unjust to enforce the analogy …
My decision was the subject of appeal, and on appeal the same principles were applied: Barker & Ors v Duke Group Ltd (In Liq) [2005] SASC 81; (2005) 91 SASR 167 at [82]-[85] Perry J, [164] Duggan J, [165] White J.
In the present case there is no close similarity between the relevant equitable principles and remedies and the remedy under the Act. I explained earlier in my reasons how different is the remedy under the Act compared with the equitable principles and remedies. There is no basis for importing the statutory time limit in the present case.
No other equitable defence has been pursued.
Under this heading Mr Heywood-Smith referred again to the schedule (referred to above) of the parties’ assets and liabilities. This shows that during the relationship the share of the increase in the parties’ “net worth” was similar – 47.9% in the case of Ms Cooper, 52.1% in the case of Mr Lees. But if the effect of the Judge’s orders is taken into account, and the relevant assets are removed from Ms Cooper’s assets and credited to Mr Lees’ assets, the share of the increase in the net worth becomes 26.5% and 73.5% respectively. This is said to demonstrate injustice. But this exercise treats payments by Mr Lees to Ms Cooper, or for her benefit, as swelling her assets. The issue in the present case is whether that should be done. In other words, the submission by Mr Heywood-Smith appears to me to be based on a false premise.
Resulting trust
As to the purchase of shares in AMP Limited and the payments by Mr Lees into Ms Cooper’s superannuation fund, the Judge found that there was “no agreement, in the strict sense of a contract” between the parties: [153]. Then at [166]-[168] he said:
[166]I find that the purchase of the AMP Ltd shares and the superannuation contributions were payments made by the plaintiff for the purpose of divesting himself of income and directing income into the hands of the defendant for taxation reasons in accordance with the recommendations of financial advisers. Those steps were taken for the purpose of maximising the combined income [of] the parties. On that finding the presumption of a resulting trust is not rebutted.
[167]There is no evidence that when the AMP Ltd shares and superannuation payments were made on behalf of the defendant either party specifically applied their mind to the question of whether the asset was to be held in trust. The plaintiff asserts that there was an agreement that if the relationship broke down the assets would be returned to him.
[168]I accept that evidence. …
Mr Heywood-Smith submits that the Judge has contradicted himself. I disagree. The Judge is distinguishing between an enforceable contract, which must be applied according to its terms, and an understanding or arrangement that does not give rise to an enforceable contract. The Judge went on to reject in terms evidence by Ms Cooper that the payment to her superannuation fund was by way of compensation for loss of rent from the St Peters property, and her evidence that the AMP Ltd shares were purchased as a gift: [171]-[175].
The Judge then correctly reasoned that the principles relating to resulting trust were applicable to the purchase of the shares and the payment into the superannuation fund. The relevant principle was summarised by Mason and Brennan JJ in Calverley v Green [1984] HCA 81; (1984) 155 CLR 242 at 255-256 as follows:
Equity presumes a trust in favour of the person who contributes the whole of the purchase price when the property is conveyed into the joint names of himself and another … though the strength of the presumption varies from case to case … and may be confirmed, rebutted or qualified by evidence of his intention… . The presumption is displaced if the legal joint tenant who does not contribute any of the purchase price is the wife of the joint tenant who does. Then the presumption is that she takes her legal interest as a gift, not in trust for her husband, and that the beneficial ownership goes with the legal title. …
However, the weight of opinion in Napier v. Public Trustee (W.A.)(1981) 55 ALJR 1; 32 ALR 153 was against a presumption of gift when a man buys property and places it in the name of himself and a woman with whom he is living not his wife. …
Citations omitted
The Judge found no evidence to rebut the presumption that arose from the circumstance that Ms Cooper was not Mr Lees’ wife, and the circumstance that the payments were made wholly by Mr Lees. As I have said, he rejected Ms Cooper’s claim of gift or compensation for loss of rental. The Judge made a finding that the aim of the payments was to minimise Mr Lees’ income, and to increase Ms Cooper’s income, thereby increasing their joint income for their mutual benefit: [169]. In other words, payments were made on the basis of the accounting advice the parties had received. And, as I have indicated, the Judge accepted that there was an agreement or understanding that if the relationship came to an end, the money would be returned to Mr Lees: [167]-[168].
In light of those findings, which there is no basis for reversing, the Judge’s conclusion must stand.
Constructive trust
In relation to Mr Lees’ work on the St Peters house, and his payments towards the renovations of that house, the Judge applied the principle identified by Deane J in Muschinski v Dodds [1985] HCA 78; (1984-1985) 160 CLR 583 at 620. Deane J was there considering the situation in which money or property is paid or applied on the basis of a joint relationship or endeavour which “fails without attributable blame”: 618. At 620 he considered the circumstances in which a constructive trust may be imposed in favour of one party, on the basis of unconscionable behaviour. He said:
Those circumstances can be more precisely defined by saying that the principle operates in a case where the substratum of a joint relationship or endeavour is removed without attributable blame and where the benefit of money or other property contributed by one party on the basis and for the purposes of the relationship or endeavour would otherwise be enjoyed by the other party in circumstances in which it was not specifically intended or specially provided that that other party should so enjoy it. The content of the principle is that, in such a case, equity will not permit that other party to assert or retain the benefit of the relevant property to the extent that it would be unconscionable for him so to do …
Citations omitted
This statement of principle was approved by the High Court in Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137. The statement of principle by Deane J was approved in particular by Mason CJ, Wilson and Deane JJ at 147-148. It was applied to parties in a de facto relationship. The manner in which their Honours summarised the case before them is relevant to the present case. They said at 149:
The case is accordingly one in which the parties have pooled their earnings for the purposes of their joint relationship, one of the purposes of that relationship being to secure accommodation for themselves and their child. Their contributions, financial and otherwise, to the acquisition of the land, the building of the house, the purchase of furniture and the making of their home, were on the basis of, and for the purposes of, that joint relationship. In this situation the appellant's assertion, after the relationship had failed, that the Leumeah property, which was financed in part through the pooled funds, is his sole property, is his property beneficially to the exclusion of any interest at all on the part of the respondent, amounts to unconscionable conduct which attracts the intervention of equity and the imposition of a constructive trust at the suit of the respondent.
These statements of principle are capable of application to the present case, with reference to the work done by Mr Lees on the St Peters property, and the expenditure by him on that property.
These are the principles that the Judge applied: [187]. Although the Judge did not say so in terms, it is implicit in his reasons that he accepted that the work done and payments made in relation to the St Peters property were for the purposes of the de facto relationship and, that relationship having failed relatively early in the piece, that it was unconscionable for Ms Cooper to disregard his contribution to the property by asserting her beneficial interest in it to the exclusion of any interest on his part. It does not follow that Ms Cooper’s contributions to the relationship were to be ignored, nor that the fact that Mr Lees lived in the house was to be ignored. But as against this, other financial adjustments were also to be considered, including the circumstance that Mr Lees’ house at Gilberton was let out and that Ms Cooper benefited from that. In my opinion it was open to the Judge to reach the conclusion that he did, and to do so without making any further adjustments.
The Judge treated Mr Lees’ interest in the St Peters house as measured by a reference to the extent to which his efforts increased the value of the property: [191].
The Judge’s approach is in accordance with principle, and in my opinion has not been shown to be in error.
The Judge valued Mr Lees’ interest in the property at $20,000. In doing so he accepted the evidence of a valuer, Mr Brooke.
Mr Heywood-Smith complains about the Judge’s approach generally, and also about his assessment of the value of Mr Lees’ interest. As to the former, Mr Heywood-Smith complains that the Judge made no allowance for Ms Cooper’s loss of rental from the property, for her own contributions to the property, and for the benefit that Mr Lees gained from living in the property. As I have said, these were matters that could be considered by the Judge, but it cannot be said that he was obliged to make an adjustment on this account.
Mr Heywood-Smith also complains that the $20,000 increase in value, found by the Judge, was based on a report and on evidence that did not distinguish between work done and money paid by Mr Lees and work done and money paid by Ms Cooper. I refer here to work and expenditure on the property.
Mr Brooke’s report was tendered. In it he lists the work which he understands was undertaken by Mr Lees. He also summarises the improvements to the property which he understands Ms Cooper effected. He concludes that the improvements by Mr Lees “may have added $20,000 to the value of the property”. Mr Heywood-Smith called Mr Brooke to give evidence. He tendered Mr Brooke’s report. His examination-in-chief was very brief. So was the cross-examination. There was no challenge to Mr Brooke’s opinion on the basis that it did not adequately distinguish between the work done by the respective parties.
In those circumstances, in my opinion it is not now open to Mr Heywood-Smith to make the complaint that he does. The point that he now takes is a matter that should have been pursued in evidence, if it was to be raised.
In short, in my opinion the improvements to the house at St Peters were made with reference to the de facto relationship and for its purposes, and in circumstances in which it was not intended that Ms Cooper should retain the benefit of the contribution when the relationship came to a premature end. It was unconscionable on her part to deny Mr Lees’ interest. The challenge to the Judge’s decision should be rejected.
Medical expenses
The Judge ordered payment by Ms Cooper of the sum of $6,419. He found that the expenses were paid by Mr Lees, and that there was an implied agreement that Ms Cooper would repay these amounts, once she recovered them in her damages claim: [202]. These payments were the subject of some analysis by an accountant called by Ms Cooper who said that only $2,242 was identifiable as being paid by Mr Lees, and that the balance “appears to have been paid by [Ms Cooper] in cash or from her MasterCard”. The accountant appears to acknowledge a sum of $2,242.20 paid by Mr Lees, and to say that $2,473.15 of the medical expenses was paid from Ms Cooper’s MasterCard. As to that, Mr Wells counters that on the evidence it was Mr Lees who funded Ms Cooper’s MasterCard, and so that aspect of the accountant’s evidence went nowhere. Mr Heywood-Smith argued that according to the accountant a number of the payments were made by Ms Cooper before the de facto relationship began. There is evidence from the accountant suggesting that some amounts were paid before November 1999, although the significance of that date is not clear to me, because the parties were already living together. The evidence on this topic is not entirely clear, and it is more or less impossible for this Court on appeal to unravel the issue. I am not persuaded that the Judge is shown to be wrong, and accordingly reject this challenge to his decision.
Conclusion
For the reasons that I have given, the criticisms of the Judge’s decision are not sustained. The appeal should be dismissed, as should the cross-appeal.
DUGGAN J: In my view the appeal and cross-appeal should be dismissed. I agree with the reasons of the Chief Justice.
NYLAND J: I agree that the appeal should be dismissed for the reasons expressed by the Chief Justice.