Dimitrijevic v Dimitrijevic
[2014] NSWSC 863
•26 June 2014
Supreme Court
New South Wales
Medium Neutral Citation: Dimitrijevic v Dimitrijevic [2014] NSWSC 863 Hearing dates: 10, 11, 17 and 20 December 201325 and 26 June 2014 Decision date: 26 June 2014 Jurisdiction: Equity Division Before: Lindsay J Decision: Determination of beneficial entitlements to a family residence. Proceedings adjourned for submissions on form of consequential relief.
Catchwords: EQUITY - Trusts - Property purchased in name of defendant as residence for both defendant and plaintiff - Arrangement not reduced to writing - Plaintiff funded bulk of purchase price with defendant borrowing supplementary funds - Whether plaintiff intended his contribution t o be an outright gift to the defendant - Whether defendant held property on trust for the plaintiff and himself in equal shares - Parties purchased property as owners in equal shares - Relief granted Legislation Cited: - Cases Cited: - Texts Cited: - Category: Principal judgment Parties: Milorad Dimitrijevic (Plaintiff)
Stojan Dimitrijevic (Defendant)Representation: Counsel:
C Cassimatis (Plaintiff)
S Reuben (Defendant)
Solicitors:
Mitry Lawyers (Plaintiff)
Petar Dobrich & Co (Defendant)
File Number(s): 2012/339936
Judgment - EX TEMPORE (REVISED)
These proceedings concern a dispute between members of a family about beneficial ownership of a residential property (the land contained in folio identifier 1/501614) at Punchbowl.
The family members in dispute are:
(a) firstly, the plaintiff (Milorad), the father of the defendant (Stojan) and a daughter (Nada); and
(b) secondly, the defendant, Stojan.
The plaintiff's daughter, sister to Stojan, Nada, has participated in the proceedings, at least to the extent that she has given evidence in the plaintiff's case, attended court throughout the proceedings and, it seems, engaged in family discussions about the proceedings generally.
Nevertheless she is not a party to the proceedings. Although the question of whether she could, or should, properly be joined as a party was openly canvassed at the hearing of the proceedings, no member of the family applied for her joinder.
The plaintiff was born in 1925, and is presently aged 89 years. The defendant was born in 1949, and is presently aged about 64 years. Nada was born in 1952, and is presently aged about 62 years.
All three family members were born in Serbia. The plaintiff came to Australia in 1970. Nada followed him later that same year. The defendant came to Australia on or about 19 December 2006.
The defendant came to Australia, and was allowed by the Australian government to come to Australia, at the invitation of the plaintiff and on the specific basis that he was to be the plaintiff's carer.
At the time of the events central to these proceedings in 2007 all three members of the family were single. The plaintiff was in the process of separation from a partner with whom he had lived in Hobart, Tasmania. The defendant had recently separated from his wife in Serbia. Nada's husband had earlier died.
The plaintiff owned his Hobart residence. On 3 February 2007 he entered a contract for the sale of it for $350,000. That contract was completed on or about 16 March 2007.
On or about 15 February 2007 the defendant entered a contract for the purchase of the Punchbowl property for $378,000. A receipt for the payment of a holding deposit of $950 (dated 15 February 2007) was issued to the defendant by the vendor's real estate agent. The balance of a ten per cent deposit (funded by the plaintiff) was paid on the contract being entered, by means of an exchange of contracts effected by the real estate agent.
The contract was completed, with the benefit of a $100,000 loan facility granted to the defendant by the National Australia Bank and proceeds of sale of the plaintiff's Hobart property, on or about 29 March 2007.
The contract for the purchase of the Punchbowl property was completed by the defendant utilising the services of a licensed conveyancer, Mrs Vivian Cakovski, practising under her maiden name as "Vivian James Conveyancing", from an office in Chapel Rd, Bankstown.
Her evidence, and that of her husband, assumes some importance in the proceedings. Her husband, a real estate agent, operated his own business from an office adjoining hers. Informally, he served as an interpreter during at least one critical meeting that took place in one or another, or in the vicinity, of the adjoining offices shortly after the conveyancer was retained to act for the defendant.
The conveyancer was retained by the defendant, with assistance from Nada, after the two of them had taken advice from a mortgage broker, Mr Sam Kassar.
In all business transacted in the family's dealing with the mortgage broker, the conveyancer and the National Australia Bank Nada acted as a facilitator, and informal translator, for both the plaintiff and the defendant. She was the only one of the three family members proficient in English. The plaintiff spoke little English, the defendant virtually none. Nada also had business experience, having worked with her husband in a service station business conducted at Punchbowl.
In financial terms, there was a symbiotic relationship between the plaintiff and the defendant in the purchase of the Punchbowl residence.
Shortly after the defendant's arrival in Australia, the plaintiff proposed that he, with the defendant as his carer, move to Sydney, to be closer to Nada. All three family members engaged in the process of house hunting in the western suburbs of Sydney. The dominant voice in selection of the Punchbowl residence may have been that of the plaintiff, but all three family members participated in the process of decision making, and there is a degree of artificiality in ascribing a dominant role to any of them.
The purchase price of the Punchbowl residence was more than the plaintiff could fund from the proceeds of sale of the Hobart residence (bearing in mind an obligation to accommodate a property settlement with his former domestic partner), without supplementary loan funds.
On account of his advanced age, and his status as a pensioner, the plaintiff had been unable to borrow funds for the purchase. A decision was taken by the family, in a process in which all three family members participated, that the defendant would borrow the supplementary funds required to complete the purchase.
The object of that exercise was to be that a house would be acquired, as a joint residence for both the plaintiff and the defendant, living together, with the defendant available to care for the plaintiff in a home not far removed from Nada's residence.
Unfortunately, the arrangements made, relevantly by the plaintiff and the defendant, were not reduced to writing.
The subsequent recollections of the parties (and those of the conveyancer and her husband) are not readily reconcilable. Each of the plaintiff and the defendant has a sense of entitlement that appears to have coloured their evidence, and Nada's evidence has been coloured by her commitment to her father's cause.
In the absence of a necessity to do so, I am not prepared to find that any of them was an untruthful witness. This, despite cross-examination on both sides of the record directed towards a finding that the family member or members on the other side should be regarded as lacking creditworthiness for one reason or another.
That said, given the emotional engagement in the proceedings of each family member I am not comfortably satisfied that I can accept the uncorroborated evidence of any of them as reliable.
Necessity dictates a resort to objective facts.
That necessity is partly, but not wholly, relieved by reference to the evidence given by the conveyancer and her husband. Their dealings with the plaintiff and the defendant were hampered by the inability of the plaintiff and the defendant to speak English, and the unavailability of a suitably qualified, independent interpreter. The conveyancer's husband lent his services to the task of interpretation, but he did not pretend to be more than an imperfect instrument of expediency in the process of translation. His was a rough and ready facility for the task informally allocated to him.
I make no criticism of the professional conduct of the conveyancer, or her husband, and I do accept them as witnesses of truth, but their evidence (given orally, without the aforethought inherent in affidavit evidence) was qualified by language difficulties that had hampered their dealings with the plaintiff and the defendant; the absence of any formal, written advice written by the conveyancer; and the passage of time since the transaction of 2007 in which the conveyancer played a role.
I do accept that:
(a) the conveyancer advised the plaintiff and the defendant to obtain independent legal advice, and that it would be prudent for them to reduce their family arrangement to writing; and
(b) all members of the family now in dispute declined to accept that advice.
On the evidence of the conveyancer (corroborated by that of her husband), if accepted according to its tenor, the Punchbowl property was being purchased in the name of the defendant, to be held by him on trust for himself and the plaintiff during the lifetime of the plaintiff and, thereafter, for the defendant and Nada, subject to an adjustment of the quantum of the defendant's interest in the land to reflect the different financial contributions of the plaintiff and the defendant to acquisition of the property.
This perspective of the arrangement between the parties does not sit neatly with the perspectives of the parties themselves, including the acquiescence of all family members in Nada's non-joinder in the proceedings.
The principal effect of the evidence of the conveyancer is that:
(a) it confirms that there was a "family arrangement" for the acquisition of the Punchbowl property as a residence for both the plaintiff and the defendant;
(b) it confirms the symbiotic relationship between the plaintiff and the defendant in dealing with the means by which the property was to be acquired;
(c) it is inconsistent with the defendant's primary case that the plaintiff intended his contribution to the purchase of the property to be an outright gift to the defendant; and
(d) it is inconsistent with any reliance by the plaintiff on a resulting trust arising from his contribution to the purchase price.
It is no easy task to steer one's way through the conflicting evidence, to make findings of fact about what the "family arrangement", principally between the plaintiff and the defendant, was.
In my assessment, however, the objective facts point to the plaintiff and the defendant having a common intention that the property would be purchased in the name of the defendant, for the joint benefit of the plaintiff and the defendant living together indefinitely, on the basis:
(a) that, by funding the bulk of the purchase price, the plaintiff would provide a home for the defendant in Australia; and
(b) that, by his willingness to enter the mortgage necessary to allow the purchase to be made, and by his availability to care for the plaintiff, the defendant would make a commensurate contribution to family welfare.
I am not prepared to find that the parties, or either of them, intended that the respective interests of the plaintiff and the defendant in the property would be limited to, or measured by, an arithmetical calculation of their respective financial contributions to the acquisition (or, for that matter, their development or maintenance) of the property. It was, I find, intended by both the plaintiff and the defendant that the property would be, equally, a home for both of them.
Whatever mental reservations the plaintiff may have had about parting with wealth accumulated over a lifetime he did, I find, invite the defendant to come to Australia as his carer, on the basis that he would "buy a house" for the defendant personally.
That invitation was not, perhaps, the primary cause of the defendant's emigration. He had earlier tried, unsuccessfully, to migrate to Australia and, with the breakdown of his marriage, the plaintiff's invitation was a fresh opportunity to start a new life. And yet, it was a factor affecting his decision making, before and after his arrival in Australia in December 2006.
It would not be correct to make a finding of fact that, at the time of acquisition of the Punchbowl property, the intention of the plaintiff, or the expectation of the defendant, was that the plaintiff would simply "buy a house" for the defendant. Discussion within the family had moved on from that, and the defendant himself had aspirations to assist his father, not merely to be the gratuitous recipient of "a house".
I am satisfied that the common intention of the plaintiff and the defendant, in which Nada acquiesced, was, in fact, that the Punchbowl property was to be purchased, and that it was in fact purchased, as a home for the benefit of both the plaintiff and the defendant living together indefinitely, unattended by any calculation that their respective interests were ever to be limited to, or measured by, the proportions of their respective financial contributions.
They purchased the property on this basis, effectively, as owners of it in equal shares, not imagining that their relationship would break down.
However, as events have unfolded, their relationship has broken down - not to the point where either of them has moved out of their joint residence or sought orders designed to force the other to vacate it - but to the extent that they are both determined, or reconciled to the prospect, that there must be a parting of the ways.
Given the basis upon which each party acquired an interest in the property, I am satisfied that it would be unconscionable for either of them to deny the other's entitlement to a half share in the property.
Subject to allowing the parties an opportunity to be heard about the form of relief to be granted, including any relief consequential upon declaratory relief, I propose to declare that the defendant holds the Punchbowl property on trust for the plaintiff and himself in equal shares. Subject to one qualification, I envisage that, if the parties invite the Court to make orders for the property to be sold, the net proceeds of sale (after discharge of the mortgage) would be divided between the plaintiff and the defendant equally.
The qualification is this. The parties agree that, in the acquisition of the property, only something just shy of $70,000 of the NAB loan facility was deployed in purchase of the property. Subsequently, and for no benefit to the plaintiff, the defendant borrowed, for his own purposes, a further $50,000 or thereabouts on the security of the NAB mortgage. That further borrowing should not be laid to the account of the plaintiff. On any accounting between the parties, it should be borne by the defendant alone.
Provisionally, I am of the view that there should be no orders as to costs, with the intent that each party should pay or bear his own costs.
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Decision last updated: 02 July 2014
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