DKL v LYK - [2019] SASC 100

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
DKL v LYK
[2019] SASC 100
Judgment of The Honourable Justice Doyle
17 June 2019
EQUITY - TRUSTS AND TRUSTEES - IMPLIED TRUSTS - CONSTRUCTIVE TRUSTS - DE FACTO RELATIONSHIP
EQUITY - TRUSTS AND TRUSTEES - IMPLIED TRUSTS - RESULTING TRUSTS - WHEN ARISING - JOINT PURCHASE OF LAND
FAMILY LAW AND CHILD WELFARE - DE FACTO AND OTHER RELATIONSHIPS UNDER STATE LEGISLATION - ADJUSTMENT OF PROPERTY INTERESTS
Competing claims by the parties arising out of the breakdown of the personal relationship between them. The dispute between them related primarily to their respective interests in various properties acquired during the course of that relationship.
The defendant claimed an interest greater than his legal interest in those properties under various alleged resulting and constructive trusts which were said to arise by reason of his greater financial contributions over time. In the alternative, he claimed that various financial contributions made by him were loans that the plaintiff was required to repay.
The plaintiff claimed an entitlement to a division of assets under the Family Law Act 1975 (Cth) or the Domestic Partners Property Act 1996 (SA). She also sought orders for the sale of a property referred to as the Medindie property under the Law of Property Act 1936 (SA).
Held (per Doyle J):
1. Consideration of the principles governing the imposition of resulting and constructive trusts in the respect of properties acquired during the course of a personal relationship.
2. The defendant has not made out any resulting or constructive trust in respect of any of the disputed properties.
3. The plaintiff has not established that the relationship between the parties during the period from October 2014 to September 2016 was either a de facto relationship for the purposes of the Family Law Act, or a close personal relationship for the purposes of the Domestic Partners Property Act, and is thus not entitled to a division of assets under either of those Acts.
4. As the 50 per cent owner of the Medindie property, the plaintiff is entitled to an order for the sale of the Medindie property under s 70 of the Law of Property Act.
Family Law Act 1975 (Cth) ss 4AA, 90RG, 90SB, 90SK, 90SM; Domestic Partners Property Act 1996 (SA) ss 3, 9, 10; Law of Property Act 1936 (SA) ss 60, 70, referred to.
Stanford v Stanford (2012) 247 CLR 108; Calverley v Green (1984) 155 CLR 242; Sivritas v Sivritas (2008) 23 VR 349; Nelson v Nelson (1995) 184 CLR 538; Ong v Lottwo Pty Ltd (2013) 116 SASR 280; Muschinski v Dodds (1985) 160 CLR 583; Baumgartner v Baumgartner (1987) 164 CLR 137; Parij v Parij (1997) 72 SASR 153; Willis v State of Western Australia (No 3) [2010] WASCA 56; Miller v Sutherland (1990) 14 Fam LR 416; Cressy v Johnson (No 3) [2009] VSC 52; Lloyd v Tedesco (2002) 25 WAR 360; Green v Green (1989) 17 NSWLR 343; Windt v Carabelas [2002] SASC 418; Engwirda v Engwirda [2000] QCA 61; De Lacey v James [ 2003] QSC 94; Stowe v Stowe (1995) 15 WAR 363; Kriezis v Kriezis [2004] NSWSC 167; Anson v Anson (2004) 12 BPR 22; Hibberson v George (1989) 12 Fam LR 725; West v Mead [2003] NSWSC 161; Ikeuchi v Liu (2001) 160 FLR 94; The Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278; Miller v Dudman [2002] WASC 99; Dahl v Hamblin (2011) 254 FLR 49; Dabney v Laird [2013] FCCA 214; In Re Fagan, Deceased (1980) 23 SASR 454; Sam v Lamothe [2016] FamCA 576; Taddeo v Taddeo (2010) 269 LSJS 309; Petersen v Gregory [2007] NSWSC 8; Edelman v Badower [2010] VSC 427; Sheahan v Cooper [1998] FCA 1531; Kasewieter v Galligan [2015] SASC 5; Bray v Bray (1926) 38 CLR 542; Re Permanent Trustee Nominees (Canberra) Ltd [1989] 1 Qd R 314; Callahan v O’Neill [2002] NSWSC 877; Pannizutti v Trask (1987) 10 NSWLR 531; Joyce v Joyce [1963] Qd R 139; Karastamatis v Tzanavaras [2013] SASC 163; Spathis v Nanos [2008] NSWSC 418, considered.

DKL v LYK
[2019] SASC 100
Civil
DOYLE J:
PART A: INTRODUCTION
An overview of the facts
The parties’ claims
The trial and the evidence
PART B: BACKGROUND FINDINGS
The parties and their backgrounds
The parties’ relationship in Hong Kong from late 2003 to 2006
Purchase of the Bowen Road property
DG Company and the purchase of the Pottinger Street property
The events of 2006
The defendant moves to China in December 2006
The end of the parties’ romantic relationship in early 2007
Post-relationship events
The August 2007 reconciliation of arrangements
The period from August 2007 to September 2015
Sale of the Pottinger Street property in 2007
Purchase of the Port Willunga property in 2011
Commencement of DM Company and subsequent financial assistance
The defendant moves to Spain in June 2014
The plaintiff’s diagnosis with a brain tumour in July 2014
The period of cohabitation in Hong Kong from October 2014
Looking for properties in Australia in 2015
Sale of the Bowen Road property in September 2015
Acquisition of the Medindie property
Moving to Adelaide in September 2015
The parties’ relationship while living in the Medindie property
The relationship ends in September 2016
Events since September 2016
The parties’ current circumstances and pool of assets
The defendant’s relationships with other women
The evidence from the non-party witnesses
PART C: THE PARTIES’ CLAIMS
PART D: SOME MATTERS OF LEGAL PRINCIPLE
Resulting trusts in the context of cohabiting couples
Constructive trusts in the context of the breakdown of a personal relationship
The interaction between resulting and constructive trusts
PART E: THE PARTIES’ GENERAL LAW PROPERTY RIGHTS
The Bowen Road property
The parties’ contributions to the Bowen Road property
The circumstances surrounding the purchase of the Bowen Road property
The alleged resulting trust over the Bowen Road property
The alleged constructive trust over the Bowen Road property
The alleged August 2007 agreement in relation to the Bowen Road property

The Pottinger Street property
The circumstances of the defendant’s contributions to the Pottinger Street property
The alleged resulting trust over the Pottinger Street property
The alleged constructive trust over the Pottinger Street property

The Port Willunga property
The alleged resulting trust over the Port Willunga property
The alleged constructive trust over the Port Willunga property

Financial contributions to DM Company
The Medindie property
The alleged resulting trust over the Medindie property
The alleged constructive trust over the Medindie property

Alleged overarching constructive trust
PART F: STATUTORY ALTERATION OF THE PARTIES’ PROPERTY RIGHTS
Adjustment of property interests under the Family Law Act
The existence of a de facto relationship under s 4AA of the FLA

Adjustment of property interests under the Domestic Partners Property Act
The existence of a domestic partnership under the DPPA

PART G: ENTITLEMENT TO ORDER FOR SALE UNDER THE LAW OF PROPERTY ACT
PART H: CONCLUSION
PART A: INTRODUCTION

These proceedings involve competing claims by the parties arising out of the breakdown of the personal relationship between them. The dispute between them is primarily as to their respective interests in various properties acquired during the course of that relationship.
An overview of the facts
The plaintiff and the defendant were in a relationship from late 2003 until late 2006. Throughout that period they lived together in Hong Kong, initially in the plaintiff’s rented apartment, and then from early 2005 in an apartment they jointly purchased on Bowen Road (the Bowen Road property). They had a son together in October 2006.
In December 2006, the defendant moved to China for work. The parties’ relationship deteriorated, and at some point in the first half of 2007 at least the romantic and sexual aspect of their relationship came to an end.
For the next seven years or so, the parties continued to live in different cities, with the plaintiff living in the Bowen Road property in Hong Kong and having the primary care of their son in Hong Kong.
In July 2014 the plaintiff was diagnosed with a brain tumour. She was originally from Adelaide, and returned to Australia for medical care and treatment, and so that she could have the support of her family. In August 2014, the defendant took over the primary care of their son.
From October 2014, and while the plaintiff was continuing to recover from the surgery to remove her tumour, the plaintiff and the defendant resumed living together, with their son, in the Bowen Road property in Hong Kong.
In September 2015, the plaintiff and the defendant sold the Bowen Road property and moved to Adelaide to live. They jointly purchased a property in Medindie (the Medindie property), and after some interim arrangements for a short period, commenced living there together with their son in December 2015. This arrangement came to an end in late September 2016 when, following a heated argument between the parties, the plaintiff and their son moved out of the Medindie property.
The nature of the parties’ relationship throughout the period from their initial separation in the first half of 2007 through to September 2016, but in particular during the period from the resumption of their cohabitation in around October 2014, is a matter of contention in these proceedings. On the plaintiff’s case, by the time they moved to Australia to live in 2015 they were in a ‘de facto relationship’ or ‘domestic partnership’ within the meaning of the relevant legislation, albeit without any romantic or sexual dimension to the relationship. On the defendant’s case they were merely living together for the purposes of co-parenting their son.
The parties have been unable to agree a division of their assets following the end of their relationship. They are in dispute as to the nature of their respective interests in the Bowen Road property in Hong Kong, and hence also their interests in the Medindie property that they purchased with the proceeds from the sale of that property. They are also in dispute about their interests in a property purchased by the plaintiff in February 2011 in Port Willunga in South Australia (the Port Willunga property), and a property purchased through the plaintiff’s interior design consultancy business (which she ran through a company referred to in these reasons as DG Company) on Pottinger Street in Hong Kong (the Pottinger Street property). They are also in dispute about the significance of various sums of money provided by the defendant to the plaintiff, most of which was provided during the period they were living separately and for the purpose of supporting the plaintiff’s art gallery and retail business (which she established in July 2011 through a company referred to in these reasons as DM Company).
The parties’ claims
In very general terms, the plaintiff claims that she had a half interest in the Bowen Road property, that she and her business partner owned the Pottinger Street property (through her company, DG Company), and that she alone owns the Willunga Property. She claims that the monies provided to her by the defendant were gifts from him, and hence were neither loans that needed to be repaid, nor contributions to some joint endeavour that resulted in the creation or enlargement of any interest by the defendant in any of the properties in dispute. The plaintiff also claims a half interest in the Medindie property.
The plaintiff seeks a determination of her claimed interests as a matter of general law, but also seeks a division of assets under the Family Law Act 1975 (Cth) (the FLA) or the Domestic Partners Property Act 1996 (SA) (the DPPA). She also seeks orders for the sale of the Medindie property under the Law of Property Act 1936 (SA) (the LPA).
The defendant, on the other hand, by way of both defence and counterclaim, contends for a greater equitable interest on his part in each of the relevant properties. He contends that the plaintiff’s case ignores the additional contributions that he made over time, and mischaracterises his provision of funds as gifts. He contends that the plaintiff holds the relevant properties on either resulting or constructive trust for him. He denies that their relationship was of a nature sufficient to qualify for any division of assets under either the FLA or the DPPA. He also denies that any basis has been established for an order for the sale of the Medindie property under the LPA.
In order to determine the parties’ claims in these proceedings, it is necessary to consider not only the nature of their relationship at various times between 2003 and 2016, but also the circumstances surrounding the acquisition and sale of their various property interests and the provision of money to the plaintiff by the defendant.
While both parties adduced a good deal of evidence in relation to these matters, there was significant agreement between them as to most of the primary facts. With some significant exceptions that will become apparent, their evidence differed mainly as to the characterisation of their relationship, and of their financial dealings and property interests, rather than the primary facts and circumstances. For that reason, I consider it appropriate to commence by recounting in some detail the (largely) uncontroversial findings of fact that I have made, before then turning to consider more closely the issues needing to be resolved in these proceedings and the controversies in the evidence relevant to the resolution of those issues.
However, before doing so, it is useful to commence by saying something about the trial, and the evidence relied upon by the parties.
The trial and the evidence
The trial proceeded over six days. Both the plaintiff and the defendant gave their evidence in chief predominantly in writing, but were then cross-examined at length.
In my view, neither the plaintiff nor the defendant were entirely satisfactory witnesses. I accept that a large proportion of the evidence given by each as to the facts and circumstances relevant to their relationship and financial dealings was consistent with the evidence given by the other witnesses and the documentary evidence. I have thus had no difficulty in accepting the truthfulness and reliability of most of their evidence. However, in respect of various issues in dispute, I have had some difficulties in accepting the reliability of the evidence of both parties. That said, for the reasons I shall elaborate upon, it is fair to say that I have had greater difficulties in respect of the defendant’s evidence.
So far as the plaintiff is concerned, I found her to be a generally satisfactory witness. In the main she gave her evidence in a careful and considered manner. I found her to be a truthful, and generally reliable, witness. The only significant concern that I had with the plaintiff’s evidence was in relation to her characterisation of the parties’ relationship from the point of their separation in the first half of 2007 onwards. I consider that in various respects, the plaintiff’s evidence did not fully acknowledge the change in their relationship. Overall, and in various respects, I have concluded that the plaintiff’s evidence overstated the significance of the personal relationship between them from their separation in early 2007 onwards. I accept that this may well have occurred subconsciously, without any intention to give untruthful or misleading evidence. However, I have ultimately reached my own views, based upon the evidence as a whole, as to these matters of characterisation. I have nevertheless generally accepted the reliability of the plaintiff’s evidence as to the detail of the parties’ personal and financial dealings, including in those areas where her evidence diverged from the defendant’s evidence. To the extent that there were some minor qualifications to this in respect of particular aspects of the communications between the parties, these matters have either been identified in my reasons or were not relevant to my determination of the issues that it has been necessary for me to decide.
Turning to the defendant, I had some more significant concerns with his evidence. I have concluded, for reasons explained later, that the defendant’s evidence was inaccurate in some significant respects. This included his evidence in relation to the circumstances in which the parties came to hold the Bowen Road property as joint tenants (rather than tenants in common). It included his evidence in relation to the timing and circumstances of the breakdown in the parties’ relationship in the first half of 2007. It also included his evidence as to the agreement that he alleged the parties reached in August 2007 to the effect that he would contribute AUD 1 million towards a house for the plaintiff and their son when they returned to Australia to live.
However, my concerns extended beyond the inaccuracy of the defendant’s evidence on these topics. He gave his evidence in a manner that was often emphatic and emotional. He displayed through both the content of his evidence and the manner in which he gave it that he continues to feel great anger and resentment, indeed bitterness, towards the plaintiff for what he considers to be a lack of gratitude and respect from her for his financial contributions during their relationship. To some extent the defendant’s feelings are understandable and to be expected. No doubt the plaintiff is also angry and resentful about the way she considers she has been treated by the defendant in some respects. However, the difficulty is that it appeared to me that the defendant allowed his feelings to affect his evidence in a way that has led me to doubt its reliability in important respects. It appeared to me that in many respects he gave his evidence with the benefit of hindsight; that his evidence in these respects involved a reconstructed or reconsidered view of his actions, thoughts and motivations in light of his present feelings for the plaintiff, rather than an accurate reflection of his contemporaneous actions, thoughts and motivations. Of particular significance in this regard, I found unconvincing the defendant’s evidence to the effect that he considered various of the contributions he made along the way to be loans, rather than reflections of his gratitude and generosity towards the plaintiff. It is for these reasons that in several situations where the parties’ evidence diverged, I have preferred the evidence of the plaintiff.
In addition to the evidence from the parties themselves, both the plaintiff and the defendant also relied upon some relatively short affidavits from other witnesses. Their evidence was primarily relevant to the general characterisation of the parties’ relationship at various stages. None of these witnesses were required to attend for cross-examination.
The plaintiff relied upon affidavits from her mother (EL), her brother (DL), a friend and work colleague from her time in Hong Kong (DN), and two other long term friends (RL and CW). She also relied upon two affidavits from one of her solicitors in relation to some more formal matters.
The defendant relied upon affidavits from friends of his (namely FR and LN from the period he was living in China, and AI, XL and CH from the period he was living in Adelaide), as well as a woman (WF) who worked as the plaintiff’s part-time assistant in her businesses from about 2007 to 2016.
As the evidence from these witnesses was not challenged I have accepted it. I have outlined the significant aspects of that evidence later in these reasons.
The parties also relied upon a number of documentary exhibits. These exhibits totalled more than 5,000 pages, and included a joint tender bundle consisting of 16 lever arch folders. However, most of these documents were either relatively formal in nature (such as bank statements, accounts, receipts and the like), or were relevant only in a general way. Included within this last category were many hundreds of email communications between the parties which, with a few notable exceptions, were relevant only to assist me to understand the sequence of events, and the general nature and tone of the communications between the parties throughout the relevant period.

The evidence adduced by the parties made reference to amounts expressed in both Hong Kong dollars (HKD) and Australian dollars (AUD). The evidence included a schedule of the exchange rates applicable throughout the relevant period. The rates varied throughout that period, but were generally between about HKD 6: AUD 1 and HKD 8: AUD 1. While there are some exceptions, I have generally used HKD in the period prior to the parties moving to Australia in October 2015, because that is the currency in which the parties transacted and paid their expenses. I have used AUD in the period after the parties’ relocation to Adelaide in October 2015. Whilst it has been relevant for me to have general regard to the exchange rates between these currencies, it has not ultimately been necessary for me to carry out any precise conversions.
PART B: BACKGROUND FINDINGS
As mentioned, there was little dispute between the parties as to most of the objective facts and circumstances relevant to the determination of the issues in these proceedings. The following is a summary of the findings I make in relation to these matters.
Most of these findings are based upon either the uncontested evidence of one or both of the parties, or the documentary evidence. To the extent that there are some relatively minor exceptions to this where I have found it necessary to resolve differences between the parties, or to favour the evidence of one over the other, I have done so based upon my overall view of the evidence of the parties but in the context of the particular issue.
In a number of instances where the parties’ evidence has diverged, I have not found it necessary to resolve the differences. In some of those instances I have simply not addressed the evidence as I do not think it bears upon the matters I need to determine. In other instances, where the competing versions of the evidence at least form a significant part of the narrative, I have simply referred to the parties’ evidence without making a finding.
The parties and their backgrounds
The plaintiff was born in 1966. She grew up in Adelaide. She then spent some time living in Melbourne before moving to Hong Kong in the early 1990s. Her parents and brothers remained living in Adelaide. She is an interior designer, and in about 2000 established a Hong Kong company, DG Company, with her friend, DN, to operate an interior design consultancy business.
As at 2003, the plaintiff was living in an apartment that she was renting in Glenealy in Hong Kong. While she was generating an income from her business that was sufficient to meet her expenses, she did not own any property or significant assets other than the furniture and effects that she had accumulated over time.
The defendant was born in Hong Kong in 1958. His family live in various places, but none of them live in Australia. He is an architect, and from around 1983 worked as an architect in Singapore and then New Zealand. In the late 1980s he returned to Hong Kong where he continued working full-time as an architect until late 2002.
Throughout his time in Hong Kong, the defendant invested in and renovated several properties in Hong Kong. By the time he stopped work in 2002, he owned three apartments in Hong Kong. Two of them (both on MacDonnell Road and purchased for HKD 5.5 million and HKD 2.1 million respectively) he owned outright. One of them (in Happy Valley and purchased for approximately HKD 4.0 million) was subject to a “small” mortgage. The defendant was receiving rental income from the MacDonnell Road properties of about HKD 50,000 per month.
As at 2003, the defendant was living in the Happy Valley property. His plan was to keep the MacDonnell Road properties as investment properties, and to sell the Happy Valley property with a view to travelling to Australia to determine whether he would like to live there. The defendant signed a contract to sell the Happy Valley property for HKD 5.1 million in October 2003, but continued to live there prior to settlement.
The parties’ relationship in Hong Kong from late 2003 to 2006
The plaintiff and the defendant met in Hong Kong around October 2003. They met when the plaintiff went to look at the apartment the defendant was selling in Happy Valley. They chatted and then began corresponding by email. Their relationship developed quickly, and by November 2003 the defendant commenced staying overnight at the plaintiff’s Glenealy apartment.
In December 2003, the defendant moved into the plaintiff’s apartment. It is agreed that they were soon living there together on a genuine domestic basis. They were in a sexual relationship and sleeping together in what had been the plaintiff’s bedroom. The plaintiff continued paying the rent and utilities for the Glenealy apartment because she was working full-time (in her design consultancy business) and he was not working in a full-time position; and she undertook most of the domestic chores, including the cleaning. They ate meals together and either he cooked, or they cooked together.
In December 2003, the plaintiff and the defendant travelled together to Australia to celebrate Christmas with the plaintiff’s family. The plaintiff told her family that the defendant was her boyfriend, and that they were living together.
From relatively early in their relationship the plaintiff and defendant both discussed their desire to have children together. They began trying for a baby in about April 2004. The plaintiff fell pregnant three times in the period from 2004 to 2005. In the case of the first pregnancy, the parties unfortunately learned after about four and a half months that the pregnancy was not viable. They travelled together to Melbourne to terminate the pregnancy. It was a time of great sadness for them both. And in the case of the second and third pregnancies, they unfortunately ended in miscarriages.
In September 2004, the defendant signed a contract to purchase a property on Robinson Road in Hong Kong for HKD 6.328 million. He had intended to develop this property, but upon learning of the opportunity to purchase the Bowen Road property (see below), he immediately on-sold the Robinson Road property.
Purchase of the Bowen Road property
On 30 September 2004, the plaintiff and the defendant signed a contract to purchase the Bowen Road property. The purchase price was HKD 8.9 million (excluding transaction and subsequent renovation costs), and settlement occurred on 18 January 2005. Bowen Road was a very desirable address, and the apartment was a relatively large apartment (with three bedrooms and two bathrooms) on the second floor of a low-rise building. According to the plaintiff, they purchased the home as a family home. The defendant, on the other hand, emphasised that they had also both viewed the property as a good investment opportunity.
Of the purchase price of HKD 8.9 million, the defendant contributed HKD 6.7 million and paid most of the transaction costs.[1] The balance of HKD 2.2 million was funded through a loan with the Bank of China (the Bowen Road loan). While both the defendant and the plaintiff were jointly liable under this loan, it was agreed between the parties that the plaintiff would be responsible for repaying the loan.
[1] The defendant paid HKD 333,960 in duties and taxes, and HKD 89,000 as an agent’s fee, thus giving a total contribution by him of HKD 7,122,960 inclusive of transaction costs. The plaintiff paid HKD 13,850 in fees associated with the purchase.
The plaintiff and the defendant became registered proprietors of the Bowen Road property as joint tenants. They became joint tenants following a meeting with their lawyer, Mr Chan. I shall return to the details of the circumstances in which this occurred later in these reasons.
The plaintiff serviced the Hong Kong home loan from her own funds from about February 2005 until August 2006, making monthly payments of principal and interest. These monthly payments were about HKD 22,120 per month, giving a total of approximately HKD 398,162.[2]
[2] Of which, approximately HKD 224,000 was by way of reduction of the capital balance of the Bowen Road loan.
Following settlement, the parties undertook a significant renovation of the Bowen Road property. According to the defendant, he carried out and managed the renovations on a full-time basis over several months. According to the plaintiff, she designed, coordinated and managed (with the defendant) the renovation. I do not need to resolve the dispute between the parties as to the relative significance of their contributions to the renovations. It is sufficient to observe that I accept that both parties contributed significantly. Of the approximately HKD 500,000 cost of the renovation, the plaintiff paid approximately HKD 330,000 and the defendant approximately HKD 170,000.
The parties moved into the Bowen Road property, following completion of the renovation works, in about April or May 2005. The plaintiff furnished the Bowen Road property with her furniture, artwork, kitchenware and household effects from the Glenealy apartment, together with additional items of this nature that she subsequently selected and purchased. The defendant made only a very limited contribution by way of household effects.
While living together in the Bowen Road property, the parties continued to live in a genuine domestic relationship. They were in a sexual relationship, and shared the master bedroom, ensuite bathroom and walk in robe. They did not have a shared bank account, but did both contribute to their living and household expenses. They shared the domestic chores, with the plaintiff doing most of the cleaning and the defendant most of the cooking. They ate meals together, and entertained family and friends at their home. They went to social outings together. They visited the defendant’s family in Hong Kong for meals and other special occasions. They still wished to, and were trying to, have a child (or children) together. According to the plaintiff, she was committed to a shared life with the defendant, and he led her to believe that he was also committed to a shared life together. I accept this evidence.
DG Company and the purchase of the Pottinger Street property
In about 2000, the plaintiff and her friend, DN, had established a Hong Kong company, DG Company, through which to operate their interior design consultancy business. They became the two directors, and each took up a 50 per cent shareholding in the company. As at the time of trial, the company was being wound up in Hong Kong and had no assets or liabilities.
From around mid-2004, the defendant commenced doing some work for DG Company. He did so because he did not have a full-time job, and wanted to assist. He did some drafting and sketching, and provided some technical advice on the construction aspects of some of DG Company’s projects. The company retained and paid the defendant for this work.
In September 2005, DG Company purchased a property on Pottinger Street in Hong Kong for HKD 2.1 million (excluding transaction costs).[3] The defendant identified the property and suggested it to the plaintiff and DN as a potential investment opportunity. It was a commercial unit in an old three storey building that had the potential to be converted into a residential flat.
[3] Inclusive of transaction costs, the purchase was HKD 2.135 million.
This purchase occurred at a time when the defendant was not personally in a financial position to make any further investment in property. He did not have any substantial cash savings available to him. Nor did he have any capacity to borrow given that he did not at that time have any formal employment.
However, when he became aware that DN and her husband (ST) were interested in investing in a property, the defendant suggested that they buy the Pottinger Street property through DG Company. Following a meeting or discussion between the four of them (the defendant, the plaintiff, DN and ST), it was agreed that the defendant would negotiate with the vendor with a view to purchasing the property on behalf of DG Company. It was agreed that if they were successful in purchasing the property it would be renovated as a residential apartment. According to the defendant it was agreed that he would manage the renovation. The defendant then undertook the negotiations, which took place in Chinese (with the defendant being the only one of the four of them able to speak Chinese fluently), and culminated in the purchase summarised above.
The plaintiff agreed with DN that they would fund the purchase of the Pottinger Street property in equal shares. DN provided her share to DG Company in cash, and the plaintiff made her half share contribution primarily through a loan of HKD 900,000 that DG Company obtained from the Bank of China (the Pottinger Street loan). The plaintiff agreed with DN that she would be responsible to DG Company for the monthly loan repayments, and that they would be funded by her reimbursing DG Company out of her salary. And that is how the monthly repayments were thereafter made.
DG Company serviced the Pottinger Street loan from about October 2005 to September 2006. It made principal and interest payments of about HKD 15,000 per month, totalling approximately HKD 182,614.
Soon after settlement on the Pottinger Street property, the renovation of it into a residential apartment commenced. According to the defendant, he carried out and managed the renovations to the Pottinger Street property on a full-time basis over the period from about October 2005 to March 2006. According to the plaintiff, she and DN designed and coordinated the renovations. While acknowledging that the defendant assisted in carrying out those renovations, the plaintiff said that he was paid for that assistance. DG Company paid for all of the renovation costs for the Pottinger Street property, totalling HKD 326,149 (including HKD 50,000 paid to the defendant for his assistance). DG Company also paid for the maintenance and other outgoings for the Pottinger Street property.
Once the renovation was completed, and with the assistance of the defendant in retaining an agent, a tenant was located. DG Company leased the Pottinger Street property from 1 January 2006 to 6 September 2007, and as the owner of that property received the rental income.
The events of 2006
In early 2006, the defendant sold the more expensive of his MacDonnell Road properties for HKD 10.68 million.
Also in early 2006, the plaintiff fell pregnant with the parties’ son.
At some point mid-pregnancy, the plaintiff and the defendant travelled to Lebanon and Europe for a two month holiday. According to the plaintiff, it was around this time that the defendant said to her that he would name her and their son as beneficiaries under the life insurance policy that he had with Zurich Insurance. Documentation subsequently received from Zurich Insurance suggests that the defendant did as he said he would.
The plaintiff claims that when she was about five months pregnant, they had several discussions about their future together. According to the plaintiff, when she raised the question of marriage, the defendant said words to the effect that marriage was not for him, but that he would always look after her and their son. While accepting that he did not wish to marry the plaintiff (and that he told her as much), the defendant denied saying that he would always look after her and their son, adding that what he would have said was that “I would take care of [our son], and that I would do my best.”
According to the plaintiff, they also discussed what she would do ‘work wise’ after their son was born. She said she would prefer to be at home with their son for the first two years of his life, and that she and the defendant agreed that she would not work for at least this period. According to the plaintiff, the defendant said to her words to the effect that he wanted her to focus on their son, and did not want her to worry financially. The defendant, on the other hand, denied discussing whether the plaintiff would take time off after having a baby.
To the extent their evidence differed in relation to the above conversations, I prefer and accept the plaintiff’s evidence.
In August 2006 the defendant offered to pay, and did pay, the balances then owing by the plaintiff and DG Company on the Bowen Road loan and the Pottinger Street loan. In particular, on 14 August 2006, he paid HKD 1.976 million off the Bowen Road loan; and on 28 August 2006, he paid HKD 828,000 off the Pottinger Street loan. The defendant used some of the proceeds of the sale of his MacDonnell Road property earlier that year to make these payments.
On the plaintiff’s evidence, which I accept, the defendant’s offer to pay out these loans occurred in the context of the discussions about their future together, as recounted above. That said, the parties agreed that there was no discussion between them as to the basis upon which the loan repayments were being made, let alone any suggestion by either of them to the effect that the repayments would alter the parties’ interests in the Bowen Road or Pottinger Street properties. However, as the defendant contends that his payments did have this effect, I shall return to the circumstances and relevance of these loan repayments later in these reasons.
In the lead up to their son’s birth, the plaintiff wound down her design consultancy projects.
On 24 October 2006, the parties’ son was born. During the first two months of his life, both the plaintiff and the defendant were at home to care for him. Neither of them was working.
The defendant moves to China in December 2006
By December 2006, the defendant had decided that he needed to find some regular work so that he could financially support the plaintiff and their son. As he told the plaintiff, he felt a responsibility to do so.
He was approached, and was then interviewed and offered work, by the general manager of a property development company. The project he was employed to work on required him moving to Beijing, China.
The parties discussed moving to China together, but decided it would not be a good place to raise their son. The defendant decided that he would nevertheless move to China to work. The likely duration of the work in China was at that stage unclear and open-ended.
The plaintiff was surprised and unhappy with the defendant’s decision to work in China. She initially tried to persuade him to change his mind, but ultimately felt she had no choice but to accept his decision. When the defendant left for China in late December 2006, he took only limited belongings with him. He left most of his personal effects in the Bowen Road property. Neither the plaintiff nor the defendant believed at the time that this was the end of their relationship.
In the early stages of 2007, the parties kept in regular contact by telephone and email, albeit that this contact was generally initiated by the plaintiff. The plaintiff sent the defendant photographs of their son.
The plaintiff did not find it easy looking after their son on her own, and at some point in early 2007 her mother came to Hong Kong to help her. Her mother stayed with the plaintiff in the Bowen Road property. In about March 2007, the plaintiff (together with her mother and their son) flew to China to visit the defendant. They all met in Shanghai, as that was where the defendant happened to be working at the time. They stayed in a hotel room together.
The defendant also returned to Hong Kong to visit the plaintiff and their son in February 2007 (for Chinese New Year) and in April 2007. The defendant stayed in the Bowen Road property on these occasions.
The end of the parties’ romantic relationship in early 2007
In early May 2007, the defendant informed the plaintiff that he was in a relationship with another woman. He did so in the course of a telephone conversation when the plaintiff enquired about some background noise in the defendant’s apartment. The plaintiff was shocked and devastated by this news.

The defendant’s evidence was that their relationship had already ended by this point. They had had no sexual or physical contact since he had left in December 2006, and he considered that their relationship came to an end in early 2007.
The defendant’s evidence was that he believed they had agreed to end their relationship shortly prior to him returning to visit Hong Kong for Chinese New Year in February 2007. He said that they had a telephone conversation in which the plaintiff expressed her unhappiness about him working in China, and asked him to quit his job and return to Hong Kong to live. When he declined to do so, and said he intended to complete the project he was working on, they ended up having an argument. He told her that if she was so unhappy with him being away, then they should go their separate ways.
According to the defendant, he thought they had agreed to separate as a result of that conversation. The defendant drew support for this timing of the end of the relationship from his recollection that the plaintiff told him she did not want him to stay at the Bowen Road property when he returned to Hong Kong for the Chinese New Year. He considered this confirmatory of their separation in early 2007.
The defendant said that he still travelled to Hong Kong for the Chinese New Year in February 2007, in part because he had in any event been requested by his employer to do some work from its Hong Kong office during this period. However, the defendant said that he stayed in a hotel while in Hong Kong, rather than at the Bowen Road property. He said that he also stayed at a hotel when he visited Hong Kong in April 2007, again because he was in effect excluded from the Bowen Road property by the plaintiff.
The defendant said that from as early as 2007 he commenced to meet and date other women, including by placing online personal advertisements seeking company to play bridge or tennis. One of the women he met was named M. He said that they commenced dating, and indeed lived together in his Beijing apartment for about 18 months from April 2007 until July 2008 (when she moved to London to study).
The defendant acknowledged a phone conversation with the plaintiff in about May 2007, in the terms recounted by the plaintiff. He said that the woman in his apartment was M. However, he says that by that stage his relationship with the plaintiff had been over for a few months, and so he saw no difficulty with him having commenced a relationship with M a few weeks earlier.
There was a difficulty with the defendant’s evidence in relation to the timing of their separation, and in relation to his February and April 2007 visits to Hong Kong. Having regard to the plaintiff’s evidence, and some photographs tendered by the plaintiff of those visits, I am satisfied that the defendant stayed at the Bowen Road property during those visits, and indeed slept in the same bed as the plaintiff. And while I accept that the relationship between the plaintiff and defendant had deteriorated by that point, I do not accept that there had been any communication between them to the effect that they had separated, or that they were no longer a couple.
I accept that the defendant may have begun to move on from the relationship, in an emotional sense, prior to May 2007. This would be consistent with the plaintiff and defendant having ceased to have any sexual relations by December 2006, and with the defendant having commenced a relationship with M at some point in early 2007. However, I do not accept that he communicated this in any clear way prior to their May 2007 conversation to which I have referred. While the plaintiff no doubt appreciated that their relationship was under significant stress throughout early 2007, I accept that it was not until the May 2007 conversation that it was made plain between the parties that their relationship (at least in any romantic sense) was at an end.
Whilst I consider that the inaccuracies in the defendant’s evidence as to the timing and circumstances of the demise of the parties’ relationship were significant in terms of my assessment of his reliability as a witness, the precise timing and circumstances of the demise in their relationship was not of any real significance to the issues I need to determine. It is sufficient in that respect to observe, as the parties’ agreed, that by at least May 2007, the romantic and sexual aspect of the relationship between them was over.
Post-relationship events
By about June 2007, and after recovering from the initial shock of discovering that the defendant was in a relationship with another woman, the plaintiff resumed working part-time in her design consultancy business so that she would have a source of income to take care of herself and her son. In about July 2007, she hired a live-in domestic helper so that she could work longer hours. The plaintiff’s mother also continued to visit from time to time to help the plaintiff care for their son.
The parties continued to communicate with one another by telephone and email, speaking predominantly about their son and their Bowen Road property. In the course of these communications, the defendant indicated that he would support the plaintiff and their son by contributing to their expenses. He asked the plaintiff to let him know what they needed from him in this respect. The plaintiff and their son also continued to have some contact with the defendant’s family in Hong Kong and elsewhere.
From the defendant’s perspective, there was no longer any relationship between him and the plaintiff from that point in time. Over the ensuing months and years while the defendant remained in China, he continued seeking and having relationships with various women. While acknowledging that he continued to communicate with the plaintiff (particularly in relation to their son and financial support), and returned to Hong Kong to visit the plaintiff and their son a number of times, the defendant did not regard this as involving any continuation or resumption of their relationship.
The August 2007 reconciliation of arrangements
In late August 2007, the plaintiff and the defendant met in Hong Kong to discuss a reconciliation of their living and financial arrangements. While both agreed that discussion occurred on this occasion, there were differences in their evidence as to what was discussed and agreed. They both gave evidence that they discussed and agreed that the defendant would start by making monthly contributions to the household and living expenses for the plaintiff and their son in the amount of HKD 30,000. They also both gave evidence that they discussed the plaintiff’s future living arrangements, and that in this context the plaintiff mentioned the possibility of her at some time returning to live in Australia with their son. However, there was a dispute in their evidence about the ultimate effect of their discussion about this possibility.
The plaintiff said that she merely mentioned this as a future possibility and, indeed, said to the defendant words to the effect “at this stage I have decided to make a go of it in Hong Kong.” The defendant, on the other hand, suggested in his evidence that following the plaintiff’s indication of an intention to move to Australia to live they then agreed that he would contribute AUD 1 million, or HKD 6 million, to her purchase of a property in Australia, and that this would in effect be in exchange for her interest in the Bowen Road property. The plaintiff denied any discussion, let alone agreement, in these terms.
The defendant relies upon this alleged agreement in support of his claim to ownership of the Bowen Road property. I shall return to this dispute between the parties’ competing versions of their August 2007 meeting in the context of my consideration of the ownership of this property.
The period from August 2007 to September 2015
The plaintiff and her son continued living in the Bowen Road property in Hong Kong until they eventually moved to Adelaide in September 2015 (in the circumstances described in more detail below). The defendant continued living and working in China until about June 2014, when he moved to Spain.
By way of overview of this period, before later addressing some particular events in more detail, both parties continued to generate their separate incomes during this period, the plaintiff from her design consultancy work and the defendant from his project work in China. From the plaintiff’s tax returns, it appears that she drew a relatively modest income from her businesses during this period, ranging from about HKD 100,000 per annum up to slightly less than HKD 400,000 per annum. The defendant’s income was significantly greater during this period. It varied over time between about HKD 100,000 per month (or HKD 1.2 million per annum) to in excess of HKD 150,000 per month (or HKD 1.8 million per annum). They each retained their own incomes, managed their own finances, and were generally financially independent from each other, subject to the following exceptions.
The plaintiff continued to pay the utilities and government rates associated with the Bowen Road property, and to pay the household and living expenses for herself and their son. This included paying expenses associated with their son’s education (such as pre-school and kindergarten expenses, and the cost of uniforms and transport) and his sporting and social activities.
The defendant continued to contribute HKD 30,000 per month towards these expenses, although according to the plaintiff their monthly expenses usually substantially exceeded this sum. The defendant also paid the management fees associated with the Bowen Road property, and most of their son’s school fees for his attendance at the Hong Kong Academy. Their son commenced at this school in about 2010, and the fees were high (being about HKD 60,000 per semester). The defendant also made some other occasional payments, for example, for some medical expenses and holidays.
The plaintiff and the defendant continued to communicate with each other. The frequency of their communication varied, from quite often at some points in time to quite intermittently at other points in time. Most of the communications were by email, but they also had occasional telephone and skype conversations. Their communications generally related to their son, but they sometimes also communicated about matters associated with the Bowen Road property, their jobs and some financial and property related matters of interest to the both of them. Apart from their communications about their son, their communications were generally of a relatively functional or practical nature, rather than of a personal nature. They generally (but not always) kept each other informed of their travel plans. The tone of the communications appears to have been generally amicable, although there were occasional disagreements and tensions between them over various matters. The communications did not generally evince any significant personal warmth or affection between the plaintiff and the defendant.
The defendant continued to visit the plaintiff and their son in Hong Kong. When visiting, the defendant stayed at the Bowen Road property with the plaintiff and their son, although he slept in a different bed and bedroom from the plaintiff. While the defendant spent some of this time in Hong Kong with just their son, they also spent time with all three of them together. This included them socialising and attending some outings and activities together.
The frequency and duration of the defendant’s visits to Hong Kong varied over time, however they continued throughout this period. According to the plaintiff, if anything, the visits tended to become more frequent over time, increasing from approximately every couple of months to every couple of weeks.
The plaintiff travelled to Beijing on a couple of occasions during this period for her work, but did not visit the defendant. She said that her work commitments on these occasions were such that she did not have the time to do so.
In 2013, the defendant made both the plaintiff and their son beneficiaries of a superannuation fund that he had with HSBC. The plaintiff occasionally undertook tasks in the nature of administrative errands for the defendant (such as sending him paperwork for his employment, and assisting him with his passport requirements). The defendant left some personal effects in the Bowen Road property throughout this period for his use when visiting. He also continued to have some of his mail sent to this address.
Sale of the Pottinger Street property in 2007
Prior to the purchase of the Pottinger Street property in 2005, DN had informed the plaintiff and the defendant that when she and her family decided to return to Australia, she would need to take their money out of DG Company so that they could buy a property in Australia.
In 2007, DN decided that she would return to Australia. She ultimately did so in 2008. The plaintiff and DN agreed that the Pottinger Street property should be sold so that DN’s money could be returned to her. The property was prepared for sale.
The defendant expressed an interest in buying the property. Indeed, in about May 2007, in a telephone conversation between the plaintiff and the defendant, the defendant said he would pay HKD 4.2 million for the Pottinger Street property.
However, when a subsequent bank valuation obtained by the defendant gave a lower value than this, he reduced his offer to HKD 3.26 million. In an email to the plaintiff and DN, he suggested that the plaintiff and DN take the property to market to see if they could obtain any offer above what he was prepared to offer.
The property was put on the market, and a third party offered to purchase the property for HKD 4.7 million. When the plaintiff informed the defendant of this offer, he initially indicated a preparedness to match it. According to the plaintiff, the defendant then said he would not press his offer, and that DG Company could sell the property to the third party, which it did. According to the defendant, he did not withdraw his offer; rather, the plaintiff and DN simply declined to accept his offer. While it does not matter much, I prefer the plaintiff’s evidence on this topic. I do so based in part upon it being more consistent with the contemporaneous written communications between the parties, but also in part upon my general preference for the reliability of the plaintiff’s evidence on matters where the parties’ evidence diverged.
There is no evidence to suggest any discussion at this point in time in relation to the defendant having a share in the Pottinger Street property or the proceeds from its sale. However, the defendant said that if he had purchased the property, then he had intended that his share of the property value would have been deducted from the purchase price that he was required to pay. But he agreed that he did not discuss this with DN or the plaintiff.
In any event, the property was ultimately sold to the third party in late 2007 for HKD 4.7 million. Of the net proceeds of sale, half was paid to DN. The other half, which the plaintiff considered to be hers, remained in DG Company’s bank account for some time thereafter. This cash balance, of about HKD 2 million, was the only asset of substance held by DG Company.
Purchase of the Port Willunga property in 2011
In February 2011, the plaintiff purchased the Port Willunga property. She did so in her own name, and for a purchase price of AUD 600,000 (plus transaction costs of AUD 32,026).
Prior to purchasing this property, the plaintiff discussed her interest in it with the defendant. She told him that she had enjoyed the times she and their son had stayed at Port Willunga while on holidays in Australia, and that she would like to own a house there. She told him the asking price was AUD 650,000, and explained that she would need to borrow most of this from HSBC in Hong Kong and to use the Bowen Road property as security. When she asked the defendant his thoughts, he said it was up to her whether she bought the property. He agreed to her using the Bowen Road property as security for the loan that she needed to make the purchase.
The plaintiff went ahead with the purchase and, as mentioned, ended up purchasing the Port Willunga property for AUD 600,000, being less than the initial asking price. She borrowed HKD 4 million (approximately AUD 500,000) towards the purchase price from HSBC (the Port Willunga loan), secured against the Bowen Road property. She paid the balance of the purchase price (approximately HKD 1 million) from her own funds. Although it is not entirely clear on the evidence, it seems she used some of the proceeds from the sale of the Pottinger Street property for this purpose.
While it appears from the bank documentation that both parties may well have been principally liable for repayment of the Port Willunga loan, the understanding of both the plaintiff and the defendant was that the plaintiff would be responsible for servicing the loan. There was no suggestion or discussion to the effect that the defendant would contribute to the payments required. Consistently with this understanding, the plaintiff serviced the Port Willunga loan from about March 2011 through to September 2015, making monthly payments of principal and interest of approximately HKD 35,000, giving a total of about HKD 1.89 million.
After purchasing the Port Willunga property, the plaintiff undertook a renovation of the property. She designed and managed the renovations, and paid the cost of the renovations (approximately AUD 87,000). She paid all of the ongoing expenses associated with the property (such as rates and taxes, utilities, insurance, and repairs and maintenance).
The then balance of the Port Willunga loan (HKD 2,248,322 or approximately AUD 400,000) was paid off in September 2015, using the proceeds of the sale of the Bowen Road property, and in the circumstances described later.
Commencement of DM Company and subsequent financial assistance
In the second half of 2011, the plaintiff commenced operating an art gallery and retail business through DM Company. The defendant provided her with financial assistance both in commencing that business, and in relation to its subsequent operation. Those contributions were as follows:
·    HKD 500,000 in July 2011 to assist in the establishment of DM Company;
·    HKD 150,000 in July 2013 to assist with the operation of DM Company;
·    HKD 1,453,346 in October 2013 to pay out the DM Company loan;
·    HKD 300,000 in December 2013 to assist with the operation of DM Company; and
·    HKD 300,000 in January 2015 to enable repayment of a loan from a friend of the plaintiff (VL).
The initial contribution of HKD 500,000 was made following discussions between the plaintiff and the defendant in around July 2011. The plaintiff told the defendant that she wanted to start a new art and design retail business in Hong Kong with her friend, EY. The plaintiff said that a great site for the business had become available, but that she was not able to match EY in terms of the capital needed to start the business. The defendant agreed to provide her with HKD 500,000.
While the parties were agreed about the matters in the preceding paragraph, they differed slightly in the detail of their evidence as to the circumstances surrounding this payment of HKD 500,000. According to the plaintiff, in the context of their discussions about the proposed business, the defendant volunteered to give her this amount without any suggestion that it was a loan or would need to be repaid. According to the defendant, the plaintiff asked him if he was willing to support her and lend her some money, which she said she would repay. When he asked her how much she needed, she told him that she had some money, but needed some more and asked for HKD 500,000. He then agreed to provide her with that amount, which he said he regarded as a loan. I shall return to the significance of this difference between the evidence from the parties later in these reasons.

The HKD 500,000 was to be used to secure a lease for the proposed business premises, and to carry out some work on those premises. A lease for these premises was obtained and the business then commenced trading by about September 2011.
In late 2011, HSBC in Hong Kong extended a loan for HKD 1.74 million, on the security of the Bowen Road property (the DM Company loan). The intended purpose of the funds advanced under the DM Company loan was for the plaintiff to use to buy out the other shareholder of DM Company, EY who had decided not to continue to be involved in the business, and to use as working capital in the business. The defendant was included in discussions between the plaintiff and the bank in relation to the DM Company loan. The bank was not prepared to provide the plaintiff with an overdraft facility or unsecured personal loan. It was only prepared to advance funds secured by a further mortgage over the Bowen Road property (that is, in addition to the mortgage taken out in connection with the Port Willunga loan). The plaintiff and the defendant agreed to this.
Both parties accept that it was implicit in this arrangement that the DM Company loan was the responsibility of the plaintiff, and was to be serviced by her (or DM Company). Consistently with this, the plaintiff serviced the DM Company loan from about February 2012 until October 2013, making monthly principal and interest payments of approximately HKD 16,443, totalling approximately HKD 328,860.
Throughout the period of the operation of this business, the defendant made various enquiries of the plaintiff about how it was progressing. The effect of her responses was often that she and the business were experiencing difficulties from a financial perspective.
On about 5 July 2013, the defendant provided the plaintiff with HKD 150,000. This was in response to a request from the plaintiff for assistance in relation to some family expenses. Her email request outlined the expenses and then concluded with “Are you able to help me over this hump? I’d really appreciate it.” The defendant’s email response was to the effect that he did “not mind to pay for all of these”.
In October 2013, the defendant paid HKD 1,453,346 to pay out the DM Company loan. The plaintiff did not ask the defendant to do this; the payment was made at his suggestion.
According to the plaintiff, the defendant said to her words to the effect: “I want to help you succeed and I don’t want you to have the financial burden of running two businesses and raising our son. Let me do this for you because I have had a good share sale.”
According to the defendant, he decided to make the payment because it was clear to him that the plaintiff was struggling financially. He owned some shares in Lloyds Bank, which he said had been part of the provision he had been maintaining to enable him to pay the AUD 1 million that he said he had agreed to pay in their August 2007 discussions. According to the defendant, he told the plaintiff that he would sell these shares and use the proceeds to pay off the DM Company loan. He said that there was no discussion about this being a gift, and that his reasons for making the payment were his concerns about the possibility of the plaintiff defaulting on the DM Company loan, and because he wanted to help her make DM Company successful so that she would be financially secure enough to provide for their son, and be able to repay him the money he had already provided her.
I shall return to this divergence in the evidence later in these reasons when assessing the character of the various payments made by the defendant to assist the plaintiff to establish and operate DM Company.
In relation to the December 2013 payment of HKD 300,000, the defendant offered to pay this sum on an occasion when he was staying in Hong Kong with the plaintiff and their son. He then arranged the transfer of this sum into her bank account.
In relation to the January 2015 payment of HKD 300,000, this occurred during the period when the defendant had resumed living in Hong Kong with the plaintiff and their son (see later). The plaintiff told the defendant that she wished to repay VL, who had lent her HKD 500,000 in December 2011. The plaintiff had repaid her HKD 300,000 in January 2013, but still owed her HKD 200,000. It was in this context, and in circumstances where the plaintiff had recently paid AUD 90,000 for the medical expenses she incurred in Australia, that the defendant offered to, and did, provide the plaintiff with HKD 300,000.
The defendant moves to Spain in June 2014
The defendant continued working for the same employer in Beijing until 2011, when he commenced working for another company. He worked as the general manager for this second company on a construction project in Beijing. In about 2013 he commenced working for a third company, as a general manager on another construction project. This project was also in China, but in Tianjin rather than Beijing.
In about June 2014, the defendant stopped work and moved to Valencia, Spain. He bought two apartments on the beach front, for 83,000 and 86,000 Euros respectively. His intention was to renovate them both, and then live in one of them and rent out the other one.
However, it was only shortly after his move to Spain that the defendant learned of the plaintiff’s diagnosis with a brain tumour, which (as described below) led to him travelling to Australia to collect their son and then moving to Hong Kong to live in the Bowen Road property. As a result of this change in his plans he sold the Valencia apartments, without undertaking the renovations he had planned. He did so for a modest loss.
The plaintiff’s diagnosis with a brain tumour in July 2014
On 11 July 2014, after a period of feeling unwell, the plaintiff underwent an MRI scan at a Hong Kong hospital. The scan revealed that she had a brain tumour. She informed the defendant of the outcome of her scan. The following week a neurosurgeon in Hong Kong confirmed the diagnosis.
In late July 2014, the plaintiff flew to Australia to visit potential surgeons in Sydney and Melbourne. She decided to have the surgery that she required in Melbourne. She informed the defendant of her intention to undergo surgery, and asked whether he would travel from Spain to collect their son from Australia, and then take him back to the Bowen Road property in Hong Kong while she underwent surgery and treatment in Australia. The defendant agreed to do so.
On 7 August 2014, the defendant flew to Adelaide to collect and commence caring for their son. Upon his arrival in Adelaide, the defendant stayed initially with the plaintiff and their son at the plaintiff’s parents’ house, before then staying with the plaintiff and their son at the Port Willunga property.
While in Australia, there was no resumption of any romantic or sexual relationship between the plaintiff and the defendant. They slept in separate rooms both at the plaintiff’s parents’ house, and at the Port Willunga property. There was no discussion or suggestion that the two of them were a couple again, or were otherwise resuming their romantic relationship. According to the defendant, he returned to Australia to provide the plaintiff, as the mother of his child, with whatever support he could, and to ensure that their son was able to be around his mother whilst also being cared for appropriately while she was recovering.
In mid-August 2014 the plaintiff executed a new will. She did not leave anything to the defendant in that will, although as joint tenant in respect of the Bowen Road property he would have received that property through survivorship in the event of the plaintiff’s death.
Also in mid-August 2014, the plaintiff travelled to Melbourne for treatment, and the defendant flew to Hong Kong with their son. Once back in Hong Kong, and living at the Bowen Road property, the defendant cared for their son with the assistance of their live-in helper.
The plaintiff had two operations in Melbourne. While recovering, she had frequent email, telephone and Skype contact with the defendant and their son.
In about early October 2014, the defendant and their son returned to Australia to help the plaintiff prepare for her return to Hong Kong. They then travelled with her back to Hong Kong.
The period of cohabitation in Hong Kong from October 2014
From October 2014, the plaintiff, the defendant and their son lived together in the Bowen Road property. They did so until they relocated to Australia in September 2015, and so for a period of just short of a year.
Once back in Hong Kong, the plaintiff resumed working in her businesses. She did so initially on a part-time basis, but then returned on a full-time basis from about November 2014. The defendant did not work while they were living together in Hong Kong.
While the plaintiff’s health gradually improved, she still continued to experience some difficulties and concerns, including significant headaches.
During the period of their cohabitation in the Bowen Road property, the plaintiff and the defendant slept in different bedrooms, and did not resume any romantic or sexual relationship. Apart from their respective bedrooms, they both went about the house freely, spending most of their time together in the shared areas of the house (that is, the kitchen, dining and living rooms).
They generally ate their meals together, with the defendant often doing the shopping and cooking for all three of them. They shared the care of their son, although the plaintiff tended to undertake more of the day-to-day tasks for him (including accompanying him to his sporting and social activities). They celebrated birthdays together, and took their son on various outings together. They socialised with family and friends together, including hosting them from time to time at the Bowen Road property.
While living together in Hong Kong, they each contributed to the living and household expenses, albeit without any pooling of their funds. They did not have a joint bank account, and each managed their own finances separately.
In December 2014, the three of them returned to Australia to visit the plaintiff’s family and celebrate Christmas with them. They stayed for about a month, spending most of their time at the Port Willunga property. The three of them spent most of their time together, including mixing with family and friends and taking their son on outings.
Looking for properties in Australia in 2015
Soon after their October 2014 return to Hong Kong following the plaintiff’s surgeries and treatment, the plaintiff told the defendant that she had decided that after 25 years in Hong Kong it was time for her to return to Australia to live. The plaintiff said that given her ongoing health concerns, she thought the lifestyle in Australia would be more suitable for her. She said that her parents were getting older, and she wanted to be closer to them. She also expressed a desire that their son live and go to school in Australia.
The defendant was not surprised, as this was consistent with what the plaintiff had previously said she eventually wanted to do. The defendant agreed that moving to Australia with their son seemed to be the best option for the plaintiff. The plaintiff announced her intention to return to Australia to her parents and family while back in Australia over the Christmas period in late 2014. She did so at a time when the defendant had not yet decided where he planned to live.
It was in this context, in early 2015, that the parties discussed selling the Bowen Road property. They both agreed to do so. The plaintiff suggested that they use the proceeds to invest together in a property in Australia.
In the lead up to this suggestion, the defendant had been considering work opportunities in China, Dubai and Cambodia. He had not made up his mind where he wanted to live next, but was open to job opportunities elsewhere, particularly in a warmer climate. The defendant agreed with the plaintiff’s suggestion that they buy a property in Australia. He thought that the right property in Australia would be a good investment, and decided he would at least give living in Australia a chance before deciding whether to pursue opportunities elsewhere. He thought it would be a good opportunity for him to have a day-to-day relationship with their son. He also felt a need to provide the plaintiff with support given her ongoing health issues. But there was no discussion or agreement to the effect that they were resuming a romantic relationship. According to the defendant, that thought never entered his mind. The plaintiff did not suggest differently from her perspective.
In the context of their agreement to sell the Bowen Road property in order to relocate to Australia, and to purchase a house together to live in with their son, they did not ever discuss, let alone agree, their respective interests in the Bowen Road property or their intended new purchase.
From January 2015 onwards the parties began looking for a house in Australia. They made contact with real estate agents in Australia. They spent time looking at houses online, and discussing them together. They travelled to Australia in both February and June 2015 to look at some of the properties of interest to them. They based themselves in the Port Willunga property during those trips to Australia.
In March 2015, the defendant bought a property in Croydon, in suburban Adelaide, for AUD 530,000 (the Croydon property). He did so with a view to doing it up and selling it for a profit. While the plaintiff (and some of her family) went with him to inspect the property before he purchased it, and assisted with the logistics associated with its purchase, she did not contribute financially to its purchase. The defendant did not end up doing any work on the Croydon property. He ultimately sold it in January 2017 for AUD 580,000.
Sale of the Bowen Road property in September 2015
In around March 2015, the plaintiff and the defendant researched and agreed upon an agent to sell the Bowen Road property. The house was styled for sale with furniture and effects, including artwork, that the plaintiff had selected and paid for over the years she had lived there. The plaintiff hired a painter to spruce up the property, and she and the defendant also did some touch up painting themselves. In mid-2015, the house featured on the front cover of an architectural magazine.
The Bowen Road property was ultimately sold for a price of HKD 33,438,668. Settlement occurred in September 2015.
The plaintiff and the defendant agreed that part of the net sale proceeds (HKD 2,248,322 or approximately AUD 400,000) was to be applied to pay off the balance of the Port Willunga loan, given that this loan was secured over the Bowen Road property. According to the plaintiff, whose evidence I accept, the defendant said something to the effect that “The money still owing on Port Willunga has to be taken out of the sale proceeds first because it’s on the title”.
They jointly instructed the solicitors they had retained to assist with the sale to pay out the balance of the Port Willunga loan so that the mortgage could be discharged, and to then split the balance of the proceeds equally between them. The defendant provided the solicitors with their bank account details so that they could make payments to each of them.
While acknowledging that he acquiesced in the equal division of the net proceeds of the sale of the Bowen Road property (that is, after paying off the Port Willunga loan), the defendant said this was not something they discussed. He said that in his view, particularly given the uncertainty about the plaintiff’s health, it was not an appropriate time to discuss their respective interests in the Bowen Road property, or “what she owed me.”
The defendant did not say anything to suggest that he was acquiring any interest in the Port Willunga property, either when he first agreed to take out the loan, or when it was being paid off out of the proceeds of the sale of the Bowen Road property.
Acquisition of the Medindie property
During their February 2015 trip to Australia, the plaintiff and the defendant inspected the Medindie property that they ultimately ended up purchasing. It was a 1880s bluestone house with a 1920s extension, pool, tennis court and extensive gardens. The house needed renovation, although this was an attractive prospect for both of them.
Following their return to Hong Kong, they kept in email contact with the real estate agent selling the Medindie property.
Over the course of several months they discussed buying the Medindie property. They discussed the floor plan, including the prospect that they would have separate bedrooms either side of their son’s room. They discussed the renovations they might undertake, including so that the plaintiff could use the front room as a gallery for her business.
The parties had initially been concerned that the asking price was too high. However, the property stayed on the market for several months, and over time the vendors’ asking price began to fall. In August 2015, the two of them agreed to make an offer of AUD 4.1 million for the property. The vendors accepted this offer.
The plaintiff paid the deposit of AUD 200,000, and settlement was scheduled for October 2015. They agreed that they would contribute equally to the purchase price, and that the property would be conveyed to them in joint names. They agreed they would live in the property and renovate it as they had discussed. There was no discussion between them to suggest that they were to have anything other than equal interests in the property.
In the lead up to settlement they retained a conveyancer to act on their behalf. In circumstances elaborated upon later in these reasons, they instructed him to register their interests in the Medindie property as joint tenants.
In the lead up to settlement, arrangements were made with the conveyancer for each of the plaintiff and the defendant to transfer funds from their respective bank accounts to pay the purchase price of AUD 4.1 million plus transaction costs. The plaintiff and the defendant also discussed between themselves the best timing for the conversion of their respective contributions from HKD to AUD.
Settlement took place as anticipated in October 2015. The defendant contributed AUD 2,118,346 to the purchase price and transaction costs from his own bank account; and the plaintiff contributed AUD 2,240,000 to the purchase price and transaction costs (inclusive of the AUD 200,000 deposit that she had paid). They each used the funds they had received from the proceeds of the sale of the Bowen Road property.
The plaintiff had paid the deposit because she already had a local bank account, which made it convenient for her to do so. The difference in their contributions was not intentional, and not something that either of them sought to address.
Moving to Adelaide in September 2015
There was a significant amount of work associated with relocating to Adelaide. The plaintiff and the defendant researched, discussed and agreed an appropriate school for their son. They worked together to pack up their belongings from the Bowen Road property, as well as the plaintiff’s shop, office and storeroom. The plaintiff arranged and paid for their furniture and effects (including artwork) – which were largely hers – and for the items and equipment associated with her business, to be shipped to Adelaide. The cost was HKD 224,352.
In September 2015, the three of them moved to Australia. They initially stayed a couple of nights with the plaintiff’s parents, before then staying at the Port Willunga property while waiting for settlement on the Medindie property.
Following settlement on the Medindie property, which occurred on 19 October 2015, work on the planned renovations commenced. The defendant moved into the house soon after settlement, and stayed there throughout the renovation works. The plaintiff stayed with their son at her parents’ house, in part because it was closer to their son’s school.

Under s 90SK, the court must be satisfied (a) that either or both of the parties were ordinarily resident in a participating jurisdiction when the proceedings were commenced, and (b) that either (i) both parties were ordinarily resident in a participating jurisdiction during at least a third of the de facto relationship, or (ii) the plaintiff made substantial contributions in relation to the de facto relationship of a kind mentioned in s 90SM(4)(a), (b) or (c). Alternatively, under s 90SM(1A) the geographical requirements of s 90SM will be satisfied if the parties to the de facto relationship were ordinarily resident in a participating jurisdiction when the relationship broke down.
In my view, (a) and each of (b)(i) and (ii) have been satisfied. This conclusion in relation to (b)(i) assumes that the parties were not in a de facto relationship between 2007 and 2014, which in my view is an accurate assumption. But even if there were some basis for thinking that (a) and (b)(i) or (ii) had not been made out, the alternative condition under s 90SM(1A) has been satisfied.
The only remaining threshold requirement is that the parties were in a de facto relationship during the period from around October 2014 to September 2016. It is to that requirement that I now turn.
The existence of a de facto relationship under s 4AA of the FLA
Section 4AA of the FLA relevantly defines a de facto relationship in the following terms:
4AA De facto relationships
Meaning of de facto relationship
(1)     A person is in a de facto relationship with another person if:
(a)    the persons are not legally married to each other; and
(b)    the persons are not related by family (see subsection (6)); and
(c)having regard to all the circumstances of their relationship, they have a relationship as a couple living together on a genuine domestic basis.
Paragraph (c) has effect subject to subsection (5).
Working out if persons have a relationship as a couple
(2)     Those circumstances may include any or all of the following:
(a)    the duration of the relationship;
(b)    the nature and extent of their common residence;
(c)    whether a sexual relationship exists;
(d)    the degree of financial dependence or interdependence, and any                 arrangements for financial support, between them;
(e)     the ownership, use and acquisition of their property;
(f)    the degree of mutual commitment to a shared life;
(g)     whether the relationship is or was registered under a prescribed law of                a State or Territory as a prescribed kind of relationship;
(h)     the care and support of children;
(i)    the reputation and public aspects of the relationship.
(3)No particular finding in relation to any circumstance is to be regarded as       necessary in deciding whether the persons have a de facto relationship.
(4)     A court determining whether a de facto relationship exists is entitled to have regard to such matters, and to attach such weight to any matter, as may seem appropriate to the court in the circumstances of the case.
(5)     For the purposes of this Act:
(a)    a de facto relationship can exist between 2 persons of different sexes and between 2 persons of the same sex; and
(b)    a de facto relationship can exist even if one of the persons is legally      married to someone else or in another de facto relationship.
It can thus be seen from s 4AA(3) that the absence of any one particular factor is not determinative. This would include the absence of a sexual relationship. Indeed, under s 4AA(5)(b), there may be a de facto relationship even where one of the parties is in a relationship with someone else. That would include a sexual relationship with some other person.[84]
[84] Dabney v Laird [2013] FCCA 214 at [53]-[54]; In Re Fagan, Deceased (1980) 23 SASR 454 at 464.
Further, in considering whether the parties were in a de facto relationship at a particular time (here, between October 2014 and September 2016), it will be relevant to consider this in the context of their relationship in the past.[85]
The parties’ relationship from 2004 to 2006
[85] Sam v Lamothe [2016] FamCA 576 at [66], [114].
I have earlier found that throughout the approximately three year period from early 2004 through to the end of 2006, the plaintiff and the defendant lived together on a genuine domestic basis. They did so initially in the plaintiff’s Glenealy apartment, before moving into the Bowen Road property that they purchased together. They were in a sexual relationship throughout this period, and were planning to have a family together. Their son was born in October 2006.
They did not pool their finances through any joint bank account; but they did share their living and household expenses. They shared the domestic chores, with the plaintiff doing most of the cleaning and the defendant most of the cooking. They ate meals together, socialised and entertained together, and generally presented to their friends and family as a couple.
While the defendant had indicated that he did not wish to marry the plaintiff, she had accepted this and their relationship was nevertheless a stable and committed relationship that the parties expected would continue indefinitely. They cared and supported each other, and were mutually committed to a shared life together. In short, the parties’ relationship during this period had all the indicia of a de facto relationship, and was in my view a de facto relationship.
The parties’ relationship from 2007 to 2014
The parties’ relationship changed significantly from around May 2007, when the defendant commenced a relationship with – and commenced living with – another woman in China. In my view, the parties were not in anything akin to a de facto relationship throughout the period from around May 2007 through to at least October 2014 (when the parties resumed living together). It is true that the parties’ relationship fluctuated somewhat during this period, but in my view, it did not at any stage during that period return to anything akin to a de facto relationship.
The parties ceased to have any sexual relationship in December 2006, and have never resumed any sexual relationship. Nor has there ever been any romantic or intimate dimension to their relationship since early 2007. They did not present to their family or friends as a couple at any time after 2007. The defendant pursued relationships with other women.
Throughout this period the parties lived separately, indeed in separate cities. The defendant visited and stayed with the plaintiff in the Bowen Road property a number of times during this period, and indeed kept some personal effects and possessions in that apartment. But his visits were in a context where he wished to see their son, and was a co-owner of the apartment. While he was generally on friendly terms with the plaintiff, there was no sense in which they were resuming, or even contemplating resuming, a romantic or sexual relationship. They used separate bedrooms and bathrooms when he visited.
The parties were largely financially independent throughout this period. It is true that their financial affairs were to some extent intertwined in that they had a joint interest in the Bowen Road property, and the defendant was making regular monthly contributions to the living expenses of the plaintiff and their son. And as I have recounted earlier in these reasons, the defendant made several financial contributions to further assist the plaintiff, their son and her businesses. But they did not operate any joint bank account, and they each generated and kept their own incomes.
The parties remained mutually committed to the care and support of their son. By reason of this shared commitment, and the financial matters mentioned in the preceding paragraph, the parties remained in relatively frequent communication with each other throughout the relevant period. A large number of their email communications throughout this period were in evidence. While some of these communications revealed occasional tension and disputes between the parties about matters including the care of their son and some financial matters, it is true to say that generally the parties remained on friendly terms throughout this period. They shared some personal affection and care for one another, which extended to keeping each other generally appraised of matters relating to their health, work and life more generally.
However, in my view their relationship was essentially as co-parents, who remained on generally friendly terms, and whose financial affairs were to some extent linked by reason of them being co-parents and by reason of their joint interests in the Bowen Road property. I do not think they had much, if anything, of a personal relationship beyond these matters. There was certainly no romantic interest between them. But nor were they even close friends who kept each other appraised of the daily events in their lives. Neither acted as an emotional support or confidante for the other. In my view, while they both remained committed to their son, and to providing for him, I do not think they were committed to doing so as a couple. I do not think they had a mutual commitment to a shared life.
The parties’ relationship from October 2014 to September 2016
The parties resumed cohabiting, together with their son, from October 2014 until September 2016. They did so for the first year or so in their Bowen Road property in Hong Kong, and then for the last nine months or so in their Medindie property in Adelaide. As I have explained earlier, there was a period of a couple of months in late 2015, soon after settlement on the Medindie property where the defendant stayed by himself, with the plaintiff and their son staying with the plaintiff’s parents.
The reason they resumed living together was not because of any development in their relationship per se. Indeed, only a few months earlier the defendant had moved to Spain to pursue his own financial and life ambitions without involving the plaintiff in his decision to do so. Rather, they resumed living together because the plaintiff was diagnosed with a brain tumour and requested that the defendant collect their son from Australia and take over the primary responsibility for his care throughout the period necessary for her to undergo and recover from the surgeries that she required.
That said, not only did he agree to assist in this way, I accept that he did so willingly. I also accept that throughout the period following the plaintiff’s diagnosis, surgeries and recovery, the defendant was a significant support to the plaintiff. It would seem that a level of affection or warmth for one another returned to their relationship. At the same time, there was never any suggestion of a resumption of their romantic or sexual relationship from over eight years earlier. Throughout their period of cohabitation from late 2014 onwards, they always slept in separate bedrooms and used separate bathrooms.
The reason they initially resumed cohabiting in Hong Kong in October 2014 was essentially a function of circumstances. While the plaintiff was recovering from her surgeries it was necessary that the defendant be available to care for their son. Living together in their Bowen Road property meant that the plaintiff could live with her son while the defendant cared for him. However, this arrangement continued for longer than it needed to. It seems that it continued because it was mutually convenient and satisfactory for both the plaintiff and the defendant.
When the plaintiff decided it was time for her to act upon her long-held desire to ultimately return (with their son) to live in Australia, it seems she made her decision without knowing what the defendant’s plans would be. It was only later that the defendant decided that he would join them. They agreed then that they would buy a property together in Australia, and in effect continue the arrangement they had in Hong Kong.
Whilst their decision to move to Australia and live together in the Medindie property did have the effect of leaving their financial affairs intertwined to some extent, it was again not a decision on their part to resume their romantic relationship. While the parties were obviously on friendly enough terms that they were prepared and willing to share a house, they did so on the basis that this would be a mutually convenient and satisfactory basis for them to co-parent their son. It was a way in which they could both continue to have daily involvement in his life.
It was always contemplated by the parties that they would have separate bedrooms and bathrooms in the Medindie property.
Throughout the period of their resumption of cohabitation in both Hong Kong and Adelaide, the parties resumed sharing the living and household expenses and chores. But they each met the expenses they paid for from their own funds, and did not do so through any joint bank account. They did set up a joint bank account in Australia, but it was not used to any significant extent.
The parties did not present to their family or friends as a couple. They did on occasion socialise together with family and friends. However, particularly once they moved to Australia, they generally led quite separate social lives. The plaintiff regularly travelled to Port Willunga on the weekends and the defendant generally remained at the Medindie property. The defendant pursued friendships with people who shared his interest in playing tennis and bridge. He entertained and cooked for these friends at the Medindie property without the plaintiff being present or involved. The defendant also continued to pursue romantic relationships with women other than the plaintiff. The most serious of these was a relationship with a woman (XL) the defendant met in approximately June 2016. While the defendant did not talk to the plaintiff about his relationships with other women, and was relatively private about these relationships more generally, this appears to have been a function of his personality rather than any sense that his relationship with the plaintiff meant that he should not have been engaged in these relationships with other women.
Indeed, throughout the period that they lived together in Australia, the plaintiff and the defendant led quite separate lives. It is true that they spent quite a bit of time together. They went on outings and activities together with their son, and the three of them often ate meals together. However, to the extent they spent time together beyond this, it was largely a function of the fact that they lived together. They did not spend any significant time together as a couple. While they regularly communicated with each other, particularly in relation to matters relating to their son, their finances and their renovation of the Medindie property, they also regularly argued about these matters. Their arguments grew in frequency throughout 2016, culminating in the argument on 28 September 2016 that resulted in the plaintiff taking their son and leaving the Medindie property.
In my view, having regard to all the above – which is essentially an application of the features listed in s 4AA(2)(a) to (i) of the FLA to the facts of this case – I am not satisfied that the parties were in a de facto relationship with one another during the period from October 2014 to September 2016. While they cohabited for a modest period so as to enable them to co-parent their son, and did so reasonably successfully and happily for a good proportion of this period, I do not think this involved them doing so as a de facto couple. They shared a commitment to the upbringing of their son, and by reason of their son and property acquisitions their financial affairs were to some extent intertwined. However, I do not think they did so “as a couple.” While they respected and cared for each other to a reasonable extent, they never resumed a relationship as a couple. Certainly they did not resume any sexual or romantic relationship, and in my view they did not have a mutual commitment to a shared life.
It follows that the plaintiff has not made out a basis for adjustment of the parties’ property interests under the FLA.
Adjustment of property interests under the Domestic Partners Property Act
The DPPA deals with financial matters between “domestic partners”. In particular, under s 10 of the DPPA, the court may make such orders as it considers necessary to divide between the domestic partners the property of either or both partners in a way that is just and equitable.
Under s 9(2) of the DPPA, an application for division of the parties’ property may only be made if (a) one of the parties is resident in South Australia when the application is made, (b) one of the parties was resident in South Australia for the whole or a substantial part of the period of the relationship, and (c) the domestic partnership existed for at least three years or there is a child of the domestic partners.
It is clear that (a) and (c) are made out. As to the latter, it would not seem to matter that the child, the parties’ son, was born during an earlier period of the parties’ relationship.
It is less clear to me that (b) has been made out. The plaintiff contends that it has on the basis that the parties were resident in South Australia for a substantial part of the period of the relationship. This would be difficult to accept were I to accept the plaintiff’s primary submission that the parties were in a relationship of the relevant kind throughout the entire period from 2004 until 2016. However, assuming, as reflects my view, they were not in any such relationship between 2007 and 2014 I am satisfied that they were resident in South Australia for a substantial part of their relationship.
However, it remains to consider whether the parties’ relationship between about October 2014 and September 2016 was a domestic partnership within the meaning of the DPPA.
The existence of a domestic partnership under the DPPA
Under s 3 of the DPPA, a “domestic partner” is a person who lives in a “close personal relationship”. That section further defines a close personal relationship in the following terms:
close personal relationship means the relationship between 2 adult persons (whether or not related by family and irrespective of their sex or gender identity) who live together as a couple on a genuine domestic basis, but does not include—
(a) the relationship between a legally married couple; or
(b) a relationship where 1 of the persons provides the other with domestic support or personal care (or both) for fee or reward, or on behalf of some other person or an organisation of whatever kind;
Note—
Two persons may live together as a couple on a genuine domestic basis whether or not a sexual relationship exists, or has ever existed, between them.
The plaintiff relied upon the consideration of this definition in Taddeo v Taddeo.[86] In holding that the relationship between a cohabiting mother and daughter was a close personal relationship for the purposes of the DPPA, Judge Nicholson (as his Honour then was) considered that the definition was to be applied on a case by case basis, and was very much a matter of first impression.[87]
[86] Taddeo v Taddeo (2010) 269 LSJS 309.
[87] Taddeo v Taddeo (2010) 269 LSJS 309 at [73].
His Honour also observed that while similar considerations will apply to the assessment of a “close personal relationship” under the DPPA to those that arise in relation to a de facto relationship under the FLA, the provisions are not identical. The definition of a “close personal relationship” under the DPPA covers a potentially broader range of relationships, including companion couples that fall short of a de facto couple.[88]
[88] Taddeo v Taddeo (2010) 269 LSJS 309 at [62], [80].
In the circumstances of that case, matters such as financial interdependence and support, the ownership of property, the performance of household duties and the degree of mutual commitment and support between the parties were accorded significant weight;[89] and the absence of any romantic or sexual dimension to the relationship did not prevent it being a close personal relationship.
[89] Taddeo v Taddeo (2010) 269 LSJS 309 at [81]-[82].

At the same time, his Honour also observed the importance of the express requirement that the parties were not only living together on a genuine domestic basis, but also that they were doing so “as a couple”. His Honour noted that these words (which appear in the FLA definition of a de facto relationship) were not replicated in some of the interstate equivalents of the DPPA, and concluded that their retention in the DPPA would operate to exclude some forms of cohabitation from the purview of the DPPA,[90] and would tend to suggest that the notion of a “close personal relationship” under the DPPA was intended to be closer in concept to a de facto relationship than some of the interstate equivalents.[91]
[90] Taddeo v Taddeo (2010) 269 LSJS 309 at [67], [71].
[91] Taddeo v Taddeo (2010) 269 LSJS 309 at [79].
His Honour drew support for this conclusion from the second reading speech at the time the relevant Bill was introduced. As his Honour explained, it is apparent from that speech that the amendments to the then De Facto Relationships Act were intended not only to remove unjustified legislative discrimination against same sex couples, but also to provide legal recognition to those people who live a shared life as close companions but who were not in a sexual relationship. His Honour then extracted various passages from that speech that emphasised the intention to recognise couples (being a relationship “between two, and only two, people”) who not only live together but also “share their lives”, and “live together in an enduring personal relationship of mutual affection and support whether or not the relationship is sexual.”[92]
[92] Taddeo v Taddeo (2010) 269 LSJS 309 at [75]-[77].
The second reading speech drew a distinction between a relationship of this kind, and a relationship where persons (such as house mates) might live together, and share some common expenses and domestic tasks, but nevertheless not share their lives.
As his Honour recognised, there will be circumstances in which two people choose to live together for practical or family reasons who would not be regarded as living together as a couple.[93] In his Honour’s view it was significant to identify a mutual commitment to a shared life.[94]
[93] Taddeo v Taddeo (2010) 269 LSJS 309 at [78]-[79], citing Ye v Fung [2006] NSWSC 243 at [52].
[94] Taddeo v Taddeo (2010) 269 LSJS 309 at [86].
His Honour also noted the potential significance of the parties having a mutual commitment to one another, extracting the following passage from the reasons of Barrett J in Petersen v Gregory[95] (in relation to the phrase “together as a couple” in the New South Wales legislation):
The central concept is one of personal commitment that is mutually acknowledged and of an emotional kind transcending a mere fact of the shared residential setting. It is that which causes two persons residing under the same roof to be living ‘together as a couple’.
[95] Petersen v Gregory [2007] NSWSC 8 at [11].
I agree with Judge Nicholson’s analysis of the significance of the broadening of the legislation to extend beyond traditional de facto couples, while at the same time retaining the limiting feature that the relationship involve two persons living together on a genuine domestic basis and “as a couple”.
In my view, the relationship between the plaintiff and the defendant between October 2014 and September 2016 was not a close personal relationship under the DPPA. I have outlined the features of their relationship in my application of the definition of a de facto couple under the FLA. The rationale for the parties living together was their desire to co-parent their son, and their recognition of the practical convenience (particularly given their joint property investment in the Bowen Road property, which they ‘rolled over’ into the Medindie property) of cohabiting for this purpose. It is true that they did so on friendly terms, with a mutual commitment to their son’s support and well-being, and in circumstances that involved some sharing of expenses and domestic chores. However, I do not think they did so ‘as a couple’.
In some cases two people living together for the purposes of co-parenting a child may suffice to establish a close personal relationship for the purposes of the DPPA. But here the period of cohabitation between the parties was short in duration and unstable in nature. They commenced cohabiting in Hong Kong while the plaintiff was recovering from her surgeries. Within a few months the plaintiff had decided to move to Australia. Only subsequently did the defendant decide to join them and try living in Australia. They then spent several months looking at properties and planning the move. Once back in Australia, they did not begin living together in any settled way until the initial renovations had been completed in December 2015. Within a few months it was apparent that their living arrangements were not working as they had hoped. By the middle of 2016 they were regularly arguing and living essentially separate lives while still attempting to co-parent their son under the one roof. By September their living arrangements had become untenable.
In my view, the plaintiff accurately summarised the position in an email she wrote to the defendant in mid-October 2016, soon after their final separation. Her email included:
We are now at the point where we agree we are very different people, and are not compatible living together. Although we had the best intentions to co-parent under the same roof over the past year, sadly those living arrangements have not been successful.
Had the parties’ attempts to “co-parent under the same roof” turned out to be more stable and longer lasting, then their arrangements may well have evolved into a close personal relationship for the purposes of the DPPA. However, their attempts in that regard were unsuccessful.
In the circumstances, I do not think the parties had any significant mutual commitment to each other as a couple. I do not think they were committed to a shared life together. While their arrangements meant they spent significant time together, this was largely for the purpose of co-parenting their son. Subject to the requirements of this purpose, they tended to live quite separate lives rather than being committed to a shared life.
For these reasons, I am not satisfied that the parties were domestic partners at any point between October 2014 and September 2016. The plaintiff has thus not made out a basis for any adjustment of the parties’ property interests under the DPPA.
PART G: ENTITLEMENT TO ORDER FOR SALE UNDER THE LAW OF PROPERTY ACT
Having rejected the plaintiff’s claimed entitlement to orders under the FLA or DPPA, it remains to consider her alternative claim that there should be an order under ss 69 or 70 of the LPA for the sale of the Medindie property.
Sections 69 and 70 of the LPA provide:
69—Power to order partition or sale instead of partition
(1)On any application for partition the court may order a partition of the said land or other property, and may give all necessary or proper consequential directions.
(2)On any such application if it appears to the court that, by reason of the nature of the property, or of the number of the parties interested or presumptively interested therein, or of the absence or disability of some of those parties, or of any other circumstance, a sale of the property and a distribution of the proceeds would be more beneficial for the parties interested than a division of the property between or among them, the court may, if it thinks fit, on the request of any of the parties interested, and notwithstanding the absence, dissent or disability of any others of them, direct a sale of the property accordingly, and may give all necessary or proper consequential directions.
70—Sale on application of certain proportion of parties interested
On any application for partition, if the party or parties interested individually or collectively, to the extent of one moiety or upwards in the property, request the court to direct a sale of the property and a distribution of the proceeds, instead of a division of the property between or among the parties interested, the court shall, unless it sees good reason to the contrary, direct a sale of the property accordingly, and shall give all necessary or proper consequential directions.
The plaintiff’s primary claim is under s 70 on the basis that she has an interest “to the extent of one moiety or upwards” in the Medindie property.
In the context of s 70, an interest to the extent of one moiety connotes a half interest.[96] On my findings, and in particular my rejection of the defendant’s contention that the plaintiff holds her interest as a joint tenant on any resulting or constructive trust in the defendant’s favour, the plaintiff has a one-half interest in the Medindie property. She therefore has standing under s 70.
[96] Edelman v Badower [2010] VSC 427 at [8]; Sheahan v Cooper [1998] FCA 1531; Kasewieter v Galligan [2015] SASC 5 at [11]; Bray v Bray (1926) 38 CLR 542 at 545; Miller v Dudman [2002] WASC 99 at [5].
In the circumstances, s 70 provides that the Court shall direct a sale of the property “unless it sees good reason to the contrary”. Authority suggests that a person with standing under s 70 is entitled to an order almost as of right; that the Court’s discretion not to order a sale may be described as limited.[97] The onus is on the party resisting the order to persuade the Court not to order sale.[98] The application will not be refused merely on the grounds that it is opposed, on the grounds that the party resisting sale does not wish to the sale to proceed for sentimental reasons,[99] or because they wish to purchase the property.[100] Indeed, even the likelihood of hardship or unfairness may not suffice.[101]
[97] Re Permanent Trustee Nominees (Canberra) Ltd [1989] 1 Qd R 314 at 317; Callahan v O’Neill [2002] NSWSC 877 at [8]; Kasewieter v Galligan [2015] SASC 5 at [16].
[98] Pannizutti v Trask (1987) 10 NSWLR 531 at 538; Miller v Dudman [2002] WASC 99 at [5].
[99] Joyce v Joyce [1963] Qd R 139 at 155; Karastamatis v Tzanavaras [2013] SASC 163 at [20].
[100] Sheahan v Cooper [1998] FCA 1531.
[101] Spathis v Nanos [2008] NSWSC 418 at [20]; Kasewieter v Galligan [2015] SASC 5 at [16].
In the present case, the defendant has opposed any order that the Medindie property be sold. However, he has done so on the basis that he has continued to assert that the plaintiff holds some or all of her interest in the Medindie property on resulting or constructive trust for him, and on the basis that the plaintiff’s claim in this respect could only be determined after consideration (and rejection or exhaustion) of her claims to relief under the FLA and DPPA. In light of the conclusions that I have reached, the bases for the defendant’s opposition to the sale of the Medindie property have fallen away.
The defendant gave evidence that it would be costly and impractical for him to obtain a rental property. He also gave evidence of an intention (and presumably preference) to reside in the property long term and to keep it as an investment. Even accepting the defendant’s evidence as to the cost of him moving, and his intention in relation to the property, I do not think these constitute “good reason to the contrary” for the purposes of s 70.
The defendant also gave evidence that he did not consider now to be an appropriate time to sell the Medindie property. He said that considerable work will need to be done both to prepare the property for sale and to facilitate the sale, and that he is not in a position to fund this work. In my view, these are also not matters that constitute “good reason to the contrary” for the purposes of s 70. They are merely matters that might influence the terms of the consequential or ancillary orders that might be made to give effect to a sale of the property.
I do not understand the defendant to have requested an opportunity to purchase the plaintiff’s interest in the Medindie property prior to any sale occurring. Indeed, I understand the effect of his evidence to be that he would not be in a financial position to do so. However, in case the defendant does wish that opportunity – but without at this stage giving any indication of whether he should be entitled to pursue, let alone be granted, such a request – I propose to give the defendant an opportunity to be heard on this matter before making orders giving effect to the sale sought by the plaintiff.
But subject to this qualification, I consider that the plaintiff is entitled to an order that the Medindie property be sold, and that the net proceeds be divided equally between the parties. I will direct that the parties provide draft minutes of order to this effect, including the consequential or ancillary orders they contend are appropriate to give effect to these orders.
In circumstances where, on my reasoning and conclusions, the plaintiff has standing to seek an order for sale under s 70, there is no occasion for me to consider whether she might in the alternative have been entitled to an exercise of the Court’s discretion to make such an order under s 69 of the LPA.
PART H: CONCLUSION
For the reasons set out above, I have rejected the defendant’s claims that the plaintiff held or holds her interest in any of the disputed assets or properties (the Bowen Road property, the Pottinger Street property, the Port Willunga property, the Medindie property or the DM Company assets) on a resulting or constructive trust in favour of the defendant. Nor has the defendant established an entitlement to recover any of the financial contributions that he made on the basis that they were loans. I have also rejected the plaintiff’s claim to any adjustment of the parties’ property rights under the FLA or the DPPA.
It follows that the parties’ interests in the disputed properties are as reflected in the legal ownership of those properties. As a consequence, I have concluded that the plaintiff has a one-half share in the Medindie property and, subject only to consideration of whether the defendant wishes to purchase the plaintiff’s interest in the Medindie property, is entitled to an order for the sale of that property under s 70 of the LPA.
I will hear further submissions from the parties as to the terms of the orders necessary to give effect to the conclusions I have reached.