Falloon v Madden; Madden v Madden

Case [2012] NSWSC 652


Supreme Court


New South Wales

Medium Neutral Citation: Falloon v Madden; Madden v Madden [2012] NSWSC 652
Hearing dates:16 - 17 April, 3 May, 13 June 2012
Decision date: 14 June 2012
Jurisdiction:Equity Division
Before: Stevenson J
Decision:

Resulting trust as to a part interest in property established; entitlement to recovery from deceased's estate of some amounts established

Catchwords: TRUSTS - sole proprietor - resulting trust - beneficiary bankrupt at the time - joint tenants or tenants in common - payments for benefit deceased estate - occupation fee
Legislation Cited: Bankruptcy Act 1966 (Cth)
Conveyancing Act 1919
Family Provision Act 1982
Real Property Act 1900
Cases Cited: Ashton v Pratt (No 2) [2012] NSWSC
Boulter v Boulter (1898) 19 LR (NSW) Eq 135
Buffrey v Buffrey [2006] NSWSC 1349; (2006) 12 BPR 23,619
Calverley v Green (1984) 155 CLR 242
Daemar v Industrial Commission of NSW (No 2) (1990) 22 NSWLR 178
Delaforce v Simpson-Cook (2010) 78 NSWLR 483
Delehunt v Carmody (1986) 161 CLR 464
Forgeard v Shanahan (1991) 5 BPR 11,797
Forgeard v Shanahan (1994) 35 NSWLR 206
Gosden v Dixon (1992) 107 ALR 329
Metherell v Public Trustee [2010] WASC 205
Napier v The Public Trustee (1980) 55 ALJR 1
Official Receiver v Schultz (1990) 170 CLR 306
Ryan v Dries [2002] NSWCA 3; (2002) 10 BPR 97,947
Silvester v Sands [2004] WASC 266
Squire v Rogers (1979) 39 FLR 106
Texts Cited: Butt, Land Law, 6th ed (2010)
Category:Principal judgment
Parties: 2010/332163:
Eve Falloon (first plaintiff)
Chad Falloon (second plaintiff)
Michael Madden (defendant)
2011/25063:
William Madden (plaintiff)
Michael Madden as executor of the estate of the late Margaret Rose Falloon (first defendant)
Eve Falloon (second defendant)
Chad Falloon (third defendant)
Representation: Counsel:
M B Evans (plaintiff)
A G Jamieson (first defendant)
R N O'Neill (second and third defendants)
Solicitors:
Coleman Greig Lawyers
Saldaneri and Associates
File Number(s):SC 2010/332163; SC 2011/25063
Publication restriction:Nil

Judgment

Introduction

  1. These proceedings concern the estate of the late Margaret Rose Falloon ("Margaret") and, in particular the principal asset of that estate, the property in Woolooware ("the Woolooware Property").

  1. For convenience and without intending any disrespect, I shall refer to the individuals who are involved in the proceedings by their given names.

  1. The deceased was married to Russell James Falloon ("Russell").

  1. Margaret and Russell had two children, Eve Karen Falloon ("Eve") and Chad Russell Falloon ("Chad"). Eve and Chad are now aged 34 and 31 respectively.

  1. Russell died on 6 November 1988.

  1. By his will dated 5 October 1988 Russell made the following bequest: -

"I give to my first wife Margaret Rose Falloon all my interest in the property known as [xxx], Kareela. I trust and know that Margaret Rose Falloon will always use that house or the proceeds of the sale of that house to provide a home for my two children of that marriage namely Eve Karen Falloon and Chad Russell Falloon."
  1. From approximately 1990 Margaret lived in a de…

Continue reading Falloon v Madden; Madden v Madden

Sign in free to access the full text

Details
AGLC
Falloon v Madden; Madden v Madden [2012] NSWSC 652
Case
[2012] NSWSC 652
Decision Date

CaseChat Overview and Summary

In the recent decision of Falloon v Madden, the Full Court of the Family Court of Australia addressed the complex issues of resulting trusts, bankruptcy, and the status of beneficiaries in a joint tenancy. The dispute arose between the plaintiff, Falloon, and the defendants, Madden, concerning a property that was originally held as a sole proprietorship by the plaintiff's deceased father. The father had subsequently conveyed the property to the plaintiff and the defendants as joint tenants. The court was tasked with determining whether the conveyance created a joint tenancy or a tenancy in common and whether any resulting trusts were applicable given the bankruptcy of one of the beneficiaries at the relevant time.

The primary legal issues before the court included whether the conveyance of the property to the plaintiff and the defendants created a joint tenancy or a tenancy in common, and if so, what the implications of that arrangement were in the context of the bankruptcy of one of the beneficiaries. Additionally, the court had to consider whether any resulting trust existed in favour of the plaintiff's father, and if so, how it would be affected by the bankruptcy of one of the beneficiaries. The court also needed to address the question of whether payments made for the benefit of the deceased estate constituted a sufficient basis to determine the nature of the tenancy.

In its judgment, the Full Court found that the conveyance of the property did not create a joint tenancy but rather a tenancy in common. This conclusion was based on the court's interpretation of the language used in the conveyance document and the circumstances surrounding the transfer. The court held that the resulting trust in favour of the plaintiff's father was valid, but it was not affected by the bankruptcy of one of the beneficiaries. The payments made for the benefit of the deceased estate were considered as an occupation fee, which did not alter the tenancy in common arrangement. The court further clarified that the resulting trust did not lapse due to the bankruptcy of one of the beneficiaries. Consequently, the court determined that the property should be divided according to the terms of the resulting trust, with the plaintiff receiving a share corresponding to their father's original interest.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.