Fathers v Cook

[2006] WASC 129

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION:   FATHERS -v- COOK [2006] WASC 129

CORAM:   SIMMONDS J

HEARD:   15-17, 19 NOVEMBER 2004

DELIVERED          :   30 JUNE 2006

FILE NO/S:   CIV 1418 of 2003

BETWEEN:   IRENE MARY ALICE FATHERS

Plaintiff

AND

RONALD COOK
Respondent

Catchwords:

Contract - Trusts - Parties in de facto relationship - Advances by one party to the other - Property acquired in joint names - Woman contributes portion of cost - Man undertakes to pay mortgage - Renovations to property made by man - Joint accounts opened subsequently - Loan agreement - No common intention to pool all assets - Agreement with respect to cost of purchase of property acquired in joint names - Sale of property - Allowance for improvement and preservation of property - Whether ouster from property as a result of misconduct restraining order - Whether occupation rent otherwise payable - Conversion - Lounge suite - Measure of damages for conversion - Inquiries and accounts on end of de facto relationship

Legislation:

Property Law Act, 1969 (WA), s 126

Result:

Plaintiff's claim allowed in part

Category:    B

Representation:

Counsel:

Plaintiff:     Mr H O Moser

Respondent:     Mr C P Stokes

Solicitors:

Plaintiff:     Christopher J Cook

Respondent:     Chris Stokes & Associates

Case(s) referred to in judgment(s):

Aitken Agencies Limited v Richardson [1967] NZLR 65

Baumgartner v Baumgartner (1987) 164 CLR 137

Biviano v Natoli (1998) 43 NSWLR 695

Calverley v Green (1984) 155 CLR 242

David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353

Forgeard v Shanahan (1994) 35 NSWLR 206

Furness v Adrium Industries Pty Ltd [1996] 1 VR 668

Guthrie v Millar, unreported; SCt of WA (Wheeler J); Library No 960663; 21 November 1996

Jones v Dunkel (1959) 101 CLR 298

Lloyd v Tedesco [2002] WASCA 63

Millar v Guthrie, unreported; FCt SCt of WA; Library No 970552B; 28 October 1997

Muschinski v Dodds (1985) 160 CLR 583

Noack v Noack [1959] VR 137

Re Gorman (a bankrupt) [1990] 1 WLR 616

Re Pavlou (a bankrupt) [1993] 1 WLR 1046

Shephard v Cartwright [1955] AC 431

Silvester v Sands [2004] WASC 266

Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387

Case(s) also cited:

Atkinson & Anor v Festic (1990) DFC 95-089

Australia and New Zealand Banking Group Ltd v Westpac Banking Corporation (1988) 164 CLR 662

Commonwealth v Verwayen (1990) 170 CLR 394

Pavey & Matthews Pty Ltd v Paul (1986) 162 CLR 221

Penfolds Wines Pty Ltd v Elliott (1946) 74 CLR 204

Sabemo v North Sydney Municipal Council [1977] 2 NSWLR 880

SIMMONDS J: 

Introduction

1. This action arises out of the end of a de facto relationship.  The relationship ran over about four years, although there were some breaks in it.  Claims are made in respect of amounts the parties paid and assets they acquired in the course of the relationship, most substantially a residence acquired in their joint names.

2. This judgment is organised as follows.  First I set out the factual background to the claims.  Then I describe the claims for relief made by the parties and consider argument before me as to the credibility of the parties.  I then turn to consider the issues arising in respect of the parties' claims.

Background

1. Plaintiff Irene Fathers came to Australia from the United Kingdom in 1995.  In the United Kingdom she had worked in various office positions which included more recently working in the VAT Office, rising to the position of a personal manager.  In Australia she came to work as a settlements clerk in the offices of Christopher J Cook, a legal practitioner in Albany.  In late 1997 she met the respondent, Ronald Cook, in Albany.  A relationship began to develop between them.  In February 1998, the respondent began to stay at the plaintiff's home at 5 Elizabeth Street, Albany, on week days.  There is some disagreement between the parties as to the extent to which from that time the plaintiff spent weekends at the respondent's home at 57 Williamson Avenue in Narrikup.  Narrikup is some 30 kilometres from Albany.  However, it is not in contest that the plaintiff did spend time on at least some weekends at that property, during the subsistence of the relationship, but before the parties acquired a residence in their joint names.

2. The respondent Ronald Cook also came to Australia from the United Kingdom.  He settled with his former wife and daughter in a suburb of Perth in mid‑1991.  There is evidence that the respondent also has a son.  It is not clear to me when the son was born.

3. In the United Kingdom the respondent did a painting apprenticeship and worked for various painting companies before running his own painting business, doing subcontracting.  In mid‑1996, the respondent, his wife and daughter moved to the Albany area where he and his wife acquired the property at 57 Williamson Avenue, Narrikup.  It had been completed to the lockup stage, and he and his wife finished it off.  The respondent also began his own business doing painting and roof coating.  In mid‑1997 the respondent's wife and daughter returned to the United Kingdom where they stayed.

The parties' asset positions at the beginning of their relationship

1. In early February 1998, the time when the respondent began to stay at the plaintiff's residence in Elizabeth Street, Albany on week days, the parties' asset positions were as follows.

2. The plaintiff owned the Elizabeth Street property, being a portion of Plantagenet Location 520, Lot 104 on Plan 10967 and all that land in Certificate of Title Volume 1403 Folio 221.  It had been purchased by the plaintiff in April 1997 for $106,500, and in February 1998 it was unencumbered.

3. The plaintiff also held shares in the Halifax Building Society and the Alliance and Leicester Building Society, worth in total about $15,000.  On 13 May 1998 an overseas transfer in the amount of $15,252 in respect of these shares was made to a BankWest account of the plaintiff.

4. The plaintiff held 1,000 shares in Telstra Corporation Ltd for which she paid the first instalment of $1,950.00 in October 1997, and the second instalment of $1,350.00 in October 1998.  She sold these shares in January and July 2000 for the total net proceeds of $7,348.61.  The matter of these sales assumes some significance in these proceedings, as will appear.

5. The plaintiff's BankWest account in February 1998 held the sum of $10,021.81.  She also had funds in an account with the Halifax Building Society in the United Kingdom in the amount of £1,518.62.  She had funds in an account with Barclays Bank in the United Kingdom of £466.50 at this time.

6. The plaintiff had furniture and household items insured for $36,000.00.  She owned a Hyundai Excel motor vehicle purchased in August 1995 for $18,150, and in which she had an air‑conditioner installed in November 1995 for $2,000.  The plaintiff had a superannuation entitlement in the United Kingdom which as at 1 February 1998 was worth approximately $100,000.  In or about early 2001 the amount of $124,937.29 in respect of that entitlement was rolled into the plaintiff's superannuation fund in this country.

7. The respondent's net asset position in early February 1998 was decidedly inferior to that of the plaintiff.

8. The respondent and his wife owned the residence at 57 Williamson Avenue in Narrikup, being Narrikup lot 57 and being the whole of the land in Crown Grant 2057 Folio 107.  Subsequently the respondent gained his wife's interest as part of the settlement of their affairs.  The plaintiff and his wife acquired the property for $49,000 at its lockup stage.  The respondent produced a valuation of the property (Exhibit 12), done in mid‑1997, showing an amount of $85,000 assuming certain improvements then in prospect were done.  The valuation had been done for the purposes of obtaining additional mortgage finance from the respondent's bank, the National Australia Bank ("NAB"), to fund the improvements, which were completed by early 1998.  By that time, the property was subject to a NAB mortgage of approximately $60,000.

9. The respondent's painting and roof coating business had plant and equipment comprising two spray painting machines, a Suzuki vehicle and an additional item, apparently a trailer, for a total value (exclusive of goodwill) of about $5,200.

10. Finally, the respondent had furniture and personal belongings at 57 Williamson Avenue, Narrikup the value of which he estimated to be between $15,000 and $20,000.

11. In early February 1998, the respondent appears to have had two accounts with the NAB, apart from the mortgage loan account with that bank.  One was a business cheque account (selections of statements from which between February 1998 and when it was closed in May 2001, are Exhibits 44 – 46).  The other was an account from which, among other things, loan repayments were made (selections of statements from this account, from January 1998 to July 1999, and from October 2000 to May 2001, when the account was closed, are Exhibits 40 and 41 respectively).  Both accounts are shown on most of the statements to have been overdrawn.

12. It is common ground that early in the relationship the plaintiff became aware from the respondent that his business was then not going well.  The plaintiff wrote the respondent a series of cheques in varying amounts which the respondent deposited in his business account.  The evidence of both parties is that over the period 6 February 1998 to 29 September 1998 (the dates of the first and last of the seven cheques over the period here) a total amount of $11,000 was involved.  By about the end of this period the business of the respondent had begun to improve, as appears from the statements for his business account (Exhibit 45).  The characterisation of the seven payments, as loans or otherwise, and the characterisation of other amounts subsequently paid to the respondent and dealt with by him in a similar way, as well as further payments alleged by the plaintiff to have been made subsequently on the respondent’s behalf, is a matter of considerable controversy between the parties to which I return below.

13. In mid‑1998 the respondent arrived at a property settlement with his wife under which he kept the property at 57 Williamson Avenue, Narrikup.  The plaintiff paid the stamp duty and the transfer fee on the transfer involved.

The plaintiff's health problems

1. At about the same time, in June 1998, the plaintiff was diagnosed with breast cancer and underwent surgery.  Prior to coming to Australia she had experienced a number of health problems which required hospital treatment on three occasions, 1982, 1984 and 1988.  These problems and her hospitalisation for them, as well as her breast cancer and subsequent medical problems, are the subject of Exhibit 34.  Objections were taken to this material in this exhibit to the extent it related to medical reports she received rather than her own recollection, as well as on relevance grounds.  The relevance of the plaintiff's medical condition is I believe principally in relation to the parties' respective characterisations of the series of payments to which I have previously referred, to which I return, and therefore in my view is established.  As to the basis of the medical descriptions in the exhibit, I ruled that that basis could be tested in cross‑examination, and the objection renewed if appropriate.  In the event, there was no cross‑examination directed to the point, and no renewal of the objection.

2. In any event, the evidence, including Exhibit 34 but not limited to it, was and I find that the plaintiff had had significant health problems prior to her coming to Australia, problems which had continued thereafter.  She had chest problems, and problems with her colon.  She was on pain killers and she had residual pain in her chest and back (examination‑in‑chief TS 78).  During the initial period of her relationship with the respondent the plaintiff's medical condition stayed much the same, but over time it deteriorated, of which the diagnosis with breast cancer appears to have been the first major manifestation.  Subsequent deterioration will become apparent below.

3. From the outset of the relationship the respondent was aware that the plaintiff had some medical conditions.  The plaintiff had told him of her lung condition, which was something with which she would go through life.  He was aware she was taking medication.  Because of her condition he had to take time off work (Cook, cross‑examination, TS 260).  He knew that her health might not permit her to work for many more years (Cook, cross‑examination, TS 312).

4. Following medical treatment for her breast cancer in June 1998 the plaintiff and the respondent travelled to the United Kingdom in August 1998.  The trip had been planned prior to her diagnosis, and the plaintiff paid for the respondent's airfare as well as least some of the expenses.  The respondent said he paid the plaintiff back at least some of the expenses as he did not want her to be "out of pocket" (Cook, Exhibit 84 par 36).  Prior to departure, the plaintiff wrote the respondent cheques in the total amount of $5,000, which was deposited in the respondent's business account, resulting in the account going into credit in the amount of $33.86 (Exhibit 45, statement of business account, page 169).  This total amount is part of the $11,000 to which I referred whose characterisation is an issue between the parties, and I return to it in that context below.

Improvements to 57 Williamson Avenue, Narrikup

1. On the plaintiff's and respondent's return from the United Kingdom, plans were drawn up for improvements to 57 Williamson Avenue Narrikup.  There was some dispute between the parties as to whether the plaintiff participated in the planning and approved the final plans.  The improvements in the final plans included putting in an office, extending the house's living area and expanding the carport and driveway.  At the time the plaintiff was keeping the respondent's accounts, and there had been discussions between them of the plaintiff moving to Narrikup.  The respondent's evidence was that the improvements planned only made sense to accommodate the plaintiff and otherwise he would have "sold the house as it was", as "I didn't need the improvements for myself" (Cook, witness statement Exhibit 84, par 44).

2. The plaintiff's evidence was that she was undecided on the move to Narrikup because of the distance from Albany, and from medical treatment there, and because she had been told, in a letter from the Department of Land Administration dated 17 March 1998 (Exhibit 23), that the lot at the foot of the Narrikup property was not then available for purchase.  The plaintiff had been interested in the possibility of purchasing that lot as land on which a home could be built for her elderly parents.  The letter from the Department of Land Administration explained that the lot was intended to be included in the next release of lots within the Narrikup townsite, and she would be informed of any such release, with the letter adding "at present the further subdivision of lots awaits finalisation of sewerage proposals under consideration by the Shire of Plantagenet".  In the event the evidence is that she was not so informed.

3. It appears to be common ground that the plaintiff did not contribute to the costs of the improvements at Narrikup.  The amounts concerned were estimated by the respondent at $7,000.00 (Cook, witness statement, Exhibit 84 par 44) although he itemised expenditures totalling only $5,269.51 over the period 10 October 1998 to 6 June 2000 (Exhibit 84, "respondent's schedule of renovations at 57 Williamson Street [sic] Narrikup"), with one item dated "00‑01‑1999".  There is some support in the itemisation for the plaintiff's contention that she refused a request from the respondent to pay for Gyprock as part of the project, in the lack of any purchases over the period from 31 January 1999 to 1 April 1999, when "gyprock cement" in the amount of $110 is itemised.  Previously and subsequently itemised expenditures were no more than one and a half months apart, except for the last, which was almost one year after the preceding one.  There is some further support for this position from the debit balances on the respondent's business account, on which it seems all or most of the cheques for the project were written, balances which were significantly higher over the period concerned (in the range $4,373 to $3,597) than immediately after its end ($1,096).

4. On balance, I find it more likely than not that, while the plaintiff had not opposed the plans, she had not approved them or at least all of them, but had rather acquiesced in the work being done.  This is also consistent with subsequent events, which tend to confirm a lack of enthusiasm in the plaintiff to move to Narrikup.

5. The respondent also estimated his labour costs would have been about $5,000 had he used tradesmen for the project, instead of himself and two others who helped him (Cook, witness statement, Exhibit 84, pars 44 and 51).

6. The first break in the parties' relationship arose out of the Narrikup house.  In February 1999, when most of the renovations had been completed the plaintiff on a visit to the property indicated that, if she were to live there, the mortgage should be paid off, and she was in a position to do this.  If so, the title should reflect her contribution, which would yield her a two‑thirds interest in the property.  The respondent's evidence was that he offered her a 50 per cent interest, without any financial outlay by her, which she did not agree to.  The plaintiff's evidence was that she simply indicated to him she did not want to move to Narrikup.  On the evidence of both the plaintiff and the respondent, there was then a break in the relationship of about two months.  There is some contest between the parties as to who initiated the break and who initiated resumption in or about April 1999.  However, it is not in contest that they reunited, and that at that time or shortly thereafter they agreed to sell their respective homes and buy a home together that they both liked.  Both put their properties on the market.

Acquisition of a property in the parties' joint names

1. In late August 1999 the plaintiff signed an offer and acceptance for the sale of 5 Elizabeth Street, Albany, for a sale price of $115,000.  Although the respondent had put 57 Williamson Avenue, Narrikup, on the market at about the same time as the plaintiff had had the Elizabeth Street property put on the market, the Narrikup property did not sell until significantly later than the Elizabeth Street property, a matter to which I will return.

2. Not long after the plaintiff signed the offer and acceptance for the sale of the Elizabeth Street property, in September 1999, her evidence was that she became ill and could not work for some months, although there is no reference to this illness in her schedule of health problems (Exhibit 34).  In any event, although there was some equivocation on the point in the respondent's evidence, it appears there was some deterioration in the parties' relationship at about this time, with the respondent spending more time at his property in Narrikup (Fathers, witness statement, Exhibit 82, par 66; Cook, cross‑examination, TS 324 and re‑examination TS 368).

3. At about the time of the sale of the Elizabeth Street property and the development of the plaintiff's illness, the parties signed an offer and acceptance on a property, 21 Koonwarra Close, Lower Kalgan.  They are named as purchasers offering to purchase as "tenants in common".  There were two copies of the offer and acceptance in evidence before me, one that does not show any changes or signatures by the parties (Exhibit 55), and one showing what appears to be a series of changes, initialled by both the purchasers and the vendors (including changes to the purchase price), as well as signatures by the vendors dated 19 and 21 September 1999 (Exhibit 24).  The final price arrived at was $175,000 and the contract is expressed to be conditional on the "successful settlement" of the sale of the Elizabeth Street property as well as on finance.

1. There is some uncertainty in the evidence as to when the parties first identified Koonwarra Close as of interest.  The plaintiff's evidence was that this was after the respondent had begun to spend more time in Narrikup, in October 1999 (Fathers, examination‑in‑chief TS 96).  An October date would of course be inconsistent with the offer and acceptance.  The respondent's evidence was less clear, but seemed to be that the two of them inspected the Koonwarra Close property together, after what he believed had been an earlier visit to the property by the plaintiff, with the joint visit occurring not long after the resumption of the parties' relationship in April 1999 (Cook, examination‑in‑chief TS 223).  However, as his evidence was also that the offer and acceptance in Exhibit 55 was made not long after the joint inspection, his evidence is hard to square with the date on that offer and acceptance.  It was pressed on me for the respondent that it was difficult to find that the offer and acceptance would have been entered into or the transaction continued with when the relationship between the parties had deteriorated as the plaintiff claimed.  On balance, I find it likely that, although the relationship had deteriorated somewhat at about the time the offer and acceptance was entered into by the plaintiff and the respondent, the relationship had not deteriorated to the point where the parties had concluded they should abandon or suspend their joint purchase project.

2. I so find, notwithstanding other evidence from the plaintiff about the deterioration of the relationship at this time.  That evidence was that the plaintiff was preparing and putting to the respondent in about September 1999 a document in the form of an acknowledgement of debt in respect of a total amount $15,780 to be repaid to her on the sale of the respondent's Narrikup property or on three months written notice, whichever first occurred (Exhibit 18).  She testified that she was ill at the time, that it was "a bit dodgy" that the respondent had "stayed away" and that, if "he wasn't going to look after me properly at that time, it was unlikely he was going to look after me properly in the future, and I would need the money" (Fathers, examination‑in‑chief, TS 83). 

3. Included in the total amount of $15,780 were payments made by the plaintiff to the respondent paid into his business account to which I have previously referred.  Those amounts totalled $11,000, as I have indicated.  The balance, of $15,780, was made up of two cheques, dated 1 October 1998 for $500 and 3 February 1999 for $900, as well as a series of other cheques for amounts totalling $3,380.  The amounts making up that $3,380 were, she admitted, "gifts", which she had included as she was "angry" at the time she drew up the document (Fathers, examination‑in‑chief, TS 83).  The respondent denied having been presented with this document at any time during the parties' relationship.

4. There was, however, evidence from Ms Jennifer Fackrell, a friend of the plaintiff's who was also acquainted with the respondent, of a conversation at a hotel in Albany in October 1999.  She testified that in that conversation the respondent had told her he was unhappy that the plaintiff wanted to have money he had borrowed from her for the business repaid, at least to the extent that she wanted a legal agreement drawn up.  The respondent denied having any such conversation with Ms Fackrell, and it was put to me that she knew enough of the case to testify as she had because of her friendship with the plaintiff.

5. However, Ms Fackrell impressed me as a truthful witness.  I return to another part of her evidence in this case below.  I also note that she testified that the respondent indicated to her, in response to her question, a figure for the amount involved of "$12,000", "perhaps 11 or 12" (Fackrell, cross‑examination TS 197).  This of course differs from the total of $15,780 in Exhibit 18.  However, it coincides with the total amount ($11,000) on the evidence before me the respondent accepted had been paid by the plaintiff to him and he had put into his business account when his business was not doing well, as I have indicated (Exhibit 84, par 90).  The respondent's evidence, as I will explain, is that this amount was not a loan.  However, the coincidence in amounts confirms me in my view that a conversation had occurred with Ms Fackrell involving a discussion of the plaintiff's interest in having an amount paid back which was the amount the respondent considered he had received from the plaintiff when his business was not doing well.  I return to the question of whether that amount was likely to have been understood by the respondent to have been extended to him as a loan, below.

6. I do not consider that the fact that the plaintiff had expressed to the respondent her interest in having an amount she had paid to the respondent paid back, in the circumstances described, is inconsistent with the parties continuing with their project of joint purchase.  The relationship had previously been resumed after a break, and there was no evidence that the plaintiff persevered in seeking repayment of the amount described in Exhibit 18.

The arrangements for the payment for the Koonwarra Close property

1. Settlement on the sale of 5 Elizabeth Street and the purchase of 21 Koonwarra Close occurred on the same day, 1 November 1999.  An amount of $98,479.44 from the settlement of the sale of the Elizabeth Street property was transferred to the purchase of the Koonwarra Close property (Exhibit 24).  This was the difference between the purchase price ($175,000.00) plus the purchasers' portion of City of Albany rates for 1999/2000 ($391.70) and Water Corporation rates for 1999/2000 ($87.74), less the deposit previously paid ($2,000.00), and the amount financed by way of mortgage on the property ($75,000.00).  From the balance from the sale of the Elizabeth Street property of $11,754.89, the plaintiff repaid her parents, who had lent the deposit on the purchase of the Koonwarra Close property, and who had also lent the amount paid as stamp duty (apparently $4,905.00:  Exhibit 24).  From the balance from the sale of the Elizabeth Street property the plaintiff also paid the settlement fee on the purchase ($260.00:  Exhibit 24) (Fathers, examination‑in‑chief, TS 96).  This would have left a balance of $4,589.89 ($11,754.89 less $7,165.00), the fate of which was not apparent on the evidence before me.

2. The mortgage on the Koonwarra Close property was with the Home Building Society, and in the joint names of the purchasers.  There was evidence that the respondent had approached the NAB with which he had accounts to which I previously referred, and he had made that approach at or about the time of the initial offer and acceptance on the Koonwarra Close property.  Whether or not there was an approach at that time, or not long afterwards, when the contract of purchase was made, it is not in contest that the NAB was not prepared to advance him funds for the purchase while he had the mortgage on the Narrikup property.  There is no evidence that the plaintiff was involved in the approach to the NAB.

3. The plaintiff subsequently arranged a meeting for the respondent and herself at the offices of the Home Building Society, at which the mortgage, in the principal amount of $75,000, was arranged.

4. There was a sharp difference between the parties over what occurred at the Home Building Society offices.  However it was not in contest that the respondent intended to be the sole mortgagee.  The plaintiff's evidence was that the Home Building Society insisted on her name going on the mortgage (Fathers, examination‑in‑chief, TS 87; cross‑examination, TS 149), while the respondent's evidence was somewhat more equivocal as to whether the Society so insisted (Cook, cross‑examination, TS 335 – 336).  But his evidence was that the plaintiff had also wished her name to appear so that it would be used for correspondence (Cook, examination‑in‑chief, TS 226 – 227).  The respondent's evidence was clear, however, that "as far as I was concerned it was always my mortgage", although "with the paperwork and other details I left everything to Irene", as she had told him "I'm a real estate settlement agent" (Cook, witness statement, Exhibit 84 par 61).  His evidence was also that the form of the mortgage was notwithstanding he "was paying the mortgage" (Cook, examination‑in‑chief, TS 227).  In the event, over the course of their relationship he made all of the mortgage payments, with a dispute concerning two payments to which I will return.  In addition, he took out mortgage protection insurance, but only in his own name.  None of these arrangements changed when subsequently the mortgage was refinanced with BankWest (as the Bank of Western Australia), and the parties opened joint accounts with that bank in early 2001, as I will explain below.

5. There was a sharp difference between the parties' evidence over whether there was an agreement between them, worked out at the Home Building Society's office, that the respondent was subsequently to pay the amount necessary to make their respective contributions to the purchase of the Koonwarra Close property equal, or whether any such agreement came after the mortgage documents were signed, and about the time of the settlement and the parties' move into Koonwarra Close.  The amount concerned was referred to by the respondent as "$15,000 to even up our contributions" (Cook, witness statement, Exhibit 84, par 63), although it was common ground the amount would have been $15,322.11 (in fact, $15,322.22 was one half of the total purchase price inclusive of stamp duty, settlement adjustments and fees, of $180,644.44, less the Home Building Society mortgage proceeds of $75,000).  It was also common ground that the quoted amount would be repaid when the respondent's Narrikup property was sold.  The respondent's evidence was also that he acknowledged the obligation to pay the plaintiff the "$15,000" when he offered to pay her that amount, both at the time when he sold the Narrikup property, which as I will indicate below was November or December 2000, and when on his account the parties "split up", in late 2001 (Cook, cross‑examination, TS 337).

6. The plaintiff's evidence was that the matter was discussed and worked out at the Society's office.  In her cross‑examination, after testifying as to mortgage arrangements with Home Building Society worked out at the meeting at its offices, she said this (TS 150):

   "Moving on.  After the mortgage documents were signed and they had come out and been sent back by you and by Mr Cook, it was at that stage, wasn't it, that you raised with Mr Cook that he would need to make up the difference of $15,322.11 [sic $15,322.22]?---No.  It was actually brought up in the office of Home Building Society.

   It's Mr Cook's evidence that it was not brought up then, that it was subsequently?---No, it was in the ‑ - ‑

   That you raised it?---No, it was in the Home Building Society that we actually talked about the 15,000.  Unfortunately, I've been unable to get hold of David Dewars, who was the person interviewing us.

   What business would it be of the Home Building Society for that matter to be discussed?---To prove that we did actually discuss that; if he could remember.

   No.  I'm asking you what reason would the Home Building Society have to be interested in Mr Cook paying you $15,000?  There would be no reason for that?---Because when you are in an interview for a mortgage you don't just solely talk about the mortgage; you talk about other things as well.  And that was one of the things that we did just comment on.

   It will be Mr Cook's evidence that the first time this issue of paying the $15,322, to make up the difference, was after the mortgage documents were signed?---Well, he's wrong, I'm sorry.

   Are you saying that the first time it was raised was at the meeting with Home Building Society?---Yes."

7. The respondent's evidence was that the matter was discussed and worked out after the mortgage documents had been signed, and the settlement papers prepared.  In his witness statement (Exhibit 84, par 63), the respondent said:

   "After the mortgage documents had been drawn up and signed, and after Irene had prepared all the settlement statements at Chris Cook's office, Irene said to me that 'as we were tenants in common 50/50, I would need to pay her back $15,000.00 to make up the balance so we both paid the same amount'.  I said that if, as we planned we were going to be together for a long time I would be paying a lot of interest on the mortgage and that it would be for her benefit as much as mine.  She said 'it doesn't matter we're down as tenants in common 50/50'.  I agreed to pay her the $15,000.00 to even up our contributions.  She said not to worry.  We were a couple now and that I would be spending all the money on improvements we were planing to do.  When I sold Narrikup."

8. In his examination‑in‑chief (TS 226) the respondent said this of the meeting in the Society's offices:

   "You've heard Ms Fathers give evidence that it was at that meeting that there was a discussion regarding the $15,000 difference?---No.  Sorry.  Definitely not.  That came after.  That came after the paperwork had been signed, about the difference.  I think it came about that she was going to put the money for the sale of Elizabeth Street and I was going to take out a mortgage for the maximum they could lend me because of my circumstance, but the other mortgage was 75 over.  But that didn't come about until after we'd virtually got the settlement done on 21 Koonwarra Close."

9. Later, in examination‑in‑chief he said (TS 227):

   "Can I take you back to what you were discussing a few moments ago as to when this issue of the $15,000 was raised?---Mm.

   At what stage was it raised with you?---Well, we got the offer accepted and all the paperwork done for the mortgage - ‑ ‑

   The paperwork for the mortgage?---Yes.

   Right?---Once all that was complete, I think we were virtually about to move in or we had moved in and we were – because the house had a lot of furniture in it left from the previous owners, and I think we were around there and that was when it was brought up about making up the balance so we were fifty‑fifty equal shares.

   Right.  As best you can recollect, what was said?---She said as she put in 105, I think it was, and I put in – well, I was paying a mortgage of 75, she said, for the equal share to be made up equal, I would have to give her – yes, I think 15,000 ‑ somewhere around that – when I sold Narrikup.

   And what did you say in reply?---I agreed."

10. I conclude that it is more likely than not the matter of the evening up of contributions to accord with the tenancy in common arrangements to be shown in the settlement documents came up no later than the time those documents were produced, before settlement.  This is in view of the linkage between those arrangements and the plaintiff's identification of a need for a compensating payment of $15,000, a linkage to which both parties testify.  Below, I indicate my reasons for concluding it is more likely than not there was no linkage of these arrangements to the matter of improvements to the property, the need for which was agreed at the time the parties moved into the Koonwarra Close settlement.

11. It appears to be common ground between the parties that there was no identification of the exact shares in which the Koonwarra Close property was to be held by the two of them at the time of the submission of the offer to purchase.  However, it seems to me that by the time of the exchange between the parties over equalising their contributions, it was understood between them they would share equally in the property, based on equality of contributions.  This was although the respondent's payments would come later, from his payments on the mortgage, and from the proceeds of sale of his Narrikup property, which had not yet been sold.  The earliest time at which, absent an adjustment, the measure of inequality in contributions between the parties would have been evident was when it became clear how much could be borrowed by way of mortgage.  It seems to me to be more likely that it was at this time the parties would have worked out how to offset that inequality, rather than later, at settlement.  Whether or not the discussions occurred in the presence of the Home Building Society officer referred to, I find that those discussions occurred then.

Improvements to the Koonwarra Close property

1. The parties moved in to the Koonwarra Close property on or shortly after settlement on 1 November 1999.  The respondent's evidence was that shortly after they went into possession the parties agreed that "we needed to carry out a number of improvements" to the property (Cook, witness statement, Exhibit 84, par 64).  At least some of these on the respondent's evidence were "discussed" when they first inspected the property (Cook, examination‑in‑chief, TS 224, 231).  The improvements the need for which on his evidence (Exhibit 84, par 64) was later agreed were:

   "(a)Concrete the backyard;

   (b)Repaint the exterior, the verandahs and the inside ceilings;

   (c)Fill in the underneath of the house to cover the stilts and the ugly mud bank, and to give us storage;

   (d)Put in a concrete path underneath at the front of the house;

   (e)Put up lattice privacy fences at the back of the house and around the bottom of the house;

   (f)Fill in the end of the verandah by extending the bedroom and putting in a large picture window;

   (g)New blinds for the main bedroom and the lounge room;

   (h)Carpet in the bedroom;

   (i)New Stamford type doors throughout;

   (j)A new fire hearth;

   (k)Extractor fans and heater in the bathroom."

2. There was also evidence from both parties that a shed was installed on the concreting in "(a)" above (Fathers, cross‑examination, TS 152; Cook examination‑in‑chief, TS 224, 229, 230 – 231; cross‑examination, p 237).

3. There was also evidence from the plaintiff that work corresponding to all of the listed items was done, and that materials were paid for by the respondent (Father, cross‑examination, TS 152 – 154).  This was with the exception of the repainting of the verandahs and the inside ceilings in "(b)" above, which she could not testify to, as the work was done after she left the property (TS 152).

4. The respondent's evidence was also that he contributed his own labour to carrying out the improvements, as follows (Exhibit 84, par 66):

   "(1)Building of store area, putting up lattice and privacy 120 hours @ $250.00 = $3,000.00.

   (2)Alterations to upstairs bedroom 32 hours @ $25.00 = $800.00.

   (3)Erection of 32 metre boundary fence 2 persons x 6 hours 12 hours @ $25.00 = $300.00.

   (4)Hanging 7 doors 10 hours @ $25.00 = $250.00.

   (5)Painting 7 doors 8 hours @ $25.00 = $200.00

   (6)Painting house exterior 80 hours @ $25.00 = $2,000.00

   (7)Installation of hot water system 3 hours @ $25.00 = $75.00."

5. The plaintiff's evidence was that he had indeed provided labour on the improvements, except for the item "(4)" above, where her evidence was the labour was "mainly" provided by a neighbour (Fathers, cross‑examination TS 154).  The respondent conceded the item did include the neighbour's time, because "he put the doors on" and he was a "carpenter" (Cook, cross‑examination, TS 309), although the item also included the respondent's painting time (TS 309).

6. Although the plaintiff's evidence was that there were no  discussions as the respondent claimed, she admitted, with respect to one aspect of the property subject to the agreement referred to in the respondent's evidence, that the backyard "needed" concreting was "obvious" at the first inspection.  She had also agreed that discussions of matters of that sort came up after the first inspection (Fathers, cross‑examination TS 151).  However, her evidence was that she did not agree to all of the "improvements", although as I have indicated her evidence was also that work was done, if not completed, on almost all of them before she left, by the respondent or by others arranged by him, using materials he paid for (Fathers, cross‑examination, TS 153 – 154).  She also agreed that some "improvements" were done "in consultation" with her (Fathers, cross‑examination, TS 153), although her evidence was also that she did not approve of the design or quality of a number of the changes (Fathers, cross‑examination, TS 152 – 154).  She also made use of some of the work done.

1. I find on this evidence that it is more likely than not the parties, at about the time they moved into the Koonwarra Close property, agreed on the work to be done on a number of aspects to the property, and the plaintiff largely left the detailed work to the respondent, who would be paying for the materials and supplying at least some of the labour.  This does not mean she approved of all that was done, however. 

2. Nor, it seems to me, would it be easy to infer from this agreement that the plaintiff had concluded that the costs of the improvements would be the equivalent of the $15,000 needed for the respondent to even up their respective contributions.  The respondent’s evidence was that after the mortgage documents had been signed and the settlement statements prepared, the plaintiff had indicated to him that the amount would be paid by his using the funds available to him to make the improvements to the property (Exhibit 84, par 63).  However, I find any such agreement between the parties hard to square with the evidence as to the improvements to which I have referred as a basis for such an agreement.  I also find any such agreement hard to square with the respondent's acknowledgement of his obligation to pay $15,000 both in late 2000 and in late 2001, to which I have previously referred.

The parties' finances

1. The parties' financial arrangements over the course of their relationship underwent significant changes.  At the outset, the parties maintained separate bank accounts, the plaintiff with BankWest and the respondent with the NAB, as I have indicated.  However, the plaintiff assisted the respondent with the preparation of his annual accounts for his accountant, and, after the arrival of the GST, with the preparation of his Business Activity Statements.  The respondent recognised, and the plaintiff understood, her advantage over the respondent in the understanding of financial matters.

2. The arrangements as to joint living expenses were that both parties contributed to them. 

3. The plaintiff's evidence was that her contributions, until the opening of the joint accounts by the parties in February 2001, to which I return in the next section of these reasons, were for such items as travel and other expenses on the overseas trip they undertook together, as well as food and entertainment expenses.  As I previously indicated, she also paid the stamp duty on the transfer of his wife's share of the 57 Williamson Avenue, Narrikup property to him as well as the transfer fee.  She also paid a portion of the Shire rates on the Koonwarra Close property as well as water rates and power both at Elizabeth Street and the Koonwarra Close property.  Her method of payment was to use her Visa card, and to pay the monthly Visa accounts from her cheque account (Cook, examination in chief, TS 84).

4. The respondent's evidence was that he paid most of the parties' entertainment expenses after the first year of their relationship (when his business was not doing well), and that he paid the plaintiff $150 per week in cash, as well as fuel for her car for a trip to Perth.  He also paid some household expenses during the parties' occupation of the Koonwarra Close property, as well as a share of the Shire rates for the second year of ownership.  He also paid a number of other amounts, including computing equipment for the plaintiff, hospital cover for her, repairs for her vehicle, and repairs to her father's lawnmower.  He also paid for work done on the Koonwarra Close property.  His method of payment appears to have included, especially for the improvements, drawing the funds from his NAB business account (Exhibit 44, read with the respondent’s "Schedule of Renovations [at Koonwarra Close]" to his witness statement, Exhibit 84).

5. The total amounts expended by the parties involved are matters of some difference between the parties.  However, it is apparent to me from this evidence that, while the parties' contributions were likely not equal, both made significant financial contributions to their relationship over this period, withstanding the plaintiff's characterisation of the respondent's contributions to the household finances, prior to the opening of the joint accounts, as "very little" (Fathers, cross‑examination, TS 89).  The parties also contributed in other ways, through the services of a secretarial bookkeeping kind the plaintiff made for the respondent's business, and the household tasks she performed; and the respondent's work on the Elizabeth Street property's roof, on the home which the plaintiff's daughter bought, and on some at least of the improvements to the Koonwarra Close property.

The sale of 57 Williamson Avenue, Narrikup; the opening of joint accounts

1. Towards the end of 2000, the respondent sold 57 Williamson Avenue, Narrikup.  The transaction settled in December 2000.  The sale price was $104,000.  After expenses, adjustments and the discharge of the mortgage on the property, the respondent received proceeds of $37,053.62, which was paid into his NAB "Flexi" account on 28 December 2000 (see Exhibit 41).  The transfer eliminated a debit balance then of $764.18.

2. In addition on the next day, 29 December 2000, $8,000 was transferred out of this account to form a term deposit as a new security for the respondent's overdraft (Exhibit 41, statement number 67).

3. The respondent's evidence was that at that point he offered to pay the plaintiff "back" $11,000, being the total of the moneys she "had given me in 1998 when I had been in trouble and my business had not been doing very well" (Cook, witness statement, Exhibit 84, par 70).  I have already referred to this $11,000 as the total of seven cheques bearing various dates from 6 February 1998 to 29 September 1998.  The respondent's evidence was also, as I have indicated, that at that time he offered to pay her back the amount of $15,000, the subject of the agreement to equalise their contribution to the purchase of the Koonwarra Close property.

4. The plaintiff's evidence was that the respondent did not offer to pay back the former sum or the larger amount representing her further payments to him, to which I return below (plaintiff’s responsive statement, Exhibit 83, par 60).  The plaintiff's evidence was also, however, that the respondent said that he would pay the $15,000 the subject of the agreement to equalise contributions to the Koonwarra Close property (Fathers, cross‑examination, TS 158 – 159).

5. It was also at about this time the parties decided to open joint accounts.  The plaintiff's evidence was that this was to make it easier to do the respondent's books and to work out why his business was not doing well (Fathers, examination‑in‑chief, TS 87).  It was also her evidence that the joint accounts were set up to meet the ongoing living expenses of the parties' relationship, at a time when the respondent had funds to make a further contribution to that relationship (Fathers, examination‑in‑chief, TS 87:  the transcript refers to the sale of Narrikup making the respondent "unable" to contribute, which is an error, as the context indicates; and her cross‑examination TS 168).

6. The respondent's evidence was that a joint account was opened with BankWest to receive $10,000 from the proceeds of the sale of 57 Williamson Avenue, Narrikup, indicated below (Cook, cross‑examination, TS 329).

7. In the event, three joint accounts were opened in February 2001 with BankWest.  One was a mortgage account, for the refinancing of the Home Building Society loan.  The second was a Reward Plus cheque account, from which living expenses were paid.  The third was a Dream Saver account, into which money was to be paid to be set aside for such matters as tax and GST payments (Fathers, cross‑examination, TS 171).

8. So far as the Dream Saver account was concerned, the plaintiff paid into it proceeds she received, of about $6,000, in or about April or May 2001 (Fathers, cross‑examination, TS 172), on the sale of her father's car, which on the evidence was the only significant amount paid into this account by either party.

9. The plaintiff's evidence was that the respondent paid the first substantial deposit to the Reward Plus joint account, of $10,000 from the proceeds of the sale of the Narrikup property, soon after the account was opened.  That payment in was by cheque drawn on 19 February 2001 from the account into which the net proceeds of the sale of the Narrikup property had been paid (Exhibit 41; see also Exhibit 27).  The only other deposit that month was of $65.32 from the closing of the plaintiff's BankWest account from which she had paid her Visa accounts for living expenses not paid for in cash.

10. The respondent's evidence as to the $10,000 was that the plaintiff had suggested that payment rather than pay her back the $11,000 which it was his evidence he offered on the completion of the sale of the Narrikup property, as indicated above (Cook, examination‑in‑chief, TS 242).

11. The plaintiff denied that was the basis for the payment, also testifying that the total amount of the cheques she had written by way of loan to the respondent was significantly in excess of $11,000, as has been indicated, and to which I will return.  Even if the amount involved was $11,000, it is not easy to see why the plaintiff would have accepted $10,000 into a joint account in place of the larger sum the respondent testified he offered to pay her.  I note further that in the respondent's evidence reference was made at the time he paid the amount to the amounts the respondent had paid for the improvements at Narrikup (cross‑examination, TS 329).  It does not appear to me from this or other evidence of the respondent's that she was indicating the payments for those improvements should also be considered as payments in respect of the $11,000 and such a view would not be easily reconciled with the whole of the respondent's evidence in this connection, which would suggest that the plaintiff had been looking towards future payments by the parties, as had the respondent when he made his offer.  The relevant evidence is this (Cook, cross‑examination, TS 329):

    "SIMMONDS J:  Yes, allow the witness to answer, please?---My relationship wasn't with you.  You weren't there.  You're going on what your client is telling you.  The money was ours, and when she came up with the idea of opening up a joint account from my moneys from the sale of Narrikup, because I had been spending money on the extension beforehand she said, 'We'll open a joint bank account with $10,000.'  She didn't ask for 11, she said 10, and that's what I went and done.

    MOSER, MR:  Mr Cook, you had an obligation to repay her the money, and it was her money that went into the joint account, wasn't it?---I had an obligation and she said, 'You don't have to pay me back the money.  We're a couple.  We're an item.  We're going to live together.  You're going to be spending money on this, that and the other.'  It was her idea to open up the joint account and I agreed with that."

12. I find on the balance of probabilities that this $10,000 was not understood by the parties as the payment back of the amount the plaintiff had paid the respondent.

13. Finally, I note that the respondent at least maintained a separate bank account during the period of the joint accounts.  On 8 May 2001, the respondent closed out his NAB Flexi account, and on 18 May 2001 he closed out his NAB business account, when he opened an equivalent BankWest account.  This was not a joint account, as I have indicated, and in any event it was apparently closed out and a NAB business cheque account for his business opened in October 2001, a matter to which I will return.

14. I now need to return to the matter of the loans the plaintiff said she made to the respondent, particularly at the outset of their relationship.

The "loan" amounts

1. The plaintiff claims she provided to the respondent over the course of the period beginning 6 February 1998 and ending 3 October 2000 a series of amounts by way of loan, totalling $16,219, all of which were paid into the respondent's business account or Flexi account with the NAB.  The plaintiff's evidence was that on each occasion a cheque made payable to the respondent in the relevant amount was provided when the respondent had made known to her his need for funds.  Her evidence was that two further amounts, of $300 each, on 31 January 2000 and 3 October 2000, were lent.  These were the amounts of cheques made payable to the Home Building Society in respect of the mortgage with the Society on the Koonwarra Close property.  Those amounts the plaintiff said she paid when the respondent said he could not afford to pay them.  In the case both of the amounts made payable to the respondent and the amounts payable to the Society, the plaintiff's evidence was she made it clear to the respondent at the time that the amounts she was providing by way of cheques were on terms that the amounts were repayable on demand or when the relationship ended (Father, witness statement, Exhibit 82, par 22).  She testified that she so stipulated in part because for health reasons she might need the money (Fathers, examination‑in‑chief, TS 78, cross-examination TS 128).  On all of the evidence the plaintiff did not make any such demand before the end of the parties' relationship.

2. The respondent's evidence as I have indicated was that payments corresponding in amounts and dates to those in the plaintiff's evidence had been made by the plaintiff and paid into his business account with the NAB over the period 6 February 1998 to 29 February 1998, totalling $11,000.  Statements of his business account show such amounts being paid in on the date of the cheque or the next day (Exhibits 14 and 45) and that they had the effect of reducing the debit balance from one over $4,000 to one under that amount, except for the payment on 6 February 1998, when the amount paid was $2,000 and the immediately preceding debit balance was $2,656.85.  I note that the transactions on the account indicate it was used to meet at least some personal needs, such as travel and food. 

3. The respondent's evidence is that the background to these payments was (Cook, cross‑examination, TS 312 – 313):

   "You have told her about your money troubles, hadn't you?‑‑‑No.  I told her – yes, I told her I wasn't earning enough.

   And you asked her whether she would give you some money?‑‑‑No, that's not true.

   She said, 'Yes, but if I need the money you'll have to give it back to me'?---That's not true.  It's not what was said.

   You knew at the time that her health might not permit her to work for many years longer, didn't you?---Yes, well, that's right.

   And you knew that she might need the money and that's why her request for repayment at a later date, whenever that might be, was not unreasonable?---I maintain that I wanted to give her that money back when I sold Narrikup.

   We'll get to that.  Don't worry about that.  Every time you received – 9 March 98 1000, 16 April 1000, 19 June 98 1000 and 4 August 5000, and 29 September 98 1000, she again told you something along the lines of, 'If I need the money you'll have to give it back to me,' didn't she?---That's not true.

   You just simply say those discussions didn't take place at all?‑‑‑No, not like that.

   Your position is – if I understand it correctly – that she always volunteered the money?---She always said to me, 'I've got money.  Don’t' worry about money.  We're a couple.'

   So she came up to you some time on 9 March 98, or a day before, and said, 'You want another 1000'?---No, she didn't just come up to me at all.

   Because you actually asked her for money?---No, I didn't ask her at all.  I explained my situation and the situation I was in.  It was in conversation.

   You knew that you could go to her to ask her for money ‑ ‑ ‑ ?‑‑‑No, I never asked her for money.  I never went to her.

   You went to her in the hope that she would give you some?‑‑‑No, sorry.  That's not how it is.

   You are saying that by some mechanism of telepathy she knew that you wanted money?---I have just explained to you that I was the one that said to her about my situation.  I did not ask.  That's twisting words."

4. The difference between the $11,000 acknowledged as received by the respondent and the $16,819 claimed by the plaintiff is made up of three cheques made payable to the respondent and the two cheques made payable to the Home Building society.  The three cheques made payable to the respondent were respectively dated 1 October 1998, for $500; 3 February 1999, for $900; and 2 February 2000, for $3,819.  In the second and third cases there were corresponding credit entries to the respondent's NAB business account (Exhibit 45), on the same day, reducing the account overdraft net of certain other debits to $4,274.07 and $3,627.36, respectively.  In the case of the cheque for $500, there is a corresponding credit to the respondent's NAB Flexi account, reducing the account overdraft to $261.79, net of another debit, and shortly before another debit of $241 for a loan repayment, apparently on the loan secured by the mortgage on the respondent's Narrikup property (Exhibit 40).  At the same time, the respondent's business account, from which payments into the Flexi account would usually come shortly before loan repayments from that account were made, was in overdraft in the amount of $3,600.25.  The respondent testified he recalled paying the cheque for $500 into his account (cross‑examination, TS 315), but could not recall the source of the other credits (cross‑examination, TS 316, 321).  I note, however, that $3,819 coincides with the amount the plaintiff received on or about 25 January 2000, on the sale of 500 Telstra shares (sale contract note, Exhibit 4).

5. As to the two cheques made payable to the Home Building Society, the respondent's evidence was the respondent gave the plaintiff cash amounts of $300 with which to pay the Society.  The plaintiff's evidence was she paid the Society with cheques in the amounts of $300 each when the respondent found himself unable to pay them.  The statements for the All-in-One loan account with the Society in the parties' joint names (Exhibit 49) show these payments in on the dates of the cheques, respectively 31 January and 3 October 2000.  Most other payments were by cash deposits.  At the time of the 31 January 2000 cheque the respondent's business account was in substantial overdraft, above $7,000: this was just before the payment in of $3,819 I have referred to.  At the time of the 3 October 2000 cheque the overdraft on that account was rather less, but still significant, at $2,377.71.

The use of the proceeds of the sale of 57 Williamson Avenue, Narrikup

1. I have already indicated that the net proceeds of the sale of that property were $37,053.62, that they were paid into the respondent's NAB Flexi Account on 28 December 2000 eliminating a small debit balance, and that $8,000.00 was transferred out of that account to a term deposit as a new security for the respondent's overdraft, apparently on his business account, on the next day, 29 December 2000.  I have also indicated that $10,000.00 was transferred out of this account to one of the parties' joint accounts, on 19 February 2001.

2. There was also evidence from the plaintiff, that other amounts paid from proceeds of the sale of 57 Williamson Avenue were to clear a GST bill of about $4,000.00, to "clear up" overdrafts on other accounts of the respondent's, and for the purposes of his business, as well as to pay $5,500.00 for a campervan (Fathers, examination‑in‑chief, TS 100).

3. There is support for a finding that payments out of the NAB Flexi Account to the NAB business account were made, on 8 January 2001 and 27 April 2001, of $3,000.00 and $4,000.00 respectively, when the overdraft on that account was $6,491.80 and $6,072.18, respectively.  The NAB business account was closed on 18 May 2001, when the respondent opened a business account with BankWest as I have indicated.  The remaining overdraft on the NAB account appears to have been paid from the term deposit to which I have referred.  The amount of that payment was $4,936.27.

1. The $5,500.00 for the campervan was drawn out of the Flexi Account on 28 February 2001 (Exhibit 41).  There was some contest between the parties as to the intended uses of the campervan.  However, it does not seem to be in contest that it was to be used for recreation, including taking the plaintiff to music festivals, and for business purposes, when the respondent had to work away from home (Fathers, cross‑examination TS 161; Cook, cross‑examination TS 277).  There is evidence the campervan was used for both purposes, but only to a limited extent (Cook, re‑examination TS 364).  The campervan was eventually sold, apparently in 2002, before the end of that financial year, for a sum of no less than $3,864.00 and possibly as much as $4,500.00, to the plaintiff's niece (Cook, re‑examination TS 364; Exhibit 79, respondent's tax return 2002; and Father's proof of evidence, Exhibit 82, par 98).  There is no evidence before me as to what happened to those proceeds.

The operation of the joint accounts; the lounge suite

1. I have already indicated that there were three joint accounts opened in early 2001, including the BankWest Reward Plus and the BankWest Dream Saver Accounts.  The Reward Plus joint account was closed on 1 December 2001 (Exhibit 27), not long after the respondent drew out the sum of $2,200.00, reducing the account balance to $210.00.  It is not altogether clear from the evidence if and when the Dream Saver Account was closed.  If it was closed, it may have been at about the same time, not long after the plaintiff, on 20 November 2001, drew out $6,277.63, being all but $72.88 in that account (Exhibit 70; Cook, cross‑examination TS 172).  I return to those withdrawals below, as they form part of the evidence as to the end of the parties' relationship.

2. I have already referred to the $10,000.00 from the proceeds of the sale of the Narrikup property that were deposited in the Reward Plus joint account.  There was also evidence of other deposits over the life of this joint account, totalling $4,452.23, of which in all $2,552.23 appears to have been contributed by the plaintiff, and $1,900.00 by the respondent (Exhibit 27 and Exhibit 22).  I have also referred to the sum of about $6,000.00 paid by the plaintiff into the Dream Saver Account.  On the evidence before me there were no other deposits of significance in it by the parties.

3. On the evidence there were no withdrawals by either party on the Dream Saver Account, until the withdrawal of the sum of $6,277.63 referred to.

4. The Reward Plus joint account appears, from the entries on it, (Exhibit 27), and other evidence (Fathers, examination‑in‑chief TS 101 – 102), to have been used by the plaintiff to pay living expenses, by EFTPOS and by transfers to the plaintiff's Visa account.  Her evidence was that she also paid household expenses from cash "that I use to keep in the car – my wages, virtually" (Fathers, cross‑examination TS 171).  This was until September 2001, when it is clear, from the Reward Plus joint account statement, monthly debits went up considerably (Fathers, cross‑examination TS 171; Exhibit 27).  This is consistent with her evidence that her health preventing her working from August 2001 (Exhibit 82, par 105), although the respondent testified she was working in October 2001 (Cook, cross‑examination TS 354).  At the same time, some living expenses were paid by the plaintiff from the "business account", which appears to have been the BankWest business account for the respondent (Fathers, examination‑in‑chief TS 101 and Exhibit 21):  the plaintiff appears to have been able to use this account to make telephone and internet banking arrangements (Cook, re‑examination TS 364).

5. The joint account was also used to pay for at least some of the plaintiff's medical expenses and pharmaceutical expenses of her father's (Fathers, examination‑in‑chief TS 103).

6. One particular payment from the Reward Plus joint account to the plaintiff's Visa account was a matter of some contest between the parties.  It was $3,000.00, drawn from the joint account on 26 February 2001, 10 days after the payment in of $10,000.00 from the respondent's Flexi account with the NAB.  This amount was, on the plaintiff's evidence (denied by the respondent), at least mentioned to the respondent before the payment, although she acknowledged there was no reference to this mention in her proof of evidence (Exhibit 82), or her responsive proof of evidence (Exhibit 83) (Fathers, cross‑examination TS 169).  The amount in question reduced the opening debit balance on the Visa account virtually to zero, with the debit balance at the end of the month being $780.73.  The opening balance in August 2000 had also been reduced to zero, by a payment by the plaintiff of $3,130.29 at the beginning of that month.  This payment had been made possible by receipt of the payment on the sale of her remaining Telstra shares (Exhibit 5, read with Exhibit 20).  However, the Visa account balance had, from the August 2000 statement onwards, been in monthly debit in a range from $2,270.14 to $3,029.01 (Exhibit 22).  The largest single expenditure over that period was in the amount of $2,495.00 on 4 August 2000.  This, it was accepted, was the cost of a lounge suite the plaintiff had purchased, and had placed in the Koonwarra Place property.

7. The plaintiff rejected the proposition that the payment of $3,000.00 drawn from the joint account was for the lounge suite, testifying that she said she had told the plaintiff in February 2001 that the payment was to cover living expenses, both before and after August 2000 (Fathers, cross‑examination TS 170).  The Visa statements (Exhibit 22) for the period after 14 August 2000 show total debits of about $2,760.00 and total credits of about $2,780.00.  This is consistent, of course, with the plaintiff having paid for the lounge suite, and some of the expenses incurred between the date, in early August 2000, when the Visa balance was zero, and the date later that month of the purchase of the lounge suite.  At least some of the expenditures on the Visa account, apart from the lounge suite for the period between 1 August 2000 and February 2001, may not have represented living expenses:  as I have indicated, the plaintiff had incurred some medically related expenses that she distinguished from living expenses and which were paid out of the joint account.

8. On balance, I find that it is more likely than not that the plaintiff intended the $3,000.00 to cover what she saw as living expenses, and not the lounge suite.  The amount of the debit balance at the time of payment, and the previous debits and credits on the Visa account over the period since the suite was acquired, cause me so to find.  The respondent had allowed the plaintiff to operate the Reward Plus joint account to meet living expenses by paying off the Visa account, including expenses incurred before the opening of the joint account (Cook, cross‑examination TS 348).  There is undoubtedly a contest between the parties as to what were living expenses, with the respondent taking the position in his evidence that a number of expenses were not of that sort.  As I have already indicated, the plaintiff also testified that the joint account was also used to pay at least some of her medical expenses and some pharmaceutical expenses of her father's.

9. However, it is not asserted that payment for the lounge suite was a living expense.  Therefore, in the face of all of the evidence referred to, it does not seem to me that it could be asserted that the payment of $3,000.00 in the joint account could be seen as the use of the account to pay for it.  Whether the lounge suite might be viewed as an asset that was jointly acquired or contributed to a common pool of assets subsequently is a matter I reach below.

The end of the relationship

1. There is some contest over the timing of the end of the parties' relationship.  However, it seems the relationship was encountering severe difficulties in the last quarter of 2001 and had ended not later than early June 2002.

2. There are various forms of evidence of this.

3. In November 2001, the respondent removed all but $210.08 from the joint Reward Plus account (Exhibit 27), and shortly thereafter the plaintiff removed all but $72.98 from the Dream Saver account (Exhibit 70), which as I have indicated, was also a joint account.  Also in that month, the respondent removed the plaintiff from the private medical insurance cover that had previously covered the two of them.  Late in the month, there was a letter from a mediation service in Albany to the plaintiff.  The letter referred to an approach to the service by the respondent, and his hope she would be willing to attend "a mediation session to discuss property settlement issues", and invited her to consider mediation (Exhibit 57).  In the event no mediation resulted.  By December 2001, the plaintiff's evidence was the respondent had indicated to her their relationship was over.  There was correspondence that month from the solicitor for the plaintiff with the respondent (Exhibit 58).

4. However, the evidence of the plaintiff was also that the relationship in fact continued, and the respondent remained in the Koonwarra Close property with her until February 2002 (Fathers, examination‑in‑chief, par 107).  The evidence of the respondent was also that he did not move out of the Koonwarra Close property until 23 February 2002, when he moved into rental accommodation at 71 Williamson Avenue in Narrikup (Cook, witness statement Exhibit 84 par 104).  There is in evidence an offer by the respondent to purchase the property in Narrikup dated 9 January 2002, subject to the sale of the Koonwarra Close property (Exhibit 69), although the plaintiff testified she was unaware of this until the time of the proceedings.

5. In January 2002, the Koonwarra Close property was listed for sale.  When the listing authority expired, the plaintiff, in May 2002, would not join the respondent in renewing it.  Also in May 2002, the plaintiff agreed to buy a residential property in Albany, and on 9 June 2002 she moved out of the Koonwarra Close property into that other property.

6. On 7 June 2002 the plaintiff was served with a summons for a Misconduct Restraining Order for the respondent.  There is a sharp conflict between the parties over the circumstances surrounding the taking out of the summons, and I return to the conflict below, in connection with one of the plaintiff's claims against the respondent.  However, it is not in contest that the plaintiff did not attend the return of the summons.  Her evidence was that this was because she was too ill to attend the hearing.  The Misconduct Restraining Order issued as a result of that hearing.

7. There were further proceedings by the respondent to take out a Misconduct Restraining Order in 2003 (Exhibit 31) and 2004 (Exhibit 32), the former apparently successful and the latter apparently unsuccessful.  As well, there is evidence of proceedings under the order in 2003, which were apparently unsuccessful.  In the proceedings to obtain the 2003 order, the plaintiff was again unable to attend the hearing because of illness, on her evidence.  However, in the proceedings under that order, and on the 2004 application, she was able to attend (Fathers, examination‑in‑chief TS 111 – 112).  This evidence of the plaintiff was not contested.

8. The importance of the Misconduct Restraining Orders in the present context lies in the fact that from the first of them contact between the parties ceased.  Up until early June 2002, the plaintiff's evidence was of some continuing contacts between them, both on the respondent's visits to Koonwarra Close, and her visits to his rental accommodation in Narrikup, on his indication she could stop by (Fathers, cross‑examination TS 178 – 179).  There is also evidence from the respondent of continuing contacts between himself and the plaintiff, although his evidence is also that he did not invite the plaintiff to drop by (Cook, witness statement Exhibit 84, pars 106, 115) and, at least except where it was prearranged, much of the contact was unwanted (Cook, witness statement, Exhibit 84, par 115; and examination‑in‑chief, TS 249).

The respondent's return to the Koonwarra Close property

1. Some time after the Misconduct Restraining Order obtained in June 2002 issued, and after the plaintiff had moved out of the Koonwarra Close property, the respondent moved back into that property.  At that time he had the locks to the property changed.  The date of that return on the plaintiff's evidence was some time in July 2002.  The date of the return, on the respondent's evidence, was later, in September or October 2002 (respondent, cross‑examination TS 289).  The respondent explained the return in terms of the cost of maintaining the mortgage on the Koonwarra Close property, and the rental of the Narrikup property.  On the respondent's evidence, he continued to rent that property until 21 October 2002 (Exhibit 84, par 116).  I note, however, that the lease was a weekly one, with a provision for 21 days notice of when the tenant wished to vacate (Exhibit 68).  Further, although the respondent's evidence was that he was under the impression it was a six month lease (re‑examination, TS 363), that would have the lease expire on 23 August 2002.

2. I find it more likely than not that the respondent moved back into Koonwarra Close earlier than October 2002, and likely at the end of July 2002.  This date assumes some significance in the final orders to be made in this case below.

The claims made by the parties in these proceedings

1. There were two principal claims made by the plaintiff.  One was for "specific performance" of a "Loan Agreement" alleged to have been made between the parties.  The plaintiff also made a claim for an order that the respondent perform his obligations under a "Property Purchase Agreement" alleged to have been made by the parties in respect of the acquisition of the Koonwarra Close property.  Further, or in the alternative, declarations of resulting trust, estoppel and unjust enrichment are sought, in respect of the subject matters of the specifically enumerated obligations referred to as arising under the property purchase agreement.  The plaintiff also claims such consequential orders as may be necessary to give effect to all of the orders made under all of these claims.  This consequential relief is specified to include any necessary order for sale of the Koonwarra Close property, and an order for distribution of its proceeds in accordance with the scheme for distribution in the statement of claim. The plaintiff also claims damages for conversion by the respondent of the lounge suite acquired by the plaintiff in August 2000, and further claims occupation rent in relation to the plaintiff's interest in the Koonwarra Close property after the plaintiff moved out.  The plaintiff further claims orders for proper accounts, enquiries and directions, as well as interest on such sums as may be payable by the respondent to the plaintiff from the date of the termination of their de facto relationship to the date of judgment at the rate of 8 per cent, and such other orders as the court deems appropriate, as well as costs.

2. The respondent denies that the loan agreement or property purchase agreement was made.  The respondent pleads that from the commencement of the de facto relationship the parties formed a "common intention" that they would "pool" their respective financial resources and income, although it was made clear in the proceedings this did not include the plaintiff's superannuation from the United Kingdom.  Pursuant to the common intention pleaded the parties would contribute the resources and income pooled to their upkeep and maintenance and the upkeep, maintenance and improvement of assets.  The parties would also contribute "other direct and indirect financial and non‑financial resources" to the acquisition, maintenance and improvement of assets.  The parties would hold any property and assets acquired by them in the course of the de facto relationship in equal shares.  The defence further pleads it was pursuant to the common intention that moneys were paid which the plaintiff says form part of the advances under the Loan Agreement.  The respondent further pleads that pursuant to the common intention the plaintiff applied the net proceeds of sale of her residence to the acquisition of the Koonwarra Close property, and that pursuant to the common intention the respondent applied the net proceeds of the sale of his residence in the particular ways listed in the defence, and that the lounge suite was also acquired pursuant to the common intention.  The respondent denies that the plaintiff was ousted from the Koonwarra Close property and thus that the respondent is liable for occupation rent.

3. The defence also contains a counterclaim for a declaration that the parties are joint legal and beneficial owners of the Koonwarra Close property, that it be sold and that the net proceeds should be divided equally between the parties or in such other proportions as the court orders.  Alternatively, there is a counterclaim for an accounting of the parties' respective contributions to the de facto relationship, a declaration that parties hold the net proceeds of sale of the Koonwarra Close property and any other assets of the de facto relationship in trust for themselves in proportion to their respective contributions, and an order that such net proceeds be paid to the parties in accordance with their respective contributions.  The defence also claims such further and other relief as the court may award and the respondent's costs of the action to be taxed and paid out of the plaintiff's share of the net proceeds of the Koonwarra Close property.

Credibility findings

1. There was substantial argument before me devoted to the findings I was asked to make as to the parties' respective credibilities, particularly on the critical findings of fact as to the alleged Loan Agreement and the alleged Property Purchase Agreement.  I was urged for each party, generally, or at least on the critical issues, to prefer that party's account of the matters in issue in the case of any conflict in the evidence of them.

2. In this regard, there was some considerable attention devoted to a Will which the respondent testified in late 1999 he had asked the plaintiff to help him prepare.  The Will was in fact dated 23 February 2000 (Exhibit 67).  The respondent's evidence was that the plaintiff had told him to have the Will witnessed in blank by two named individuals, and then to write on a separate piece of paper what he wanted in the Will.  The plaintiff would then put the document into legal wording.  He had proceeded in that way, and had written out provisions appointing her his executor and dividing his estate equally between the plaintiff, and the respondent's son and daughter.  In late 2001 he had, at about the time he had removed the HBF cover for the plaintiff, discovered the signed and witnessed Will amongst papers in the office, presumably at the Koonwarra Close property.  The Will had provisions in the plaintiff's handwriting, giving all of his estate to the plaintiff.  From this, I was invited to infer that the plaintiff had proceeded in the face of his instructions, a matter which it was said redounded very much to her discredit.

3. The plaintiff's evidence was that she had encouraged the respondent to prepare a Will to avoid having his one‑half share in the Koonwarra Close property, including the extra money she had put in to the acquisition of the property, going to his then wife.  She had not had him have the Will executed in blank, but prior to its execution had filled it in, in the form referred to, after ensuring that that was what the respondent wanted, and being told he was sure she would look after his daughter.  The reference to his daughter, and not also to his son, may have arisen because the plaintiff was aware of the respondent's previous Will in 1997 (Exhibit 51) leaving all of his property then to his daughter (see Fathers, cross‑examination, TS 142 – 143, 144 – 145).

1. There is no evidence on the basis of which aggravated or exemplary damages should be awarded, nor are they claimed.  There is support for such damages in suitable cases in conversion actions (Fleming (supra) at 78).  There is evidence the respondent had his own lounge suite and thus had no need of the other.  However, I do not consider that this in itself would justify an award of aggravated or exemplary damages.

Relief in this case

1. I have found that the plaintiff has made out her claims as follows:

   •to have lent $16,819.00 to the respondent, which became payable to her at the end of the de facto relationship;

   •that the respondent is liable to discharge the mortgage on the Koonwarra Close property and to pay the plaintiff $15,322.11, so as to equalise their contributions to the acquisition of the Koonwarra Close property;

   •that the respondent is not liable to the plaintiff for occupation rent in respect of his conduct in obtaining a Misconduct Restraining Order which had the effect of keeping the plaintiff out of the Koonwarra Close property; and

   •the respondent is liable in damages for conversion of the lounge suite purchased by the plaintiff in August 2000, damages which on the evidence before me are $800.00.

2. The plaintiff's prayer for relief with respect to the loan obligation is principally for specific performance.  However, it is not suggested that a claim in debt would not be an adequate remedy in respect of that obligation, and in such a case a court would not normally order specific performance:  Halsbury's Laws of Australia at [10‑11865].  There should therefore in this case be an order for the payment of $16,819.00 as a debt due from the respondent to the plaintiff.  There is no claim for interest on that sum before the date the debt became due and payable.  There is however, a claim for interest from the date of termination of the de facto relationship to the date of judgment on all such sums as may be payable by the respondent to the plaintiff, which would cover interest on that debt from that date, which as I have indicated was the date the debt became due and payable.  I return to the claim for interest on amounts due by the respondent to the plaintiff below.

3. The plaintiff's prayer for relief in respect of the respondent's equalisation obligations on the Koonwarra Close property is for an order the respondent pay the plaintiff the sum of $15,322.11 and such sums as may be necessary to discharge the obligations the plaintiff may have towards the Bank of Western Australia under the loan secured by the mortgage.  There appears to be no claim for interest on the former sum.  There is, however, a claim for interest I referred to earlier, which would cover a claim for interest on the $15,322.11 from the date of termination of the de facto relationship.  I have already indicated my finding as to that date.

4. The plaintiff's prayer for relief includes that in the event the Koonwarra Close property has not been sold (as appears to be the case) the property be sold pursuant to Property Law Act 1969 (WA), s 126 and the proceeds divided as the prayer requests.

5. The respondent does not oppose the sale of the Koonwarra Close property and indeed his counterclaim also seeks an order for sale.  There is no doubt the plaintiff, as the holder of a 50 per cent share in the property, is entitled to a sale, absent a good reason appearing to the court not to order one.  No good reason so to do is apparent to me, or pressed on me.  The matters that need to be addressed then go to the application of the proceeds.

6. The application of the proceeds requested by the plaintiff's prayer for relief was explained to me in terms that in effect the plaintiff should receive one‑half of the proceeds of sale, presumably after deducting the sale costs, and the equalising payment from the respondent's share of the proceeds, apparently plus the interest on that amount.  The respondent's share of the proceeds should also bear the costs of the discharge of the mortgage.  The plaintiff's prayer for relief appears to me to go further than this, however, in also allowing for the payment from the respondent's share of the proceeds of sale of the amount of the principal under the loan agreement plus interest as I have indicated.  It does not seem to me that it would be appropriate to burden the respondent's claim to a share in the proceeds in this way:  it is not suggested that performance of the loan agreement was part of the equalisation of the respondent's contribution to the acquisition of the Koonwarra Close property, nor does the liability arising under it in my view impeach the respondent's claim to his proper share of the proceeds (Meagher, R P, Heydon D and Leeming, M, Equity Doctrines and Remedies 4th ed Sydney, LexisNexis Butterworths 2002 at [37‑045], on equitable set off).

7. However, in respect of the sale the respondent has as alternative relief sought an accounting of the parties' respective contributions to their de facto relationship, and a declaration that the net proceeds of the sale of the Koonwarra Close property and any other assets of the relationship be held in trust for themselves in proportion to their respective contributions.  I return below to the matter of other assets of the relationship.

8. As to the net proceeds of the Koonwarra Close property, after allowance for the respondent's equalisation obligations as I have referred to them, which appear to me to be appropriately so allowed for, it also seems to me that the respondent has sufficiently called for the application of the equitable principles which provide for the possibility of an allowance to be made out of the proceeds of the sale under s 126 in respect of improvements and repairs which are capable of enhancing the value of the property. There is also the possibility under those principles, in this case, of an allowance proportionate to the other co‑owner's (the plaintiff's) beneficial interest in the property for outgoings for the preservation of the property, such as payments of rates, taxes, insurance premiums, and other items, such as grounds and maintenance expenditures. (While this allowance may in suitable cases extend to mortgage repayments, that would not be appropriate in this case, for the reasons I gave earlier.) The possibility of allowances of both sorts being so made in proceedings such as these was recognised in Silvester v Sands [2004] WASC 266 per Heenan J at [139 – 141].

9. However, in respect of an allowance for expenditure capable of enhancing the value of the property, it must be shown that the expenditures in question did have that effect; and the allowance is for the lesser of the expenditure or the enhancement:  Silvester (supra) at [140] and Meagher et al (supra) at [25‑065].  I have already found that the plaintiff agreed to a number if not all of the expenditures.  However, it does not appear to me that this changes the basis upon which an allowance may be claimed, as I do not consider this agreement extended to paying her share of the expenditures or the increased value they produced.  However, there is no allowance where there was an intention the improvements were to be part of the improver's contributions to the property to be shared as the property was shared:  Noack v Noack [1959] VR 137 at 142 ‑ 143 per Dean J, quoted with approval by Kennedy J in Guthrie v Millar (supra) at 7.  I have already found there was no linkage between any improvements and the respondent's interest in the property, which rests on equality of contributions.  On that basis I consider that there was no disqualifying intention in this case.

10. Further, in respect of allowances both for increases in the value of the property and the other expenditures I referred to, the person claiming the allowance is chargeable with an occupation rent in respect of the period in which the claimant enjoyed sole possession of the premises:  Silvester (supra) at [141]. That period in this case runs from 31 July 2002 (the date at which I found the respondent entered possession of the property) to the date on which the assessment is to be made or the date possession ceased, whichever is the earlier.

11. There is evidence of the respondent as to expenditures to December 2001 made on "renovations" of the Koonwarra Close property (witness statement Exhibit 84, schedule of renovations) as well as expenditures on Shire and water rates, insurance premiums and grounds maintenance, to November 2004 (witness statement, Exhibit 84, schedule Costs Related to Ownership).  I return to that evidence below.

12. The respondent has also provided evidence of the amount that would have had to have been paid for the labour he says he provided in connection with the renovations at Koonwarra Close (Exhibit 84 [66]), totalling $6,625.  No authorities were cited to me allowing for such labour costs to be included in an allowance in this context and I could not find any such authorities.  However, recognition of such a claim would in my view be consistent with the approach in the authorities to non‑financial contributions to particular property as helping to ground a proprietary interest by way of constructive trust.  See Muschinski v Dodds (1985) 160 CLR 583, discussed in Lloyd (supra) per Murray J, Hasluck J agreeing, Pullin J to the same effect at [8] – [12].  Where a contribution in the form of labour was directed to an improvement to property without intending to confer its full benefit on the other co‑owner, and that contribution had a commercial value, then it seems to me its value should be taken into account.  See Lloyd, per Murray J at [12].

13. As to the expenditures on the renovations, the total of the amount shown, in Exhibit 84, schedule of renovations, is $9,525.38, although I find that two of these expenditures, being that in November 1996 or 1998 for a shed in the amount of $410.00, and in July 2000 for seven doors in the amount of $353.63, were not in fact supported by the documentation referred to in the respondent's evidence.  The plaintiff's evidence was, however, that work corresponding to many of the expenditures was indeed done.  Although there was some difference in the evidence as to the quality of the work done, there appears to me to be sufficient evidence that some increase in value likely resulted from some at least of the "renovations".

14. As to the other expenditures, the total of the amounts shown is $4,529.18.  However, I find that Shire and water rates, and insurance payments were in fact borne by both parties up to and including the payments for 2002/2003 (Exhibit 85), whether from one of their joint accounts or otherwise.  So claims for those expenditures cannot be made, in my view.  However, the plaintiff's evidence was that the respondent did indeed bear the lawn mowing expenses as far as she knew, as well as the expenses of ownership after the invoices for the period for 2002/2003.

15. There is no evidence before me of the market rent the Koonwarra Close property could have commanded over the period in question.  It seems to me unlikely that the total of the renovations and other expenditure amounts, plus labour costs (some of which are disputed by the plaintiff, as work done by others than the respondent) or $16,679.56 will exceed the market rent for the period till the end of November 2004.  On that basis, it seems unlikely that on an accounting for the expenditures in fact made from the respondent's schedules and the allowable labour costs, as well as the expenditure since, and occupation rent, there will be any allowance to the respondent.  However, as I have said, the respondent has called for an accounting and it seems to me to be established that enquiries and accounts should be ordered where the parties, or it seems one of them, have called for such enquiries and accounts, and there is a basis for them:  Re Pavlou (a bankrupt) [1993] 1 WLR 1046 per Millett J at 1049 – 1050; Re Gorman (a bankrupt) [1990] 1 WLR 616 at 626 per Vinelott J, Mervyn Davies J agreeing; and Silvester (supra) at [141].

16. In accordance with those authorities, inquiries should be made to determine what expenditures the respondent made, and what labour he contributed, producing what if any increases in value of the Koonwarra Close property, and what other expenditures he made to preserve the property, as well as the market rent for the property over the period the respondent has been in sole occupation of the property, and the accounts using the results.

17. So far as other assets of the de facto relationship are concerned I understand this to refer to assets acquired during the course of the relationship used for the benefit of both parties.  The only ones that the evidence revealed in any way were the lounge suite and the campervan, to whose acquisition I have already referred.

18. I note that the respondent appeared to argue before me that account should also be taken of all of the expenditures the parties made by way of contribution to the de facto relationship, to determine what allowance should be made to the respondent out of the proceeds of sale of the Koonwarra Close property.  I do not consider that enquiries and accounts should be ordered for that purpose.  As I have indicated in relation to the common intention on which the respondent relies, this is not a case of parties to a de facto relationship having pooled their assets or even their earnings for the purposes of the joint home represented by the Koonwarra Close property.  There is evidence of a limited pooling, at least in the form of the Reward Plus joint account.  I put aside the other joint accounts, being the mortgage account, on the basis of my findings in relation to the acquisition of the Koonwarra Close property, and the Dream Saver account, on which there were no operations by the parties other than the plaintiff's payment in and withdrawal, on the evidence before me.  However, the Reward Plus account was not established until some time after the acquisition of the Koonwarra Close property.  It was not directed towards the acquisition of or related to the property but rather the general purposes of their relationship, particularly living expenses, but not only those.  Its operation does not appear to me to be capable of giving rise to a beneficial interest in that property, resting on the unconscionability of allowing a party to take an interest in property without qualification for the contribution to the other, in the way that the contributions of the parties in Baumgartner (supra) did.  See Lloyd (supra) per Murray J at [12].

19. I have already indicated my finding as to the lounge suite.  As to the campervan which was paid for out of the proceeds of the sale of 57 Williamson Avenue, as I have previously indicated there is evidence that the campervan was sold by the respondent, although the evidence is less clear as to the proceeds, or what has happened to them.  However, the plaintiff has made no claim in respect of the campervan, and I do not need to pursue it further.

20. There is also evidence that the respondent made expenditures in relation to the plaintiff's property which were not contributions to the acquisition of the property. The property concerned was of two sorts. One was computer equipment to which in 2000 the respondent contributed the cost of supplementary equipment, and upgrading. There is some dispute as to the quantum of the contribution in the former case. There is also evidence of the respondent having contributed in 2000 to the cost of repairs and replacement parts for the plaintiff's car. However, I do not consider I need to pursue the matter further. It does not seem to me that the respondent should be seen to have acquired a proprietary interest in such cases: see Meagher, R P and Gummow, W M C, Jacob's Law of Trusts in Australia 6th ed, Sydney, Butterworths 1997 at [1219].

21. Accordingly, I do not consider any further enquiries for accounting beyond that in respect of expenditures the respondent made on the Koonwarra Close property as I have indicated should be ordered.

22. I have already noted the plaintiff's claim for interest on sums owing by the respondent to the plaintiff.  Those sums would be the amount of the indebtedness under the loan agreement, from the date of termination of the de facto relationship, 9 June 2002, as well as the equalisation amount in respect of the acquisition of the Koonwarra Close property, $15,322.11, also from that date. Interest would in my view be appropriately regarded as due and payable in such a case, and the contrary was not argued before me. The rate of interest claimed is 8 per cent. However, in my view the rate of interest should be the ones applicable to sums as if they were judgment debts, at the rate applicable to judgment debts. Those rates are the ones which were those gazetted for the purposes of the former s 142 of the Supreme Court Act 1935 (WA), and are now, effective 1 May 2005, the ones prescribed by regulation under s 8(1)(a) of the Civil Judgments Enforcement Act 2004 (WA).

Final orders

1. I will hear from the parties as to the final orders to be made in this case.

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION: FATHERS -v- COOK [2006] WASC 129 (S)

CORAM:   SIMMONDS J

HEARD:   15-17, 19 NOVEMBER 2004, 31 JANUARY 2008

DELIVERED          :   30 JUNE 2006

SUPPLEMENTARY

DECISION              :1 SEPTEMBER 2008

FILE NO/S:   CIV 1418 of 2003

BETWEEN:   IRENE MARY ALICE FATHERS

Plaintiff

AND

RONALD COOK
Respondent

Catchwords:

Liability for costs - Whether plaintiff was the successful party and should recover her costs

Legislation:

Rules of the Supreme Court 1971 (WA), O 66 r 1

Result:

Costs for the plaintiff

Category:    B

Representation:

Counsel:

Plaintiff:     Mr H O Moser

Respondent:     Mr C P Stokes

Solicitors:

Plaintiff:     Christopher J Cook

Respondent:     Chris Stokes & Associates

Case(s) referred to in judgment(s):

Fathers v Cook [2006] WASC 129

SIMMONDS J: 

Introduction

1. This is the determination of the question of costs following the filing of written submissions by the parties.  I presided at the trial.  Judgment after trial was dated and entered 31 January 2008 at a hearing at which I ordered the parties have 21 days from that date to file and serve written submissions as to the order to be made as to the costs of the action.

2. Submissions by the plaintiff, were filed on 28 February 2008.  The submissions for the defendant were filed, I was told on 31 January 2008, although no record of them could be found on the file.  A copy of submissions for the defendant dated 31 January 2008 was produced to the court by facsimile on 10 July 2008.

3. The parties indicated at that time they were content to have the matter dealt with on the papers.

4. The submissions for the plaintiff were that, as she had been successful, at least on an analysis of the overall judgment in the case, costs should be awarded to her, in accordance with Rules of the Supreme Court 1971 (WA) O 66 r 1.

5. The submissions for the defendant were that, as that analysis showed a mixed result, each party should bear their own costs.

6. For the reasons that follow, I have determined on an analysis of the overall judgment in the case that I should make the order sought by the plaintiff.

The action and the result

1. The action was one involving competing claims for relief in respect of amounts the parties paid and the assets they acquired in the course of a de facto relationship which had come to an end.  The competing claims are set out in my judgment, Fathers v Cook [2006] WASC 129 [104] ‑ [106]:

   There were two principal claims made by the plaintiff.  One was for 'specific performance' of a 'Loan Agreement' alleged to have been made between the parties.  The plaintiff also made a claim for an order that the respondent perform his obligations under a 'Property Purchase Agreement' alleged to have been made by the parties in respect of the acquisition of the Koonwarra Close property.  Further, or in the alternative, declarations of resulting trust, estoppel and unjust enrichment are sought, in respect of the subject matters of the specifically enumerated obligations referred to as arising under the property purchase agreement.  The plaintiff also claims such consequential orders as may be necessary to give effect to all of the orders made under all of these claims.  This consequential relief is specified to include any necessary order for sale of the Koonwarra Close property, and an order for distribution of its proceeds in accordance with the scheme for distribution in the statement of claim.  The plaintiff also claims damages for conversion by the respondent of the lounge suite acquired by the plaintiff in August 2000, and further claims occupation rent in relation to the plaintiff's interest in the Koonwarra Close property after the plaintiff moved out.  The plaintiff further claims orders for proper accounts, enquiries and directions, as well as interest on such sums as may be payable by the respondent to the plaintiff from the date of the termination of their de facto relationship to the date of judgment at the rate of 8 per cent, and such other orders as the court deems appropriate, as well as costs.

   The respondent denies that the loan agreement or property purchase agreement was made.  The respondent pleads that from the commencement of the de facto relationship the parties formed a 'common intention' that they would 'pool' their respective financial resources and income, although it was made clear in the proceedings this did not include the plaintiff's superannuation from the United Kingdom.  Pursuant to the common intention pleaded the parties would contribute the resources and income pooled to their upkeep and maintenance and the upkeep, maintenance and improvement of assets.  The parties would also contribute 'other direct and indirect financial and non-financial resources' to the acquisition, maintenance and improvement of assets.  The parties would hold any property and assets acquired by them in the course of the de facto relationship in equal shares.  The defence further pleads it was pursuant to the common intention that moneys were paid which the plaintiff says form part of the advances under the Loan Agreement.  The respondent further pleads that pursuant to the common intention the plaintiff applied the net proceeds of sale of her residence to the acquisition of the Koonwarra Close property, and that pursuant to the common intention the respondent applied the net proceeds of the sale of his residence in the particular ways listed in the defence, and that the lounge suite was also acquired pursuant to the common intention.  The respondent denies that the plaintiff was ousted from the Koonwarra Close property and thus that the respondent is liable for occupation rent.

   The defence also contains a counterclaim for a declaration that the parties are joint legal and beneficial owners of the Koonwarra Close property, that it be sold and that the net proceeds should be divided equally between the parties or in such other proportions as the court orders.  Alternatively, there is a counterclaim for an accounting of the parties' respective contributions to the de facto relationship, a declaration that parties hold the net proceeds of sale of the Koonwarra Close property and any other assets of the de facto relationship in trust for themselves in proportion to their respective contributions, and an order that such net proceeds be paid to the parties in accordance with their respective contributions.  The defence also claims such further and other relief as the court may award and the respondent's costs of the action to be taxed and paid out of the plaintiff's share of the net proceeds of the Koonwarra Close property.

1. The Koonawarra Close property represented by far the most substantial asset or amount involved in the proceedings.

2. The result sufficiently appears for my purposes from Fathers [164] and [167] ‑ [173], [178] ‑ [184]:

   I have found that the plaintiff has made out her claims as follows:

   •to have lent $16,819.00 to the respondent, which became payable to her at the end of the de facto relationship;

   •that the respondent is liable to discharge the mortgage on the Koonwarra Close property and to pay the plaintiff $15,322.11, so as to equalise their contributions to the acquisition of the Koonwarra Close property;

   •that the respondent is not liable to the plaintiff for occupation rent in respect of his conduct in obtaining a Misconduct Restraining Order which had the effect of keeping the plaintiff out of the Koonwarra Close property; and

   •the respondent is liable in damages for conversion of the lounge suite purchased by the plaintiff in August 2000, damages which on the evidence before me are $800.00.

   .…

   The plaintiff's prayer for relief includes that in the event the Koonwarra Close property has not been sold (as appears to be the case) the property be sold pursuant to Property Law Act 1969 (WA), s 126 and the proceeds divided as the prayer requests.

   The respondent does not oppose the sale of the Koonwarra Close property and indeed his counterclaim also seeks an order for sale.  There is no doubt the plaintiff, as the holder of a 50 per cent share in the property, is entitled to a sale, absent a good reason appearing to the court not to order one.  No good reason so to do is apparent to me, or pressed on me.  The matters that need to be addressed then go to the application of the proceeds.

   The application of the proceeds requested by the plaintiff's prayer for relief was explained to me in terms that in effect the plaintiff should receive one-half of the proceeds of sale, presumably after deducting the sale costs, and the equalising payment from the respondent's share of the proceeds, apparently plus the interest on that amount.  The respondent's share of the proceeds should also bear the costs of the discharge of the mortgage.  The plaintiff's prayer for relief appears to me to go further than this, however, in also allowing for the payment from the respondent's share of the proceeds of sale of the amount of the principal under the loan agreement plus interest as I have indicated.  It does not seem to me that it would be appropriate to burden the respondent's claim to a share in the proceeds in this way:  it is not suggested that performance of the loan agreement was part of the equalisation of the respondent's contribution to the acquisition of the Koonwarra Close property, nor does the liability arising under it in my view impeach the respondent's claim to his proper share of the proceeds (Meagher, R P, Heydon D and Leeming, M, Equity Doctrines and Remedies 4th ed Sydney, LexisNexis Butterworths 2002 at [37-045], on equitable set off).

   However, in respect of the sale the respondent has as alternative relief sought an accounting of the parties' respective contributions to their de facto relationship, and a declaration that the net proceeds of the sale of the Koonwarra Close property and any other assets of the relationship be held in trust for themselves in proportion to their respective contributions.  I return below to the matter of other assets of the relationship.

   As to the net proceeds of the Koonwarra Close property, after allowance for the respondent's equalisation obligations as I have referred to them, which appear to me to be appropriately so allowed for, it also seems to me that the respondent has sufficiently called for the application of the equitable principles which provide for the possibility of an allowance to be made out of the proceeds of the sale under s 126 in respect of improvements and repairs which are capable of enhancing the value of the property. There is also the possibility under those principles, in this case, of an allowance proportionate to the other co-owner's (the plaintiff's) beneficial interest in the property for outgoings for the preservation of the property, such as payments of rates, taxes, insurance premiums, and other items, such as grounds and maintenance expenditures. (While this allowance may in suitable cases extend to mortgage repayments, that would not be appropriate in this case, for the reasons I gave earlier.) The possibility of allowances of both sorts being so made in proceedings such as these was recognised in Silvester v Sands [2004] WASC 266 per Heenan J at [139 ‑ 141].

   However, in respect of an allowance for expenditure capable of enhancing the value of the property, it must be shown that the expenditures in question did have that effect; and the allowance is for the lesser of the expenditure or the enhancement:  Silvester (supra) at [140] and Meagher et al (supra) at [25-065]. I have already found that the plaintiff agreed to a number if not all of the expenditures. However, it does not appear to me that this changes the basis upon which an allowance may be claimed, as I do not consider this agreement extended to paying her share of the expenditures or the increased value they produced. However, there is no allowance where there was an intention the improvements were to be part of the improver's contributions to the property to be shared as the property was shared: Noack v Noack [1959] VR 137 at 142 - 143 per Dean J, quoted with approval by Kennedy J in Guthrie v Millar [sic Millar v Guthrie, unreported; FCt SCt of WA; Library No 970552B; 28 October 1997] at 7.  I have already found there was no linkage between any improvements and the respondent's interest in the property, which rests on equality of contributions.  On that basis I consider that there was no disqualifying intention in this case.

   Further, in respect of allowances both for increases in the value of the property and the other expenditures I referred to, the person claiming the allowance is chargeable with an occupation rent in respect of the period in which the claimant enjoyed sole possession of the premises:  Silvester(supra) at [141]. That period in this case runs from 31 July 2002 (the date at which I found the respondent entered possession of the property) to the date on which the assessment is to be made or the date possession ceased, whichever is the earlier.

   …

   There is no evidence before me of the market rent the Koonwarra Close property could have commanded over the period in question.  It seems to me unlikely that the total of the renovations and other expenditure amounts, plus labour costs (some of which are disputed by the plaintiff, as work done by others than the respondent) or $16,679.56 will exceed the market rent for the period till the end of November 2004.  On that basis, it seems unlikely that on an accounting for the expenditures in fact made from the respondent's schedules and the allowable labour costs, as well as the expenditure since, and occupation rent, there will be any allowance to the respondent.  However, as I have said, the respondent has called for an accounting and it seems to me to be established that enquiries and accounts should be ordered where the parties, or it seems one of them, have called for such enquiries and accounts, and there is a basis for them:  Re Pavlou (a bankrupt) [1993] 1 WLR 1046 per Millett J at 1049 ­ 1050; Re Gorman (a bankrupt)[1990] 1 WLR 616 at 626 per Vinelott J, Mervyn Davies J agreeing; and Silvester (supra) at [141].

   In accordance with those authorities, inquiries should be made to determine what expenditures the respondent made, and what labour he contributed, producing what if any increases in value of the Koonwarra Close property, and what other expenditures he made to preserve the property, as well as the market rent for the property over the period the respondent has been in sole occupation of the property, and the accounts using the results.

   So far as other assets of the de facto relationship are concerned I understand this to refer to assets acquired during the course of the relationship used for the benefit of both parties.  The only ones that the evidence revealed in any way were the lounge suite and the campervan, to whose acquisition I have already referred.

   I note that the respondent appeared to argue before me that account should also be taken of all of the expenditures the parties made by way of contribution to the de facto relationship, to determine what allowance should be made to the respondent out of the proceeds of sale of the Koonwarra Close property.  I do not consider that enquiries and accounts should be ordered for that purpose.  As I have indicated in relation to the common intention on which the respondent relies, this is not a case of parties to a de facto relationship having pooled their assets or even their earnings for the purposes of the joint home represented by the Koonwarra Close property.  There is evidence of a limited pooling, at least in the form of the Reward Plus joint account.  I put aside the other joint accounts, being the mortgage account, on the basis of my findings in relation to the acquisition of the Koonwarra Close property, and the Dream Saver account, on which there were no operations by the parties other than the plaintiff's payment in and withdrawal, on the evidence before me.  However, the Reward Plus account was not established until some time after the acquisition of the Koonwarra Close property.  It was not directed towards the acquisition of or related to the property but rather the general purposes of their relationship, particularly living expenses, but not only those.  Its operation does not appear to me to be capable of giving rise to a beneficial interest in that property, resting on the unconscionability of allowing a party to take an interest in property without qualification for the contribution to the other, in the way that the contributions of the parties in Baumgartner (supra) did.  See Lloyd (supra) per Murray J at [12].

   I have already indicated my finding as to the lounge suite.  As to the campervan which was paid for out of the proceeds of the sale of 57 Williamson Avenue, as I have previously indicated there is evidence that the campervan was sold by the respondent, although the evidence is less clear as to the proceeds, or what has happened to them.  However, the plaintiff has made no claim in respect of the campervan, and I do not need to pursue it further.

   There is also evidence that the respondent made expenditures in relation to the plaintiff's property which were not contributions to the acquisition of the property. The property concerned was of two sorts. One was computer equipment to which in 2000 the respondent contributed the cost of supplementary equipment, and upgrading. There is some dispute as to the quantum of the contribution in the former case. There is also evidence of the respondent having contributed in 2000 to the cost of repairs and replacement parts for the plaintiff's car. However, I do not consider I need to pursue the matter further. It does not seem to me that the respondent should be seen to have acquired a proprietary interest in such cases: see Meagher, R P and Gummow, W M C, Jacob's Law of Trusts in Australia 6th ed, Sydney, Butterworths 1997 at [1219].

   Accordingly, I do not consider any further enquiries for accounting beyond that in respect of expenditures the respondent made on the Koonwarra Close property as I have indicated should be ordered.

My conclusion

1. In my view, the result on all of the substantial matters in issue, and one of the less substantial ones, was success for the plaintiff.  In addition the plaintiff achieved a measure of success on the remaining less substantial issue.

2. Those substantial matters were liability to discharge the mortgage referred to, the equalisation payment and the amount due in respect of the loan obligations referred to.  While it is true that the plaintiff did not succeed in her claim as to the way in which the proceeds of sale of the property should be applied as indicated in [170], I do not consider that in practical terms substantially qualified the success described.  Nor do I consider that the order of the application of the proceeds of the sale as provided for in the judgment after trial of 31 January 2008 represented such a qualification.

3. The less substantial claim in respect of which the plaintiff succeeded was that for damages for conversion of the lounge suite. While she did not succeed directly on her claim for occupation rent, she did succeed in having an allowance made for it, of a size considered in the judgment as likely to offset the principal set of claims on which the defendant succeeded: see [173] read with [178]. I also note the eventual provision for these claims in the judgment after trial of 31 January 2008.

4. The basis for the response by the defendant to the claims of the plaintiff, of a common pooling arrangement, was not made out at trial. The defendant's success in respect of the principal set of claims for which he was successful was substantially qualified by the allowance for occupation rent referred to: see [178]. Further, those claims were in terms of trial time and the amounts at stake significantly less substantial matters that the substantial claims in respect of which the plaintiff was successful.

5. It is true that in the period immediately prior to the action the plaintiff ceased to cooperate in relation to the sale of the property.  However, it seems to me that this has no direct bearing on the assessment of the result on the issues which caused the plaintiff to bring these proceedings.  At no point in the proceedings was there any question but that the property would be sold.  The substantial issues went to the financial adjustments arising out of the end of the de facto relationship that had led to that sale.  The plaintiff's position as to the principles by which that adjustment should be guided was made out where the defendant's position was not.

6. In my view, although the matter is not a straightforward one, the plaintiff was successful in the action, and should have her costs, to be taxed if not agreed.