Judgment of the Honourable Auxiliary Justice Bochner
EQUITY - TRUSTS AND TRUSTEES - EXPRESS TRUSTS CONSTITUTED INTER VIVOS - QUISTCLOSE TRUSTS
ESTOPPEL - ESTOPPEL BY CONDUCT - ACT, OMISSION OR ASSUMPTION - REPRESENTATION GENERALLY
GIFTS - GIFTS INTER VIVOS
ESTOPPEL - ESTOPPEL BY CONDUCT - PROMISSORY ESTOPPEL
FAMILY LAW AND CHILD WELFARE - DE FACTO AND OTHER RELATIONSHIPS UNDER STATE LEGISLATION
RESTITUTION - GENERALLY
The parties commenced a personal relationship in about August 2014, during which the applicant gave the respondent, amongst other things, large sums of money and a luxury motor vehicle. When the relationship broke down, the applicant sought the return of the money remaining in the respondent’s bank account and the motor vehicle, on the basis that they were not gifts, but that the respondent held the moneys on a special purpose trust for the applicant, and the motor vehicle remained his. The respondent asserted that the money and the motor vehicle were gifts to her. She further claimed that the parties were in a de facto relationship within the meaning of the Family Law Act 1975, and sought a declaration accordingly.
Held: the applicant's claim is dismissed; the respondent's cross-claim is dismissed.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
H, AW v K, S [2021] SASC 128
Case
[2021] SASC 128
Decision Date
CaseChat Overview and Summary
The case of H, AW v K, S involves a dispute between the applicant and the respondent regarding ownership of money and a motor vehicle given by the applicant to the respondent. The applicant, born in 1958 and a dual citizen of Australia and the United States, is self-employed and owns properties in Australia and the United States. The respondent, an Australian citizen born in 1984, is a single mother with a son from a previous relationship. The court was required to decide whether the money and motor vehicle given by the applicant to the respondent were gifts or loans, and whether there existed a de facto relationship between the parties. The court also needed to determine if the applicant's conduct was unconscionable, and if the respondent suffered a detriment as a result of the applicant's departure from certain assumptions.
The court found that the money and motor vehicle were gifts, and not loans. The applicant's claim for restitution was dismissed. The court also found that the respondent did not suffer any detriment due to the applicant's conduct and that the conduct was not unconscionable. The court held that the parties were not in a de facto relationship, dismissing the respondent's cross-claim. The court found the applicant's evidence to be evasive and unhelpful, while the respondent was considered a weaker party in the relationship due to the significant financial disparity between the parties. However, this disparity did not affect the respondent's ability to make judgments about her best interests.
The court dismissed both the applicant's claim and the respondent's cross-claim. The applicant's claim for restitution of the money and motor vehicle was dismissed, as the court found that the items were gifts and not subject to a claim in restitution. The respondent's cross-claim, which relied on the applicant's unconscionability and detriment suffered by the respondent, was also dismissed as the court found no unconscionability and no detriment. The court found no de facto relationship between the parties, dismissing the respondent's cross-claim on this basis as well.
Orders
Orders of the court
Held: the applicant's claim is dismissed; the respondent's cross-claim is dismissed.
Background
Background to the litigation
I also consider that Mr Antoniou, Mr O and Mr R were reliable witnesses, although I place little weight on Mr Antoniou’s evidence. It was clear that he did not have much independent memory of this interactions with the parties, save for what was recorded in his notes. The parties and their backgrounds The applicant was born on 16 September 1958 and holds dual citizenship of Australia and the United States of America. He gained Australian citizenship in 1999, although says that he did not tell the respondent that he was an Australian citizen. When in Australia, he spends the majority of his time in New South Wales or Queensland. He holds a New South Wales driving licence. The applicant is self-employed and travels for work in Australia, the United States and Europe. He is able to work remotely using a smart phone and a computer. As well as owning a residence in Point Piper, New South Wales, the applicant also has a residence in Pebble Beach, California. The applicant has never been married, nor does he have children. The respondent is an Australian citizen who was born in Adelaide in 1984. She has a son, IK, who was born in 1999. She left school when she was in year 11 because she was pregnant. The respondent has worked in various occupations and commenced, but did not complete, a Bachelor of Laws and Legal Practice. At the time she met the applicant, the respondent was living with IK at her father’s home in the Adelaide Hills and worked as a part‑time sales consultant at the dealership and a designer clothes store (“the clothes store”). The respondent obtained an order for sole parental responsibility in respect of her son when he was ten years old, because of his father’s violent disposition. From that time, she had no contact with him and IK has had no contact with him since he was eleven years old. In 2006, the respondent completed the equivalent of year 12 through Open Access UniSA. She applied to University to commence a Bachelor of Laws and Legal Practice, and started this degree in 2007. At this time, she was also working in her then partner’s business. She ceased working in this business in 2008, when that relationship broke down. She commenced working at the dealership in 2009, initially on a casual basis in the marketing department. In 2012, the respondent moved to a sales role at the dealership. In 2011, she commenced working part time at the clothes store, and at the time that she met the applicant, was employed on a permanent part time basis at both the dealership and the clothes store. She says that she resigned from her position at the clothes store at the request of the applicant. The commencement of the relationship and the relationship generally The parties first met in May 2014 at the dealership while the applicant was looking to buy a car for a business he had in South Australia. The applicant subsequently sent a box of T-shirts to the respondent and a colleague, along with a photograph of himself and his mother. The respondent was told by her colleague that the applicant wanted her to contact him directly to thank him for the gift and she did so on her personal phone after work. While the applicant was at the dealership, the respondent saw a copy of his driver’s licence. This recorded his date of birth as 16 September 1969, rather than 1958, the true year of his birth. She says that she was unaware of the applicant’s true age until the commencement of this action.
Evidence
Evidence Before The Court
The trial of this matter proceeded over some nine days. At trial, the ownership of the money and the motor vehicle remained the outstanding issues in dispute between the parties on the applicant’s claim. The main issue in contention on the counter claim was the existence of a de facto relationship.The evidence Each of the witnesses, including the applicant and respondent, gave their evidence in chief by way of affidavit. The applicant gave evidence himself, and called two other witnesses, CR (“Mr R”), the respondent’s former partner, and JMO (“Mr O”), the respondent’s current partner. Mr R and Mr O were called as rebuttal evidence, and not as part of the applicant’s primary case. As well as giving evidence herself, the respondent called her mother, DFM, her son, IK, Gary Antoniou, a salesman at Mercedes-Benz Unley, and Dr Wendy Raymond, the landlord of the North Adelaide house rented by the respondent. Over the course of their relationship, the applicant and respondent exchanged over 5000 text messages. Indeed, the text of 5468 messages was exhibited to the respondent’s affidavit of evidence in chief. Only those messages that were put to a witness during cross examination were tendered. In considering this matter, I have not had regard to the many hundreds of messages that were not put to witnesses and therefore not tendered. I did not find either of the parties to be satisfactory witnesses. In cross‑examination, the applicant tended to preface his answers with words such as, “I’m going to say…”, “I will say…”. The respondent submitted that I should find, as a result of these types of prefaces, that the applicant was not straightforward in his evidence. She further submitted that the applicant was not truthful in his evidence about whether the money and the cars were gifts, and that there were significant inconsistencies in his evidence, such as referring to both the Gilberton and North Adelaide properties as “our home” in various communications, but then denying that they were his places of residence in evidence.[1][1] See for example R16, SK 60 at p 1599-1600 and 1603. I do not make any adverse findings in respect of the applicant’s evidence as a result of the way he introduced many of his answers. I regard this more as a mannerism that did not betoken evasion or lack of candour. There were, however, various inconsistencies in his evidence, particularly with some of the communications between the parties during the relationship. I will deal with the more significant ones in the course of this judgment. Overall, they have caused me to doubt the truth of much of the applicant’s evidence, which I frequently found to be evasive and unhelpful. I also consider that the applicant was not truthful in all of his dealings with the respondent. He lied to her about his age.[2] He also lied to her towards the end of their relationship when he told her that he had caused a woman to go to prison when she stole money from him. He misled the respondent when she raised her concerns with him that she was being followed, in that, while he told her (correctly) that his lawyer had not arranged surveillance of her, he did not tell her that he had done so himself, and he in fact encouraged her to believe that she was paranoid about this.[3] [2] See, for example, R16, SK60 and T172.13-20.[3] See R16, message no 5403.
Decision
Reasons for decision
While I am prepared to conclude that the respondent was the weaker party in her relationship with the applicant, on the basis of the significant disparity in their financial positions, I do not consider that this, or any of the other factors pleaded by the respondent, such as her relative youth and inexperience in business matters were sufficient to affect her ability to make a judgment about what was in her best interests, at the time that she entered into the relationship. Further, it was not clear from the respondent’s submissions, either oral or written, what transaction or bargain she was seeking to have set aside as a result of the applicant’s unconscionability. It was not clear to me that the transaction of entering into the lease of the North Adelaide property was the one that she sought to have set aside. Given the complete lack of clarity in this regard, there can be no finding the conduct of the applicant was unconscionable. Conclusion I have determined that the moneys and the black Mercedes that the applicant gave to the respondent were gifts, and not subject to a claim in restitution. As a result, the applicant’s claim is dismissed. I have determined that the respondent neither suffered a detriment as a result of the applicant’s departure from the assumptions that he had induced her to adopt, nor she was the victim of unconscionable conduct on his part. Thus, the respondent’s defence to the claims of the applicant fail on this basis, as does any independent cause of action raised by the respondent in her cross-claim which is reliant on them. Further, I have found that the parties were not in a de facto relationship. The respondent’s cross-claim is dismissed.