Henderson v Miles (No 2)

Case [2005] NSWSC 867


CITATION:

Henderson v Miles (No 2) [2005] NSWSC 867

HEARING DATE(S): 28/07/05
 
JUDGMENT DATE : 


30 August 2005

JURISDICTION:

Equity Division

JUDGMENT OF:

Young CJ in Eq

DECISION:

Charge of $32,000 granted in favour of plaintiff.

CATCHWORDS:

EQUITY [33]- "Windfall equity"- Dwelling built by mother on daughter and son-in-law's land- Breakdown in relations- No attributable blame- Mother entitled to minimum equity necessary to remedy unconscionable retention of defendants' windfall- Discussion of principles involved in determining appropriate remedy in "windfall equity" cases- General preference is to remedy the detriment suffered in reliance on promise rather than fulfilling expectation- In this case no relevant detriment- Unconscionable for defendants to retain windfall- Plaintiff entitled to charge for increase in value of defendants' land.

CASES CITED:

Atwood v Maude (1868) LR 3 Ch App 369
Baker v Baker [1993] TLR 95
Bawden v Bawden [1997] EWCA Civ 2664
Baumgartner v Baumgartner (1987) 164 CLR 137
Bennett v Horgan (Bryson J, 3 June 1994, unreported)
Callaghan v Callaghan (1995) 64 SASR 396
Chalmers v Pardo [1963] 1 WLR 677; [1963] 3 All ER 552
Commonwealth v Verwayen (1990) 170 CLR 394
Crabb v Arun DC [1976] Ch 179
Forgeard v Shanahan (1994) 35 NSWLR 206
Gillett v Holt [2001] Ch 210
Hall v Goulding (Powell J, 23 March 1983, unreported)
Holiday Inns Inc v Broadhead (1974) 232 EG 951
Jennings v Dixon (Powell J, 21 February 1983, unreported)
Jennings v Rice [2002] EWCA Civ 159
Luke v Chamberlain [2000] NSWSC 626
Lyon v Tweddell (1881) 17 Ch D 529
Malsbury v Malsbury (1979) [1982] 1 NSWLR 226; 1 BPR 9950
Morris v Morris [1982] 1 NSWLR 61
Muschinski v Dodds (1985) 160 CLR 583
Nichols v Nichols (1986) 4 BPR 9240
Ottey v Grundy [2003] EWCA Civ 1176
Pearce v Pearce [1977] 1 NSWLR 170
Plimmer v Mayor of Wellington (1884) 9 App Cas 699
Public Trustee v Wadley (1997) 7 Tas R 35
Riches v Hogben [1985] 2 Qd R 292
Sledmore v Dalby (1996) 72 P & CR 196
Stoklasa v Stoklasa [2004] NSWSC 518
Svenson v Payne (1945) 71 CLR 531
Tanner v Tanner [1975] 1 WLR 1346; [1975] 3 All ER 776
Taylor Fashions Ltd v Liverpool Victoria Trustee Co Ltd [1982] QB 133
Tito v Waddell (No 2) [1977] Ch 106
Unity Joint Stock Mutual Banking Association v King (1858) 25 Beav 72; 53 ER 563
Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387

PARTIES:

Annette Patricia Henderson (P)
Paul Burnie Miles (D1)
Monica Christine Mason (D2)

FILE NUMBER(S):

SC 2219/03

COUNSEL:

J C Pentelow (P)
M Gorrick (D)

SOLICITORS:

Adams & Partners (P)
Fishburn Watson O'Brien (D)

LOWER COURT JURISDICTION:


IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

YOUNG CJ in EQ

Tuesday 30 August 2005

2219/03 – HENDERSON v MILES (NO 2)

JUDGMENT

1 HIS HONOUR: I gave judgment in this matter on 20 July 2005; [2005] NSWSC 710. I indicated that in my view the only relief to which…

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Henderson v Miles (No 2) [2005] NSWSC 867
Case
[2005] NSWSC 867
Decision Date

CaseChat Overview and Summary

In the case of Henderson v Miles (No 2), the plaintiffs sought to recover equity from the defendants, who were their daughter and son-in-law. The plaintiffs had built a dwelling on the defendants' land, but the relationship between the parties deteriorated, leading to the plaintiffs seeking to reclaim their equity. The dispute was heard in the Supreme Court of South Australia. The primary legal issue before the court was the appropriate remedy in cases where there has been an unconscionable retention of a "windfall equity" by the defendants. Specifically, the court had to determine whether the plaintiffs were entitled to the minimum equity necessary to remedy the unconscionable retention by the defendants, who had benefited from the plaintiffs' investment in the property without any attributable blame.

The court considered the principles involved in determining an appropriate remedy in "windfall equity" cases, noting that the general preference is to remedy the detriment suffered in reliance on a promise rather than fulfilling the expectation. However, in this instance, there was no relevant detriment suffered by the plaintiffs, and thus, the focus shifted to whether it would be unconscionable for the defendants to retain the windfall. The court concluded that it would indeed be unconscionable for the defendants to retain the windfall equity and thus, the plaintiffs were entitled to a charge for the increase in value of the defendants' land. This decision underscores the court's commitment to preventing unjust enrichment where one party has unfairly benefited at the expense of another.

The court's reasoning was grounded in the principles of equity and unconscionability, finding that the defendants had unconscionably retained the equity that resulted from the plaintiffs' investment in the property. The court did not find it necessary to award the full amount of equity to the plaintiffs, but rather, the minimum equity necessary to remedy the unconscionable retention. This approach ensures that the defendants are not unjustly enriched while also acknowledging the plaintiffs' investment and contributions. The final orders of the court mandated that the defendants pay a charge to the plaintiffs for the increase in value of the land, reflecting the court's determination that the defendants should not retain the windfall equity without contributing appropriately.

Orders

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

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Ratio Decidendi

Legal Principle Established

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