Henley v Bone

[2019] NSWSC 254

Supreme Court

New South Wales

Medium Neutral Citation:

Henley v Bone [2019] NSWSC 254

Hearing dates:

6, 7 February 2019

Decision date:

18 March 2019

Jurisdiction:

Equity

Before:

Emmett AJA

Decision:

Direct the first defendant to file and serve no later than 1 April 2019 short minutes of proposed directions and orders.
List the proceedings for directions and orders on 8 April 2019.

Catchwords:

EQUITY – trusts and trustees – resulting trusts – presumption of advancement – whether son held property on trust for mother – where son received benefit of first home owner’s grant and stamp duty concession

Legislation Cited:

Duties Act 1997 (NSW)
First Home Owner Grant Act 2000 (NSW)
Real Property Act 1900 (NSW)

Cases Cited:

Amit Laundry Pty Ltd v Jain [2017] NSWSC 1495
Calverley v Green (1984) 155 CLR 242; [1984] HCA 81
Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353; [1956] HCA 28
Dullow v Dullow (1985) 3 NSWLR 531
In re Kerrigan; Ex parte Jones (1946) 47 SR (NSW) 76
Jain v Amit Laundry Pty Ltd [2019] NSWCA 20
Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78
Nelson v Nelson (1995) 184 CLR 538; [1995] HCA 25

Category:

Principal judgment

Parties:

Anita Gertrud Henley (Plaintiff)
Brianna Casandra Jayne Bone (First Defendant)
Michael Frances Henley (Second Defendant)

Representation:

Counsel:

 

P O’Loughlin (Plaintiff)
A Cassidy (First Defendant)
No appearance (Second Defendant)

  Solicitors:
CH Law (Plaintiff)
Chinka (HEP) Steel (First Defendant)
No appearance (Second Defendant)

File Number(s):

2018/00040910

Judgment

Introduction

1. The question in these proceedings is whether the late Gregory Henley (Gregory), who died intestate between 3 and 13 March 2017, held the fee simple in a property situated at Ballina, New South Wales (the Property) on trust for his mother, the plaintiff, Anita Henley (Anita). The defendants in the proceedings are the only children of Gregory. The first defendant, Brianna Bone (Brianna) has been appointed to represent the estate of Gregory, no grant of administration having been made. I shall refer to the parties by their first names without intending any disrespect.

2. The proceedings were commenced by summons filed on 7 February 2018 and an amended summons was filed on 24 December 2018. The substantive relief claimed in the summons is a declaration that Gregory held the Property on trust for Anita. Anita also claims procedural orders for the transfer to her of legal ownership of the Property, which is under the Real Property Act 1900 (NSW) (the Real Property Act). Both Anita, and Brianna in her capacity as representative, appeared by counsel. Evidence-in-chief was given by Anita by affidavits and orally and she was cross-examined by counsel for Brianna.

Purchase of the Property

3. In 2010, Anita retired and sold her business in Victoria, as a result of which she held a sum in excess of $1 million in a bank account. She gave evidence that she had always wanted to live on the North Coast of New South Wales and, in early March 2011, travelled there for a few days with her daughter, Katarina (Katarina). Anita’s and Katarina’s purpose for travelling to the North Coast was to look at properties that would be suitable for Anita and Katarina to live in. That required a house that was wheelchair accessible, because Katarina is wheelchair bound as result of an accident some years ago.

4. Anita decided that she liked Ballina but found no property that she regarded as satisfactory. After they returned to Bendigo, where Anita was then living, Katarina suggested that Anita speak to Gregory to ask him to look on the internet to see if he could find a suitable property. Anita telephoned Gregory and said words to the following effect:

“Why don’t you look on the internet and see if you can find something suitable. If you see something nice then go and fly up and have a look at it because I don’t want to travel back up there again. If you think it’s suitable then I will be happy with it”

In her oral evidence-in-chief, Anita said that the following exchange took place between her and Gregory:

“Anita:   Would you look on the internet, please, and see if you can find a house for me and it also has to be suitable for Katarina, she needs to have wheelchair access.

Gregory:   Well, I[’ll] look, and I[’ll] let you know.”

5. Anita said that a few weeks went by and then Gregory telephoned her and said that he had found “a couple which would be suitable” and he would have to fly or drive to Ballina to look at them and make sure they were suitable. Anita said that Gregory subsequently telephoned her and said that there was one property that was the best of all of the properties and that:

“[It w]ould be good for you because there are no steps for you and then there’s certainly no steps for Katarina and so you want me to buy that house for you?”

Anita said that the following exchange occurred:

“Anita:   You sure it’s alright for Katarina to get in with the wheelchair?

Gregory:   Yes, it’s the best one of the lot.

Anita:   Well, go and buy it for me then.”

6. A couple of days before 9 March 2011, Gregory telephoned Anita and said words to the following effect:

“I have found a Property and it’s the best one I’ve seen which would be good for Katarina. It’s on the market for $520,000 but there is another buyer looking. … There are other people interested in the property and now they’re wanting to go to auction on 24 March”

Anita told Gregory to offer them some more money and to start with $5,000 extra. Gregory subsequently telephoned Anita and told her that the vendor had accepted the extra $5,000. The purchase price agreed was $525,000.

7. On 9 March 2011, Anita’s account with National Australia Bank Limited (NAB) was debited with the sums of $24.61 and $52,500. The notation for each debit was:

“To 3088–xx17”.

There is no evidence as to the account to which that notation refers. For example, there is no evidence that it refers to an account of Gregory’s or of a real estate agent. As appears below, it is clear enough that the transfer of $52,500 was a transfer of the amount of the deposit payable in connection with the purchase of the Property.

8. On 23 March 2011, Gregory, as purchaser, entered into a contract with Ms Helen Adkins, as vendor, in the form of the 2005 edition of the Contract for the Sale of Land approved by the Law Society of New South Wales and the Real Estate Institute of New South Wales (the Contract). The Contract provided for the sale of the Property by Ms Adkins to Gregory for a price of $525,000, with a deposit of $52,500 to be paid to the agent, LJ Hooker Real Estate (the Agent). Completion was to occur on the 35th day after the date of the Contract. Clearly enough, the debit to Anita’s account of the sum of $52,500 on 9 March 2011 was for the payment of the deposit under the Contract. Whether the payment was made to an account of Gregory or directly to an account of the Agent is unknown. The Contract named Clarissa Huegill & Associates Pty Ltd, Lawyers (Huegill & Associates) as Gregory’s conveyancers and Robson & Oliver as Ms Adkins’ conveyancers.

9. On 28 March 2011, Anita’s account with NAB was debited with the sum of $5,696.50, with the notation “[w]ithdrawal”. On 4 April 2011, Huegill & Associates received notification dated 29 March 2011 from its banker, Australia and New Zealand Banking Group Limited (ANZ), that the sum of $5,696.50 had been received from NAB on behalf of Anita and that Huegill & Associates’ account had been credited with that sum. It appears that Huegill & Associates assumed that the funds were paid by Anita for Gregory’s benefit and established a trust account in Gregory’s name (Gregory’s Trust Account). A trust account statement issued by Huegill & Associates in respect of Gregory’s Trust Account (the Trust Account Statement) records a deposit of the sum of $5,696.50 on 29 March 2011 with the following notation:

“Received from: Mr Gregory … Henley

…

Reason: Stamp duty and Torrens Assurance Levy”.

10. The Trust Account Statement records a withdrawal of the sum of $5,642.50 on 5 April 2011 with the following notation:

“Paid to: Office of State Revenue.

Reason: Stamp Duty.”

The Contract bears a stamp of the Office of State Revenue showing that duty of $5,622.50 was paid in respect of the Contract. The discrepancy of $20 is not explained. The Trust Account Statement also shows a withdrawal shortly thereafter of the sum of $54 with the following notation:

“Paid to: LPMA

Reason: Torrens assurance levy.”

That left a nil balance in Gregory’s Trust Account.

11. On 6 April 2011, Anita’s NAB account was debited with the sum of $473,955.77 with the notation “withdrawal”. On 11 April 2011, Huegill & Associates received a notification dated 6 April 2011 from ANZ that the sum of $473,955.77 had been received from NAB on behalf of Anita and that Huegill & Associates’ account had been credited with that sum. The Trust Account Statement records a deposit on 7 April 2011 of the sum of $473,955.77 with the following notation:

“Received from: Mr Gregory … Henley [address]

Cobram VIC 3644

Reason: Settlement Monies.”

12. The Trust Account Statement records a withdrawal on 7 April 2011 of the sum of $472,783.77 with the following notation:

“Paid to: Robson & Oliver Law Practice Trust Account.

Reason: Settlement Funds.”

On 13 April 2011, a withdrawal for fees and disbursements and a deposit for reimbursement of bank fees were recorded, leaving a nil balance in Gregory’s Trust Account.

13. On 6 April 2011, Gregory signed a declaration forming part of an application for exemption or concession from stamp duty (the Concession Application). Section 3 of the Concession Application gave particulars of the Contract and of the Property and specified a dutiable value of $525,000. Sections 2, 4 and 5 specified Gregory as “the applicant”, “the purchaser” and the “eligible purchaser” respectively. Section 7 of the Concession Application contained a declaration by Gregory relevantly as follows:

“1.   I have completed the application form and attached all relevant documents in support of this application.

2.   I have never owned residential property in Australia, either solely or with someone else.

…

4.   The interest I hold in the property is not held subject to a trust.

…

6.   At least one eligible purchaser will occupy the home that is the subject of this application as their principal place of residence for a continuous period of six months commencing within 12 months from the date of completion of the agreement or transfer …

…

7.   I undertake to notify the Commissioner if I fail to meet the residence requirement.

…

10   I acknowledge that I may be required to repay the concession or exemption or be liable for penalties and may also be prosecuted for making a false or misleading statement in or in connection with this application.”

14. It appears that the Concession Application was lodged with the Office of State Revenue and was acted upon, in that the amount of stamp duty paid was in fact a concession. The full ad valorem duty under the Duties Act1997 (NSW) (the Duties Act) would have been $19,115. Thus, it appears that, prior to completion on 27 April 2011, the application for exemption of 6 April 2011 must have been sent to the Office of State Revenue.

15. Also on 6 April 2011, Gregory completed an application (the Grant Application) under the First Home Owner Grant Act 2000 (NSW) (the Grant Act). Section 2 of the Grant Application specified Gregory as the applicant. Section 4 described the Property and referred to the purchase price of $525,000, the date of contract of 23 February 2011 (sic) and the date of settlement of 8 April 2011. Section 5 contained details for payment of the grant to an account with NAB in the name of Gregory.

16. Section 6 of the Grant Application is a declaration by Gregory dated 6 April 2011, relevantly saying as follows:

“1.   I have completed the application form and attached all relevant documents in support of this application.

2.   I declare that I have not previously received and retained the grant under the First Home Owner Grant Act 2000 or a corresponding Act in another State or Territory …

3.   I declare that I have not owned a home or had a relevant interest in a residential property within Australia prior to 1 July 2000.

4.   I declare that I have not owned and occupied, for a continuous period of at least six months, a residential property within Australia in which I acquired a relevant interest on or after 1 July 2000.

5.   I declare that the interest I hold in the property is not held subject to a trust.

…

7.   I declare that at least one applicant will be residing in the home that is the subject of this application as their principal place of residence for a continuous period of at least six months commencing within 12 months of completion of the eligible transaction …

8.   …”

Above Gregory’s signature is a declaration that he had read and understood the above and that the information provided in the application was true and correct.

17. Completion of the Contract took place on 8 April 2011. Following completion, Huegill & Associates lodged the relevant documents for registration of transfer of the fee simple in the Property from Ms Adkins to Gregory and on 18 April 2011 Gregory was registered under the Real Property Act as the proprietor of an estate in fee simple in the Property.

18. On 20 April 2011, Huegill & Associates wrote to the Office of State Revenue enclosing the Grant Application, a certified copy of the certificate of title for the Property and a certified copy of the Contract. Also on that date, Huegill & Associates wrote to Gregory at a post office box address in Victoria. The letter referred to “Purchase from Adkins”’ of the Property and relevantly said as follows:

“We have now received the Certificate of Title … in your name and enclose a copy for your records. We advise that, unless instructed otherwise, we will hold the original in safe custody on your behalf free of charge.

We also confirm that we have today lodged your Application Form for the First Home Owner Grant with the Office of State Revenue. We would expect you should receive communication from them within the next 21 days as to the outcome of your application.

…”

It is reasonable to assume that Gregory received a grant under the Grant Act, although there is no direct evidence about that matter one way or the other.

19. Following completion of the purchase of the Property, Gregory moved into the Property with his son, Michael. For the period of six months thereafter, Katarina also lived in the Property with Gregory and Michael. At that time, Anita was living in Bendigo.

20. Some six months after the Property was purchased, Katarina left the Property. Around that same time, Gregory and Michael also left the Property and returned to a house at Eleebana, on the New South Wales central coast, where they had been living prior to the purchase of the Property. The Eleebana property is owned by Anita. She said that she purchased the Eleebana property in 2005 to provide a stable residence for Gregory to assist him in gaining permanent custody of his son, Michael. Michael mostly lived with Gregory from 2005 when Michael was seven years old until about six months before Gregory’s death.

21. After Katarina and Gregory left the Property, Anita moved to the Property. She continues to reside in the Property.

22. It is clear, and indeed is not in dispute, that all of the funds applied in the purchase of the Property by Gregory under the Contract were provided by Anita. The issue is how the provision of the funds should be characterised. If the funds were never intended as a gift by Anita, such that they always remained her property, questions arise as to whether there was a presumption of a resulting trust in favour of Anita in respect of the Property, which, on that hypothesis, was purchased with Anita’s money. Alternatively, if there was a presumption of advancement of the funds by Anita to Gregory, Anita’s claim would fail.

Relevant Legal Principles

23. Where one person provides the whole of the purchase price paid for the purchase of property in the name of a second person, the question of whether the second person acquires a beneficial interest in the property depends on the intention of the first person. It will be presumed that the first person did not intend the second person to take beneficially and a resulting trust will arise in favour of the first person. For the presumption of a resulting trust to arise, the purchase price must have been provided by the first person in the character of purchaser and not, for example, by way of loan or gift to the second person. However, if there is such a relationship between the first person and the second person as will give rise to a presumption that the first person intended to give the second person a beneficial interest, there will not be a resulting trust in favour of the first person. [1]

    1. See Calverley v Green (1984) 155 CLR 242; [1984] HCA 81 at 246.

24. The presumption of advancement will arise where the relationship between the two persons is such that, in the absence of anything further, it would be assumed that the first person was intending to make a gift to the second person. For example, the presumption of advancement will arise where the relationship between the first person and the second person is that of mother and child. [2] Where property is purchased by a parent in the name of a child, the purchase is prima facie to be deemed an advancement and the resulting trust that would arise in favour of a person who pays the purchase price and takes a conveyance or transfer in the name of a stranger would not arise. [3] H

    2. See Nelson v Nelson (1995) 184 CLR 538; [1985] HCA 25 at 548-9.

    3. See Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353; [1956] HCA 28 at 364.

25. The exceptional cases in which equity assumes an intention of advancement, and thereby precludes a presumption of a resulting trust, are defined by reference to recognised categories of relationships, rather than by the actual presence of love or affection. While those relationships were the ones that equity originally saw as involving obligations of support owed by the person providing the consideration to the person who would otherwise be presumed to hold upon an implied resulting trust, the categories of relationships are not finally settled or closed. [4]

    4. See Calverley v Green at 268.

26. However, the relationship of parent and child is merely evidence of the intention of the parent to advance the child. That evidence may be rebutted by other evidence manifesting an intention that the child not take beneficially. Contemporaneous acts and contemporaneous declarations of the parent may amount to such evidence. It is necessary to look at what was said and done at the time of purchase. The acts and declarations of the parties before or at the time of the purchase and so immediately after the purchase as to constitute a part of the purchase transaction, are admissible as evidence either for or against the presumption. [5] The whole of the available evidence must be considered, including statements made by the person providing the purchase price of that person’s own intention. While the presumption may be rebutted, the evidence to rebut a presumption of advancement must be cogent. [6] The presumption is a strong one and must not be frittered away by “nice refinements”. [7] In a case where there is no relevant arrangement between the parties, the critical question may be whether there was an actual intention on the part of the person who contributed the purchase price to benefit the other party, and direct evidence of the first person of that person’s actual own intention is admissible. [8]

    5. See Charles Marshall v Grimsley at 365.

    6. See In Re Kerrigan; ex parte Jones (1947) 47 SR at 82.

    7. See In Re Kerrigan at 87

    8. See Calverley v Green at 270

27. Thus, three presumptions must be considered. The first presumption is that beneficial ownership is commensurate with the legal title. In the present case, legal title is clearly vested in Gregory, since he is the registered proprietor under the Real Property Act of an estate in fee simple in the Property. The second is the presumption of a resulting trust that a person who acquires legal title with funds provided by another person otherwise than by loan or gift holds the Property on trust for the provider of the funds. The third presumption is that, where there is a relevant relationship between the provider of the funds and the acquirer of the legal estate, the presumption of a resulting trust will be rebutted. The burden of rebutting a presumption of resulting trust, once that presumption arises, lies in the party denying the existence of the trust. On the other hand, the burden of rebutting the presumption of advancement, once the relevant relationship is shown to exist, lies with the person asserting the existence of a trust. [9]

    9. See, for example, Amit Laundry Pty Ltd v Jain [2017] NSWSC 1495 at [109] to [111].

Anita’s Evidence

28. The outcome of the proceedings turns essentially on the credibility of Anita. If I accept her evidence-in-chief at face value, that she asked Gregory to find a house “for her” that was suitable for Katarina, I do not understand Brianna to dispute that the presumption of advancement by mother to son would be rebutted. While it was not put directly to Anita that her evidence-in-chief was false, she was challenged on inconsistencies in her evidence, which are somewhat stark.

29. Anita’s principal evidence-in-chief was given by two affidavits, each of which was sworn on the same day. It is difficult to understand how both affidavits could have been sworn by Anita on the same day if she had paid any attention to their contents. The two affidavits contain inconsistent allegations, which emphasise the undesirability of proceedings involving disputed facts proceeding on affidavit evidence rather than evidence given via voce. How inconsistency occurred in affidavits sworn on the same day was unexplained. It suggests that the affidavits were not properly read and understood by Anita before they were sworn.

30. Paragraph 17 of one affidavit is in the following terms:

“At the time of the purchase it was my understanding that whilst I was giving Gregory the money for [the Property] it was to be purchased in my name. Before the sale was completed Gregory told me that he had to act urgently to ensure that he secured it and therefore he had put it in his name only. I have subsequently discovered that he also was eligible for the First Home Owner’s grant which he received after the sale was completed …"

Paragraphs 21(g), (h) and (i) of the other affidavit were relevantly in the following terms:

“(g)   I assumed that the property had been purchased in my name as I was providing all the money and had paid the deposit. Gregory and I never had an express discussion about in whose name the property would be purchased and I assumed he had signed the contract on my behalf.

(h)   I have subsequently discovered that Gregory was eligible for the First Home Owner’s Grant which he received after the sale was completed.

(i)   I was not aware that [the Property] was in Gregory's name until after he died when I attended upon Clarissa Huegill … who advised me her conveyancer Susannah Poole had acted for Gregory on the purchase and that the property was in Gregory’s name. She told me … that there is no mention of me in her file other than two ANZ Bank Transaction records showing payments by me to her trust account …”

31. Thus, in one of the affidavits, Anita said that it was her understanding, at the time of the purchase, that, whilst she was “giving” Gregory the money for the Property, the Property was to be purchased in her name. She said that, before the sale was completed, Gregory told her that he had to act urgently to ensure that he secured the Property and therefore he had put it in his name only. She asserted in that affidavit that it was not her intention that the Property would belong to Gregory and that he never said anything to her or did anything to indicate that he thought the Property was his.

32. In the other affidavit sworn on the same day, Anita said that she assumed that the Property had been purchased in her name, since she was providing all the money and had paid the deposit. She asserted that she and Gregory had never had an express discussion about whose name the Property would be purchased in and she assumed that Gregory had signed the Contract on her behalf. Anita asserted, in that affidavit, that she was not aware that the Property was “in Gregory’s name” until after he died when she attended Huegill & Associates, who advised her that the Property was registered in Gregory’s name. When the tension between the evidence given in the affidavits was drawn to Anita’s attention in cross-examination, her explanation was not entirely convincing. It was put to her that, contrary to paragraph 21(g) of one of the affidavits, paragraph 17 of the other affidavit was evidence of a discussion between Anita and Gregory about whose name the Property “was to be in” and Anita agreed with that proposition. She then asserted that that discussion “wasn’t the final discussion”. However, Anita agreed that, after that discussion, she never had any other discussion with Gregory and that the only subsequent discussion was about rates. She agreed with the proposition that she spoke to Gregory about the rate notices being in his name but not about the title to the Property.

33. Anita has paid all insurance premiums and rates in respect of the Property since it was purchased. However, rate notices issued by the Local Council were issued in the name of Gregory. Anita said in one of her affidavits that she “did not think much of this”, and that, when she raised the matter with Gregory by saying “[t]he rate notices are in your name”, Gregory replied to the effect “[d]on’t worry I will change it over one day”. Anita said that she said to Gregory “[t]hanks, okay, I am in no hurry”. She asserted in the affidavit that she did not realise that the fact that rate notices were issued to Gregory “indicated the property was in Gregory’s name”. Thus, Anita appears to draw a distinction between Council records as to the owner and the legal title to the Property. The possibility of a distinction between a property being registered with the Council in one name and being registered under the Real Property Act in another name was not explored in cross examination or re-examination.

34. Another inconsistency in Anita’s evidence asserted on behalf of Brianna concerned Gregory’s contribution to Anita’s former business. Paragraph 19 of one of Anita’s affidavits was in the following terms:

“From about 1997 until 2005 when he moved to Eleebana, Gregory worked with me in my business at Cobram in Victoria … He would work whenever required and in return rather than paying him a wage whenever he needs money or bills paid I would attend to those payments on his behalf. For example, I bought him vehicles over a period of time, I paid his accounts and gave him cash money from time to time. He also had business credit cards that he could use for his expenses which he did. At no time was the arrangement in respect of the [Property] a part of that arrangement as he had never done sufficient work for me, to justify him receiving a house for nothing.”

When it was put to Anita in cross-examination that Gregory, by working without a salary for a period of eight years, had made a “very, very significant contribution” to Anita's business, Anita responded:

“Yes, but I paid all of his accounts and. … It was quite a bit of money, which he wouldn’t have earned in those years … I bought a car for him, I bought motorcycles for him.”

It was then put to Anita that she had agreed that Gregory’s contribution to her business was “a very significant one”. Her response was:

“No not in that sense, no. … Because he wasn’t there on a permanent basis.”

35. Anita would not then agree that Gregory had made a “very significant contribution”. She then went on to assert that she needed somebody permanent to be on her staff, which Gregory was not in that “some holidays he came, some holidays he did not”. When it was put to her that her evidence in her affidavit was that whenever Gregory was required to work, he worked, Anita responded “[w]hen he was able to come”. Anita then asserted that if Gregory was living at Eleebana, on the New South Wales Central Coast, and there were no school holidays, Gregory could not come and work for her so that his working for her was limited to certain timeframes.

36. However, Anita said that Gregory ceased work for her in 2005 when the property at Eleebana was purchased. Anita failed to explain why Gregory’s inability to come from Eleebana except in school holidays was relevant prior to the purchase of the property at Eleebana in 2005. There was no evidence as to where Gregory lived from 1997 until 2005 when he moved to Eleebana.

37. Another curious aspect of the matter, upon which some light may possibly have been thrown, is the absence of evidence from Katarina and from the conveyancer who acted on the purchase of the Property. There was no suggestion that either of them was unavailable to give evidence.

38. No explanation was offered as to why Gregory, Michael and Katarina lived in the property for only six months and then moved out. In circumstances where Anita said that she wanted to buy the Property for herself and Katarina to live in, it would be curious if she did not say so to Katarina. Katarina may then have been able to give evidence to corroborate any assertion by Anita that she discussed with Katarina her intention to buy a house for herself and Katarina to live in.

39. One explanation for Gregory moving into occupation of the Property and staying for six months is that that was a requirement under the Grant Act and the Duties Act. As indicated above, Gregory declared that he would be residing in the Property as his principal place of residence for a continuous period of at least six months commencing within 12 months of completion of the purchase of the Property. The fact that Anita did not move into the Property until after the expiration of six months after completion of the purchase suggests that Anita may have been mindful of the prerequisite for six months continuous residence on the part of Gregory. In cross-examination, Anita denied having seen either the Grant Application or the Concession Application. With respect to the existence of the Grant Application, Anita stated in one of her affidavits:

“I have subsequently discovered that Gregory was eligible for the First Home Owner’s Grant which he received after the sale was completed.”

40. Read strictly, the statement that Gregory was eligible for the first home owner’s grant that he received operates as a concession that he took the Property as full legal owner. I do not adopt that strict reading. Clearly, the whole thrust of the proceedings is Anita’s claim that there was a resulting trust in her favour and that Gregory had no beneficial entitlement to the Property.

41. More significantly, the expression is unclear as to whether, and if so, when, Anita knew of the Grant Application. It was not specifically put to Anita that she delayed moving in until after the expiration of six months so as to satisfy that requirement. Acceptance of Anita’s evidence may well entail a conclusion that Gregory made a knowingly false declaration that the interest he held in the Property was not “held subject to a trust”. In that regard, the evidence of the conveyancer, Susanna Poole, may have thrown some light on Gregory’s actions. While Gregory’s state of mind may not be relevant, anything that he told the conveyancer about the arrangement and about discussions that he had had with Anita may well have been admissible evidence of Anita’s intention.

42. Another curious aspect of Anita’s conduct is the total absence of evidence of any communication between herself and the conveyancer acting on the purchase of the Property. While the evidence makes clear that the deposit and the balance of the purchase price were paid direct from Anita’s NAB account to Huegill & Associates’ trust account, Anita made no attempt to communicate with the conveyancer to give instructions in relation to the purchase or the application of funds transferred by her. Her explanation as to the urgency of exchanging contracts may explain the absence of communication prior to exchange, but it would not explain failure to communicate thereafter. There was no evidence of any communication between Anita and Gregory about the payment of the deposit or the stamp duty. Nor was there any evidence of any communication between Anita and Gregory about the payment of the balance of the purchase price.

43. It is improbable that a businesswoman such as Anita would invest more than $500,000 in the purchase of a property without taking some steps to obtain confirmation from the conveyancers acting on the purchase that she had acquired title to the Property. She made no effort, for example, to obtain at least a copy of the certificate of title, assuming she may have been prepared for the original to be retained for safe keeping by the conveyancers. However, there was no communication whatsoever until after Gregory’s death. In the meantime, the only material that came to Anita were rate notices indicating that the Property was owned by Gregory.

44. I would not draw the inference that Gregory’s contribution to Anita’s business from 1997 until 2005 was a motivation for making a gift to him of the funds necessary to enable him to buy the Property. While the evidence was somewhat vague, Anita asserted that she had paid substantial sums of money for Gregory’s legal fees in relation to Family Court proceedings and provided him with a house to live in at Eleebana, albeit owned by her.

The Question

45. The essential dispute in the present proceedings is whether the presumption of a resulting trust arises and whether that presumption is rebutted by a presumption of advancement to Gregory. In essence, Anita contends that she raised with Gregory the idea of buying a property at Ballina for her that was suitable for her and Katarina. Gregory did not contribute any funds for the purchase of the Property nor for the maintenance of the Property after purchase and at no time did he make any claim of having any interest in the Property. Anita had previously purchased the Eleebana property, which she made available to Gregory as a residence for him and Michael.

46. Anita’s evidence as to when she first became aware that Gregory was the legal owner of the Property is somewhat conflicting. It was not suggested, however, that Anita was fabricating her evidence as to the discussions that she had with Gregory prior to the purchase of the Property. Each of the applications made by Gregory under the Grant Act and Duties Act is consistent only with Gregory intending to be the beneficial owner of the Property. Evidence by Anita, while somewhat ambiguous, appears to deny that she had any knowledge of either of Gregory’s applications. It was not suggested that that apparent denial was false. On the other hand, the fact that Gregory left the Property after six months is consistent with his intending to satisfy the requirements of each of the Grant Act and Duties Act. One possibility is that Gregory made two false declarations that the interest that he held in the Property was not held subject to a trust. Of course, he was not available to give evidence as to his understanding or comprehension of the notion of a trust. It is not clear whether there was a previous relationship between Huegill & Associates and Anita in relation to legal matters. Nevertheless, it is significant that there was no mention in the conveyancing file of Huegill & Associates that the purchase of the Property was in any way for the benefit or on behalf of Anita.

47. It is clear that Anita had no communication with the vendor of the Property or the Agent in relation to the negotiations for the Property. It is also clear that Anita had no communication with the conveyancer who acted on the purchase of the Property. To all intents and purposes, Gregory was the purchaser, notwithstanding that the funds for the deposit, the stamp duty and the balance of the purchase price were provided by Anita. There is no evidence of any express discussion between Anita and Gregory concerning the payment of the deposit, the stamp duty and the balance of the purchase price. One might expect that there would have been communications along the lines of Gregory saying to Anita that the deposit had to be paid, presumably to the Agent. One might have expected evidence of a communication from Gregory to Anita in relation to the transfer of funds for the stamp duty and the balance of the purchase price.

48. It is possible to conclude that conversations such as those deposed to by Anita occurred between her and Gregory prior to 23 March 2011, when the Contract was signed. However, clearly enough, Gregory was aware of the first home owner grant scheme under the Grant Act, since he completed the Grant Application, which was sent by Huegill & Associates to the Office of State Revenue. While there is no reason to conclude that Anita saw the Grant Application or the Concession Application prior to Gregory’s death, it appears to me to be more likely than not that she was aware of the desirability for Gregory to be the purchaser of the Property in order to obtain the benefit of a grant under the Grant Act and the concession under the Duties Act. That is consistent with the fact that Gregory lived in the Property for six months after purchase and then moved out to enable his mother to move in.

49. No submission was made that the Grant Application, the Concession Application and the Contract being in the name of Gregory constituted a sham. Further, I do not consider there is a basis for concluding that Gregory may have been guilty of a serious offence in making a false declaration in the Grant Application and the Concession Application. I consider that it is more likely than not that, while Anita expected and intended that Gregory would deal with the Property as she wished and directed, Anita’s intention as to the beneficial ownership of the Property was that it would be owned by Gregory, who would get the benefit of the first home owner grant and the duty concession, but that, after the prerequisites for that grant had been satisfied, Gregory would, in effect, permit Anita to treat the Property as her own. That is, I find that it was Anita’s intention at the time of purchase that Gregory would be the beneficial and legal owner of the Property, but that his ownership would be subject to a personal obligation to permit Anita to treat the Property as her own. [10]

    10. See Jain v Amit Laundry Pty Ltd [2019] NSWCA 20, [114], [130], [134] (Beazley P). See also Dullow v Dullow (1985) 3 NSWLR 531 at 540 (Hope JA) and Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78 at 604, 607 (Brennan J).

50. I have made a finding as to Anita’s actual intention, at the time of purchase, concerning the beneficial ownership of the Property. Accordingly, there is no scope for the operation of the presumption of resulting trust or the presumption of advancement. [11]

    11. Calverley v Green at 251.

Conclusion

51. It follows that Anita’s prayers for relief must fail. There is no cross-claim on behalf of Gregory’s estate. Whether or not there would be an estoppel preventing Gregory’s legal personal representatives, once appointed, from seeking possession of the Property from Anita is not presently before me. Such questions must be decided in other proceedings. Lest there be a question of an issue estoppel or Anshun estoppel, Brianna may wish to give consideration to possible amendment of these proceedings. Accordingly, I will make no orders until the parties have had an opportunity of considering the conclusions I have reached and my reasons for those conclusions. I propose to direct Brianna to bring in short minutes of any orders or further directions that she seeks and will list the proceedings for directions at a convenient time to make orders.

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Endnotes

Decision last updated: 18 March 2019