Joan Phyllis Quinn v Susan Bryant
[2011] NSWSC 1153
•14 October 2011
Supreme Court
New South Wales
Medium Neutral Citation: Joan Phyllis Quinn v Susan Bryant [2011] NSWSC 1153 Hearing dates: 9 June 2011, 10 June 2011, 2 September 2011 Decision date: 14 October 2011 Jurisdiction: Equity Division Before: Sackar J Decision: See paragraphs 152 - 156 of Judgment
Catchwords: Promissory estoppel - Constructive Trust - Equitable damages - Detriment - Reliance Legislation Cited: Guardianship Act 1987 Cases Cited: Muschinski v Dodds (1985) 160 CLR 583
Tasevska v Vlado (Larry) Tasevski & Anor [2011] NSWSC 174
Sullivan v Sullivan [2006] NSWCA 312
Briginshaw v Briginshaw (1938) 60 CLR 336
Browne v Dunn (1893) 6 R 67
Allied Pastoral Holdings Pty Ltd v Commissioner of Taxation [1983] 1 NSWLR 1
Steinberg and Others v Federal Commissioner of Taxation (1975) 134 CLR 640Texts Cited: Nil Category: Principal judgment Parties: Joan Phyllis Quinn v Susan Bryant Representation: Counsel
F F Salama - plaintiff
R Wilson - defendant
solicitors
Scott Richardson, Vizzone Ruggero & Associates - plaintiff
Vasso P Tsolakis, Tsolakis Solicitors - defendant
File Number(s): 2011/45569
Judgment
The Proceedings
The plaintiff and defendant in these proceedings are grandmother and granddaughter respectively.
The plaintiff seeks a declaration that the defendant does not have any equitable interest or estate in a property known as 581 Princes Highway, Blakehurst. Further declarations are sought in respect of certain funds said to be held or received by the defendant as the result of the sale of a property previously owned by the plaintiff in Chifley. There is also a claim for equitable damages. A declaration is also sought that the defendant breached her fiduciary duties pursuant to a power of attorney executed by the plaintiff in favour of the defendant on 17 September 2009.
The plaintiff also seeks possession of the property at Blakehurst and an order that the defendant be restrained from re-entering the premises.
In her cross claim the defendant seeks an order that the cross defendant holds the Blakehurst property on constructive trust for the term of the cross defendant's life or such shorter period as the cross claimant shall determine. An order is also sought that the cross claimant be entitled to licence the residence for the term of the life of the cross defendant by the payment of an occupation fee or rent of $200 per week or such other amount as the court shall determine. The cross claimant makes an offer to care for or look after the cross defendant during that time but in the alternative she seeks an order for compensation in equitable damages for the detriment she has suffered or damages for breach of contract.
Background Facts
The plaintiff turned 87 years of age on 21 July 2011. The events the subject of this litigation took place in 2009 and 2010. She is the grandmother of the defendant Susan Bryant who is presently aged 46 years.
The plaintiff's husband passed away approximately 35 years ago. The plaintiff's daughter Elizabeth took over the management of her financial affairs and managed them for the plaintiff pursuant to a power of attorney.
In June 2009 Elizabeth passed away. The defendant is Elizabeth's daughter.
After some discussions took place between the plaintiff and the defendant, facilitated by the plaintiff's son, Terry, in 2009, the plaintiff it is alleged agreed that the defendant take over her mother's role pursuant to a power of attorney.
On or about 17 September 2009 the plaintiff executed a power of attorney. It was witnessed by a Mr Allan McKimm, a solicitor of Hurstville, who prepared it. The power of attorney appointed the defendant to act as the plaintiff's attorney and to exercise such authority as may be conferred upon her by reason of part 2 of the Powers of Attorney Act 2003 "to do on my behalf anything I may lawfully authorise an attorney to do".
In August, September and November 2009 it is alleged that certain representations were made by the plaintiff to the defendant to the effect that the plaintiff would sell her home in Chifley and buy a suitable property in the St George area in which she and the defendant and the defendant's family could live. It is alleged that she also represented that she would make a will leaving half of the estate and her jewellery to the defendant. At the time the representations were allegedly made the defendant lived in subsidised housing owned by the Department of Housing for whom she was also employed.
On 1 October 2009 the plaintiff made a will. That will left her estate in equal shares to the defendant and the plaintiff's son Terry. It also left her jewellery to the defendant. The will was prepared and witnessed by Mr McKimm, solicitor.
It is alleged that the plaintiff represented to the defendant in November 2009 that if she purchased the Blakehurst property she would pay for the construction of a two bedroom granny flat. The defendant asserts that she agreed with that proposal.
In late November 2009 the plaintiff signed a contract for the purchase of the Blakehurst property for the sum of $745,000.
On 12 December 2009 she sold her home at Chifley by public auction for the sum of $920,000.
The purchase of the Blakehurst property settled in early February 2010 through the use of bridging finance secured on the Chifley property and on 26 February 2010 the sale of the Chifley property completed.
In early February 2010 the defendant, her then partner and her two children moved into the Blakehurst property. The plaintiff and her companion of many years, Mr Leonard Donaldson, moved in towards the end of February 2010.
On 1 March 2010 proceedings were brought by a Mr Gary Foreman a grandson of the plaintiff for the appointment of a guardian and financial manager for the plaintiff under the Guardianship Act 1987 . The application had been lodged on 29 January 2010. A hearing was conducted before a three member Tribunal and the application was dismissed. The plaintiff appeared before the Tribunal and was represented by a solicitor Mr McKimm.
Mr McKimm had also acted for the plaintiff on the sale of the Chifley property and the purchase of the Blakehurst property.
On 12 March 2010 the plaintiff signed a building contract for the erection of a flat at the property. The building work was completed by early July of that year.
The defendant had for some years lived in subsidised housing owned by the Department of Housing. On 19 April 2010 by email she terminated her tenancy of the Department of Housing flat. She asserts she did this upon reliance of the plaintiff's representations.
During 2010 there were periods of seemingly intense conflict between the parties. This culminated for example in the defendant lodging a complaint with police on 28 January 2011.
The plaintiff with her companion Mr Donaldson however left the Blakehurst property on 14 October 2010.
By a letter dated 14 October 2010 from Marsdens Solicitors the plaintiff informed Ms Bryant that the power of appointment of her as attorney was "revoked immediately". On 12 November the plaintiff executed a formal revocation of power of attorney having given instructions to the New South Wales Trustee and Guardian. In her request to the Trustee the plaintiff requested that there be a sale of the Blakehurst property. She requested that notice be served on the defendant to move out of the property. She indicated that it was her intention to purchase a new property following the sale of the Blakehurst property.
During the period from October 2010 to date the defendant and her two children have continued to live at the Blakehurst property. The defendant has paid $200 a week rent since early 2010.
From about 23 December 2010 until 24 February 2011, in the period after leaving the Blakehurst property the plaintiff resided at the Formule 1 hotel in Mascot.
From late February or early March 2011 the plaintiff and her companion have lived in a rented retirement villa at Little Bay, rented from the Benevolent Society of New South Wales.
The Contentions of the Parties
In substance, the plaintiff asserts that she was pressured and/or duped into executing a power of attorney and then into selling what had been her matrimonial home at Chifley and further into acquiring the property at Blakehurst. She further asserts that as part of the process she was inveigled into constructing what has been described as a granny flat at the back of the Blakehurst property. All of these things she says were contrary to her will and intentions.
The defendant denies the suggestion that she pressured the plaintiff and asserts that as the result of representations made to her by the plaintiff she gave up a housing commission unit at Allawah which would otherwise be available to her for the balance of her and her children's lives. She did so she asserts on the basis that she would be given, along with her children, accommodation with the plaintiff provided that she would care for the plaintiff for the rest of her life. She asserts that as a result she terminated the lease over her housing commission flat and assisted the plaintiff to find and acquire the Blakehurst property. She also asserts that she assisted the plaintiff in entering contractual arrangements with builders for the purposes of constructing the granny flat.
The defendant asserts that as the result of the representations, she altered her position to her detriment. She alleges that she is no longer eligible to re-enter subsidised Housing Commission accommodation in the future.
At the centre of the plaintiff's case of course is the proposition that she was denied in effect any freedom of choice, or informed decision making in a number of respects. She asserts that the sale of her house in Chifley and the move to Blakehurst was entirely contrary to her wishes and desires. She also denies appreciating the significance of the power of attorney she executed as well as the will she made naming her granddaughter, the defendant, as a beneficiary.
Discussion
The Guardianship Tribunal
General
I was invited by counsel for the plaintiff to find that the plaintiff was fragile and in effect at the relevant time incapable of looking after her own interests. Having observed her give her evidence and her former solicitor Mr McKimm give his evidence, and having considered contemporaneous documents I have formed quite the contrary view. I consider that at the relevant time she knew exactly what she was doing, although I am sure she came to the view that it was not as she had hoped it would be.
If I had had any doubt about some of the matters raised in these proceedings the record of proceedings before the Guardianship Tribunal in 2010 puts them in my mind beyond doubt. I am certain she told that Tribunal the truth about her affairs and her relevant wishes at the relevant points in time. She would clearly have seen it in her interests that she do so.
I am firmly of the view, notwithstanding her lack of formal education, that she is and was at all relevant times in control of relevant events. To my observation she is and was redoubtable. She appreciated someone, such as her daughter Elizabeth, taking the stress away from her day to day financial activities. The defendant was to fulfil and continue that role. It suited the plaintiff that that occur until she and her granddaughter had a falling out.
The record of the proceedings before the Guardianship Tribunal in my view is of considerable importance. The proceedings before the Tribunal were brought by the plaintiff's grandson Mr Garry Foreman on 29 January 2010. He had apparently said in his application that he and other family members were concerned that the plaintiff was being financially exploited. The question before the Tribunal was whether Mrs Quinn was being exploited and whether the plaintiff was able to manage her own affairs and if not whether some order should be made.
Mrs Quinn had her then solicitor Mr McKimm attend the hearing with her and represent her before the Tribunal.
She was ultimately successful in opposing any order being made.
The Tribunal gave its decision on 1 March 2010. Although the decision purports to paraphrase what was said by the plaintiff and is not a verbatim transcript it has not been suggested by counsel that it does not accurately set out what was said by various persons including the plaintiff.
The Tribunal's findings make a number of things plain:
(a) The plaintiff was with her solicitor Mr McKimm who represented to her at the hearing and made submissions in her presence;
(b) The plaintiff was upset by the application and distressed that her arrangements could be called into question;
(c) The plaintiff said she had wanted to sell her home at Chifley because she was thinking about her care needs in the future and that her granddaughter had offered to look after her;
(d) On that basis she had purchased the Blakehurst property as the block was big enough to build a separate dwelling for her and Mr Donaldson to live in and the defendant and her family were to live in the existing dwelling;
(e) She described her relationship with her grandson it seems in unflattering terms and said she thought he was just after her money;
(f) The plaintiff indicated that she was an independent woman and at the date of the hearing she accepted the defendant was doing all the cooking but the plaintiff would resume doing her own when the dwelling was finished;
(g) Although the defendant pays all her bills she said she continued to sign the cheques needed and oversees her finances;
(h) The plaintiff was adamant she is and was able to make informed decisions about her welfare and that she was capable of managing her own financial affairs and was very satisfied with the arrangements she has in place to assist her in the management of her affairs through the appointment of the defendant as her attorney.
The defendant gave evidence before the Tribunal supporting her grandmother's case. She told the Tribunal that she was using the power of attorney where necessary but that any actions she took on behalf of her grandmother were done after they were discussed with her grandmother and her uncle Terry.
Mr Leonard Donaldson gave evidence before the Tribunal. He acknowledged that he had been a long time friend of the plaintiff. He is recorded as saying "I haven't seen her happier" when describing their then current living arrangements. He also supported the plaintiff's case in resisting the appointment of a guardian or financial manager.
Mr Terry Quinn gave evidence. He said that he had provided guidance to his mother and niece and was happy to assist as required. He also supported his mother generally in opposing any order.
Mr McKimm gave evidence before me and also gave evidence before the Tribunal. He expressed the view to the Tribunal that he did not believe his client was exhibiting any signs of disability. He made submissions to the Tribunal which not only the plaintiff heard but must have given him instructions to put as follows:
(a) That the plaintiff was very happy with her current living arrangements;
(b) That the plaintiff had made her own arrangements for her financial affairs through the power of attorney. He submitted there was no medical evidence that could or did not support the contrary;
(c) He further submitted she signed her own cheques and that she signed the contract and transfer documents for the sale of her Chifley property;
(d) He also submitted that she was remarkably capable and constantly expressed her satisfaction with her current arrangements.
At the hearing, her grandson Garry (who did not give evidence before me) acknowledged that he had no evidence that his grandmother suffered from a disability. He further apparently conceded that he had no evidence that his grandmother did not have capacity to manage her financial affairs.
Ms Karen Provost a granddaughter (who likewise did not give evidence before me) said her grandmother never knew what she was signing and simply goes along with things. She cannot and never could make lifestyle decisions.
The Tribunal rejected the evidence from the last two witnesses and refused the application. In doing so it clearly relied upon the plaintiff's evidence and those who gave evidence supporting her.
The Evidence before the Court
Of those persons (including the plaintiff and the defendant) who gave evidence before me I have placed considerable reliance upon the evidence of Mr McKimm, solicitor.
Mr McKimm, Solicitor
Mr McKimm, solicitor, had a great deal to do with the plaintiff. He acted for her in relation to the sale of Chifley and the purchase of Blakehurst, and also more importantly in relation to the drafting of the power of attorney and relevant will gave evidence before me. He also of course appeared for her before the Tribunal.
Mr McKimm was admitted as a solicitor in 1977, and has practised as a solicitor for the whole of that period. He is an accredited specialist in property law. He drafts about 30 powers of attorney per year. He has over his career drafted many wills. He had initially met the defendant because her then partner had a traffic matter which he acted on.
He prepared the power of attorney for the plaintiff on or about 17 September 2009, which she executed in his presence. Mr McKimm said that the plaintiff had explained to him that the defendant's mother had previously looked after the plaintiff's affairs before her death and that an arrangement had been made with the defendant that she take over that role. He said he gave the plaintiff the kind of explanation he had normally given in similar circumstances to other clients who had executed powers of attorney.
He said that he explained to the plaintiff that the power of attorney authorised the defendant to do whatever the plaintiff could do at law. It was not a blanket authority to do whatever the defendant wanted to do. She the plaintiff could give instructions and revoke the power of attorney if she wished. He was satisfied that the plaintiff understood the nature of the document and wanted to sign it. She exhibited no reticence on the day of its execution to his observation.
He was also shown a copy of a will executed by the plaintiff and dated 1 October 2009. He prepared the will which was executed in his presence. The plaintiff told Mr McKimm that she wanted (then) to split her estate 50% to her son 50% to the defendant. She was quite certain. He explained the will to her and he was satisfied that the plaintiff was quite happy with it. He was also satisfied that she knew and approved of the contents and understood it.
During his dealings with the plaintiff his observation was that she seemed quite content about the prospect of moving to Blakehurst.
Mr McKimm also confirmed that he attended the Guardianship Tribunal with the plaintiff and sat next to her. He confirmed the record of the proceedings tendered before me accorded with his "total recollection" of what happened. He was quite convinced as her solicitor that she had been completely happy and accepting of everything that had taken place up to that date.
Mr McKimm recalled that the plaintiff always asked for things to be read out to her and she told him that she had a limited education at school.
In 34 years of practice I am quite certain that Mr McKimm has had all manner of clients. He impressed me as competent, obviously experienced and careful. I am quite confident that he gave meaningful explanations to the plaintiff in particular about the power of attorney and the will and for that matter the nature of the proceedings before the Guardianship Tribunal which again I am quite confident enabled her readily to understand what was transpiring such as to be able in her own interests to give instructions accordingly reflecting her wishes.
I also am satisfied that Mr McKimm discharged his professional obligations in an independent and forthright manner. My view is not affected by the fact that it was the defendant who facilitated the plaintiff retaining him. Had the plaintiff been suffering from any disability or unable to comprehend what she was doing or why I would have expected an experienced practitioner such as Mr McKimm would have been astute to pick that up. He made no such observation, quite to the contrary.
Mr McKimm's evidence which I accept runs quite contrary to the very core of the plaintiff's case.
The Plaintiff
I have already made some general observations about the plaintiff.
In her evidence before me the plaintiff said she wanted to go back to her home (in Blakehurst). She denied that she had told the Public Trustee she wanted to sell the property at Blakehurst in 2010.
There are some problems at least with this assertion by her. The first is that on 12 November 2010 in the context of the revocation of the 2009 Power of Attorney, the plaintiff signed a document which quite clearly indicates she wanted to sell the Blakehurst property. She gave the reason for wanting to sell the property as being because it was quite close to passing traffic and the fumes give her asthma. She clearly wants to live in the Chifley area again.
She denied that when her daughter Elizabeth died, her son Terry had suggested that the defendant take over the role formerly performed by her. She said that in effect her son and granddaughter "took it all on their own hands". She denied that she asked for or indeed needed any assistance. I am unable to accept this.
She also denied that in 2009 the defendant was the grandchild closest to her. Again I am unable to accept that. That is why I believe she agreed to the defendant performing the role previously undertaken by her daughter.
She denied that Mr McKimm did legal work for her, but asserted that he had done it for the defendant. She asserted that the defendant was getting her to sign things and that "I didn't know what I was signing". I again am unable to accept that evidence as indeed I do not accept her assertion that Mr McKimm was simply the defendant's solicitor.
Her evidence on the power of attorney was to the effect that she had signed it against her will and without full knowledge of what she was doing. I do not accept that evidence.
She denied that she was happy to have the defendant assist her with her financial affairs and again I reject that as I am quite certain that is exactly the role she wanted the defendant to play and accepted the defendant's offer to do so.
She also denied making a will in October 2009, although that will was clearly made..
Indeed she denied wanting to sell the Chifley property and again asserted that the sale was all the defendant's doing. I do not accept that.
She agreed at the time of the Guardianship Tribunal that she did not get on well with her grandson, the applicant, a Mr Foreman. That was obviously true.
She flatly denied making a number of statements to the Guardianship Tribunal which in my opinion she clearly did. As an example it was put to her that she told the Tribunal that she had decided to sell the property at Chifley. Her response was:
"No way, no way I said that. No fear, no way."
I am simply unable to accept much of her evidence before me. As I have already observed her case before me was greatly at odds with what she told the Guardianship Tribunal and for that matter Mr McKimm. I am placed in a position where I consider that, absent support from contemporaneous documents, her evidence is quite unreliable.
She ultimately had a falling out with the defendant and the defendant's children and as a result she has sought in her evidence in my view to rather crudely reinvent history.
Whoever initiated the topic of conversation is in my mind not material but I am certain she cordially discussed selling the home at Chifley with the defendant and her son Terry. I am also certain that her son may well have raised with the plaintiff the prospect of the defendant taking over the role her daughter Elizabeth had fulfilled before she died. The plaintiff's account is that she was told she had to agree and had no choice. I reject that account.
I also accept that her son Terry likely brokered the idea of the plaintiff and defendant living together so that the defendant could look after her, which she happily accepted. I reject the plaintiff's denial in this regard.
I am persuaded that the plaintiff in August/September of 2009 expressed the desire to live with the defendant and move to the St George area and contrary to her denials at the time the plaintiff was amenable to moving.
I am certain that the plaintiff knew at the time that the idea that she and the defendant live together was being discussed and that the defendant was living in subsidised housing in premises owned by the Department of Housing.
I am persuaded that the plaintiff said quite clearly that she wanted to live with her granddaughter and family and that she would make sure "everything works out". I find that she promised in effect to compensate the defendant should the situation not work out and I also find that she knew the defendant was concerned about that issue and sought to placate her and allay the defendant's fears, because that is precisely what the plaintiff wanted to do at the time, although I accept that she radically changed her mind and as a result family alliances changed. The plaintiff denied offering compensation in effect if things went wrong. Again I cannot accept her denial.
I find it entirely credible and probable that the defendant discussed the question about the subsidised housing. After all she worked for the Department and knew only too well the perils of relinquishing subsidised housing.
Again, the plaintiff denied that the defendant did things for her including cooking meals. I reject her evidence again. I consider that the defendant for a time, until relations were strained or broke down, did care for the plaintiff in a number of ways.
As I have already said in my view the plaintiff willingly and happily granted the power of attorney to the defendant on 17 September 2009. Likewise she made her will of 1 October 2009, which was in my mind a true and rational reflection of her state of mind as at that date. At that point not only did she leave the residue of her estate equally to her son and the defendant but she gave her jewellery to the defendant as well. In the event that the defendant pre deceased her she left the defendant's share equally to three of the defendant's children.
That testamentary regime was indeed substantially similar to the will she made on 2 August 2005 in which she left a third of her estate to her son Terry, another third to her then daughter Elizabeth, and the other third to be distributed amongst her grandchildren as identified. In an earlier will again signed on 14 June 1995 she left her estate then equally to each of her then children, which included of course her son.
The Defendant
As is obvious from my rejection of much of the plaintiff's case I did find the defendant to be a credible witness. My observation was that she answered candidly and to the best of her ability. Her evidence was quite consistent with contemporaneous documents, especially the record of the Guardianship Tribunal.
She was also substantially corroborated by Mr McKimm.
I find that in or about September 2009 the defendant who I already observed was acutely aware of the difficulties being an employee of the Department of Housing raised expressly with the plaintiff what would happen in the event that the arrangement failed to work out. As I have said I find that the plaintiff acknowledged that she would give money to the defendant so that the defendant could provide a place for herself and her children to live. This, I find, was a direct result of the defendant having expressed concerns about what would happen if the arrangement did not work.
I also find that in or about October 2009 the plaintiff said to the defendant that she would make a will leaving her one half interest in her estate. I also find that this representation was really all part of the arrangements which were being discussed at the relevant time. She did exactly that.
I am satisfied that on or about 19 March 2010 the defendant vacated her Allawah unit where she had been paying subsidised rent of $200 per week to the Department of Housing in direct reliance upon the statements made by the plaintiff to her in the course of conversations concerning the proposed arrangements.
The defendant was clearly entitled to remain in the Allawah unit for her life but is no longer eligible for subsidised accommodation. Prior to 2003, when the defendant moved into the unit at Allawah, she had been a long time tenant in Department of Housing accommodation of about 23 years in totality.
The evidence is that she relinquished that subsidised housing when she moved to the Blakehurst property.
She had previously had a tenancy for life from the Department. I understood her evidence, which was not challenged, that once she had such a tenancy she would not have been subject to any ongoing assessment even in circumstances where her income had increased. She had in order to qualify for subsidised housing for the future to re qualify on the relevant criteria (2010) then in force.
In July 2010 the defendant attended at the Department of Housing and applied for reinstatement of her tenancy as she was concerned she would be homeless. That application was refused. Her income had risen to $52,000 per annum and that apparently exceeded the criteria now to be applied to her.
Despite protestations to the contrary and certainly prior to relations breaking down I find that the defendant cared for the plaintiff whilst the plaintiff lived at the Blakehurst property and assisted in the supervision of the construction of the granny flat.
The Plaintiff's Son, Terry
It is again clear from my findings in relation to the plaintiff that I largely accept his evidence. I thought he gave his evidence truthfully and for similar reasons I expressed in relation to the defendant his evidence was again corroborated by the proceedings before the Guardianship Tribunal .
I am persuaded that he did raise with the plaintiff his concern for the defendant in the event that things did not work out. I am also inclined to accept him when he said that he plaintiff would provide money to the defendant to buy a house if the arrangements did not work out.
The Principles
Whilst it is not necessary for me to determine the precise cause for the break down on the basis of the relevant authorities I am certainly of the view that the relationship broke down without any "attributable blame" on the defendant's part.
Justice Deane in Muschinski v Dodds discussed the financial consequences of a failed partnership or joint venture and the applicable equitable principles as follows:
"Those circumstances can be more precisely found by saying that the principle operates in a case where the sub stratum of a joint relationship or endeavour is removed without attributable blame and where the benefit of money or other property contributed by one party on the basis and for the purposes of the relationship or endeavour would otherwise be enjoyed by the other party in circumstances in which it was not specifically intended or specifically provided that the other party should so enjoy it. The content of the principle is that in such a case equity will not permit the other party to assert or retain the benefit of a relevant property to the extent that it would be unconscionable for him to do so."
I also respectfully adopt what Einstein J said in Tasevska v Vlado (Larry) Tasevski & Anor as follows:
"71. Mr McGrath submitted that even if the Court were to favour a constructive trust, Menka should not be entitled to relief as the relationship broke down because of her behaviour. Mr McGrath submitted that 'attributable blame' is an essential element of relief per Baumgartner v. Baumgartner [1987] HCA 59; (1987) 164 CLR 137 and Taylor v Streicher [2007] NSWSC 1006 per McDougall J.
72. The concept of attributable blame has received considerable attention over the years.
73. In McKay v McKay [2008] NSWSC 177, Brereton J adopted (16 ]16]) what was said by Bryson J in Bennett v. Horgan (in a passage that has been approved by Burchett AJ in Kriezis v. Kriezis [2004] NSWSC 167 (at [23]), and by Campbell J (as his Honour then was) in Hill v Hill [2005] NSWSC 863, at [35]):
The concept of attributable blame must be understood and applied with some tolerance; in my view it does not call for a judgment attributing blame among members of a family for the continuing relationship becoming intolerable, unless perhaps in particularly gross cases. Such judgment would be difficult and unreliable, as it is rare indeed that something or other which could be said to be a ground for blame cannot be identified and laid to the charge of each of the persons concerned. Leaving gross cases involving criminality or similarly reprehensible behaviour on one side, it should usually be understood, in my opinion, that where personal relationships deteriorate and the sharing of a dwelling becomes intolerable to some or all of those concerned, there is, within the meaning of Deane J's expression, no attributable blame and the case is one for an equitable adjustment."
I also accept the submissions on behalf of the defendant that the evidence supports representations emanating from the plaintiff which are in my view sufficiently clear to support an estoppel. These were not representations which were susceptible to ambiguity or uncertainty. The defendant expressly presented her concerns and uncertainty about leaving subsidised housing in the event that the arrangement with the plaintiff did not work out.
I find that as a result of the representations identified the defendant was entitled and clearly did believe then, namely, that in return for giving up her subsidised accommodation and caring for the plaintiff the defendant either expected to receive accommodation for the remainder of the plaintiff's life and half of the plaintiff's estate on her death which given the plaintiff's age would reasonably be expected to amount to half of the Blakehurst property.
I am of the view that the detriment suffered by the defendant in relinquishing her subsidised accommodation which she had for life is a relevant detriment and in accordance with authorities such as Sullivan v Sullivan .
In that decision of the Court of Appeal, comprising Handley, Hodgson and McColl JJA, Hodgson JA made the following comments:
"85. Generally, a promise or representation will be sufficiently certain to support an estoppel if it was reasonable for the representee to interpret the representation or promise in a particular way and to act in reliance on that interpretation, thereby suffering detriment if the representor departs from what was represented or promised. Generally, if there is a grey area in what is represented or promised, but it was reasonable for the representee to interpret it as extending at least to the lower limit of the grey area and to act in reliance on it as so understood, I see no reason why the court should not regard the representation or promise as sufficiently certain up to this lower limit.
90. For reasons given previously, the loss of the Housing Commission accommodation with its subsidised rent, for which the appellant had waited about seven years, is a detriment to the appellant suffered through her reliance on the representation or promise; and although there is no evidence explicitly addressing the present availability of Housing Commission accommodation, the Court, can infer that the appellant would have to wait a substantial time to obtain Housing commission accommodation, and that until then she would be subject to payment of higher rent so as to obtain appropriate accommodation in privately owned housing."
91. I conclude that there is substantial detriment, though due to the paucity of evidence it is not possible to quantify it more precisely. The onus to show detriment is on the appellant, so it would not be appropriate for the Court to quantify the detriment in a manner generous to the appellant: where there is uncertainty due to paucity of evidence, that uncertainty should generally be resolved adversely to the party that could and should have called that evidence: Ho v. Powell [2001] NSWCA 168, 57 NSWLR 572; Oron Park Motor Sport Pty Limited v Fleissig [2002] NSWCA 371 at [66], and cases there cited."
I also find that the representations about the buying of the property in the St George area and the making of the will were operative at the time the defendant acted to her detriment.
Having established however that she suffered detriment in reliance upon the plaintiff's conduct by having given up her subsidised accommodation means that she has in my mind established the necessary elements for her equitable estoppel claim.
I have focussed on the estoppel claim as that reflects the way the case was conducted. For that reason I have not discussed for example the question of whether the parties entered contractual relations or not, nor have I found it necessary to find a constructive trust. Counsel for the defendant was content for me to deal with the matter just on the basis of an estoppel. He submitted quite correctly that his client would not be the worse off if I did not go on to decide whether a contract as alleged existed. I am content therefore to follow that course.
The question of what relief the defendant is entitled to raises some difficult questions. I will deal with this matter below.
The Plaintiff's Claim in Damages
The plaintiff asserts that the defendant, independently of any issue of estoppel and the like, misused her position as attorney and has in effect misappropriated funds of the plaintiff making the defendant liable in damages. This was not an allegation of mere financial mismanagement.
The plaintiff initially made a claim for $114,784.91. This amount was made up as follows:
(i) Misuse of plaintiff's accounts - breach of duties under Power of Attorneys Act - $52,500.00
(ii) Misuse of plaintiff's accounts - breach of duties under Power of Attorney Act - $31,035.08
(iii) Accommodation at Formule 1 Hotel - $5,515.00
(iv) Accommodation at Little Bay - $2,660.00
(v) Motor Vehicle sale proceeds - $3,300.00
(vi) Shortfall between transfer out of account of JPQ 18 September 2009 - $19,774.83
The plaintiff ultimately did not press the claim in (vi).
The plaintiff in her affidavit materials and in her oral testimony heavily hinted that the defendant misappropriated certain of the plaintiff's funds. This is a most serious allegation. Apart from a somewhat cryptic reference to something approaching such an allegation in the plaintiff's defence to the defendant's cross claim ((paragraph 11(c)) and (d) the matter is not otherwise pleaded. However it was pursued to some extent in cross examination to which I will return. In the itemised list above the court's attention was specifically directed to the first two amounts as the subject of the misappropriation.
Although in a civil case where all issues need only be determined on the balance of probabilities, it is necessary to bear in mind what Dixon J (as he then was) said in Briginshaw v. Briginshaw :
"At common law two different standards of persuasion developed, It became gradually settled that in criminal cases an accused person should be acquitted unless the tribunal of fact is satisfied beyond reasonable doubt of the issues the burden of proving which lie upon the prosecution. In civil cases such a degree of certainty is not demanded........
This mode of stating the rule for civil issues appears to acknowledge that the degree of satisfaction demanded may depend rather on the nature of the issue. In the course of a discussion of the matter containing no less wisdom than learning, Professor Wigmore says --
In civil cases it should be enough to say that the extreme caution and the unusual positiveness of persuasion required in criminal cases do not obtain. But it is customary to go further, and her also to attempt to define in words the quality of persuasion necessary. It is said to be a state of mind in which there is felt to be a 'preponderance of evidence' in favour of the demandant's proposition. Here, too, moreover, this simple and suggestive phrase has not been allowed to suffice; and in many precedents sundry other phrases - 'satisfied' , 'convinced,' and the like - have been put forward as equivalents, and their propriety as a form of words discussed and sanctioned or disapproved, with much waste of judicial effort.
.....
The truth is that, when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of mere mechanical comparison of probabilities independently of any belief in its reality. No doubt an opinion that a state of facts exists may be held according to indefinite gradations of certainty; and this has led to attempt to define exactly the certainty required by the law for various purposes. Fortunately, however, at common law no third standard of persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved.
The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding, are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences. Every one must feel that when, for instance, the issue is on which of two dates an admitted occurrence took place, a satisfactory conclusion may be reached on materials of a kind that would not satisfy any sound and prudent judgment if the question was whether some act had been done involving grave moral delinquency. Thus Mellish, LJ, says - "no doubt the court is bound to see that a case of fraud is clearly proved, but on the question at what time the persons who have been guilty of that fraud commenced it, the court is to draw reasonable inferences from their conduct" - Panama and South Pacific Telegraph Company v India Rubber, Gutta Percha and Telegraph Works Company , (1875) LR 10 Ch App 515 at p 530".
On the question of alleged misappropriation the defendant was cross examined about some of the plaintiff's bank statements and some of her own. There is no doubt that for the most part from around the middle of September 2009 to the middle of October 2010 the defendant had the ability and indeed did transact various financial payments for and on behalf of the plaintiffs.
Leaving aside the form of the plaintiff's pleading to which no objection was taken, if such an allegation was to be pursued, it was to be done in such a way so as to permit a court to make a properly informed assessment as to the probabilities.
In other words, fairness dictates that a person, the subject of such an allegation, has to be directly and fairly confronted so as to be given an opportunity to deal with it. Browne v Dunn .
In his judgment in Allied Pastoral Holdings Pty Ltd v. Commissioner of Taxation , Hunt J comprehensively reviewed the authorities concerning the decision of Browne v. Dunn . His Honour said:
"It has in my experience always been a rule of professional practice that, unless notice has already clearly been given of the cross-examiner's intention to rely upon such matters, it is necessary to put to an opponent's witness in cross-examination the nature of the case upon which it is proposed to rely in contradiction of his evidence, particularly where that case relies upon inferences to be drawn from other evidence in the proceedings. Such a rule of practice is necessary both to give the witness the opportunity to deal with that other evidence, or the inferences to be drawn from it, and to allow the other party the opportunity to call evidence either to corroborate that explanation or to contradict the inference sought to be drawn. That rule of practice follows from what I have always believed to be rules of conduct which are essential to fair play at the trial and which are generally regarded as being established by the decision of the House of Lords in Browne v. Dunn (1894) 6 R 67.
No doubt because that decision is to be found only in an obscure series of law reports (called simply "the Reports" and published briefly between 1893 and 1895) reliance upon the rules said to be enshrined in that decision seems often to be attended more with ignorance than with understanding. The appeal was from a defamation action brought against a solicitor and based upon a document which the defendant had drawn whereby he was to be retained by a number of local residents to have the plaintiff bound over to keep the peace because of a serious annoyance which it was alleged he had caused to those residents. Six of the nine signatories to the document gave evidence on behalf of the defendant that they had genuinely retained him as their solicitor and that the document was really intended to be what it appeared on its face to be. No suggestion was made to any of these witnesses in cross-examination that this was not the case and, so far as the conduct of the defendant's case was concerned, the genuineness of the document appeared to have been accepted. However, the defence of qualified privilege relied upon by the defendant depended in part upon whether the retainer was in truth genuine or whether it was a sham, drawn up without any honest or legitimate object but rather for the purpose of annoyance and injury to the plaintiff. This issue was left to the jury. The plaintiff submitted to the jury that the retainer was not genuine and was successful in obtaining a verdict in his favour. In support of that submission, the plaintiff asked the jury to disbelieve the evidence of the six signatories who had said that the retainer was a genuine one.
Lord Herschell LC said (at pp 70, 71):
"Now my Lords, I cannot help saying that it seems to me to be absolutely essential to the property conduct of a cause, where it is intended to suggest that a witness is not speaking the truth on a particular point, to direct his attention to the fact by some questions put in cross examination showing that that imputation is intended to be made, and not to take his evidence and pass it by as a matter altogether unchallenged, and then, which it is impossible for him to explain, as perhaps he might have been able to do if such questions had been put to him, the circumstances which it is suggested indicate that the story he tells ought not to be believed, to argue that he is a witness unworthy of credit. My Lords, I have always understood that if you intend to impeach a witness you are bound, whilst he is in the box, to give him an opportunity of making any explanation which is open to him; and, as it seems to me, that is not only a rule of professional practice in the conduct of a case, but is essential to fair play and fair dealing with witnesses."
His Lordship conceded that there was no obligation to raise such a matter in cross examination in circumstances where it is "perfectly clear that (the witness) has had full notice beforehand that there is an intention to impeach the credibility of the story which he is telling". His speech continued (as p71):
"All I am saying is that it will not do to impeach the credibility of a witness upon a matter on which he has not had any opportunity of giving an explanation by reason of there having been no suggestion whatsoever in the course of the case that his story is not accepted."
Lord Halsbury said (at pp 76, 77):
"My Lords, with regard to the manner in which the evidence was given in this case, I cannot too heartily express my concurrence with the Lord Chancellor as to the mode in which a trial should be conducted. To my mind nothing would be more absolutely unjust than not to cross examine witnesses upon evidence which they have given, so as to give them notice, and to give them an opportunity of explanation, and an opportunity very often to defend their own character, and, not having given them such an opportunity, to ask the jury afterwards to disbelieve what they have said, although not one question has been directed either to their credit or to the accuracy of the facts they have deposed to."
Lord Morris (at pp 78, 79) said that he entirely concurred with the two speeches which preceded his, although he wishes (at p 79) to guard himself with respect to laying down any hard and fast rule as regards cross examining a witness as a necessary preliminary to impeaching his credit. The fourth member of the House, Lord Bowen, is reported (at pp 79, 80) to have said that, on the evidence of the six signatories, it was impossible to deny that there had been a real and genuine employment of the defendant. But his Lordship made no statement of general principle."
The plaintiff was, it seems to me, quite ready to make serious and derogatory allegations about the defendant in a number of respects not the least on the issue of misappropriation. Her evidence however I have otherwise found was quite unreliable no less so in this regard.
As an example she asserted that the defendant had sold her Tarago without her knowing about it and she never received any funds from the defendant as a result of its sale. In the first place she asserted that it had been purchased against her wishes and to suit the defendant and her family and not to meet the plaintiff's needs at all. For reasons which follow I am of the view that this is quite inaccurate and I reject the plaintiff's assertion on this issue accordingly.
When Mr Donaldson, her friend and companion of many years, gave evidence, an entirely different story emerged about the Tarago. He confirmed that the plaintiff was unhappy with its colour but volunteered that when he and the plaintiff left the Blakehurst property, they left in the Tarago and went to Newcastle and then Casula. When asked in cross examination who sold it he said that he and the plaintiff gave it to a Mr Noel Hogan, a private investigator to sell for her. Mr Hogan, Mr Donaldson said sold it at a loss (for $21,600 having paid it seems probably $25,000 for it). Mr Donaldson said Mr Hogan gave a cheque to the plaintiff and he and the plaintiff went to the bank and deposited it. I accept Mr Donaldson's account. He had no reason to do anything other than tell the truth. I am afraid I cannot say the same for the plaintiff who was in my view on this and other issues minded to give what was clearly an inaccurate account to seek to prejudice the defendant.
However, as I have already observed, counsel for the plaintiff cross examined the defendant on a number of items (debits or transfers) in the bank statements of the plaintiff. At no stage did he directly put to the defendant that she had for example deliberately spirited away somehow, somewhere the two significant amounts referred to in the list above. He did not put to her that she had acted dishonestly in the handling of the plaintiff's financial affairs.
Leaving aside the lack of access to all of the defendant's bank statements early in the trial it is plain that the plaintiff did not herself in her evidence fully disclose all of the bank accounts she had at the relevant time either.
The cross examination so far as the plaintiff's bank statements were concerned centred largely on what was called a Power Saver Account at St George Bank (account No 456178456) which was operated in the period 2009-2010 and which the defendant clearly did operate on from time to time. Those bank statements were attached to the plaintiff's affidavit of 31 January 2011.
However, at the end of the trial counsel for the defendant tendered a bank statement for a term deposit (account no 0000349773866) which purports to show that as at 1 July 2010 the plaintiff had an amount of $77,999 invested on term deposit. The plaintiff did not volunteer this nor was the source of those monies the subject of an explanation from her.
In cross examination the defendant said that her uncle Terry had kept the bank statements, although they were clearly mailed to the plaintiff's address. She accepted that almost immediately the power of attorney had been executed by the plaintiff, she took it to St George bank to let them know what had transpired and to open a "power saver" account for her grandmother. When discussing bank statements with the plaintiff she agreed she did not explain every item but did generally each Saturday when she had lunch with her grandmother and uncle have discussions about expenditure from time to time. She attended to the payment of monies for the construction of the granny flat (which cost approximately $40,000). There appears to be other monies expended on fencing, landscaping and the like. She attended to the payment of these as well.
She said she thought she knew where all funds were but clearly had difficulty giving a clear explanation regarding her own bank statements which she retrieved at the end of the trial. She agreed that the plaintiff's account at ING was closed and funds transferred to St George Bank. She agreed a Bank of Queensland account was kept open.
She explained a number of transactions as either referable to the construction of the granny flat, renovations, a party for the plaintiff, sound proofing, air conditioning, change of locks, carpet, floor boards, cement work, and purchase of a Tarago motor car (which was approximately $25,000.) She also acknowledged that she repaid an amount of $7,000 into the plaintiff's account for a car she had bought prior to the power of attorney being executed.
As I have said it was not directly put to her in terms that she had misappropriated any amounts. A person can for example of course be put on notice of an allegation from the way a case is conducted. When skilful and competent counsel, as here does not candidly confront a witness with an allegation of misappropriation it makes it in my mind all the more difficult for a court to reach the requisite level of satisfaction to sustain such an allegation. There is no occasion for discourtesy or aggression. What is needed is precision and clarity. In my view, an allegation as serious as that must of course be plainly and unmistakenly put so the court is placed in a position to judge the response, for itself.
There was one amount that was the subject of such treatment. It was in relation to an amount of $600 where the following exchange took place:
"Q. Can I take you back to the entry Bid and Buy for $600.
A. Yes
Q. So you say that was for a payment previously made or debited from Ms Quinn's account?
A. Yes
Q. Is it the case you never paid her back within 7 or 14 days, it was just whenever you had the money?
A. When I received money from my mother's estate which went into my bank account, which was around July, late June, early July. I think these is another one reference to Suzanne shopping on 30 th of the 7 th , internet withdrawal for $170 authorised."
A little later the following transpired:
"Q. I am trying to be fair to you Ms Bryant by taking you to the statement of Ms Quinn for that particular period.
A. It went somewhere. It was a withdrawal. Its an internet withdrawal.
Q. Ms Bryant, the reality is the payment did not go to Ms Quinn did it?
A. There we go, sorry. I have just found some here. It is my testimony I did repay that money to her account. I'd have it there for alternative accounts. I have just found some here. It is my testimony I did repay that money to her account. Money was going through four, two Power Savers, Retirement and Complete Freedom."
On the amount of the $52,500 for example (item (i) above) the following exchange took place:
"Q. On 16 March, transfer of account (sic) $52,500. Where did this go?
A. That would, I'd say have to do with the granny flat. I would have to check the receipts.
Q. Were you certain?
A. I'm pretty sure that would have to do with the granny flat."
Counsel for the defendant fairly accepts that the $52,500 is unlikely to have been applied for the granny flat, but this is not, nor could it be, an admission of misappropriation. Counsel for the plaintiff did not put to the defendant that the $52,500 had been misappropriated, no doubt because he felt, quite appropriately in my view, that he could not do so.
The same can equally be said of the amount of $31,035.08 (item (ii)) contained in the plaintiff's affidavit of 31 January 2011. An explanation is provided for in the defendant's affidavit of 8 March 2011. Some of the items were the subject of cross examination of the defendant. She explained these items to my satisfaction. In addition she provides a detailed explanation in her affidavit of 8 March 2011 which I accept, again for two reasons. First serial and/or habitual misappropriation was not put in terms. It is and was a serious allegation. Secondly I am not persuaded given a plausible item by item explanation that misappropriation could be made out, and I reject that claim as well.
Given the seriousness of the allegation and putting to one side the question of cross examination in my view the evidence of misappropriation does not go any higher than pure speculation or conjecture. It was at all times upon the plaintiff to prove the allegations of misappropriation to the requisite level of satisfaction. An inability to show with clarity where for example the $52,500 was transferred does not prove the commission of a misappropriation for that or any other amount. It could easily be characterised as mismanagement and no more. The tenor of the cross examination was to simply invite explanations as to amounts which when given were largely not challenged. This is of some significance given the belated discovery of the fixed term deposit of approximately $80,000 in the plaintiff's name. Indeed on the state of the evidence there is in my mind some confusion as to whether these amounts are even missing.
Notwithstanding that the defendant said the bank statements were left with Mr Quinn, her uncle, no questions were put to him about any suggestion of misappropriation either, although he was present at the Saturday meetings and counsel for the plaintiff put to him that he "called the shots".
On the question of misappropriation therefore the evidence in the plaintiff's case is left in quite an unsatisfactory state, despite a skilful cross examination on the part of her counsel.
As I have already observed, the cross examination was limited to some bank statements of the plaintiff and some of the defendant. There was simply no evidence showing large amounts of cash being used by the defendant at relevant times to acquire assets, or transfer of funds to members of her family, including Mr Quinn or her former partner. No evidence has been tendered showing she had debts or any creditors who have been satisfied. There was no evidence of any term deposits in her name or subject to her control.
An inability to clearly rebut an assertion cannot amount to an admission of the fact asserted. As Barwick CJ remarked in Steinberg and Others v Federal Commissioner of Taxation :
"But disbelief does not afford evidence of the contrary of what is disbelieved, leaving on one side a doubtful case of a situation of two mutually exclusive possibilities which the facts of this case do not raise."
I accept that some of the defendant's explanations were themselves unsatisfactory and in some instances far from clear. However the last two questions and answers in her cross examination amount to a denial of any misappropriation in effect and I am inclined to accept that denial.
"Q. So other than that, any other repayment that you say you may have made or did make in relation to a repayment to Ms Quinn should appear in those statements in front of you.
A. Yes
Q. And if they don't appear in those statements, then you never made the payment, is that correct?
A. Exactly, because I paid back what I owed."
In my view, the plaintiff has not satisfied me on the balance of probabilities, given the seriousness of the allegations that more probably than not the defendant has misappropriated the first of the two amounts (i) and (ii). There is no evidence that the plaintiff has produced showing those amounts were transferred or used by the defendant for her own purposes, so as to support a finding of misappropriation and I am unable on the state of evidence to so find. I therefore reject the plaintiff's claim in that regard.
The other amounts in the damages claim are $5,515 (iii) for accommodation at the Formule 1 Hotel, an amount of $2,660 (iv) for accommodation at Little Bay, and an amount of $3,300 (v) for motor vehicle proceeds. I will deal with these separately.
I do not accept that the plaintiff left Blakehurst solely or even predominately because of the defendant's conduct. There is no doubt the parties after a time could not get on and living together became impossible. I regard that as having as much to do with personalities, especially that of the plaintiff, rather than objectively pointing to any particular or blameworthy conduct on the part of the defendant.
I consider that there is a real likelihood that the plaintiff was heavily influenced by her inability to get on with the defendant's children and perhaps a belated realisation that she preferred to live in the Eastern Suburbs where she again resides. The plaintiff was openly critical of the granny flat when completed, the hairdresser the defendant took her to, and the types of cooking the defendant did for her. The plaintiff has of course now made an alliance with other members of the family and changed her will for example very recently. On 7 March 2011 she executed her most recent will. The bulk of her estate is now left to her grandchildren or great grandchildren and 1/16 th to her long time companion Mr Donaldson. That of course is entirely her right.
In her penultimate will of 25 January 2011 she had divided her estate into 19ths, leaving her son Terry 3/19ths. She had a change of mind in the few weeks between then and 7 March and has excluded him from the most recent will. I consider this to be a good indication of the somewhat volatile nature of her personality.
Item (iii) Formule 1 Hotel - $5,515
As for this amount for the Formule 1 hotel, the plaintiff asserts she paid that amount. Upon the assumption she did, I am, as I have said, not persuaded that the defendant should bear any attributable blame in this regard. The plaintiff left for the reasons I have found above. I do not consider the plaintiff should be awarded that sum.
Item (iv) Little Bay - $2,660
Mr Donaldson in his evidence indicated that he had paid and is paying the entirety of the accommodation at Little Bay and as far as the evidence goes there does not appear to be any obligation on the part of the plaintiff to reimburse him. Mr Donaldson gave the following evidence:
"Q. What is the arrangement at the Mirrabooka village at Little Bay, are you renting a cottage weekly, or do you know what the arrangement is?
A. Weekly
Q. Do you know what the rent is?
A. Yes, its $200 for two
Q. per week
A. Yes
Q. Are you paying for half of that?
A. No, not per week, that's per fortnight. No. I'm paying for the lot of it."
I therefore reject the amount claimed.
As to claims for damages, the reasons are set out in Item (iii), Formule 1 hotel.
Item (v) Motor Vehicle sale proceeds - $3,300
As far the $3,300 is concerned in item (v), it is not, if I may say, a question of whether the defendant should have reasonably accounted for it, but whether the plaintiff has proved she is owed that sum. I am not satisfied on the materials that the plaintiff has made out a case given the serious nature of allegations. I do not consider the plaintiff has discharged her onus of proof. The plaintiff should not be awarded this amount.
On my reasons set out above I am not satisfied that the plaintiff has made out her case for any relief or her case in damages.
The Appropriate Relief for the Defendant
Difficult questions arise in circumstances such as this as to the appropriate relief that ought to be ordered. Counsel for the defendant submitted that either the court should, in making good the defendant's expectations, grant a right of residence in the Blakehurst home for the plaintiff's life subject to the payment of an appropriate rent together with damages for the loss of the chance to share in the plaintiff's estate or award the defendant an amount of money to buy another home or which is calculated by reference to the shortfall between her subsidised rent of $200 per week and the commercial rent payable in the subsidised housing accommodation.
The grant however of a right of residence for the plaintiff's life in relation to the Blakehurst property as the defendant concedes would leave the plaintiff without any capital sum which she could access for her own purposes, whether it be for rent or otherwise. It would also involve potentially at least some sort of ongoing relationship between the two parties which I regard as undesirable. For both of these reasons I think such relief would be inappropriate in the present case.
In my view in all the circumstances of this case I believe that an award of damages in favour of the defendant is the appropriate course.
I should say that the parties made submissions as to the appropriate award of damages upon the basis of a number of assumptions. On the question of the market rent for the Allawah unit it was assumed to be in the order of $500 per week. I did not detect any opposition from counsel for the plaintiff as to that amount being used in calculations. Equally both counsel were content during submissions to work on the basis that the Blakehurst property is worth approximately $800,000.
The amount I have calculated for her damages is based upon Blakehurst being valued at $800,000. Its fair market value however may well be less or it may be more.
The defendant submitted for example that if the case were to be determined solely according to the defendant's detriment the measure would arguably be the loss of the Allawah unit for the rest of her life. It was submitted that the defendant being 46 years, of age would according to life tables have a future life expectancy of 37.28 years. This the defendant calculates at $300 per week for 37 years at the 3% tables totalling a figure of $352,200. The defendant accepts that there would need to be a discount of say 10% for the vicissitudes of life. This would amount to $317,000.
It was further submitted that if the case were to be determined on a contractual basis, for the loss of chance for example, as is submitted it would lead to an amount equivalent of half of the value of the Blakehurst property being $400,000 less 10% for vicissitudes (ie $360,000). As I have already observed I do not consider a right of residence would provide a fair outcome because it denies the plaintiff access to her capital. The right of residence would be worth say $82,800 ($500 Allawah market rent less $200 paid at Blakehurst, ie $300 per week for 5.75 years being the life expectancy of the plaintiff form the 1997-1999 Australian life tables). $300 per week for 5.75 years at the 3% tables leads to a figure of $82,800.
In all the circumstances I consider a fair outcome would be to award the defendant damages having found for her on estoppel which should reflect making good her expectations. She expected to be able to rent Blakehurst for the plaintiff's life and be a 50% beneficiary in the plaintiff's estate. That would involve adding $82,800 to half of the value of the house ($400,000) but say minus 10% for vicissitudes, that is $360,000. The ultimate figure would also have deducted from it half of any expenses associated with its sale. The ultimate figure however will be contingent on the true market value of the Blakehurst property. As I say it may be more or less than $800,000.
The property should be in the meantime the subject of a charge to secure that amount pending sale. This would otherwise leave the plaintiff immediately free to sell the property by whatever means she may be advised is best.
I am also of the view that the defendant should be permitted to remain in the property pending sale provided she pays the agreed rent of $200. She should be the subject of orders requiring her to cooperate as and when necessary with the plaintiff in relation to the sale process and further be ordered to vacate the property on completion of the sale.
I would invite the parties to prepare short minutes reflecting my orders.
I will also hear the parties orally or in writing on the question of costs.
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Decision last updated: 14 October 2011
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