Killen v Rennie & 1 Ors

This appeal concerned a dispute over the ownership of the proceeds from the mortgaging of a former family home, Piccadilly Gardens. The appellant, Mrs Killen, contended that at the time of acquisition, the second respondent, Aroona, a family company, held the property on a resulting trust for her. Alternatively, she argued that the equitable interest in the property had passed to her pursuant to a resolution recorded in the minutes of an Aroona directors' meeting on 8 July 1974. The appeal was brought before the court following the rejection of Mrs Killen's proof of debt by the liquidator of Aroona.

The court was required to determine two principal legal issues. Firstly, whether Aroona held Piccadilly Gardens on a resulting trust for Mrs Killen at the date of acquisition in 1964, or if the presumption of a resulting trust had been displaced by evidence of a contrary intention. Secondly, assuming no resulting trust arose at acquisition, whether the equitable interest in Piccadilly Gardens subsequently passed to Mrs Killen by virtue of the resolution of Aroona's directors recorded in the minutes of their meeting on 8 July 1974.

The trial judge had found that Mrs Killen provided the funds for the purchase of Piccadilly Gardens, and that she made mortgage payments and attended to other outgoings for the property for a significant period, despite the property being registered in Aroona's name. However, the trial judge did not accept that these facts were sufficient to establish a resulting trust in favour of Mrs Killen, finding that the presumption of a resulting trust had been displaced. The trial judge's findings regarding the acquisition and mortgaging of the property, including the source of funds and the subsequent mortgage, were central to the first issue. The trial judge also considered a 1974 balance sheet for Aroona, which was challenged on appeal, and noted that it was the only documentary record for Aroona found from any period prior to 1975.

The appeal was allowed with costs.