Klotz & Klotz v Neubauer & Klotz No. Scciv-98-825

KLOTZ & KLOTZ v NEUBAUER & KLOTZ
[2001] SASC 454
Civil

DEBELLE J. This is an administration action brought pursuant to Rule 103 of the Supreme Court Rules. The plaintiffs seek a number of orders but, in essence, they want the defendants to account for their conduct as attorneys of the late Franz Ludwig Klotz. The defendants filed a counterclaim but did not press it. I will refer to the issues in a moment. Those issues will be understood more clearly after a summary of the facts.
Franz Ludwig Klotz was born in Eastern Europe in about 1899. The precise date of his birth is not known. He became a citizen of what is now known as Germany. In the early 1950s he emigrated to Australia with his wife and their three children. A fourth child was born in Australia. Listed in order of their birth, the children are John, Margaret, Steve and George. Margaret has married and is now called Margaret Neubauer.
John and Steve Klotz are the plaintiffs. They reside in Adelaide. Margaret Neubauer and George Klotz are the defendants. Margaret Neubauer resides with her husband in a house at 75 Hughes Street, Unley. George Klotz resides in Perth. It is readily apparent that the four children are divided into two camps. In one are the plaintiffs and in the other are the defendants. There is clearly a great deal of ill-will and distrust between those two camps.
In the early 1970s Franz Klotz returned to live in Germany in order that he could enjoy a pension there available to him. His wife later followed him to Germany. In about 1986 they both returned to Adelaide and purchased a home unit in Woodville North. The home unit was very close to a house occupied by Steve Klotz and his family.
It seems that, after returning from Germany, Franz Klotz began to behave a little erratically. He displayed an obsession about spies. However, notwithstanding these symptoms, his behaviour, generally speaking, was relatively rational. However, it is also clear that at different times he favoured one or more of his children over the others. It is not entirely clear why he changed his affections among his children. On one view, he was fickle in choosing between them. On another, his children competed for his affection and endeavoured to influence him to their own individual advantage. It is unnecessary to decide what was the cause of his change of affection. It is sufficient to note, as is readily apparent from the course of events, that Franz Klotz would do the bidding of whichever child he was favouring at that particular time. The person he favoured tended to be the person then seeing him most.
The evidence in this case is short, to the point of being extremely sketchy. It is essentially confined to objective facts about which there could be little dispute. Affidavit evidence of Steve Klotz and Margaret Neubauer has been admitted. It was not all tested in cross-examination. The following account is based on the oral evidence and those affidavits. Although the affidavit evidence conflicts on some issues, it is possible to distil relevant facts from them.
In 1988 Franz Klotz and his wife entered into negotiations with Margaret Neubauer and her husband to provide premises in which they might reside in the future. Franz Klotz consulted the firm of Mouldens, solicitors. Mr von Muenster of that firm acted for him in the negotiations. Eventually an agreement was executed on 2 June 1989 between Margaret Neubauer and her husband and Franz Klotz and his wife. The agreement is in fact dated 2 June 1988 but the parties agree it was executed on 2 June 1989. Shortly stated, the effect of the agreement was that, in consideration of Mr and Mrs Klotz paying the Neubauers $40000, the Neubauers would construct extensions to their house at 75 Hughes Street, Unley and permit Mr and Mrs Klotz to reside in the extensions for the rest of their life. It will be necessary later to examine the precise terms of the agreement.
Mr and Mrs Klotz sold the unit and paid $40000 to Mr and Mrs Neubauer. As the extensions were not completed by the time they had sold the unit, Mr and Mrs Klotz lived in rented accommodation for a time. They moved into the extensions at 75 Hughes Street on 17 November 1989.
When living in Woodville North after his return from Germany, Franz Klotz and his wife lived close to their son Steve Klotz and frequently saw him. It is not clear whether Steve Klotz continued to see his parents when they resided with the Neubauers in the extensions at 75 Hughes Street, Unley. On 28 May 1990 Franz Klotz’s wife died. Franz Klotz continued to reside at 75 Hughes Street.
On 27 June 1990 Franz Klotz made a Will in which he gave the whole of his estate to his son Steve Klotz and appointed him his sole executor. On the same day he executed an Enduring Power of Attorney appointing Steve Klotz his attorney. Both the Will and the Power of Attorney were drawn by Mouldens and I infer that Franz Klotz received independent legal advice before executing each. The time when these documents were executed gives rise to the inference, and I find, that, while living at Hughes Street, Unley, Franz Klotz remained in contact with his son Steve Klotz while he was residing in Hughes Street.
On 12 November 1990 Steve Klotz received a telephone call from Dr A B Martin, a medical practitioner, asking him to collect his father from Dr Martin’s surgery. Franz Klotz told his son that he had had an altercation with Margaret and no longer wished to reside with her at Hughes Street. According to Steve Klotz, his father had on earlier occasions told him of problems living with Margaret. The problems mentioned by his father related to an inability to enjoy privacy and peace and quiet because of the proximity of the extensions to the Neubauers’ house and constant requests by Margaret for payment of expenses.
On the same day, Steve Klotz asked Dr Martin for a medical report concerning his father. Dr Martin handed Steve Klotz a report dated 12 November 1990. The report recommended his father for hostel accommodation. The report reads:
“I write this letter to recommend Mr. Klotz for Hostel accommodation.
He suffers from paraphrenia which is a delusional and behavioural disorder of old age. He has no dementia and his cognitive abilities are intact. His current medication is Largactil tablets 25mg in the morning and 50mg a night.
Until now he has lived with his daughter but tension there has become strained in recent months and I believe it would be most appropriate for him to find alternative accommodation. If he is prepared to accept Hostel accommodation I am sure this would solve the problem.”
Steve Klotz took his father home. Within a few days he had arranged hostel accommodation at an aged persons home called Furia Rest Home in Prospect. Franz Klotz resided at the Furia Rest Home from 20 November 1990 until 17 October 1992.
Steve Klotz continued to act as his father’s attorney. He paid his father’s accounts and looked after his personal and financial needs. Apart from going to collect his father’s belongings in November 1990, Steve Klotz has not since been to Margaret Neubauer’s house at Hughes Street.
In December 1990, Franz Klotz instructed Mouldens to make a claim against his daughter to recover the sum of $40000 paid for the extensions as well as for a further $15000. By letter dated 21 December 1990, Mouldens claimed the sum of $55000 on the ground of a total failure of consideration and frustration or, alternatively, on the ground of unjust enrichment. There followed an exchange of correspondence between Mouldens and Messrs Treloar and Treloar (“Treloars”), who acted for Margaret Neubauer. It is apparent from the evidence of Steve Klotz that on some occasions he alone instructed Mr von Muenster and that on others his father was present when Mr von Muenster was instructed. Eventually, the issues were compromised. I will refer later to the terms of the compromise.
Franz Klotz remained at Furia Rest Home until 17 October 1992. Throughout that period, Steve Klotz acted as his attorney. On 17 October 1992 George Klotz removed his father from Furia Rest Home. Steve Klotz asserts that his father was happy and content at Furia Rest Home. Margaret says that John Klotz, the second plaintiff, had told her that her father was unhappy there. It is unnecessary to determine which assertion is correct.
Margaret Neubauer and George Klotz arranged for their father to be examined by Rene Grypma, a clinical psychologist at Glenside Hospital, on 3 and 4 November 1992. On 6 November 1992 Rene Grypma provided a psychological assessment to Ms Julie Redman, a solicitor acting for Margaret Neubauer and George Klotz, stating that Franz Klotz had complete testamentary capacity. On the same day, Franz Klotz executed a Will revoking all former Wills which would have included his Will dated 27 June 1990, and made a new Will in which he appointed Margaret Neubauer and George Klotz as executors. He divided his estate equally between his three children, John, Margaret and George. In clause 5 of the Will he gave his reasons for making no bequest to Steve Klotz. He said:
“I HEREBY DECLARE that I desire to make no devise or bequest to my son STEVE ALEXANDER KLOTZ on grounds which include but without limiting the generality thereof that he has been provided for during my lifetime and that I have no relationship or contact with him.”
Given the facts already noted, it is readily apparent that the last part of that clause misstates the true position. On the same day, he executed a Power of Attorney appointing Margaret Neubauer and George Klotz as his attorneys. On 19 November 1992 he revoked the Enduring Power of Attorney appointing Steve Klotz his attorney.
It appears that Franz Klotz then resided at different times at two homes for aged persons in Adelaide. The following facts as to the periods when Franz Klotz resided at different homes are agreed. He resided at St Michael’s Rest Home from 7 November 1992 until 24 April 1993 and at Marion Rest Home from 24 May 1993 until 9 October 1993. He resided for a period of about one month at the Neubauers in the period 25 April to 23 May 1993. Steve Klotz visited St Michael’s Rest Home on 23 April 1993 to see his father. He says that his sister Margaret had refused to allow him to see his father and it was not until about 23 April 1993 that he knew where his father was residing. Margaret Neubauer denies that she refused to let Steve Klotz see his father and points to a letter from Miss Redmond, her solicitor, to the solicitors for Steve Klotz dated 12 February 1993 which says that she was happy for Steve Klotz to contact her to arrange a convenient time to see their father at 75 Hughes Street, Unley. It is unnecessary to seek to resolve where the truth lies. It is sufficient to note that the nursing sister at St Michael’s Rest Home refused to let Franz Klotz see his son, Steve. The nursing sister called Margaret Neubauer who came and removed Mr Klotz from the home.
Later on 9 October 1993, Margaret Neubauer and George Klotz arranged for their father to be moved to a nursing home in Perth, called Mt Henry Respite Unit. He remained there until 21 December 1993 when he moved to Braille House Western Australia, also in Perth, where he remained until 2 November 1996. Those dates are agreed. According to Steve Klotz, he did not know where his father was. His sister Margaret refused to communicate with him and so he could not ascertain his father’s whereabouts from her. He did not see his father again until April 1996. In April 1996 Steve Klotz applied to the Guardianship and Administration Board of Western Australia for an order that Public Trustee be appointed to act as administrator of his father’s estate. The Board granted the application on 29 April 1996 and dismissed an application by George Klotz that he be appointed guardian. The Board also directed Public Trustee to apply for an administration order in respect of the estate of Franz Klotz and to apply for an order revoking the Enduring Power of Attorney made by Franz Klotz appointing Margaret Neubauer and George Klotz his attorneys. On 4 November 1996 Steve Klotz arranged for his father to be returned to South Australia. His father took up residence at St Theresa’s Nursing Home in West Croydon, where he resided from 3 November 1996 until he died on 19 April 1997. These dates are also agreed.
At the date of his death, Franz Klotz was aged 97 years. Probate of his Will dated 6 November 1992 has been granted to Margaret Neubauer, leave being granted to George Klotz to apply.
Steve and John Klotz challenge a number of the expenses said to have been incurred by the defendants when acting as attorneys for their father. They issued these proceedings calling for accounts. Accounts were provided. By notice dated 16 August 1999, the plaintiffs challenged 25 items in the accounts.
During the hearing, the parties reached a compromise on all items the subject of the challenge save item 8 to which I shall refer in a moment. The compromise involved the plaintiffs withdrawing their challenge to some items and the parties agreeing that the defendants should reimburse the estate for all of the other items except item 8. In the result, the defendants agreed to refund to the estate $26171.84 made up as follows:
EXHIBIT D
Item 1 - Claim withdrawn
                  2 - Claim withdrawn
                  3 - Defendants to reimburse                  $500.00
            4 - 7 - Claim withdrawn
                  8 - Disputed (see below)

9 - Defendants to reimburse  397.00
10 - Defendants to reimburse  55.50
11 - Defendants to reimburse                  1000.00
12 - Defendants to reimburse                  6642.65




13 - Claim withdrawn

14 - Defendants to reimburse  21.00
15 - Defendants to reimburse                  2494.35
16 - Defendants to reimburse                  4521.90



17 - Claim withdrawn
               18 - Defendants to reimburse                  4689.44
               19 - Defendants to reimburse  175.00
      20 & 21 - Defendants to reimburse                  1500.00
               22 - Claim withdrawn
  __________
Sub-total  $21996.84
EXHIBIT E
Item 1     )   Defendants to reimburse
2     )  $4000.00
3        Claim withdrawn
  __________
$25996.84

__________

(Each item corresponds to an item in the Notice of Challenge.)
The remaining issue is item 8, which concerns a claim arising out of the fact that Franz Klotz occupied the extensions at Hughes Street, Unley for about 12 months only. The claim as set out in item 8 of the Notice of Challenge is expressed in these terms:
“8.First defendant to reimburse estate for equitable proportion of $55,000.00 paid by deceased and wife for right of occupation of house extension due to premature determination of that. Alternatively disallow following expenses viz:-
8.1        St Michaels Rest Home  $3,624.00
8.2        Marion Rest Home  $3,646.00
8.3        Association for Blind  $23,720.24
__________
TOTAL $30,990.24
on the ground that deceased could have been residing in the house extension with no need for payment of these fees.”
In item 8, the first defendant refers to Margaret Neubauer and “Association for Blind” is Braille House in Perth.
The sum of $55000 plainly refers to what had been claimed from the Neubauers in the letter dated 21 December 1990 from Mouldens. As already mentioned, Franz Klotz claimed $55000 being repayment of the sum of $40000 plus a further $15000 said to have been paid to Mrs Neubauer. Shortly stated, Mrs Neubauer’s position in relation to the claim for $40000 was that she had done nothing to cause her father to leave the house at Hughes Street, that she and her husband were willing for him to return and that, by reason of the terms of the agreement dated 2 June 1989, neither she nor her husband were under any liability to repay the sum of $40000. In respect of the claim for $15000, Mrs Neubauer denied receiving that sum. She said that she had received only $11500 and could account for what had been paid. The dispute was eventually compromised. The terms were set out in a letter dated 26 July 1991 from Mouldens to Treloars.
“We confirm settlement between the above parties upon the following terms and conditions:
1.The sum of $2,789.15 was repaid to our client, receipt acknowledged.
2.The sum of $3,958.75 will be paid by your clients to our client by way of monthly instalments of $500.00 per month, first payment due on the 1 August 1991.
3.The above payments, when completed shall be in full and final settlement between the parties provided that each payment is received within seven days of its due date. Should default occur, our client has the right to re-open the transaction and sue for the whole of the disputed claim, less moneys received.”
An examination of the letters exchanged between Mouldens and Treloars shows that the letter dated 26 July 1991 does not truly record every aspect of the compromise. That letter records the compromise relating to the claim for $15000 but not the claim for $40000. It is apparent that the parties accepted the fact and proceeded on the footing that the sum of $40000 was paid pursuant to the agreement. The negotiations between the parties concerned the claim for $15000 and a further claim made in a letter dated 1 March 1991 from Mouldens to Treloars for $10000 damages payable for the delay in completing the extension and for breaches of the intent of the agreement made on 2 June 1989. It was those latter claims which were settled on the terms stated in the letter dated 26 July 1991. Letters written before 26 July 1991 indicated that Franz Klotz agreed that the sum of $40000 was subject to the terms of the agreement dated 2 June 1989. Thus, the question whether $40000 must be repaid by the Neubauers is to be determined by the terms of that agreement.
It is necessary to examine some of the clauses in the agreement made on 2 June 1988. The parties to the agreement are the Neubauers, who are called “the owners” in the agreement and Mr and Mrs Klotz who are called “the tenants”. Two of the recitals are relevant. They are recitals B and C which provide:
“B.The owners propose to erect an extension to the said house property consisting of a lounge, bedroom, bathroom and toilet under the main roof of the said house property, with kitchen facilities to be included at a later date, which extension will comprise approximately 102 square metres and shall cost not less than $40,000.
C.The owners agreed with the tenants that in consideration of the tenants contribution the sum of $40,000 towards the erection of the said extension on the said property and thus increasing the value of the said property that they would permit the tenants and the survivor of them to have the personal use and occupation of the said extension for the period and upon the terms and conditions hereinafter appearing.”
The relevant provisions in the agreement are clauses 1, 2, 4 and 5. The relevant parts of clause 1 are as follows:
“1.In consideration of the premises and of the tenants entering into the covenants contained in clause 2 hereof the owners HEREBY COVENANT AND AGREE with the tenant as follows:-
(a)     That the owners shall erect as soon as is practicable after approval by the Unley Council of the proposed extension consisting of a lounge, bedroom, bathroom, laundry and toilet to the said property such extension to be in accordance with the plan annexed hereto and initialed (sic) by both parties.
...
(c)    That upon completion of the said extension to the satisfaction of the tenants the owners will permit the tenants and the survivor of them to have the use and enjoyment of the said extension so erected on the said property such right to the use and enjoyment to be until the earliest of the following dates:
(i)     The date of the death of the survivor of the tenants.
(ii)The date the tenants or the survivor of them notifies the owners in writing that they he or she (as the case may be) no longer desires to continue residing in the said extension.
(iii)The date upon which the tenants or the survivor of them assigns or attempts to assign their his or her rights under this agreement or sub-lets or attempts to sub-let the accommodation hereby granted
whichever is the earlier.
(d)    The said tenants shall occupy the said extension rent free and shall not be liable to pay any proportion of rates taxes or insurance in respect of the said extension or the said accommodation but shall be entitled to the rights conferred herein free from any payment whatsoever however the tenants or the survivor of them shall be responsible to pay such proportion of gas and electric light and power charges and rentals and telephone charges and rentals (if any) as may be separately rated or agreed in respect of the said extension and the tenants or the survivor of them shall be responsible for keeping the interior of the said extension in good order and in a clean and tidy condition.
...
(f)     That the said tenants or the survivor of them shall not be under any obligation to remain in possession of the said extension hereby granted but may at any time vacate the same and providing that they have not given any notice in writing to the owners that he she or they no longer desires to reside in the said extension he she or they may at any time take up possession again.
...
(h)    To permit the tenants or the survivor of them to have quiet enjoyment of the premises without interuption (sic) by the owners or any other person lawfully claiming under or in trust for them and will not cause or permit any interference with the reasonable peace comfort of (sic) privacy of the tenants or the survivor of them in the use of the premises.
...
(j)     To bear pay and discharge all rates taxes charges assessments impositions and outgoings whatsoever which now are or may be at any time hereafter during the said term rated taxed charged assessed or imposed upon the said property or any part thereof under any of the following Acts namely the Local Government Act, Land Tax Act, Water Works Act, Water Sewerage Act.”
Clause 2 sets out the obligations of Mr and Mrs Klotz as tenants. It is necessary to refer only to clause 2(a) which provides:
“2.In consideration of the covenants and agreements contained in clause 1 hereof the tenants and the survivor of them jointly and severally HEREBY COVENANT AND AGREE with the owners:-
(a)     To pay to the owners the sum of $40,000 being the amount agreed as their contribution to the cost of the erection of the said extension (but not being the full cost of erection of the said extension) and that he she or they will pay the said sum in the manner following that is to say the sum of $50.00 upon the signing of this agreement (the receipt of which sum is hereby acknowledged) and the balance of the said sum in the manner following that is to say that forthwith upon signing the within agreement the tenants shall place the sum of $39,950.00 into a cheque account with the Westpac Bank such account requiring the signatures of both the said Mr. Klotz and the said Mrs. Neubauer for any withdrawal and for the said Mr. Klotz and Mrs. Neubauer to make such progress payments as may be required by Mr. Neubauer from the said cheque account to satisfy accounts incurred in erecting the said extension as advised by Mr. Neubauer in writing and supported by copy accounts received by him.”
Clause 3 has no relevance for present purposes. Clauses 4 and 5 provide:
“4.The tenants equitable interest under this agreement in the extensions will pass to the owners in the following events:-
(a)     The death of both of the tenants.
(b)    The tenants signing a release in the form of Annexure 2 annexed hereto.
5.In the event of the said property being sold for any reason prior to the events set out in clause 4 the balance of the tenants interest in the said property shall become due and payable to the tenants or to the survivor of them.”
Paragraphs 6 and 7 provide procedures for obtaining a valuation in the event that the property is sold pursuant to the terms of clause 5. These are the only provisions of the agreement to which it is necessary to refer.

Steve Klotz gave some evidence which suggested that the extensions had not been constructed in accordance with clause 1(a). However, the plans annexed to the agreement were not proved. The issue was not pursued in argument. I am not prepared to infer that the extension as constructed did not accord with the plan. I am encouraged to do so by the fact that, although the letter dated 21 December 1990 which set out Mr Klotz’s claim against the Neubauers complained that aspects of the building work had not been properly completed, it did not assert that the extensions did not comply with clause 1(a).
Mr and Mrs Klotz were entitled to reside in the extensions until the death of the survivor of them: clause 1(c). There is no evidence of any notice in writing from Franz Klotz that he did not wish to continue to reside in the extension and there is no evidence of any assignment. Thus, although Franz Klotz did not reside in the extensions for any length of time after November 1990, he was always able to return to them. By reason of clause 4 of the agreement, the interest of Franz Klotz in the premises terminated on his death.
There is no evidence which would support an order setting aside any of the terms of the agreement. All that is known is that Franz Klotz told his son that he did not wish to continue to reside there and that, after leaving the premises in November 1990, Franz Klotz did not return except for two periods each of about one month. He was at liberty to live where he chose. The agreement is plain and unambiguous. There is no basis to order repayment of the sum of $40000.
For these reasons, the defendants have no obligation to reimburse the estate for the sum of $55000 or any part of that sum.
I turn to the question whether the expenses incurred for Franz Klotz residing at the three rest homes should have been allowed as a charge against the estate. The amount of the fees is agreed. The only issue is whether they were a proper charge against the estate of Franz Klotz.
The evidence shows that, after leaving Hughes Street in November 1990, Franz Klotz lived in rest homes or nursing homes for the rest of his life except for two periods each of about one month. George Klotz gave evidence that, when living in Perth, his father did not wish to return to Adelaide. George Klotz was not cross-examined. But his evidence that his father did not wish to return to Adelaide does not assist. The issue is not whether Franz Klotz wished to remain in Perth but whether he should have been removed to Perth and whether he was willing to reside at Hughes Street. I have summarised the evidence. It is reasonable to infer, as I do, that Franz Klotz was an old man who was fickle in his affection and was prepared to do the bidding of those who were then his favourites.
Although the evidence explains why Franz Klotz decided to leave the Neubauers in November 1990, there is no evidence explaining why, after he had been removed by the defendants from Faria Rest Home on 17 October 1992, he could not then have resided in the extensions at the Neubauers’ house. Although Margaret Neubauer has expressed her willingness that her father reside with her, neither she nor her brother, George Klotz have proved why their father did not reside in the extensions after 1992. There is no evidence, for example, that he had reached such a state of infirmity that he had to reside in a nursing home. Of the several places in which Franz Klotz resided in the last seven years of his life, the only one which is called a nursing home is the last place in which he lived. There is no evidence that either St Michael’s Rest Home, Marion Rest Home or Braille House (Association for the Blind) was a nursing home.
In the scanty state of the evidence, it is not possible to conclude what Franz Klotz’s wishes were or whether the fees paid to the various homes were a proper charge against the estate.
It is well established that an agent owes his principal a fiduciary duty: Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 at 68, 96 at 141. Although there may be instances where that fiduciary duty does not exist (see, for example, the observations of Gibbs CJ in Hospital Products at 71 ‑ 72), in this case the defendants were subject to fiduciary duty given that their father was elderly and prone to periods when he was not competent to manage his affairs. Thus, as attorneys for their father, the defendants had a duty as fiduciaries to him and his estate. That fiduciary duty is, I think, entirely consistent with the duty of an attorney acting pursuant to an Enduring Power of Attorney as spelled out in s 7 of the Power of Attorney and Agency Act 1984.
As fiduciaries, the defendants had an obligation not to profit from their father’s estate and, if they do profit, they are liable to account for the profit: Keech v Sandford (1726) 25 ER 223; Keith Henry & Co Pty Ltd v Stuart Walker & Co Pty Ltd (1958) 100 CLR 342 at 350; Lister & Co v Stubbs (1890) 45 Ch D 1 per Lindley J at 15 with whom Bowen LJ agreed. The obligation is both legal and equitable: see the discussion in Meagher et al, Equity: Doctrines & Remedies (3^rd ed.) paras 540 ‑ 546 and 549.
As fiduciaries, the defendants had the burden of proving that money expended by them on fees for their father’s accommodation at rest homes were properly incurred: Van Rassel v Kroon (1953) 87 CLR 298 at 302 ‑ 303; In re Tilley’s Will Trust [1963] Ch D 1179 ‑ 1183; Warman International Ltd v Dwyer (1995) 182 CLR 544 at paras 34 and 35. The defendants, and in particular Mrs Neubauer, had a conflict of duty and interest. Mrs Neubauer and her husband had been paid $40000 in order to provide accommodation for Franz Klotz. That payment enabled them to create an asset which they could use and enjoy when Margaret Neubauer no longer lived at the house in Unley. Mrs Neubauer had a clear duty to permit her father, Franz Klotz to reside in the extensions and not to do anything to prevent his quiet and peaceful occupation. Mrs Neubauer and her brother incurred fees payable from their father’s estate for accommodation at rest homes in the period 17 October 1992 to 4 November 1996. They have not proved why it was then necessary for him to reside in rest homes instead of in the extension of Mrs Neubauer’s house. It is possible to imagine several explanations but none have been given. He did not have to live in rest homes unless there was cause to do so. There is no evidence to show whether there were any reasons why her father could not reside in the extensions. I accept that there were differences which led to her father leaving the house in November 1990 but there is no evidence to explain why he could not reside there after October 1992. The absence of such evidence is emphasised by the fact that her father resided in the house for at least two periods of about one month. The failure of the defendants to explain and thereby discharge the onus of proof upon them serves to underline the conflict of interest and duty. Mrs Neubauer has profited from being able to use the extensions at her house by accommodating her father elsewhere. In the absence of any explanation, the defendants must account for the profit.
The fees incurred at the three rest homes would have included the cost of meals as well as accommodation. So much is common knowledge. However, the defendants have not proved how much was payable for each. Here again, they had the onus of proof. Notwithstanding their failure to adduce evidence, I think that it is fair to assume that about half the fees were paid for accommodation and half for food. The total amount incurred as fees was $30990.24. I order that the defendants refund one-half of that sum, namely, $15495.12.
Thus, the defendants must refund the agreed sum of $25996.84 as well as $15495.12, a total of $41491.96. I will make the orders necessary to give effect to these reasons. I will hear the parties as to the terms of the orders and any order as to costs.

[2001] SASC 454

21 December 2001