Kopilovic v Gatley [No 2]
[2010] WASC 196
•3 AUGUST 2010
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: KOPILOVIC -v- GATLEY [No 2] [2010] WASC 196
CORAM: ACTING MASTER CHAPMAN
HEARD: 29 JUNE 2010
DELIVERED : 3 AUGUST 2010
FILE NO/S: CIV 1593 of 2003
MATTER :DANCESPORT AUSTRALIA LTD (ACN 085 929 835)
BETWEEN: PATRICIA LILIANA KOPILOVIC
First Plaintiff
JOHN GIARDINA
Second PlaintiffDAMIEN CIRANNA
Third PlaintiffJOHN ANTONACCI
Fourth PlaintiffMARCIA FRAGIADAKIS
Fifth PlaintiffVIVIAN SIMPSON
Sixth PlaintiffAARON-LEE WILDE
Seventh PlaintiffDEE JAMES
Eighth PlaintiffDEBRA OFFER
Ninth Plaintiff
ANNE FARRAWELL
Tenth PlaintiffNATHAN MAJOR
Eleventh PlaintiffHELEN MAJOR
Twelfth PlaintiffRAYMOND BUCKLEY SNEDDON
Thirteenth PlaintiffCARMELO FRANCESCO RACCUIA
Fourteenth PlaintiffAND
DEREK FRANCIS GATLEY
First DefendantMARGARET ANN LONSDALE
Second DefendantVINCENT RAYMOND BAIN
Third DefendantJEFFREY ROBERT ELWORTHY
Fourth DefendantCAROL KAY KIMMINS
Fifth DefendantKATHRYN FRANCES WIGGINS
Sixth DefendantTONY JOSEPH TILENNI
Seventh DefendantROBERT HENRY COURTS
Eighth Defendant
ROBERT JOHN STEELE
Ninth DefendantMALCOLM LENNARD BATTY
Tenth DefendantVINCENT SILVIO IOPPOLO
Eleventh DefendantEAMON MICHAEL McGRATH
Twelfth DefendantPETER SPENCER SMITH
Thirteenth DefendantORYST TKACZ
Fourteenth DefendantDALLAS LESLIE WILLIAMS
Fifteenth DefendantLEE GARTH WILTON
Sixteenth DefendantDANCESPORT AUSTRALIA LTD (ACN 085 929 835)
Seventeenth Defendant
Catchwords:
Inter-pleader summons - Registered proprietor of land - Claim by Trust
Legislation:
Nil
Result:
First plaintiff to relinquish her interests in the land to the Sheriff
Category: B
Representation:
Counsel:
First Plaintiff : In person
Second Plaintiff : No appearance
Third Plaintiff : No appearance
Fourth Plaintiff : No appearance
Fifth Plaintiff : No appearance
Sixth Plaintiff : No appearance
Seventh Plaintiff : No appearance
Eighth Plaintiff : No appearance
Ninth Plaintiff : No appearance
Tenth Plaintiff : No appearance
Eleventh Plaintiff : No appearance
Twelfth Plaintiff : No appearance
Thirteenth Plaintiff : No appearance
Fourteenth Plaintiff : No appearance
First Defendant : Ms R Cosentino
Second Defendant : Ms R Cosentino
Third Defendant : Ms R Cosentino
Fourth Defendant : Ms R Cosentino
Fifth Defendant : Ms R Cosentino
Sixth Defendant : Ms R Cosentino
Seventh Defendant : Ms R Cosentino
Eighth Defendant : Ms R Cosentino
Ninth Defendant : Ms R Cosentino
Tenth Defendant : Ms R Cosentino
Eleventh Defendant : Ms R Cosentino
Twelfth Defendant : Ms R Cosentino
Thirteenth Defendant : Ms R Cosentino
Fourteenth Defendant : Ms R Cosentino
Fifteenth Defendant : Ms R Cosentino
Sixteenth Defendant : Ms R Cosentino
Seventeenth Defendant : Ms R Cosentino
Solicitors:
First Plaintiff : In person
Second Plaintiff : No appearance
Third Plaintiff : No appearance
Fourth Plaintiff : No appearance
Fifth Plaintiff : No appearance
Sixth Plaintiff : No appearance
Seventh Plaintiff : No appearance
Eighth Plaintiff : No appearance
Ninth Plaintiff : No appearance
Tenth Plaintiff : No appearance
Eleventh Plaintiff : No appearance
Twelfth Plaintiff : No appearance
Thirteenth Plaintiff : No appearance
Fourteenth Plaintiff : No appearance
First Defendant : Gibson & Gibson
Second Defendant : Gibson & Gibson
Third Defendant : Gibson & Gibson
Fourth Defendant : Gibson & Gibson
Fifth Defendant : Gibson & Gibson
Sixth Defendant : Gibson & Gibson
Seventh Defendant : Gibson & Gibson
Eighth Defendant : Gibson & Gibson
Ninth Defendant : Gibson & Gibson
Tenth Defendant : Gibson & Gibson
Eleventh Defendant : Gibson & Gibson
Twelfth Defendant : Gibson & Gibson
Thirteenth Defendant : Gibson & Gibson
Fourteenth Defendant : Gibson & Gibson
Fifteenth Defendant : Gibson & Gibson
Sixteenth Defendant : Gibson & Gibson
Seventeenth Defendant : Gibson & Gibson
Case(s) referred to in judgment(s):
Calverley v Green (1984) 155 CLR 242
ACTING MASTER CHAPMAN: I have before me a Sheriff's inter‑pleader summons filed on 15 March 2010. The summons relates to a property comprising a portion of Swan location 1370; being lot 540 on plan 18968, certificate of title vol 1950, folio 949 situated at 27 Bainbridge Mews, Currambine (the property).
Background
On 17 May 2007 Registrar Powell taxed the defendants' bill of costs pursuant to orders of EM Heenan J of 8 February 2006 and 23 November 2006 in an amount of $41,168.86. On 23 November 2007 Registrar Dixon made a property (seizure and sale) order in the sum of $32,168.86; being the $41,168.96 less $9,000 credit, the judgment debtor being Patricia Liliana Kopilovic (the first plaintiff), and the seizable property being the property. A similar order was made by me on 2 December 2008. Several orders have been made since then extending the period of sale. The first plaintiff, her husband Zvonko Andrija Kopilovic (Joe) and children reside at the property and have done so since the home was built.
Counsel for the defendants as a witness
After counsel for the defendants had cross‑examined the first plaintiff and Joe, the first plaintiff submitted Master Sanderson had stated in a directions hearing if counsel was to rely on her affidavit then she would have to engage someone else to cross‑examine. Counsel for the defendants stated that she did not recall Master Sanderson having made such a statement. The transcript for the directions hearing was not available and the hearing proceeded on the basis that I would obtain a copy of the transcript, examine it, and if I had any concerns I would send a copy to the parties and ask for further submissions; but if not, I would proceed to prepare reasons. I have examined the transcript of 11 May 2010 and the learned master makes no reference to this point. For a number of reasons I consider it unwise for a person to act as counsel when it is highly probable they will be called upon to give evidence in a matter. As it turned out counsel was only cross‑examined on two issues and in my view no injustice has resulted in counsel giving evidence in this matter.
Issues
The property was acquired in 1993 and registered in the sole name of the first plaintiff. On 7 December 2005 the property was transferred from the sole name of the first plaintiff to the first plaintiff and Joe as joint tenants. The first plaintiff alleges the property was originally acquired by her husband and although registered in her name she held it on trust (the trust) for her husband. It is said the property was later acquired by the Kopilovic Family Trust (the Kopilovic Trust), and it was held by the first plaintiff on trust for the Kopilovic Trust. The property was later transferred into the names of the first plaintiff and Joe, as Joe also became a trustee of the Kopilovic Trust. They claim they hold the property on trust for the Kopilovic Trust.
Evidence
The evidence before me consists of seven affidavits as follows:
1.affidavit of the first plaintiff sworn on 14 October 2009 (the first plaintiff's No 1 affidavit);
2.affidavit of the first plaintiff sworn on 24 March 2010 (the first plaintiff's No 2 affidavit);
3.affidavit of the first plaintiff sworn on 11 April 2010 (the first plaintiff's No 3 affidavit);
4.affidavit of Joe sworn on 24 March 2010 (Joe's affidavit);
5.affidavit of the Sheriff sworn on 10 March 2010 (the Sheriff's affidavit);
6.affidavit of Amy Louise Bilich sworn on 9 April 2010 (Ms Bilich's affidavit); and
7.affidavit of Rachel Cosentino sworn on 27 April 2010 (Ms Cosentino's affidavit).
In addition to this the first plaintiff, Joe and Ms Cosentino were examined on oath.
The first plaintiff deposes to the fact that the property was purchased by Joe in 1993 and after a verbal agreement with him it was registered in her name 'in order to hold the property for Joe'. It is said this was done as Joe was then working away. At pars 4 ‑ 6 of the first plaintiff's No 1 affidavit she deposes as follows:
The Land was purchased by Joe in January 1993. However, at the time, Joe caused me to be registered as the sole proprietor. I had no legal or equitable interest in the Land of my own. I was registered proprietor solely in order to hold the property for Joe. At the time, I verbally agreed with Joe to be registered as the proprietor of his land. There was no written agreement entered into. I did so because Joe was often working away from Perth and not available to deal with any matters that could arise in respect of the Land. Joe was engaged in numerous petrochemical and engineering construction projects in the north of Western Australia. Joe was located in remote areas.
At all times up until about November 2004, I considered myself to be the proprietor solely for the benefit of Joe. In effect, I was acting as trustee for Joe. I paid none of the costs or expenses associated with the acquisition or holding of the Land. Joe paid all of the expenses and costs associated with the Land.
In November 2004, the manner in which I held the Land as proprietor was formalised. Joe and I discussed formalising the relationship to confirm that I was registered as the proprietor as trustee. At the time, a trust deed was entered into. By the trust deed, I confirm that I had held and was continuing to hold the Land as trustee. As referred to above, I have never purported to nor intend to hold the land in my own right. Now produced and shown to me and marked with the letters PLK02 is a true copy of the deed of settlement for the Kopilovic family trust dated 12 November 2004 (stamped on 2 May 2005).
The Deed of Settlement for the Kopilovic Family Trust (the Deed) referred to above purports to establish the Kopilovic Trust but does not seem to me to 'formalise' what is said to have existed. At par 7 of the same affidavit the first plaintiff deposes as follows:
For ease of reference, I refer this Court to Background clause (V) on page 3 of the trust deed (attachment PLK02, herein).
It is not clear what the paragraph is meant to convey but cl V reads:
These [sic] deed records that the trustee is acting as Trustee and agent for and on behalf of the listed Beneficiaries in respect to the property known as 27 Bainbridge Mews Currambine in the state of Western Australia being Lot 504 on plan 18968 and Folio 949 being the whole of the land comprised in Certificate of Title Volume 1950.
There is no evidence before me of any other written document on which the first plaintiff relies to transfer the property to her as trustee of the Kopilovic Trust. At pages 79 ‑ 80 of the first plaintiff's No 1 affidavit there are two documents which read respectively:
MINUTE OF MEETING
Held
11TH OF NOVEMBER 2004 @ 5:00P.M.
At
27 BAINBRIDGE MEWS CURRUMBINE
I Patricia Liliana Kopilovic resign from the previous agreement dated Jan 1993.
RESIGNATION from previous agreement dated Jan 1993
[signature: Patricia Liliana Kopilovic]
……………………………………......Patricia Liliana Kopilovic
Witness
[signature: Neville Frederick Allpick]
……………………………………......Neville Frederick Allpick
and:
MINUTE OF MEETING
Held
11TH OF NOVEMBER 2004 @ 7:00P.M.
At
27 BAINBRIDGE MEWS CURRUMBINE
I Patricia Liliana Kopilovic accept the position as Trustee of the Kopilovic Family Trust.
Appointment of Trustee
[signature: Patricia Liliana Kopilovic]
……………………………………......Patricia Liliana Kopilovic
Witness
[signature: Neville Frederick Allpick]
……………………………………......Neville Frederick Allpick
There is no evidence of what it is said these documents purport to do and, in relation to the first document, to what agreement it is said it relates. It refers to an agreement dated January 1993 which seems to suggest an agreement in writing, but that is far from clear. From what is the first plaintiff resigning? If it is suggested the document is to bring to an end the trust, what authority did the first plaintiff have to do so?
On 3 May 2005 Joe made a statutory declaration, which is found at page 81 of the first plaintiff's No 1 affidavit (annexure PLK03) (the declaration), as follows:
THE PROPERTY WAS PURCHEST [sic] BY ME BUT PLACED IN MY WIFE'S NAME DUE TO ME WORKING AWAY FROM HOME AND UNABLE TO HAVE DOCUMENTATION SIGNED WHEN REQUIRED. ALL MORTGAGE REPAYMENTS, MAINTENANCE EXPANSES [sic], HOME IMPROVMANTS [sic], FURNITURE, FITTINGS ETC, HAVE BEAN [sic] PAID FOR BY ME.
CURRENTLY THE ABOVE PROPERTY IS BEAN [sic] HELD IN TRUST FOR AND ON BEHALF OF SEVERAL FAMILY MEMBERS.
When the property was transferred from the sole name of the first plaintiff to that of the first plaintiff and Joe as joint tenants; the consideration was shown as 'natural love and affection'. The first plaintiff contends the transfer took place as Joe was now a trustee of the Kopilovic Trust, Joe having been appointed as trustee on 2 February 2005.
The consideration described in the transfer does not seem consistent with the inclusion of a further trustee as a registered proprietor but the first plaintiff says she did not know what words to use and was assisted by officers at Landgate. Those officers have not given any evidence supporting this contention.
The trust
I accept that when the property was acquired in 1993 it was registered in the sole name of the first plaintiff and a mortgage was entered into. At the time the first plaintiff and Joe were married. As the first plaintiff was not working outside the home I accept the mortgage payments were made from the income generated by Joe.
In Calverley v Green (1984) 155 CLR 242, 255 ‑ 256, Mason and Brennan JJ said:
If Rath J's conclusion that the defendant contributed the whole of the purchase price of the property were correct, it would be difficult to attack his Honour's finding of a resulting trust in favour of the defendant. It would be a case of a conveyance into joint names, one of whom had contributed the purchase price. Equity presumes a trust in favour of the person who contributes the whole of the purchase price when the property is conveyed into the joint names of himself and another (Benger v Drew (1721) 1 P Wms 781; 24 ER 613; Rider v Kidder (1805) 10 Ves Jun 360; 32 ER 884) though the strength of the presumption varies from case to case (Fowkes v Pascoe (1875) 10 Ch App 343 at 352) and may be confirmed, rebutted or qualified by evidence of his intention (Russell v Scott (1936) 55 CLR 440 at pp 449, 451-3; Marshal v Crutwell (1875) LR 20 Eq 328). The presumption is displaced if the legal joint tenant who does not contribute any of the purchase price is the wife of the joint tenant who does. Then the presumption is that she takes her legal interest as a gift, not in trust for her husband, and that the beneficial ownership goes with the legal title. In the judgment of Dixon CJ, McTiernan, Fullagar and Windeyer JJ in Martin v Martin (1959) 110 CLR 297 at 303, their Honours said:
'It is called a presumption of advancement but it is rather the absence of any reason for assuming that a trust arose or in other words that the equitable right is not at home with the legal title.'
Given the facts of the matter before me it is my view a presumption of advancement would exist, unless there was evidence to the contrary. The explanation for the property being registered in the name of the first plaintiff is to be found at par 6 of the first plaintiff's No 1 affidavit previously referred to, and pars 4 ‑ 5 of Joe's affidavit where he deposes as follows:
I acquired the land in January 1993. At the time, I was working on site in remote locations in the north of Western Australia. I was not available to deal with any matters that could or would arise in respect of the Land. At the time I was engaged in numerous petrochemical and engineering projects.
In January 1993, I asked [the first plaintiff] to be the registered proprietor of the Land on my behalf. [The first plaintiff] agreed. As such, and even though I had paid the purchase price for the land in January 1993, I caused [the first plaintiff] to be registered as the sole proprietor of the Land. At the time, [the first plaintiff] had no interest in the Land of her own.
The affidavit evidence was supported by the oral evidence given by the first plaintiff and Joe.
No contemporaneous written documents supporting this have been produced. Documents came into existence in November 2004, namely, minutes of two meetings, found at pages 79 and 80 of the first plaintiff's No 1 affidavit, and the Deed. Neither of the minutes reveal the nature of the meetings recorded and insufficient detail is given to enable them to be understood. The Deed also does not deal with this issue in any meaningful way, the declaration made by Joe lacks detail and is not particularly helpful.
I have had the opportunity of seeing and hearing the first plaintiff and Joe give evidence. On what is before me I have formed the view the first plaintiff and Joe adopted a position as to the ownership of the property which they thought would be in their best interests at the time. I am not persuaded the first plaintiff held the property on trust for Joe.
The Kopilovic Trust
It is accepted on the evidence that on 12 November 2004 the first plaintiff signed the Deed. Apart from the mention of the property in cl V on page 3 of the Deed no other action was taken to transfer the property to the first plaintiff as trustee of the Kopilovic Trust. Section 34(1)(b) of the Property Law Act 1969 (WA) reads:
[A] declaration of trust respecting any land or any interest therein shall be manifested and proved by writing signed by a person who is able to declare the trust or by his will;
Does the Deed fall into this category? I do not consider the Deed goes far enough. I agree with the submission of the defendants that the declaration of Joe does not achieve this either. In the first place it does not state the first plaintiff held the property on trust on behalf of Joe initially, nor does it state which trust held the property at the time the declaration was made.
In fact, apart from the Deed and the declaration, there is no written document before me which links the property to the Kopilovic Trust, that is, if you accept the declaration refers to the property. Indeed, other documentation would indicate that the property was not held on trust. The first is the transfer which is annexure PLK04 to the first plaintiff's No 1 affidavit. That document indicates the consideration for the transfer of the property was 'natural love and affection'. That is not consistent with the Kopilovic Trust. It is to be noted the Commissioner exempted the transfer from stamp duty pursuant to s 75C of the Stamp Act 1921 (WA). Section 75C(1) and (2) read:
75C.Power to exempt for certain conveyances between spouses
(1)Upon application made in the manner provided in subsection (3), the Commissioner may exempt from duty any instrument chargeable with duty under item 4(1) or 19 of the Second Schedule where -
(a)the person from whom, and the person to whom, the property is conveyed or transferred, or agreed to be conveyed or transferred, are married to each other or are de facto partners of 2 years;
(b)the property conveyed or transferred, or agreed to be conveyed or transferred, by the instrument includes a dwellinghouse which, at the time of the execution of the instrument was used solely or principally as the ordinary place of residence of the persons referred to in paragraph (a);
(c)the lot on which the dwellinghouse referred to in paragraph (b) is erected is used principally or solely for residential purposes associated with that dwellinghouse;
(d)the person from whom the property is conveyed or transferred, or agreed to be conveyed or transferred, is the sole owner of the property; and
(e)the result of the conveyance or transfer is or will be that the property is owned solely by the persons referred to in paragraph (a) as joint tenants.
(2)Where an instrument referred to in subsection (1) does not relate only to a dwellinghouse and lot described in that subsection the exemption provided by that subsection extends only to the amount of the aggregate value of all property to which the instrument relates that the Commissioner is satisfied is the amount of the value of the dwellinghouse and lot.
If the transfer were in the nature the first plaintiff claims, then one would have expected it would have been assessed for stamp duty in accordance with s 73AA of the Stamp Act.
The first plaintiff's explanation for the use of the wording in the declaration and the transfer was to the effect that officers from Landgate supplied the wording even though those officers had been told a trust was involved.
The next document is titled 'Finance Establishment' and is exhibit 1. It is a fax from Darrel Roberts (Mr Roberts), a finance broker, to Citibank. The document does not refer to the Kopilovic Trust. In fact, in part, it reads:
Proposal: Applicant's [sic] would like to refinance their Westpac loans secured against their home and increase the borrowed amount for a future investment property purchased in Adelaide.
…
Applicants wish to have 3 loan splits. No Doc 70 is to apply. Security will be their owner occupied home in Currambine WA.
At par 16 of Joe's affidavit he deposes as follows:
As trustees of the Kopilovic Family Trust, [the first plaintiff], Danaya and I entered into a financial arrangement with Citibank. This was in November 2007. The Land was used as security for borrowings then made. Each of [the first plaintiff], Danaya and I signed various documents with Citibank to secure the financial arrangement. This was arranged through a finance broker, Darrell Roberts of The Finance Establishment Co. I recall [the first plaintiff] and I telling Mr Roberts that we were the proprietors of the Land as trustees. Mr Roberts made a handwritten note of this. He said it would not matter to Citibank for the financing for the Trust to be mentioned. He said that Citibank would not be concerned with that.
There is no mention in the documentation lodged with Citibank that the property was part of the assets of the Kopilovic Trust even though the documentation asked questions designed to obtain such details. The explanation for not referring to the property as trust property is that reliance was placed upon Mr Roberts. It is said he was given this detail, he filled out the forms, and the first plaintiff and Joe signed them relying upon what he had done. Although it would seem Joe has been in contact with Mr Roberts since then Mr Roberts has not supplied any affidavit in support of the first plaintiff's position.
Whilst ready explanations were put forward as to why the documentation referred to is not consistent with the claim of the first plaintiff that the property is an asset of the Kopilovic Trust, I do not accept those explanations on the evidence before me.
Conclusion
On what is before me I am not persuaded that the first plaintiff ever held the property on trust for either Joe or the Kopilovic Trust. Further, I am not persuaded that the first plaintiff nor Joe have or now hold the property on trust for the Kopilovic Trust. I am of the view that the first plaintiff has at least a half interest in the property, there being no other claimants who have an interest or arguable interest in that share and that the first plaintiff should relinquish her share of the property to the Sheriff pursuant to the property (seizure and sale) order.
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